JOYY Inc. (NASDAQ: JOYY) Q1 2025 Earnings Call | 05/27/2025

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Joy Inc. Q1 2025 Earnings Call: Diversification and Profitability Drive Growth

Joy Inc. held its First Quarter 2025 Earnings Call, highlighting a significant strategic shift towards revenue diversification and enhanced profitability. Chairperson and CEO Ting Li emphasized 2025 as a "key milestone," marking her first complete fiscal year as CEO and the company's 20th anniversary. Joy is evolving into a multi-faceted technology leader, moving beyond its traditional live streaming focus.

Q1 Financial and Operational Highlights:

Total Revenue: Reached $494 million in Q1 2025.
Non-Live Streaming Revenue: Achieved $123 million, a 0.3% year-over-year increase, accounting for 25% of total revenue for the first time, signifying the success of the diversification strategy.
Non-GAAP Operating Profit: Increased by 25% year-over-year to $31 million.
Operating Cash Flow: Remained strong at $58 million.
Shareholder Returns: Joy distributed $49.1 million in dividends and repurchased $22.5 million worth of shares by May 23rd, reinforcing its commitment to returning value to shareholders.
Live Streaming Revenue: Was $371 million, with Bigo contributing $352 million, in line with expectations. Despite fluctuations, Bigo Live's operating profit significantly improved due to strategic adjustments.
User Metrics: Bigo Live's North American region saw Q1 MAU growth exceeding 7% year-over-year, with paying users and revenue increasing by approximately 4% quarter-over-quarter.

Strategic Shift and Growth Engines:

Joy's diversified strategy is clearly yielding results, with non-live streaming businesses emerging as the company's "second growth engine."

Bigo Ads: This global programmatic advertising platform has seen remarkable growth, leveraging Joy's substantial global user base of approximately 260 million. Bigo Ads is expanding its traffic pool by integrating premium public traffic with first-party data, delivering strong, measurable results for advertisers. This success has fueled rapid expansion of advertising revenue and is already making a positive contribution to the bottom line.
- Key drivers for Bigo Ads' growth include: responding to advertisers' needs for diversified placement and high ROI, rapid expansion of its publisher network, leveraging extensive user data and AI-powered precise targeting, and benefiting from Joy's established global infrastructure which optimizes operating costs.
Smart Commerce Platform: This platform is strategically complementary to Bigo Ads, empowering merchants with efficient customer targeting and scaling their market presence. The integrated approach is expected to create a virtuous cycle of growth.
Live Streaming Business Optimization: Joy is continuously refining its live streaming operations by:
- Prioritizing user acquisition spending on high-quality paying users in developed markets.
- Streamlining revenue sharing by phasing out underperforming agencies and channels.
- Strengthening content safety and improving content operations to boost engagement. These adjustments have stabilized live streaming revenue and are expected to drive renewed growth, particularly in developed countries and the Middle East.

Capital Allocation and Outlook:

Joy maintains a healthy balance sheet with $3.4 billion in net cash as of March 31, 2025. The company plans to:

Expand resources to support its advertising and SaaS businesses in the short term while maintaining healthy profit margins.
Invest in infrastructure upgrades, technology development, and talent expansion in the medium to long term as non-live streaming businesses scale.
Continue its consistent track record of shareholder returns through dividends and share repurchases.

Joy anticipates Q2 2025 net revenues to be between $499 million and $519 million. The company is confident that 2025 will be a year of "implementation and validation" for its multi-growth engine strategy, leading to sustainable, profitable growth and long-term value for shareholders.

About this video

JOYY Inc. (NASDAQ: JOYY) reported its Q1 2025 results on May 27, 2025, posting net revenues of $494.4 million, down from $564.6 million in the same period last year, as the company continued to optimize its sales and marketing strategies for higher return on investment. Despite the revenue decline, JOYY delivered strong profitability, with net income from continuing operations attributable to controlling interest at $45.4 million, nearly flat year-over-year, and non-GAAP net income at $63.2 million. Gross profit for the quarter was $178.6 million, with gross margin improving to 36.1% from 34.6% a year ago, reflecting disciplined cost management and a favorable shift in revenue mix. Operating income rose sharply to $12.2 million, a 244.5% increase from Q1 2024, while non-GAAP operating income reached $31.0 million, up 24.9% year-over-year. The company’s global average mobile MAUs were 260.4 million, compared to 277.3 million a year earlier, as JOYY focused on quality user acquisition and reduced advertising spend. Notably, non-livestreaming revenues grew 25.3% to $123.0 million, accounting for nearly a quarter of total group revenues—a milestone in JOYY’s diversification strategy. The company continued to return value to shareholders, distributing $49.1 million in dividends and repurchasing $22.5 million in shares during the period. Management highlighted the company’s evolution beyond social entertainment, emphasizing the growth of its programmatic advertising platform, BIGO Ads, and the increasing contribution of non-livestreaming businesses. With a multi-engine growth strategy and ongoing investment in AI-driven innovation, JOYY aims to further strengthen its competitive position and deliver long-term value for shareholders. Outlook: Continued focus on value-accretive organic growth, AI-driven product innovation, and further diversification of revenue streams. Management expects non-livestreaming businesses to become a second growth engine, supporting margin expansion and enhanced shareholder returns. About Inside Ticker: For more expert analysis and real-time updates on JOYY Inc. (NASDAQ: JOYY) and other market movers, follow Inside Ticker and visit InsideTicker.com for in-depth reports, financial insights, and the latest news on leading companies. #JOYY #EarningsCall #Q12025 #SocialMedia #Livestreaming #DigitalAdvertising #RevenueGrowth #FinancialResults #StockMarket #InsideTicker

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