DUBAI, UAE, PRNewswire/ — Yalla Group Limited (“Yalla” or the “Company”) (NYSE: YALA), the leading voice-centric social networking and entertainment platform in the Middle East and North Africa (MENA), today announced its unaudited financial results for the second quarter ended June 30, 2022.
Second Quarter 2022 Financial and Operating Highlights
Revenues were US$76.1 million in the second quarter of 2022, representing an increase of 14.2% from the second quarter of 2021.
– Revenues generated from chatting services in the second quarter of 2022 were US$52.7 million.
– Revenues generated from games services in the second quarter of 2022 were US$23.3 million.
Net income was US$20.4 million in the second quarter of 2022, compared with a net income of US$18.4 million in the second quarter of 2021.
Net margin[1] was 26.7% in the second quarter of 2022.
Non-GAAP net income[2] was US$28.6 million in the second quarter of 2022, compared with non-GAAP net income of US$32.1 million in the second quarter of 2021. Non-GAAP net margin[3] was 37.6% in the second quarter of 2022.
Average MAUs[4] increased by 35.6% to 29.9 million in the second quarter of 2022 from 22.1 million in the second quarter of 2021.
The number of paying users[5] on our platform increased by 65.3% to 10.6 million in the second quarter of 2022 from 6.4 million in the second quarter of 2021.
[1] Net margin is net income as a percentage of revenues.
[2] Non-GAAP net income represents net income excluding share-based compensation. Non-GAAP net income is a non-GAAP financial measure. See the sections entitled “Non-GAAP Financial Measures” and “Reconciliation of GAAP and Non-GAAP Results” for more information about the non-GAAP measures referred to in this press release.
[3] Non-GAAP net margin is non-GAAP net income as a percentage of revenues.
[4] “Average MAUs” refers to the average monthly active users in a given period calculated by dividing (i) the sum of active users for each month of such period, by (ii) the number of months in such period. “Active users” refers to registered users who accessed any of our main mobile applications at least once during a given period.
Yalla and Yalla Ludo have been our main mobile applications since the beginning of the periods presented herein, and Yalla Parchis has been the main mobile application of our company since the third quarter of 2021.
[5] “Paying users” refers to registered users who played a game or purchased our virtual items or upgrade services using virtual currencies on our main mobile applications at least once in a given period, except for users who receive all of their virtual currencies directly or indirectly from us for free.
“Registered users” refers to users who have registered accounts on our main mobile applications as of a given time; a registered user is not necessarily a unique user, as an individual may register multiple accounts on our main mobile applications.
“We are pleased to have achieved another solid quarter with total revenues of US$76.1 million, exceeding the top end of our guidance by 8.7% and marking another quarterly revenue record for Yalla Group despite the Ramadan holiday,” said Mr. Yang Tao, Founder, Chairman, and CEO of Yalla.
“Such strong quarterly results demonstrate our operational success in refining processes, enhancing the gamification of our flagship applications, and optimizing user acquisition.
These actions have holistically elevated our user experience, further boosting user engagement on Yalla and Yalla Ludo as well as users’ willingness to pay on our platforms, evidenced by an increase in our group’s paying users to 10.6 million, up 65.3% year-over-year.
This quarter we continued to roll out iterations for our IM product YallaChat, adding unique and innovative features catering to local users’ demands while working to deepen synergies among our products and services to build our users’ stickiness and brand loyalty.
Our casual games portfolio, including Yalla Parchis, 101 Okey Yalla, and Yalla Baloot, also performed well, with user retention and average time spent per day steadily increasing, thanks to our new VIP subscription and battle pass launched during the quarter.
Second Quarter 2022 Financial Results
Revenues
Our revenues were US$76.1 million in the second quarter of 2022, a 14.2% increase from US$66.6 million in the second quarter of 2021. The increase was primarily driven by the broadening of our user base and our enhanced monetization capability. Our average MAUs increased by 35.6%, from 22.1 million in the second quarter of 2021 to 29.9 million in the second quarter of 2022. Another primary contributor to our solid revenue growth was the significant rise in the number of paying users, which increased from 6.4 million in the second quarter of 2021 to 10.6 million in the second quarter of 2022.
In the second quarter of 2022, our revenues generated from chatting services were US$52.7 million, and revenues from games services were US$23.3 million.
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YALLA GROUP LIMITED |
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UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
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As of |
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December 31, 2021 |
June 30, 2022 |
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US$ |
US$ |
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|
ASSETS |
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Current assets |
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|
Cash and cash equivalents |
351,485,602 |
384,907,311 |
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Short-term investments |
2,906,344 |
10,717,553 |
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Prepayments and other current assets |
21,957,230 |
30,944,219 |
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|
Total current assets |
376,349,176 |
426,569,083 |
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Non-current assets |
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Property and equipment, net |
1,832,952 |
2,441,865 |
||
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Operating lease right-of-use assets |
857,474 |
1,552,952 |
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Long-term investments |
1,768,455 |
2,435,003 |
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|
Other assets |
— |
8,475,720 |
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|
Total non-current assets |
4,458,881 |
14,905,540 |
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Total assets |
380,808,057 |
441,474,623 |
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LIABILITIES |
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Current liabilities |
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Accounts payable |
4,392,330 |
4,073,353 |
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|
Deferred revenue |
24,971,203 |
31,220,516 |
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Operating lease liabilities, current |
472,734 |
761,811 |
||
|
Accrued expenses and other current liabilities |
14,896,134 |
14,124,095 |
||
|
Total current liabilities |
44,732,401 |
50,179,775 |
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|
Non-current liabilities |
||||
|
Operating lease liabilities, non-current |
195,596 |
580,474 |
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|
Amounts due to a related party |
— |
740,784 |
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Total non-current liabilities |
195,596 |
1,321,258 |
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Total liabilities |
44,927,997 |
51,501,033 |
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EQUITY |
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Shareholders’ equity of Yalla Group Limited |
||||
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Class A Ordinary Shares |
12,484 |
12,790 |
||
|
Class B Ordinary Shares |
2,473 |
2,473 |
||
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Additional paid-in capital |
265,647,268 |
282,917,483 |
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Treasury stock |
(25,419,808) |
(25,419,808) |
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Accumulated other comprehensive income (loss) |
520,010 |
(708,704) |
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Retained earnings |
95,123,951 |
133,490,271 |
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Total shareholders’ equity of Yalla Group Limited |
335,886,378 |
390,294,505 |
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Non-controlling interests |
(6,318) |
(320,915) |
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|
Total equity |
335,880,060 |
389,973,590 |
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Total liabilities and equity |
380,808,057 |
441,474,623 |
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YALLA GROUP LIMITED |
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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS |
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OF OPERATIONS |
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Three Months Ended |
Six Months Ended |
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|
June 30, 2021 |
March 31, 2022 |
June 30, 2022 |
June 30, 2021 |
June 30, 2022 |
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|
US$ |
US$ |
US$ |
US$ |
US$ |
||||||
|
Revenues |
66,620,081 |
72,337,282 |
76,090,799 |
134,269,175 |
148,428,081 |
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Costs and expenses |
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|
Cost of revenues |
(23,801,291) |
(27,527,990) |
(29,272,347) |
(47,801,763) |
(56,800,337) |
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|
Selling and marketing expenses |
(9,759,209) |
(12,526,461) |
(11,208,074) |
(18,118,613) |
(23,734,535) |
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|
General and administrative expenses |
(11,097,857) |
(8,027,870) |
(6,945,989) |
(22,811,596) |
(14,973,859) |
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|
Technology and product development expenses |
(3,167,186) |
(5,984,568) |
(7,726,715) |
(6,509,745) |
(13,711,283) |
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|
Total costs and expenses |
(47,825,543) |
(54,066,889) |
(55,153,125) |
(95,241,717) |
(109,220,014) |
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|
Operating income |
18,794,538 |
18,270,393 |
20,937,674 |
39,027,458 |
39,208,067 |
|||||
|
Interest income |
27,622 |
51,119 |
176,432 |
36,467 |
227,551 |
|||||
|
Government grants |
— |
158,685 |
1,847 |
13,809 |
160,532 |
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|
Investment income (loss) |
(61,109) |
(168,445) |
17,674 |
(58,947) |
(150,771) |
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|
Income before income taxes |
18,761,051 |
18,311,752 |
21,133,627 |
39,018,787 |
39,445,379 |
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|
Income tax expense |
(379,810) |
(613,445) |
(780,211) |
(807,782) |
(1,393,656) |
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|
Net income |
18,381,241 |
17,698,307 |
20,353,416 |
38,211,005 |
38,051,723 |
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|
Net loss attributable to non-controlling interests |
— |
78,164 |
236,433 |
— |
314,597 |
|||||
|
Net income attributable to Yalla Group |
18,381,241 |
17,776,471 |
20,589,849 |
38,211,005 |
38,366,320 |
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YALLA GROUP LIMITED |
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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS |
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OF OPERATIONS (CONTINUED) |
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Three Months Ended |
Six Months Ended |
|||||||||
|
June 30, 2021 |
March 31, 2022 |
June 30, 2022 |
June 30, 2021 |
June 30, 2022 |
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|
US$ |
US$ |
US$ |
US$ |
US$ |
||||||
|
Earnings per ordinary share |
||||||||||
|
——Basic |
0.12 |
0.12 |
0.14 |
0.26 |
0.25 |
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——Diluted |
0.10 |
0.10 |
0.12 |
0.21 |
0.22 |
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|
Weighted average number of shares |
||||||||||
|
outstanding used in computing earnings |
||||||||||
|
per ordinary share |
||||||||||
|
——Basic |
148,250,483 |
150,157,560 |
151,384,789 |
147,784,840 |
150,771,175 |
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|
——Diluted |
182,412,439 |
176,548,571 |
175,146,529 |
181,228,782 |
175,847,551 |
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|
Share-based compensation was allocated in cost of revenues, selling and marketing expenses, general and administrative expenses and |
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Three Months Ended |
Six Months Ended |
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|
June 30, 2021 |
March 31, 2022 |
June 30, 2022 |
June 30, 2021 |
June 30, 2022 |
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|
US$ |
US$ |
US$ |
US$ |
US$ |
||||||
|
Cost of revenues |
1,692,114 |
1,444,320 |
1,404,341 |
3,401,688 |
2,848,661 |
|||||
|
Selling and marketing expenses |
3,228,042 |
1,846,594 |
1,850,318 |
6,456,084 |
3,696,912 |
|||||
|
General and administrative expenses |
8,703,238 |
4,662,669 |
4,663,550 |
17,407,104 |
9,326,219 |
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|
Technology and product development expenses |
131,784 |
311,442 |
357,487 |
265,615 |
668,929 |
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YALLA GROUP LIMITED |
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RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS |
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Three Months Ended |
Six Months Ended |
|||||||||
|
June 30, 2021 |
March 31, 2022 |
June 30, 2022 |
June 30, 2021 |
June 30, 2022 |
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|
US$ |
US$ |
US$ |
US$ |
US$ |
||||||
|
Operating income |
18,794,538 |
18,270,393 |
20,937,674 |
39,027,458 |
39,208,067 |
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|
Share-based compensation expenses |
13,755,178 |
8,265,025 |
8,275,696 |
27,530,491 |
16,540,721 |
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|
Non-GAAP operating income |
32,549,716 |
26,535,418 |
29,213,370 |
66,557,949 |
55,748,788 |
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|
Net income |
18,381,241 |
17,698,307 |
20,353,416 |
38,211,005 |
38,051,723 |
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|
Share-based compensation expenses |
13,755,178 |
8,265,025 |
8,275,696 |
27,530,491 |
16,540,721 |
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|
Non-GAAP net income |
32,136,419 |
25,963,332 |
28,629,112 |
65,741,496 |
54,592,444 |
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|
Net income attributable to Yalla |
18,381,241 |
17,776,471 |
20,589,849 |
38,211,005 |
38,366,320 |
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|
Share-based compensation expenses |
13,755,178 |
8,265,025 |
8,275,696 |
27,530,491 |
16,540,721 |
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|
Non-GAAP net income attributable to |
32,136,419 |
26,041,496 |
28,865,545 |
65,741,496 |
54,907,041 |
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Non-GAAP earnings per ordinary share |
||||||||||
|
——Basic |
0.22 |
0.17 |
0.19 |
0.44 |
0.36 |
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|
——Diluted |
0.18 |
0.15 |
0.16 |
0.36 |
0.31 |
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|
Weighted average number of shares |
||||||||||
|
outstanding used in computing earnings |
||||||||||
|
per ordinary share |
||||||||||
|
——Basic |
148,250,483 |
150,157,560 |
151,384,789 |
147,784,840 |
150,771,175 |
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|
——Diluted |
182,412,439 |
176,548,571 |
175,146,529 |
181,228,782 |
175,847,551 |
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SOURCE Yalla Group Limited
