Huanju released 21Q4 and full-year financial reports: the global business turned losses into profits, achieving annual profitability for the first time

According to the U.S. Stock Research Agency, on March 16, 2022, Beijing time, Huanju Group (NASDAQ:YY, hereinafter referred to as "Huanju"/"Group"/"Company") released its financial report for the fourth quarter and full year of 2021. Huanju achieved revenue of US$2.619 billion, an increase of 36.5% year-on-year, of which revenue in the fourth quarter was nearly US$664 million, an increase of 16.8% year-on-year. The total revenue of BIGO in the overseas business segment was US$2.32 billion, an increase of 34.1% year-on-year, of which the fourth quarter revenue was nearly US$576 million, an increase of 13.2% year-on-year.

Following the global business of Huanju exceeding $1.9 billion in 2020, in 2021, Huanju will hand over another eye-catching answer sheet to the market with the profitability of its global business. For the first time, the Group achieved an adjusted full-year net profit of US$109 million (non-GAAP, excluding the divested YY Live business) with a net margin of 4.2%. The BIGO segment achieved an adjusted full-year net profit of $182 million, with a net margin of 7.8%.

As the global business turns a profit, in 2021, Huanju will continue to promote repurchases and dividends, conveying management's confidence in the company's long-term development. In 2021, Huanju added a total of US$1.2 billion in repurchases, and as of the fourth quarter, the annual dividend payment was US$160 million, the repurchase was US$393 million, and the cumulative dividend and repurchase amount was as high as US$553 million.

Li Xueling, Chairman and CEO of Huanju, said: "2021 is a year of growth, adjustment and breakthrough for Huanju Group. In the past year, the monetization ability of many of Huanju's social entertainment products has been steadily improved, and the scale of realization has continued to grow. We actively focus our resources on content, social ecology and other places that determine the long-term competitive advantage of the product, making the product growth model more healthy. With the combined effect of monetization growth and operational efficiency improvement, we achieved a huge breakthrough in the turnaround of our global business for the first time in the whole year. Looking forward to 2022, as Huanju's global business enters a positive cycle, on the basis of healthy cash flow and a steady growth model, Huanju will continue to explore and explore the global market and further expand the market share of social entertainment products in the global market. ”

Revenue increased by 36.5% for the full year The monetization efficiency of the multi-core product line has steadily improved

Although the recurrence of the COVID-19 pandemic continues to bring uncertainty and challenges to the global economy, Huanju's global business growth continues to show great resilience. Driven by the steady improvement of the monetization efficiency of multiple product lines, in 2021, Huanju achieved cumulative revenue of US$2.619 billion, an increase of 36.5%.

Global live streaming product Bigo Live performed well in 2021, with full-year revenue growth of 31.3%. Among them, in the fourth quarter, live broadcast revenue increased by 12.5% year-on-year, and paid users increased by 10.3% year-on-year. From the perspective of different market performance, Bigo Live's global business distribution continued to maintain balanced development, among which the European region performed well, with revenue up to 42.2% year-on-year, paid users up 14.7% year-on-year, Southeast Asia and other emerging markets revenue growth of 16.6%, paid users year-on-year growth of 24.4%. In 2022, Bigo Live will continue to take the path of balanced development of globalization and multi-market, focus on key regions (North America, Europe, Japan, South Korea, Australia and New Zealand, the Middle East, etc.) to expand, and accelerate investment in emerging markets, consolidating the product's leading position in the global social and pan-entertainment live broadcasting industry.

Global short video product Likee accelerated its monetization efficiency in 2021, with a strong annual revenue growth of 97.8%. In the fourth quarter, Likee's live revenue increased by 26.5% year-on-year, of which the Growth in the Middle East continued to be impressive, with revenue increasing by 59.1% year-on-year. In addition to the growth of live streaming monetization, Likee's brand advertising business is also growing steadily, further diversifying Likee's monetization structure.

The commercialization of Hago, a global multiplayer interactive social product, is a promising 2021, with a strong growth of 54.6% in the annual camp. Among them, in the fourth quarter, Hago live broadcast revenue increased by 32.1% year-on-year, and the number of paid users increased by 33.9% year-on-year.

Globalization + localization strategy continues to focus on content diversification and creator cultivation

Under the globalization strategy, Huanju has accumulated a wide user base in more than 150 countries such as Europe, the Americas, the Middle East and Asia-Pacific. Strong cross-country, cross-language, cross-cultural localization operation capabilities, continue to become an important label for gathering. In 2021, Huanju's global local operation team will continue to help the ecological cultivation of product content and the cultivation of creators, and promote the further expansion of the global brand influence of products.

In the fourth quarter, Bigo Live continued to diversify its content ecosystem, focusing on increasing the proportion of high-quality content and improving the user experience. Thanks to the cultivation of local diversified content ecology and the further expansion of the user circle, Bigo Live MAU increased by 11.9% year-on-year to 32.2 million.

From December to January, Bigo Live held a series of online activities such as live parties and concerts in Europe, the Middle East and other places, inviting local pop singers, well-known DJs, musicians, dancers, top anchors, etc., to present a number of audiovisual feasts for global users. At the annual Bigo Live Annual Gala, Bigo Live invites about 100 streamers from different cultural and linguistic backgrounds to meet fans around the world remotely through video performances. Among them, Bigo Live's recent virtual live 3D image also debuted on stage, singing with the talented Thai singer The Toys, interacting virtually and realistically, bringing a new look and feel to global audiences. As a matter of the year, Bigo Live recognizes the world's most influential anchor of the year and helps to board billboards at famous landmarks around the world, such as Times Square in New York and burj Khalifa in Dubai, UNITED Arab Emirates, to further expand Bigo Live's global brand influence.

In the fourth quarter, Likee continued to focus on identifying and nurturing content creators, providing creators with a full range of support programs to create a positive and active content interactive community. In the fourth quarter, the number of certified creators increased by 22% sequentially, with the help of the Creator Support Program. Content created by Likee creators is becoming richer and more diverse, with certified game creators popular with Gen Z users increasing by 173% quarter-on-quarter and daily premium game content up 97% quarter-on-quarter.

Product function iteration to further enhance the user's social interaction experience

In 2021, Huanju's many products will continue to innovate and iterate on product functions to create a better user experience for users, provide more possibilities for user interaction, and further enhance user participation.

In the fourth quarter, Bigo Live provided users with a new immersive social experience through continuous product feature innovation, integrating machine vision, virtual reality and other related technologies. In December, Bigo Live officially launched a new interactive function of "Virtual Anchor", allowing users to create a personalized avatar, capture the facial expressions and actions of the anchor during live broadcasting in real time, and help the anchor use the virtual image to live broadcast and communicate. In addition, Bigo Live also launched a virtual background play for single-person live broadcast scenes, and launched a new room hierarchy and privileged gameplay in multiplayer live broadcast rooms, which promoted the average start time of Q4 to increase by 12.1% year-on-year, and the total start time increased by 8.3% year-on-year.

In the fourth quarter, Likee further expanded the online area and user scope of The Superlike feature, and Superlike has gradually become a unique symbol for users to express support to their favorite creators and high-quality content. In December, for example, certified creators received nearly six times more superlike incentive revenue than in September. In the fourth quarter, Likee launched the Superfollow subscription service in some regions, supporting content creators to publish exclusive content to paid subscribers and charging a monthly subscription fee, enriching the form of interaction between creators and fans, and encouraging content creators to provide better and personalized content to fans.

In the fourth quarter, Hago remained focused on serving users' online multiplayer interaction needs more efficiently. In the fourth quarter, based on the operation of different user lifecycles and regions, Hago launched a differentiated room recommendation strategy, which promoted channel penetration by 2.2% month-on-month.

In 2021, driven by the commercialization of many of its social entertainment products, Huanju is continuing to create growth. Focusing on long-term sustainable development and focusing on the strategy of product, content and social ecology, it has laid a solid foundation for Huanju's global business to turn losses into profits and continuously enhance its market influence. In the future, relying on the support of the global localization operation team, Huanju will continue to create a global diversified social entertainment ecology through in-depth localization, continuously develop and stabilize Huanju's market position in the core area, and continue to be committed to building a communication bridge for people around the world and bringing joyful and dynamic experiences to users around the world.