Momo’s Q2 Earnings Beat Estimates, Keeps the Momentum after 5 years of Growth
China’s social networking company Momo Inc. MOMO just recently tops Fortune’s fastest-growing companies. Right after the good news, Momo prooves it by announcing its second-quarter financial report with growth.
In the Q2 report, Momo’s revenues increased 32% year over year due to the steady growth of its main revenue source : in- app-purchase items for live-streaming and other value-added services. Net revenues from Tantan, Momo’s own dating app, is reported to increase by 818.7% on a year-over-year basis.
The stock price of MOMO soon saw a boost after the report hits the market.
Founded in March 2011, Momo has now grown to a social networking platform featuring dating, gaming, and live-streaming. As of March 2019, Momo now owns 114.4 million monthly active users.
Even though MOMO beats the estimated with good growth rate, however, the market has been concerned about its performace for a while. On Apr 29, Tantan was removed from app stores in China as a punishment for inappropriate contents. It wasn’t allowed to be live again until July 14th. During the time when Tantan was mute, the app’s revenues dropped dramatically for Apple also suspended the in-app purchase services for Tantan which stops its users to auto- renew its membership.
According to consumer insights provider Measurable AI, Tantan’s revenues from in-app-purcahses were close to zero for over two months from May to July . However, on the first day it went live again on the app store, the number of paying users of Tantan soon went up quickly to almost 2/3 of where it was 2 months ago.
Surprisingly, the pressure from authorities didn’t crash Tantan and its active paying users. Most of the in-app-purchase items belong to the purchases of the VIP memberships.
Luckily, MOMO’s most revenues are still generated from its Momo service, which now owns a variety of services that can drive cash for the company. Virtual gifts in the live-streaming service in Momo’s app still primarily make the most of its revenues. According to the Q2 report, revenues from live-streaming services were $451.5 million, up 18% year over year.
Momo’s most succesful service helps the company keep the growth for the fifth year for now, however, it is also the one that make the market worried the most. If that is the only service that is helping MOMO make money. How long will it last?
About MAI Insights
Measurable AI is your data powerhouse that provides accurate, real-time and actionable consumer insights based on alternative data. By scanning and identifying billions actual online spender’s email receipts, Measurable AI transforms them into valuable consumer insights, which updates daily right after the purchases happen.
Charlie Sheng is a serial female entrepreneur, and a dedicated communicator for technology. Charlie specializes in trends and insights for the App Industry, with MAI Insights’ real-time online consumer data panel. You can reach her at [email protected]