Technology Stocks

Momo Inc (NASDAQ:MOMO) Releases Its Q3 2018 Financial Results

Chinese mobile social networking giant Momo Inc (NASDAQ:MOMO) announced its unaudited Q3 2018 financial quarter on December 5.

According to the report, the company’s net revenue for the quarter gained by 51% compared to the net revenue reported in its 2017 third quarter. Momo also revealed that its Q3 2018 net income was $85.2 million, a noteworthy increase from the $79.1 million net income that the firm reported in Q3 2017. Momo’s non-GAAP net income for the quarter was $114.3 million, thus registering a 22% year over year increment.

Momo clearly enjoyed a good quarter given the impressive growth figures. Even the number of monthly users on its platform went up from 94.4 million in September last year to 110.5 million in September 2018. The company had about 12.5 million paying users overall in Q3 2018 including 3.6 million paying users from Tantan Limited. This is a significant improvement from the 7.3 million paying users that the firm reported in Q3 2017.

Performance highlights for Q1, Q2 and Q3 combined

There was a 57% increase in Momo’s net revenues in the first nine months of this year, bringing the net revenue for the entire period to $1,465.4 million. The company’s net income for the same period was $332.8 million compared to the $221.1 million reported for the first nine months of 2017.

Momo’s non-GAAP net income$396.7 for the first nine months of 2018, a significant gain from the $258.2 million reported in the same period in the previous year. The company had a $1.57 diluted net income per ADS in the three quarters in 2018 which is slightly higher than the amount reported for the same duration in the previous year. It also reported a $1.87 non-GAAP diluted income per ADS for the same nine-month duration this year versus the $1.24 reported in the same duration in 2017.

“I am pleased that we delivered solid operational and financial results for the quarter,” stated Momo CEO, Yan Tang.

Yang also looks forward to more growth in the future because Momo has been working on product and operational improvements. The goal is to pursue long-term growth for the future.

Momo reported $442.1 million in costs and expenses in Q3 of 2018, lower than the $8.0 million costs and expenses reported in Q3 of 2017. This means that the costs and expenses have dropped by 49% year over year.

Stock performance

Momo’s stock closed the latest trading session on December 21 at 23.38 after gaining 0.17% from the value of the stock during the previous close. The stock’s current 52-week high is $54.24 while its 52-week low is $22.89. The stock price is currently not performing as well as it could judging by how close the price is to the 52-week low.

As far as the analyst ratings are concerned, Citigroup analysts downgraded the company’s stock from a “buy” rating to a “hold” rating towards the end of the first week of December. The analysts also dropped the company’s stock price target from $16 to $13. Meanwhile, Standpoint Research analysts updated their rating for Momo shares from a “Hold” rating to a “Buy” rating.

About Momo Inc.

Momo Inc. is a mobile-based firm that offers a social networking platform in China. The platform features a mobile application as well as other tools, features, services, and functionalities offered to its clients. Its mobile app allows users to create social relationships with people based on interests and location. It provides a whole new way of discovering people especially those nearby. The app is available on iOS, Android and Windows.

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