YY
$51.45
YY
($2.52)
(4.67%)
Earnings Details
Quarter December 2019
Monday, March 16, 2020 6:00:00 PM
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Summary

YY Beats but Guides Lower

YY (YY) reported Quarter December 2019 earnings of $0.96 per share on revenue of $1.1 billion. The consensus earnings estimate was $0.81 per share on revenue of $1.1 billion. The Earnings Whisper number was $0.84 per share. Revenue grew 62.1% on a year-over-year basis.

The company said it expects first quarter revenue of $965.1 million to $979.4 million. The current consensus revenue estimate is $980.9 million for the quarter ending March 31, 2020.

YY Inc is a social communication platform that engages users in real-time online group activities through voice, text and video. Its platform consists of YY Client, the YY.com and Duowan.com web portals and Mobile YY.

Results
Reported Earnings
$0.96
Earnings Whisper
$0.84
Consensus Estimate
$0.81
Reported Revenue
$1.09 Bil
Revenue Estimate
$1.06 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

JOYY Reports Fourth Quarter and Full Year 2019 Unaudited Financial Results

GUANGZHOU, China, March 17, 2020 (GLOBE NEWSWIRE) -- JOYY Inc. (NASDAQ: YY) (“JOYY” or the “Company”, formerly known as YY Inc.), a global video-based social media platform, today announced its unaudited financial results for the fourth quarter and full year of 2019. 

Fourth Quarter 2019 Financial Highlights

  • Net revenues increased by 64.2% to RMB7,618.2 million (US$1,094.3 million) from RMB4,640.9 million in the corresponding period of 2018.
  • Net income attributable to controlling interest of JOYY Inc.1 was RMB172.8 million (US$24.8 million), compared to RMB694.7 million in the corresponding period of 2018.
  • Non-GAAP net income attributable to controlling interest of JOYY Inc.2 was RMB600.8 million (US$86.3 million), compared to RMB846.9 million in the corresponding period of 2018, primarily due to the impact of the consolidation of Bigo Inc (“Bigo”).

Full Year 2019 Highlights

  • Net revenues increased by 62.2% to RMB25,576.2 million (US$3,673.8 million) from RMB15,763.6 million in 2018.
  • Net income attributable to controlling interest of JOYY Inc. was RMB3,445.2 million (US$494.9 million), compared to RMB2,209.0 million in 2018.
  • Non-GAAP net income attributable to controlling interest of JOYY Inc. was RMB2,252.6 million (US$323.6 million), compared to RMB3,274.1 million in 2018.

Fourth Quarter 2019 Operational Highlights

  • Global average mobile MAUs3 reached 485.2 million, among that 78.8% were from markets outside of China.
  • Average mobile MAUs of Likee (formerly known as Like) increased by 208.3% to 115.3 million from 37.4 million in the corresponding period of 2018.
  • Average mobile MAUs of global live streaming services increased by 21.5% to 158.9 million from 130.8 million in the corresponding period of 2018, among that (i) 102.8 million were from China, including 41.2 million from YY, which increased by 3.8% year over year, and 61.6 million from Huya, which increased by 21.5% year over year; and (ii) 56.1 million were from outside of China, including 23.1 million from BIGO LIVE, which increased by 18.6% year over year, and 33.0 million from HAGO, which increased by 57.9% year over year.
  • Average mobile MAUs of imo was 211.0 million.
  • Total number of paying users4 of YY increased by 9.8% to 4.5 million from 4.1 million in the corresponding period of 2018.
  • Total number of paying users of Huya increased by 5.9% to 5.1 million from 4.8 million in the corresponding period of 2018.

“We concluded 2019 with robust operating and financial performances in the fourth quarter, further demonstrating the success of our domestic and international businesses,” commented Mr. David Xueling Li, Chairman and Chief Executive Officer of JOYY. “During the quarter, we maintained our focus on the growth of our short-form video and live streaming products to fuel our dual growth engines. For Likee, our global short-form video platform, we continued to expand its geographic coverage, refine its content offerings, and augment its monetization capabilities. As a result, Likee’s total MAUs swelled to 115.3 million in the quarter, representing an increase of 208.3% on a yearly basis and 15.1% on a sequential basis. We also continued to expand our global live streaming ecosystem through BIGO Live, our flagship live streaming platform for international markets. Our persistence in cultivating BIGO Live’s operational efficiency, localization capabilities, and cultural sensitivity enabled the platform to achieve record growth in developed markets around the world in the quarter. Furthermore, HAGO, our casual-game-oriented social media platform, also maintained its healthy growth trajectory, as we continued to expand its game portfolio and innovate its social features to explore additional monetization opportunities.

In addition to our rapid expansion overseas, we also maintained our focus on serving YY Live’s community of loyal users to cement our leadership in China’s entertainment live streaming industry. The success of our 2019 YY Annual Awards once again demonstrated the strength and scale of our live streaming social media ecosystem in China. Moreover, as we continue to cultivate synergies across business segments, implement cutting-edge technology into our products, and cultivate our localization capabilities, we are also compounding the network effects of our product matrix and enhancing our ability to achieve sustainable growth.”

Mr. Bing Jin, Chief Financial Officer of JOYY, further commented, “During the fourth quarter of 2019, we generated a year-over-year net revenues growth rate of 64.2%, exceeding the high end of our previous guidance range. In terms of our global strategy, we are committed to continuous investment in user base expansion, content enrichment and technology innovation, while keeping rapid monetization progress in both live streaming and short-form video services.  In response to the recent COVID-19 outbreak, we immediately leveraged our capabilities to contribute to our society’s efforts of rallying charitable support and uplifting people’s spirit. While we assess and monitor the financial impact of the outbreak in 2020, we are confident that our global footprint, diversified products matrix, and abundant cash reserve have positioned us to meet the challenges and seize the opportunities ahead.”

Fourth Quarter 2019 Financial Results

NET REVENUES
Net revenues increased by 64.2% to RMB7,618.2 million (US$1,094.3 million) in the fourth quarter of 2019 from RMB4,640.9 million in the corresponding period of 2018, primarily driven by an increase in live streaming revenues and the contribution from Bigo’s consolidation.

Live streaming revenues increased by 62.7% to RMB7,146.6 million (US$1,026.5 million) in the fourth quarter of 2019 from RMB4,391.4 million in the corresponding period of 2018, primarily attributable to (i) the continued live streaming revenues growth in YY and Huya segments, amounting to RMB5,507.8 million (US$791.1 million); and (ii) the contribution from the consolidation of Bigo segment, amounting to RMB1,638.7 million (US$235.4 million).

Other revenues increased by 89.0% to RMB471.6 million (US$67.7 million) in the fourth quarter of 2019 from RMB249.5 million in the corresponding period of 2018, primarily driven by the increase in advertising revenues from Huya and Bigo.

COST OF REVENUES AND GROSS PROFIT
Cost of revenues increased by 69.3% to RMB5,101.0 million (US$732.7 million) in the fourth quarter of 2019 from RMB3,013.1 million in the corresponding period of 2018. Revenue-sharing fees and content costs increased to RMB3,727.4 million (US$535.4 million) in the fourth quarter of 2019 from RMB2,556.5 million in the corresponding period of 2018 as a result of the increase in live streaming revenues of the Company. Bandwidth costs increased to RMB505.0 million (US$72.5 million) in the fourth quarter of 2019 from RMB246.5 million in the corresponding period of 2018, as the overseas user base and time spent continued to expand following the Bigo consolidation.

Gross profit increased by 54.6% to RMB2,517.2 million (US$361.6 million) in the fourth quarter of 2019 from RMB1,627.9 million in the corresponding period of 2018. Gross margin was 33.0% in the fourth quarter of 2019, compared to 35.1% in the corresponding period of 2018. The gross margin contraction was primarily caused by the fact that Huya and Bigo segments had lower gross margins but contributed significantly greater portions of net revenues in the fourth quarter of 2019, compared to the corresponding period of 2018.

OPERATING INCOME
Operating expenses were RMB2,296.9 million (US$329.9 million) in the fourth quarter of 2019, compared to RMB931.2 million in the corresponding period of 2018. Among the operating expenses, sales and marketing expenses increased to RMB1,026.4 million (US$147.4 million) in the fourth quarter of 2019, primarily due to the Company’s increased efforts in sales and marketing activities in overseas markets and the impact of depreciation and amortization related to the Bigo consolidation. Research and development expenses increased to RMB802.3 million (US$115.2 million) in the fourth quarter of 2019, mostly due to the increase in salaries caused primarily by the consolidation of Bigo.

Operating income was RMB362.2 million (US$52.0 million) in the fourth quarter of 2019, compared to RMB718.6 million in the corresponding period of 2018. Operating margin was 4.8% in the fourth quarter of 2019, compared to 15.5% in the corresponding period of 2018, primarily due to the decrease in gross margin, the impact of depreciation and amortization related to the Bigo consolidation and other overseas expansion initiatives.

Non-GAAP operating income5 was RMB781.3 million (US$112.2 million) in the fourth quarter of 2019, compared to RMB888.5 million in the corresponding period of 2018. Non-GAAP operating margin6 was 10.3% in the fourth quarter of 2019, compared to 19.1% in the corresponding period of 2018.

NET INCOME
Net income attributable to controlling interest of JOYY Inc. was RMB172.8 million (US$24.8 million) in the fourth quarter of 2019, compared to RMB694.7 million in the corresponding period of 2018. Net margin was 2.3% in the fourth quarter of 2019, compared to 15.0% in the corresponding period of 2018. The high effective tax rate in the fourth quarter of 2019 was primarily due to the profit (loss) structure and the different effective tax rates of YY, Huya and Bigo segments. Particularly, the Company was not receiving as much benefit from losses incurred by Bigo as a majority of Bigo’s business was subject to a low applicable tax rate in its jurisdiction.

Non-GAAP net income attributable to controlling interest of JOYY Inc. was RMB600.8 million (US$86.3 million) in the fourth quarter of 2019, compared to RMB846.9 million in the corresponding period of 2018. Non-GAAP net margin7 was 7.9% in the fourth quarter of 2019, compared to 18.2% in the corresponding period of 2018.

NET INCOME PER ADS
Diluted net income per ADS8 was RMB1.87 (US$0.27) in the fourth quarter of 2019, compared to RMB10.54 in the corresponding period of 2018.

Non-GAAP diluted net income per ADS9 was RMB6.70 (US$0.96) in the fourth quarter of 2019, compared to RMB13.03 in the corresponding period of 2018.

BALANCE SHEET AND CASH FLOWS
As of December 31, 2019, the Company had cash and cash equivalents, restricted cash and cash equivalents, short-term deposits, restricted short-term deposits and short-term investments of RMB26,944.5 million (US$3,870.3 million). For the fourth quarter of 2019, net cash from operating activities was RMB1,788.1 million (US$256.8 million).

SHARES OUTSTANDING
As of December 31, 2019, the Company had a total of 1,619.7 million common shares, or the equivalent of 81.0 million ADSs, outstanding.

Full Year 2019 Financial Results

Net revenues for the full year of 2019 increased by 62.2% to RMB25,576.2 million (US$3,673.8 million) from RMB15,763.6 million in 2018, primarily driven by a 61.5% year-over-year increase in live streaming revenues.

Net income attributable to controlling interest of JOYY Inc. for the full year of 2019 increased by 56.0% to RMB3,445.2 million (US$494.9 million) from RMB2,209.0 million in 2018. Net margin for the full year of 2019 was 13.5%, compared to 14.0% in 2018.

Non-GAAP net income attributable to controlling interest of JOYY Inc. for the full year of 2019 was RMB2,252.6 (US$323.6 million), compared to RMB3,274.1 million in 2018. Non-GAAP net margin for the full year of 2019 was 8.8%, compared to 20.8% in 2018.

Diluted net income per ADS for the full year of 2019 increased by 69.5% to RMB43.01 (US$6.18) from RMB25.38 in 2018. Non-GAAP diluted net income per ADS was RMB27.11 (US$3.89) in 2019, compared to RMB50.07 in the corresponding period of 2018. 

For the full year of 2019, net cash from operating activities was RMB4,581.7 million (US$658.1 million).

Business Outlook
For the first quarter of 2020, the Company expects net revenues to be between RMB6.75 billion and RMB6.85 billion10, representing a year-over-year growth of 41.2% to 43.3%. This forecast considers the potential impact of the COVID-19 outbreak and reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change, particularly as to the potential impact of the COVID-19 on the economy in China and elsewhere.

Social Responsibility Initiatives
In late January of 2020, the Company announced a donation of RMB22 million to help contain the spread of the COVID-19 outbreak. The donation was used for the procurement of medical supplies and equipment via domestic and international channels. These items included facemasks, medical safety glasses, hazmat suits, and medical sanitizers. After receiving the medical supplies and equipment, the Company coordinated directly with hospitals both in Hubei and Guangdong provinces that were involved in the treatment of COVID-19 patients to ensure the efficient delivery of the medical supplies and equipment.

Conference Call Information
The Company will hold a conference call on Monday, March 16, 2020, at 9:00 P.M. Eastern Time (or Tuesday, March 17, 2020, at 9:00 A.M. Beijing Time) to discuss the financial results. Participants may access the call by dialing the following numbers:

United States:   +1-845-675-0437
International:   +65-6713-5090
Mainland China: 400-620-8038
Hong Kong, China: +852-3018-6771
Conference ID:   #8385384

 

The replay will be accessible through March 24, 2020, by dialing the following numbers:

United States:   +1-646-254-3697
International:   +61-2-8199-0299
Conference ID:   #8385384

 

A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.yy.com/.

Exchange Rate
This press release contains translations of certain Renminbi amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars, in this press release, were made at a rate of RMB6.9618 to US$1.00, the noon buying rate in effect on December 31, 2019 in the City of New York for cable transfers in Renminbi per U.S. dollar as certified for customs purposes by the Federal Reserve Bank of New York.

About JOYY Inc.
JOYY Inc. is a global social media platform. The Company’s highly engaged users contribute to a vibrant social community by creating, sharing, and enjoying a vast range of entertainment content and activities. JOYY enables users to interact with each other in real time through online live media and offers users a uniquely engaging and immersive entertainment experience. JOYY owns YY Live, a leading live streaming social media platform in China and Huya, a leading game live streaming platform in China. In addition, JOYY completed the acquisition of Bigo in March 2019. Bigo is a fast-growing global tech company. Headquartered in Singapore, Bigo owns Bigo Live, a leading global live streaming platform outside China; Likee, a leading global short-form video social platform; imo, a global video communication app and other social applications. YY has created an online community for global video and live streaming users. JOYY Inc. was listed on the NASDAQ in November 2012.

Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as JOYY’s strategic and operational plans, contain forward-looking statements. JOYY may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (“SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to fourth parties. Statements that are not historical facts, including statements about JOYY’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: JOYY’s goals and strategies; JOYY’s future business development, results of operations and financial condition; the expected growth of the online communication social platform market in China; the expectation regarding the rate at which to gain active users, especially paying users; JOYY’s ability to monetize the user base; fluctuations in general economic and business conditions in China; the impact of the COVID-19 to JOYY’s business operations and the economy in China and elsewhere generally; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in JOYY’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and JOYY does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Use of Non-GAAP Financial Measures
The unaudited condensed consolidated financial information is prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). JOYY uses non-GAAP operating income, non-GAAP operating margin, non-GAAP net income attributable to controlling interest of JOYY Inc., non-GAAP net margin attributable to controlling interest of JOYY Inc., non-GAAP net income attributable to common shareholders of JOYY Inc., and basic and diluted non-GAAP net income per ADS, which are non-GAAP financial measures. Non-GAAP operating income is operating income excluding share-based compensation expenses, impairment of goodwill and investments, amortization of intangible assets from business acquisitions, and gain on disposal of subsidiaries and business. Non-GAAP operating margin is non-GAAP operating income as a percentage of net revenues. Non-GAAP net income is net income excluding share-based compensation expenses, impairment of goodwill and investments, amortization of intangible assets from business acquisitions, gain on disposal of subsidiaries and business, gain on deemed disposal and disposal of investments, gain (loss) on fair value change of investments and equity investees’ investments, fair value change on derivative, interest expenses related to the convertible bonds’ amortization to face value, and income tax effects of above non-GAAP reconciling items. Non-GAAP net income attributable to controlling interest of JOYY Inc. is net income attributable to controlling interest of JOYY Inc. excluding share-based compensation expenses, impairment of goodwill and investments, amortization of intangible assets from business acquisitions, gain on disposal of subsidiaries and business, gain on deemed disposal and disposal of investments, gain (loss) on fair value change of investments and equity investees’ investments, fair value change on derivative, interest expenses related to the convertible bonds’ amortization to face value, income tax effects of above non-GAAP reconciling items and adjustments for non-GAAP reconciling items for the net (loss) income attributable to non-controlling interest shareholders. Non-GAAP net margin is non-GAAP net income attributable to controlling interest of JOYY Inc. as a percentage of net revenues. Non-GAAP net income attributable to common shareholders of JOYY Inc. is net income attributable to common shareholders of JOYY Inc. excluding share-based compensation expenses, impairment of goodwill and investments, amortization of intangible assets from business acquisitions, gain on disposal of subsidiaries and business, gain on deemed disposal and disposal of investments, gain (loss) on fair value change of investments and equity investees’ investments, fair value change on derivative, interest expenses related to the convertible bonds’ amortization to face value, accretion, cumulative dividend and deemed dividend to subsidiaries’ preferred shareholders and income tax effects of above non-GAAP reconciling items and adjustments for non-GAAP reconciling items for the net (loss) income attributable to non-controlling interest shareholders. After the non-GAAP reconciliation, non-GAAP net income attributable to controlling interests of JOYY Inc. is equal to the non-GAAP net income attributable to common shareholders of JOYY Inc. Basic and diluted non-GAAP net income per ADS is non-GAAP net income attributable to common shareholders of JOYY Inc. divided by weighted average number of ADS used in the calculation of basic and diluted net income per ADS. The Company believes that separate analysis and exclusion of the non-cash impact of above reconciling items adds clarity to the constituent parts of its performance. The Company reviews these non-GAAP financial measures together with GAAP financial measures to obtain a better understanding of its operating performance. It uses the non-GAAP financial measure for planning, forecasting and measuring results against the forecast. The Company believes that non-GAAP financial measure is useful supplemental information for investors and analysts to assess its operating performance without the non-cash effect of (i) share-based compensation expenses and amortization of intangible assets from business acquisitions, fair value change on derivative, interest expenses related to the convertible bonds’ amortization to face value, which have been and will continue to be significant recurring expenses in its business, (ii) impairment of goodwill and investments, gain on disposal of subsidiaries and business, gain on deemed disposal and disposal of investments, gain (loss) on fair value change of investments and equity investees’ investments, and accretion, cumulative dividend and deemed dividend to subsidiaries’ preferred shareholders, which may not be recurring in its business, and (iii) income tax expenses and non-GAAP adjustments for net (loss) income attributable to non-controlling interest shareholders, which are affected by above non-GAAP reconciling items. However, the use of non-GAAP financial measures has material limitations as an analytical tool. One of the limitations of using non-GAAP financial measures is that they do not include all items that impact the Company’s net income for the period. In addition, because non-GAAP financial measures are not measured in the same manner by all companies, they may not be comparable to other similar titled measures used by other companies. In light of the foregoing limitations, you should not consider non-GAAP financial measure in isolation from or as an alternative to the financial measure prepared in accordance with U.S. GAAP.

The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, or as a substitute for, the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the table captioned “JOYY Inc. Reconciliation of GAAP and Non-GAAP Results” near the end of this release.

Investor Relations Contact
JOYY Inc.
Matthew Zhao
Maggie Yan
Tel: +86 (20) 8212-0000
Email: IR@YY.com

ICR, Inc.
Jack Wang
Tel: +1 (646) 915-1611
Email: IR@YY.com

_______________________________

1 Net income attributable to controlling interest of JOYY Inc., is net income less net (loss) income attributable to the non-controlling interest shareholders and the mezzanine equity classified as non-controlling interest shareholder.

2 Non-GAAP net income attributable to controlling interest of JOYY Inc. is a non-GAAP financial measure, which is defined as net income attributable to controlling interest of JOYY Inc. excluding share-based compensation expenses, impairment of goodwill and investment, amortization of intangible assets from business acquisitions, gain on disposal of subsidiaries and business, gain on deemed disposal and disposal of investments (deemed disposal refers to dilution of equity interest in equity-method investments), gain (loss) on fair value change of investments and equity investees’ investments, fair value change on derivative, interest expenses related to the convertible bonds amortization to face value, income tax effects on non-GAAP adjustments and non-GAAP adjustments for net (loss) income attributable to non-controlling interest shareholders. These adjustments amounted to RMB428.0 million (US$61.5 million) and RMB152.2 million in the fourth quarters of 2019 and 2018, respectively. Please refer to the section titled “Reconciliation of GAAP and Non-GAAP Results” for more details.

3 Refers to mobile average monthly active users. Average mobile MAU for any period is calculated by dividing (i) the sum of the Company’s mobile active users for each month of such period, by (ii) the number of months in such period.

4 Refers to a registered user that has purchased virtual items on YY’s platforms at least once during the period presented.

5 Non-GAAP operating income is a non-GAAP financial measure, which is defined as operating income excluding share-based compensation expenses, amortization of intangible assets from business acquisitions, impairment of goodwill and investments and gain on disposal of subsidiaries and business. Please refer to the section titled “Reconciliation of GAAP and Non-GAAP Results” for details.

6 Non-GAAP operating margin is a non-GAAP financial measure, which is defined as non-GAAP operating income as a percentage of net revenues. Please refer to the section titled “Reconciliation of GAAP and Non-GAAP Results” for details.

7 Non-GAAP net margin is non-GAAP net income attributable to controlling interest of JOYY Inc. as a percentage of net revenues.

8 ADS is American Depositary Share. Each ADS represents twenty Class A common shares of the Company. Diluted net income per ADS is net income attributable to common shareholders of JOYY Inc. divided by weighted average number of diluted ADS.

9 Non-GAAP diluted net income per ADS is a non-GAAP financial measure, which is defined as non-GAAP net income attributable to common shareholders of JOYY Inc. divided by weighted average number of ADS used in the calculation of diluted net income per ADS. Please refer to the section titled “Reconciliation of GAAP and Non-GAAP Results” for details.

10 The outlook of net revenues for the first quarter of 2020 includes the impact from Bigo’s consolidation. However, when calculating the year-over-year growth rate, Bigo’s net revenues in January and February of 2019 was not included as the part of denominator.

JOYY INC.
 UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(All amounts in thousands, except share, ADS and per ADS data)

 December
 31,
2018 
 December
31,
2019
 December
31,
2019
 RMB RMB US$
Assets     
Current assets     
Cash and cash equivalents6,004,231 3,893,538 559,272
Restricted cash and cash equivalents- 4,892 703
Short-term deposits7,326,996 16,770,885 2,408,987
Restricted short-term deposits- 653,034 93,802
Short-term investments979,053 5,622,189 807,577
Accounts receivable, net198,428 762,018 109,457
Amounts due from related parties193,559 17,262 2,480
Financing receivables, net768,343 105,344 15,132
Prepayments and other current assets1,019,019 970,807 139,447
      
Total current assets16,489,629 28,799,969 4,136,857
      
Non-current assets     
Long-term deposits1,000,000 - -
Deferred tax assets70,834 127,635 18,334
Investments4,591,524 2,362,907 339,410
Property and equipment, net1,296,319 2,256,360 324,106
Land use rights, net1,784,639 1,736,544 249,439
Intangible assets, net74,685 3,179,863 456,759
Right-of-use assets, net(1)- 275,607 39,588
Goodwill11,763 12,947,192 1,859,748
Financing receivables, net224,793 129,380 18,584
Other non-current assets223,859 394,026 56,598
      
Total non-current assets9,278,416 23,409,514 3,362,566
      
Total assets25,768,045 52,209,483 7,499,423
      
Liabilities, mezzanine equity and shareholders’ equity     
Current liabilities     
Convertible bonds6,863 - -
Accounts payable114,589 124,551 17,891
Deferred revenue951,616 1,343,308 192,954
Advances from customers101,690 150,091 21,559
Income taxes payable235,561 451,623 64,872
Accrued liabilities and other current liabilities2,414,371 4,673,000 671,234
Amounts due to related parties28,336 222,281 31,929
Lease liabilities due within one year(1)- 115,564 16,600
Short-term loans- 557,203 80,037
      
Total current liabilities3,853,026 7,637,621 1,097,076
      
Non-current liabilities     
Convertible bonds- 5,008,571 719,436
Lease liabilities(1)- 162,779 23,382
Deferred revenue91,710 240,541 34,552
Deferred tax liabilities27,505 264,639 38,013
Other non-current liabilities- 11,495 1,651
      
Total non-current liabilities119,215 5,688,025 817,034
      
Total liabilities3,972,241 13,325,646 1,914,110
      

JOYY INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
(All amounts in thousands, except share, ADS and per ADS data)

 December
31,
2018
 December
 31,
2019
 December
 31,
2019
 
 RMB RMB US$ 
       
Mezzanine equity418,673 466,071 66,947 
       
Shareholders’ equity      
Class A common shares (US$0.00001 par value; 10,000,000,000 and 10,000,000,000 shares authorized, 981,740,848 shares issued and outstanding as of December 31, 2018; 1,301,845,404 shares issued and 1,293,162,504 shares outstanding as of and December 31, 2019, respectively)59 80 11 
Class B common shares (US$0.00001 par value; 1,000,000,000 and 1,000,000,000 shares authorized, 288,182,976 and  326,509,555 shares issued and outstanding as of December 31, 2018 and December 31, 2019, respectively)21 24 3 
Treasury Shares (US$0.00001 par value; nil and 8,682,900 shares held as of December 31, 2018 and December 31, 2019, respectively)- (168,072)(24,142)
Additional paid-in capital11,168,866 21,921,562 3,148,835 
Statutory reserves101,725 149,961 21,541 
Retained earnings6,913,469 10,272,122 1,475,498 
Accumulated other comprehensive income336,152 890,209 127,871 
       
Total JOYY Inc.’s shareholders’ equity18,520,292 33,065,886 4,749,617 
       
Non-controlling interests2,856,839 5,351,880 768,749 
       
Total shareholders’ equity21,377,131 38,417,766 5,518,366 
       
Total liabilities, mezzanine equity and      
shareholders’ equity25,768,045 52,209,483 7,499,423 
       

(1)  The Company has adopted ASC842 “Leases” beginning January 1, 2019 using the optional transition method. The only major impact of the standard is that assets and liabilities amounting to RMB145.2 million and RMB141.2 million, respectively, are recognized beginning January 1, 2019 for leased office space with terms of more than 12 months.

JOYY INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended
 
Twelve Months Ended
  December
31
,
2018
 September
30,
2019
 December
31
,
2019
 December
31,
2019
 December
31,
2018
 December
31,
2019
 December
31,

2019
  RMB RMB RMB US$ RMB RMB US$
               
Net revenues              
Live streaming(1) 4,391,418 6,473,946 7,146,572 1,026,541 14,877,667 24,028,299 3,451,449
Others 249,506 408,268 471,587 67,739 885,890 1,547,905 222,343
               
Total net revenues 4,640,924 6,882,214 7,618,159 1,094,280 15,763,557 25,576,204 3,673,792
               
Cost of revenues(2) (3,013,063) (4,713,175) (5,101,009) (732,714) (10,017,134) (17,148,350) (2,463,206)
               
Gross profit 1,627,861 2,169,039 2,517,150 361,566 5,746,423 8,427,854 1,210,586
               
Operating expenses(2)              
Research and development expenses (332,513) (673,058) (802,267) (115,238) (1,192,052) (2,535,482) (364,199)
Sales and marketing expenses (323,689) (1,079,577) (1,026,417) (147,436) (1,149,316) (3,739,724) (537,178)
General and administrative expenses (274,979) (408,834) (468,264) (67,262) (883,225) (1,489,495) (213,953)
               
Total operating expenses (931,181) (2,161,469) (2,296,948) (329,936) (3,224,593) (7,764,701) (1,115,330)
               
Gain on disposal of subsidiaries and business - - 82,699 11,879 - 82,699 11,879
Other income 21,924 152,718 59,290 8,516 117,860 322,103 46,267
               
Operating income 718,604 160,288 362,191 52,025 2,639,690 1,067,955 153,402
               
Interest expenses (139) (123,456) (124,574) (17,894) (8,616) (266,517) (38,283)
Interest income and investment income 123,401 203,137 225,531 32,396 485,552 733,576 105,372
Foreign currency exchange (losses) gains, net (1,338) 16,393 (21,731) (3,121) (514) 9,796 1,407
Gain on deemed disposal and disposal of investments 2,179 - - - 16,178 - -
Gain (loss) on fair value change of investments 26,138 (11,492) 26,670 3,831 1,689,404 2,679,312 384,859
Fair value change on derivative - (1,753) (14,258) (2,048) (2,285,223) (16,011) (2,300)
Other non-operating expenses - - - - (2,000) - -
               
Income before income tax expenses 868,845 243,117 453,829 65,189 2,534,471 4,208,111 604,457
               
Income tax expenses (107,114) (86,571) (192,184) (27,606) (477,707) (546,622) (78,517)
               
Income before share of  income  in equity method investments, net of income taxes 761,731 156,546 261,645 37,583 2,056,764 3,661,489 525,940
               
Share of (loss) income in equity method investments, net of income taxes (19,281) 21,261 3,176 456 58,933 38,540 5,536
               
Net income  742,450 177,807 264,821 38,039 2,115,697 3,700,029 531,476
               
Less: Net income (loss) attributable to the non-controlling interest shareholders and the mezzanine equity classified as non-controlling interest shareholders 47,744 67,879 92,024 13,218 (93,310) 254,794 36,599
               
Net income attributable to controlling interest of JOYY Inc. 694,706 109,928 172,797 24,821 2,209,007 3,445,235 494,877
               
Less: Accretion of subsidiaries’  redeemable convertible preferred shares to redemption value 6,083 9,715 9,790 1,406 73,159 38,346 5,508
Cumulative dividend on subsidiary’s Series A Preferred Shares 4,606 6,982 7,036 1,011 4,606 27,559 3,959
Deemed dividend to subsidiary’s Series A preferred shareholders - - - - 489,284 - -
               
Net income attributable to common shareholders of JOYY Inc. 684,017 93,231 155,971 22,404 1,641,958 3,379,330 485,410
               

JOYY INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)
(All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended Twelve Months Ended
  December
 31,
2018
September
30,

2019
December
 31,
2019
December
 31,
2019
 December
 31,
2018
December
 31,
2019
December
31,
2019
  RMBRMBRMBUS$ RMBRMBUS$
          
 

Net income per ADS
         
—Basic 10.641.161.950.28 25.6443.766.29
—Diluted 10.541.111.870.27 25.3843.016.18
Weighted average number of ADS used in calculating net income  per ADS         
—Basic 64,307,56980,033,60779,917,79179,917,791 64,042,39077,219,84677,219,846
—Diluted 64,609,00080,973,44781,102,54481,102,544 64,704,47078,254,04578,254,045

(1)  Live streaming revenues by geographical areas were as follows:

  Three Months Ended Twelve Months Ended
  December
31,

2018
September
30,

2019
December
 31,
2019
December
31,
2019
 December
 31,
2018
December
31,
2019
December
31,
2019
  RMBRMBRMBUS$ RMBRMBUS$
          
PRC 4,389,8395,266,8155,701,605818,984 14,875,78020,174,4172,897,873
Non-PRC 1,579  1,207,1311,444,967207,557 1,8873,853,882553,576

(2)  Share-based compensation was allocated in cost of revenues and operating expenses as follows:

  Three Months Ended Twelve Months Ended
  December
31
,
2018
September
30,

2019
December
31
,
2019
December
31,
2019
 December
 31,
2018
December
 31,
2019
December
 31,
2019
  RMBRMBRMBUS$ RMBRMBUS$
          
Cost of revenues  14,65020,60830,7334,415 74,33981,25411,671
Research and development expenses  50,042129,174145,88720,955 225,173505,69772,639
Sales and marketing expenses  1,1582,643 4,647667 5,72312,7181,827
General and administrative expenses  88,90995,21073,19510,514 342,790348,47950,056 
          

JOYY INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
(All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended Twelve Months Ended
  December September December December December December December
  31, 30,  31, 31,  31, 31, 31,
  2018  2019  2019 2019 2018 2019 2019
  RMB RMB RMB US$ RMB RMB US$
               
Operating income 718,604 160,288 362,191 52,025 2,639,690 1,067,955 153,402
Share-based compensation expenses 154,759 247,635 254,462 36,551 648,025 948,148 136,193
Impairment of goodwill and investments 15,099 10,000 52,334 7,517 35,348 62,334 8,954
Gain on disposal of subsidiaries and business -       -    
  - (82,699) (11,879)   (82,699) (11,879)
Amortization of intangible assets from business acquisitions - 193,487 194,982 28,007 - 639,209 91,817
               
Non-GAAP operating income 888,462 611,410 781,270 112,221 3,323,063 2,634,947 378,487
               
Net income 742,450 177,807 264,821 38,039 2,115,697 3,700,029 531,476
Share-based compensation expenses 154,759 247,635 254,462 36,551 648,025 948,148 136,193
Impairment of goodwill and investments 15,099 10,000 52,334 7,517 35,348 62,334 8,954
Gain on disposal of subsidiaries and business - - (82,699) (11,879) - (82,699) (11,879)
Amortization of intangible assets from business acquisitions - 193,487 194,982 28,007 - 639,209 91,817
Gain on deemed disposal and disposal of investments (2,179) - - - (16,178) - -
Gain (loss) on fair value change of investments and equity investees’ investments (1,089) 2,031 (24,610) (3,535) (1,711,509) (2,691,249) (386,574)
Fair value change on derivative - 1,753 14,258 2,048 2,285,223 16,011 2,300
Interest expenses related to the convertible bonds’ amortization to face value - 100,885 102,510 14,725 - 207,682 29,832
Income tax effects on non-GAAP adjustments 21,479 (40,166) (30,889) (4,437) 97,560 (119,942) (17,229)
               
Non-GAAP net income 930,519 693,432 745,169 107,036 3,454,166 2,679,523 384,890
               
Net income attributable to common shareholders of JOYY Inc. 684,017 93,231 155,971 22,404 1,641,958 3,379,330 485,410
Share-based compensation expenses 154,759 247,635 254,462 36,551 648,025 948,148 136,193
Impairment of goodwill and investments 15,099 10,000 52,334 7,517 35,348 62,334 8,954
Gain on disposal of subsidiaries and business - - (82,699) (11,879) - (82,699) (11,879)
Amortization of intangible assets from business acquisitions - 193,487 194,982 28,007 - 639,209 91,817
Gain on deemed disposal and disposal of investments (2,179) - - - (16,178) - -
Gain (loss) on fair value change of investments and equity investees’ investments (1,089) 2,031 (24,610) (3,535) (1,711,509) (2,691,249) (386,574)
Fair value change on derivative - 1,753 14,258 2,048 2,285,223 16,011 2,300
Interest expenses related to the convertible bonds’ amortization to face value - 100,885 102,510 14,725 - 207,682 29,832
Accretion, cumulative dividend and deemed dividend to subsidiaries’ preferred shareholders 10,689 16,697 16,826 2,417 567,049 65,905 9,467
Income tax effects on non-GAAP adjustments 21,479 (40,166) (30,889) (4,437) 97,560 (119,942) (17,229)
Non-GAAP adjustments for net loss attributable to the non-controlling interest shareholders (35,843) (51,481) (52,381) (7,524) (273,356) (172,149) (24,728)
               
Non-GAAP net income attributable to controlling interest and common shareholders of JOYY Inc. 846,932 574,072 600,764 86,294 3,274,120 2,252,580 323,563
               
Non-GAAP net income per ADS              
—Basic 13.17 7.17 7.52
 1.08 51.12 29.17 4.19
—Diluted 13.03 6.42 6.70
 0.96
 50.07 27.11 3.89
Weighted average number of ADS used in calculating Non-GAAP net income per ADS              
—Basic 64,307,569 80,033,607 79,917,791 79,917,791 64,042,390 77,219,846 77,219,846
—Diluted 64,609,000 91,400,547 91,529,644 91,529,644 64,704,470 83,684,078 83,684,078
               

 

JOYY INC.
UNAUDITED SEGMENT REPORT
(All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended
  December 31, 2019
             
  YY(1) Huya Bigo Elimination(2) Total Total
  RMB RMB RMB RMB RMB US$
             
Net revenues            
Live streaming 3,161,700 2,346,141 1,638,731 - 7,146,572 1,026,541
Others 184,708 121,329 165,550 - 471,587 67,739
             
Total net revenues 3,346,408 2,467,470 1,804,281 - 7,618,159 1,094,280
             
Cost of revenues(3) (1,842,255) (2,000,909) (1,257,845) - (5,101,009) (732,714)
             
Gross profit  1,504,153 466,561 546,436 - 2,517,150 361,566
Operating expenses(3)            
Research and development expenses (321,240) (178,290) (302,737) - (802,267) (115,238)
Sales and marketing expenses (299,985) (118,324) (608,108) - (1,026,417) (147,436)
General and administrative expenses (245,533) (96,367) (126,364) - (468,264) (67,262)
             
Total operating expenses (866,758) (392,981) (1,037,209) - (2,296,948) (329,936)
             
Gain on disposal of subsidiaries and business 82,699 - - - 82,699 11,879
Other income 29,929 28,046 1,315 - 59,290 8,516
             
Operating income (loss) 750,023 101,626 (489,458) - 362,191 52,025
             
Interest expenses (123,570) - (15,282) 14,278 (124,574) (17,894)
Interest income and investment income 150,749 88,346 714 (14,278) 225,531 32,396
Foreign currency exchange (losses) gains, net (2,221) 99 (19,609) - (21,731) (3,121)
Fair value change on derivative (14,258) - - - (14,258) (2,048)
Gain on fair value change of investments 26,670 - - - 26,670 3,831
             
Income (loss) before income tax expenses 787,393 190,071 (523,635) - 453,829 65,189
             
Income tax (expenses) benefits (170,114) (27,599) 5,529 - (192,184) (27,606)
             
Income (loss) before share of income in equity method investments, net of income taxes 617,279 162,472 (518,106) - 261,645 37,583
             
Share of income (loss) in equity method investments, net of income taxes 5,978 (2,802) - - 3,176 456
             
Net income (loss) 623,257 159,670 (518,106) - 264,821 38,039
             

(1)  In 2019 the segment of “YY Live” was renamed as “YY”.

(2)  The elimination mainly consists of interest income and interest expenses generated from the loan between YY and Bigo segments.

(3)  Share-based compensation was allocated in cost of revenues and operating expenses as follows:

 Three Months Ended
 December 31, 2019
  
 YYHuyaBigoTotalTotal
 RMBRMBRMBRMBUS$
      
Cost of revenues7,18914,8068,73830,7334,415
Research and development expenses38,21136,36971,307145,88720,955
Sales and marketing expenses9172,6401,0904,647667
General and administrative expenses35,433  28,370  9,39273,19510,514

JOYY INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS OF UNAUDITED SEGMENT REPORT
 (All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended
  December 31, 2019
   
  YY Huya Bigo Total Total
  RMB RMB RMB RMB US$
           
Operating income (loss) 750,023 101,626 (489,458) 362,191 52,025
Share-based compensation expenses 81,750 82,185 90,527 254,462 36,551
Impairment of goodwill and investments 52,334 - - 52,334 7,517
Gain on disposal of subsidiaries and business (82,699) - - (82,699) (11,879)
Amortization of intangible assets from business acquisitions - - 194,982 194,982 28,007
           
Non-GAAP operating income (loss) 801,408 183,811 (203,949) 781,270 112,221
           
Net income (loss) 623,257 159,670 (518,106) 264,821 38,039
Share-based compensation expenses 81,750 82,185 90,527 254,462 36,551
Impairment of goodwill and investments 52,334 - - 52,334 7,517
Gain on disposal of subsidiaries and business (82,699) - - (82,699) (11,879)
Amortization of intangible assets from business acquisitions - - 194,982 194,982 28,007
Gain on fair value change of investments and equity investees’ investments (24,610) - - (24,610) (3,535)
Fair value change on derivative 14,258 - - 14,258 2,048
Interest expenses related to the convertible bonds’ amortization to face value 102,510 - - 102,510 14,725
Income tax effects on non-GAAP adjustments 9,235 - (40,124) (30,889) (4,437)
           
Non-GAAP net income (loss) 776,035 241,855 (272,721) 745,169 107,036
           

 

JOYY INC.
UNAUDITED SEGMENT REPORT
(All amounts in thousands, except share, ADS and per ADS data)
       

  Three Months Ended
  September 30, 2019
             
  YY Huya Bigo(1) Elimination(2) Total Total
  RMB RMB RMB RMB RMB US$
             
Net revenues            
Live streaming 2,899,044 2,156,106 1,418,796 - 6,473,946 905,738
Others 181,006 108,986 118,419 (143) 408,268 57,119
             
Total net revenues 3,080,050 2,265,092 1,537,215 (143) 6,882,214 962,857
             
Cost of revenues(3) (1,729,389) (1,858,772) (1,125,157) 143 (4,713,175) (659,397)
             
Gross profit  1,350,661 406,320 412,058 - 2,169,039 303,460
Operating expenses(3)            
Research and development expenses (249,620) (134,969) (288,469) - (673,058) (94,164)
Sales and marketing expenses (340,619) (122,316) (616,642) - (1,079,577) (151,038)
General and administrative expenses (225,281) (96,318) (87,235) - (408,834) (57,198)
             
Total operating expenses (815,520) (353,603) (992,346) - (2,161,469) (302,400)
             
Other income 136,535 11,148 5,035 - 152,718 21,366
             
Operating income (loss) 671,676 63,865 (575,253) - 160,288 22,426
             
Interest expenses (123,456) - (11,078) 11,078 (123,456) (17,272)
Interest income and investment income 127,068 86,539 608 (11,078) 203,137 28,420
Foreign currency exchange gains, net 2,798 645 12,950 - 16,393 2,293
Fair value change on derivative (1,753) - - - (1,753) (245)
Loss on fair value change of investments (11,492) - - - (11,492) (1,608)
             
Income (loss) before income tax expenses 664,841 151,049 (572,773) - 243,117 34,014
             
Income tax (expenses) benefits (146,835) (27,879) 88,143 - (86,571) (12,112)
        
Income (loss) before share of income (loss) in equity method investments, net of income taxes 518,006 123,170 (484,630) - 156,546 21,902
             
Share of income in equity method investments, net of income taxes 21,189 72 - - 21,261 2,975
             
Net income (loss) 539,195 123,242 (484,630) - 177,807 24,877
             

(1)  On March 4, 2019, YY completed the acquisition of Bigo. Therefore, Bigo’s financial results from March 4, 2019 to March 31, 2019 were included in YY’s consolidated financial statements.

(2)  The elimination mainly consists of revenues and expenses generated from services among YY and Huya segments, and interest income and interest expenses generated from the loan between YY and Bigo segments.

(3)  Share-based compensation was allocated in cost of revenues and operating expenses as follows:

  Three Months Ended
  September 30, 2019
   
  YYHuyaBigoTotalTotal
  RMBRMBRMBRMBUS$
       
Cost of revenues 5,0438,4977,06820,6082,883
Research and development expenses 26,84824,17278,154129,17418,072
Sales and marketing expenses 4191,468756 2,643370
General and administrative expenses 41,26548,9874,95895,21013,320

JOYY INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS OF UNAUDITED SEGMENT REPORT
 (All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended
  September 30, 2019
           
  YY Huya Bigo Total Total
  RMB RMB RMB RMB US$
           
Operating income (loss) 671,676 63,865 (575,253) 160,288 22,426
Share-based compensation expenses 73,575 83,124 90,936 247,635 34,645
Impairment of goodwill and investments 10,000 - - 10,000 1,399
Amortization of intangible assets from business acquisitions - - 193,487 193,487 27,070
           
Non-GAAP operating income (loss) 755,251 146,989 (290,830) 611,410 85,540
           
Net income (loss) 539,195 123,242 (484,630) 177,807 24,877
Share-based compensation expenses 73,575 83,124 90,936  247,635 34,645
Impairment of goodwill and investments 10,000 - - 10,000 1,399
Amortization of intangible assets from business acquisitions - - 193,487 193,487 27,070
Loss on fair value change of investments and equity investees’ investments 2,031 - - 2,031 284
Fair value change on derivative 1,753 - - 1,753 245
Interest expenses related to the convertible bonds’ amortization to face value 100,885 - - 100,885 14,114
Income tax effects on non-GAAP adjustments (188) - (39,978) (40,166) (5,619)
           
Non-GAAP net income (loss) 727,251 206,366 (240,185) 693,432 97,015
           

JOYY INC.
UNAUDITED SEGMENT REPORT
(All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended
  December 31, 2018
         
  YY Huya Total Total
  RMB RMB RMB US$
         
Net revenues        
Live streaming 2,949,636 1,441,782 4,391,418 638,705
Others 186,359 63,147 249,506 36,289
         
Total net revenues 3,135,995 1,504,929 4,640,924 674,994
         
Cost of revenues(1) (1,746,771) (1,266,292) (3,013,063) (438,232)
         
Gross profit  1,389,224 238,637 1,627,861 236,762
Operating expenses(1)        
Research and development expenses (253,408) (79,105) (332,513) (48,362)
Sales and marketing expenses (263,806) (59,883) (323,689) (47,079)
General and administrative expenses (182,726) (92,253) (274,979) (39,994)
         
Total operating expenses (699,940) (231,241) (931,181) (135,435)
      
Other income 10,800 11,124 21,924 3,189
      
Operating income 700,084 18,520 718,604 104,516
         
Interest expenses (139) - (139) (20)
Interest income and investment income 70,698 52,703 123,401 17,948
Gain on deemed disposal and disposal of investments 2,179 - 2,179 317
Foreign currency exchange losses, net (1,291) (47) (1,338)  (195)
Gain on fair value change of investments 26,138 - 26,138 3,802
      
Income before income tax expenses 797,669 71,176 868,845 126,368
      
Income tax (expenses) benefits (138,961) 31,847  (107,114) (15,579)
      
Income before share of loss in equity method investments, net of income taxes 658,708 103,023 761,731 110,789
         
Share of loss in equity method investments, net of income taxes (15,837) (3,444) (19,281) (2,804)
      
Net income 642,871 99,579 742,450 107,985
         

(1)  Share-based compensation was allocated in cost of revenues and operating expenses as follows:

  Three Months Ended
  December 31, 2018
      
  YYHuyaTotalTotal
  RMBRMBRMBUS$
      
Cost of revenues  10,988 3,66214,6502,131
Research and development expenses  38,643 11,39950,0427,278
Sales and marketing expenses  551 6071,158168
General and administrative expenses 40,582 48,32788,90912,931

JOYY INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS OF UNAUDITED SEGMENT REPORT
 (All amounts in thousands, except share, ADS and per ADS data)

  Three Months Ended
  December 31, 2018
         
  YY Huya Total Total
  RMB RMB RMB US$
         
Operating income 700,084 18,520 718,604 104,516
Share-based compensation expenses 90,764 63,995 154,759 22,508
Impairment of goodwill and investments 15,099 - 15,099 2,196
         
Non-GAAP operating income 805,947 82,515 888,462 129,220
         
Net income 642,871 99,579 742,450 107,985
Share-based compensation expenses 90,764 63,995 154,759 22,508
Impairment of goodwill and investments 15,099 - 15,099 2,196
Gain (loss) on fair value change of investments and equity investees' investments (4,422) 3,333 (1,089) (158)
Gain on deemed disposal and disposal of investments (2,179) - (2,179) (317)
Income tax effects on non-GAAP adjustments 21,479 - 21,479 3,124
         
Non-GAAP net income 763,612 166,907 930,519 135,338
         

Source: YY Inc.