China’s Momo Inc. (Nasdaq: MOMO) declined 5% on midday Thursday as the company reported a loss of 6 million users.
The Beijing-based social networking platform said today in a statement that its revenue in the first quarter reached $507.6 million, down 3.5% year-over-year. Live video service revenues contributed $329.3 million, down 13% from one year ago due to less paying users.
Net profit for the first quarter reached $75.9 million, or 17 cents per share, up 84% from one year ago. However, the company saw a half-cut net income in comparison with the profits last quarter of $151.2 million, or 34 cents per share.
Momo said its Monthly Active Users declined to 108 million as of March by 6.4 million from one year ago. The company’s paying users were 12.8 million for the first quarter, compared to 14 million for the first quarter of 2019.
The company owns Tantan, a social and dating app designed for the younger generation. Net revenues from Tantan segment increased to $53.9 million in the first quarter, up 29% year-over-year.
Tanan also reports a paying user loss in the first quarter, dropping to 4.2 million in the first quarter from 5 million last year.
Some Chinese entertainment stocks benefited from the COVID-19 outbreak this week after they announced better-than-expected revenue growth in the first quarter. The stock in gaming and eSports player DouYu International Holdings Ltd. (Nasdaq: DOYU) skyrocketed over 18% Tuesday morning when the company announced its four-digit bottom line growth in the first quarter.
Not all stocks are lucky enough to enjoy a stock price liftoff. The stock in JOYY Inc. (Nasdaq: YY) was trading down nearly 3% Thursday afternoon despite its announcement of a 50% year-over-year increase in net revenue.
“Despite the macro headwind, we are seeing plenty of growth opportunities ahead of us. We will continue to pursue these opportunities and drive value for our shareholders,” Yan Tang, the chief executive officer of Momo, said in the statement.
Looking ahead, Momo said it expects its revenue in the second quarter to be between 3.8 billion yuan to 3.9 billion yuan($550 million), down 6% to 9% from one year ago.
Shares in Momo were trading at $20.13 per share, down 5% intraday Thursday.