YY Inc. (NASDAQ: YY) (“YY” or “the Company”), a leading live
streaming social media platform in China, today announced its
unaudited financial results for the second quarter of 2018.
Second Quarter 2018
Highlights
- Net revenues increased by 44.6% to RMB3,773.2 million (US$570.2
million) from RMB2,609.0 million in the corresponding period of
2017.
- Non-GAAP net income attributable to YY1 increased by 51.6% to
RMB873.2 million (US$132.0 million) from RMB576.2 million in the
corresponding period of 2017.
“Our strong performance in the second quarter of
2018 once again demonstrated our robust growth momentum in both YY
Live and Huya,” stated Mr. David Xueling Li, Chairman and acting
Chief Executive Officer of YY. “Our mobile live streaming monthly
active users (MAU) increased by 21.3% year over year to 80.2
million, and our total live streaming paying users increased by
21.1% year over year to 6.9 million. During the quarter, we
achieved solid progress in traffic acquisition, product
advancement, and technology enhancement. We have devised an
innovative way to attract traffic to our own ecosystem by promoting
our top hosts across various short-form video platforms. We
advanced our products further by rolling out two new games into
Host Battalion features to enhance user engagement and strengthen
the interaction between hosts and users. Meanwhile, we have
implemented an AI-based content recommendation technology to
accurately and efficiently identify and match live streaming
content with user preferences. Looking forward, we remain committed
to continuous product innovation and technology advancement to
uphold YY’s market leadership in the live streaming industry.”
Mr. Bing Jin, Chief Financial Officer of YY,
further commented, “We are pleased to deliver another quarter with
strong financial results. During the second quarter, our total net
revenues increased by 44.6% year over year to RMB3,773.2 million,
exceeding the high end of our previous guidance range. Our total
revenue growth was mainly driven by the robust growth of our live
streaming revenues, which increased by 50.0% year over year to
RMB3,559.7 million. In addition, our non-GAAP net income
attributable to YY increased by 51.6% year over year to RMB873.2
million in the second quarter of 2018. Looking ahead, we will
continue to bring more innovations and offer more engaging services
to users to further grow our market share.”
Second Quarter 2018 Financial Results
NET REVENUES Net revenues
increased by 44.6% to RMB3,773.2 million (US$570.2 million) in the
second quarter of 2018 from RMB2,609.0 million in the corresponding
period of 2017, primarily driven by an increase in live streaming
revenues. Live streaming revenues increased by 50.0% to RMB3,559.7
million (US$538.0 million) in the second quarter of 2018 from
RMB2,373.4 million in the corresponding period of 2017.
Other revenues2 decreased by 9.4% to RMB213.6
million (US$32.3 million) in the second quarter of 2018 from
RMB235.6 million in the corresponding period of 2017.
COST OF REVENUES AND GROSS
PROFIT Cost of revenues increased by 48.0% to RMB2,313.8
million (US$349.7 million) in the second quarter of 2018 from
RMB1,563.4 million in the corresponding period of 2017, primarily
attributable to an increase in revenue-sharing fees and content
costs to RMB1,882.6 million (US$284.5 million) in the second
quarter of 2018 from RMB1,259.0 million in the corresponding period
of 2017. The increase in revenue-sharing fees and content costs
paid to performers, guilds, and content providers was in line with
the increase in live streaming revenues. In addition, bandwidth
costs increased to RMB246.0 million (US$37.2 million) in the second
quarter of 2018 from RMB165.3 million in the corresponding period
of 2017, primarily reflecting continued user base expansion and
live streaming quality improvements.
Gross profit increased by 39.6% to RMB1,459.5
million (US$220.6 million) in the second quarter of 2018 from
RMB1,045.5 million in the corresponding period of 2017. Gross
margin was 38.7% in the second quarter of 2018 compared to 40.1% in
the corresponding period of 2017, primarily due to the increase in
revenue-sharing fees and content costs.
OPERATING INCOMEOperating
expenses were RMB779.6 million (US$117.8 million) in the second
quarter of 2018 compared to RMB476.3 million in the corresponding
period of 2017.
Operating income increased by 19.1% to RMB713.8
million (US$107.9 million) in the second quarter of 2018 from
RMB599.4 million in the corresponding period of 2017. Operating
margin was 18.9% in the second quarter of 2018 compared to 23.0% in
the corresponding period of 2017, primarily due to the increase in
share-based compensation.
Non-GAAP operating income3 increased by 45.5% to
RMB933.1 million (US$141.0 million) in the second quarter of 2018
from RMB641.5 million in the corresponding period of 2017. Non-GAAP
operating margin4 was 24.7% in the second quarter of 2018 compared
to 24.6% in the corresponding period of 2017.
NET INCOME/LOSSNet loss
attributable to YY Inc. was RMB136.9 million (US$20.7 million) in
the second quarter of 2018 compared to a net income attributable to
YY Inc. of RMB573.7 million in the corresponding period of 2017.
Net loss attributable to YY Inc. in the second quarter of 2018
includes a non-recurring and non-cash item of RMB2,273.4 million
(US$343.6 million) in fair value loss on derivative liabilities5,
which resulted from the preferred shares of HUYA Inc. that existed
before its IPO and the increase in HUYA Inc.’s enterprise value as
indicated by the price of its initial public offering. Net loss
attributable to YY Inc. in the second quarter of 2018 is partially
offset by RMB1,205.0 million (US$182.1 million) of fair value
change of investments6. The income tax expense in the second
quarter of 2018 was significantly impacted by (i) non-recurring
fair value loss on derivative liabilities which was non-deductible
for income tax purpose, and (ii) gain on fair value change of Bigo
Inc. which was non-taxable for income tax purpose.
Non-GAAP net income attributable to YY Inc.
increased by 51.6% to RMB873.2 million (US$132.0million) from
RMB576.2 million in the corresponding period of 2017. Non-GAAP net
margin7 expanded to 23.1% in the second quarter of 2018 compared to
22.1% in the corresponding period of 2017.
NET INCOME PER ADSDiluted net
loss per ADS8 was RMB2.14 (US$0.32) in the second quarter of 2018
compared to diluted net income per ADS RMB9.98 in the corresponding
period of 2017.
Non-GAAP diluted net income per ADS9 increased
by 34.3% to RMB13.46 (US$2.03) in the second quarter of 2018 from
RMB10.02 in the corresponding period of 2017.
BALANCE SHEET AND CASH FLOWS As
of June 30, 2018, the Company had cash and cash equivalents of
RMB3,562.3 million (US$538.4 million) and short-term deposits of
RMB9,503.5 million (US$1,436.2 million). For the second quarter of
2018, net cash from operating activities was RMB738.3 million
(US$111.6 million).
SHARES OUTSTANDING As of June
30, 2018, the Company had a total of 1,265.4 million common shares,
or the equivalent of 63.3 million ADSs, outstanding.
Business OutlookFor the third
quarter of 2018, the Company expects net revenues to be between
RMB3.89 billion and RMB4.02 billion, representing a year-over-year
growth of 25.8% to 30.0%. This forecast reflects the Company's
current and preliminary views on the market and operational
conditions, which are subject to change.
Conference Call InformationThe
Company will hold a conference call on Monday, August 13, 2018, at
9:00 pm Eastern Time or Tuesday, August 14, 2018, at 9:00 am
Beijing Time to discuss the financial results. Participants may
access the call by dialing the following numbers:
United States:
+1-845-675-0438International:
+65-6713-5440China
Domestic:
400-1200-654Hong
Kong:
+852-3018-6776Conference
ID:
#7888877
The replay will be accessible through August 21,
2018, by dialing the following numbers:
United States:
+1-646-254-3697International:
+61-2-9003-4211Conference
ID:
#7888877
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 RateThis 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 RMB6.6171 to US$1.00,
the noon buying rate in effect on June 29, 2018 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 YY Inc.YY Inc. (“YY” or
the “Company”) is a leading live streaming social media platform in
China. 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. YY enables users to interact
with each other in real time through online live media and offers
users a uniquely engaging and immersive entertainment experience.
YY Inc. was listed on the NASDAQ in November 2012.
Safe Harbor StatementThis
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 YY's strategic and operational plans,
contain forward-looking statements. YY 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
third parties. Statements that are not historical facts, including
statements about YY’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: YY’s goals
and strategies; YY'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; YY’s ability to monetize the user base;
fluctuations in general economic and business conditions in China
and assumptions underlying or related to any of the foregoing.
Further information regarding these and other risks is included in
YY’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 YY does not undertake any obligation to update any
forward-looking statement, except as required under applicable
law.
Use of Non-GAAP Financial
MeasuresThe unaudited condensed consolidated financial
information is prepared in conformity with accounting principles
generally accepted in the United States of America (“U.S. GAAP”).
YY uses non-GAAP operating income, non-GAAP operating margin,
non-GAAP net income attributable to YY Inc.,
non-GAAP net margin, 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, and gain on
deconsolidation and disposal of subsidiary. 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, gain
on deconsolidation and disposal of subsidiary, gain on deemed
disposal and disposal of investments, gain on fair value change of
investments and equity investees’ investments, fair value loss on
derivative liabilities, and income tax effects of above non-GAAP
reconciling items. Non-GAAP net income attributable to YY Inc. is
net income attributable to YY Inc. excluding share-based
compensation expenses, impairment of goodwill and investments, gain
on deconsolidation and disposal of subsidiary, gain on deemed
disposal and disposal of investments, gain on fair value change of
investments and equity investees’ investments, fair value loss on
derivative liabilities, deemed dividend to subsidiary’s Series A
preferred shareholders and income tax effects of above non-GAAP
reconciling items and adjustment for non-GAAP reconciling items for
the income attributable to non-controlling interests. Non-GAAP net
margin is non-GAAP net income attributable to YY Inc. as a
percentage of net revenues. Basic and diluted non-GAAP net income
per ADS is non-GAAP net income attributable to YY 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, which have been and will
continue to be significant recurring expenses in its business, (ii)
impairment of goodwill and investments, gain on deconsolidation and
disposal of subsidiary, gain on deemed disposal and disposal of
investments, gain on fair value change of investments and equity
investees’ investments, fair value loss on derivative liabilities,
and deemed dividend to subsidiary’s Series A preferred
shareholders, which may not be recurring in its business, and (iii)
income tax expenses and non-GAAP adjustments for net income (loss)
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 “YY
Inc. Reconciliations of GAAP and Non-GAAP Results” near the end of
this release.
Investor Relations ContactYY
Inc.Matthew ZhaoTel: +86 (20) 8212-0000Email: IR@YY.com
ICR, Inc. Jack WangTel: +1 (646) 915-1611Email:
IR@YY.com
______________________
1 Non-GAAP net income attributable to YY Inc. is
a non-GAAP financial measure, which is defined as net income
attributable to YY Inc. excluding share-based compensation
expenses, impairment of goodwill and investment, gain on
deconsolidation and disposal of subsidiary, gain on deemed disposal
and disposal of investments (deemed disposal refers to dilution of
equity interest in equity-method investments), gain on fair value
change of investments and equity investees’ investments, fair value
loss on derivative liabilities, deemed dividend to subsidiary’s
Series A preferred shareholders, income tax effects on non-GAAP
adjustment and non-GAAP adjustment for net (loss) income
attributable to non-controlling interests shareholders. These
adjustments amounted to RMB1,010.1 million (US152.7 million) and
RMB2.5 million in the second quarter of 2018 and 2017 respectively.
Please refer to the section titled “Reconciliation of GAAP and
Non-GAAP Results” for details.
2 Starting from the first quarter of 2018, the
Company re-classified its revenues from online games, revenues from
memberships, and other revenues (which mainly represent revenues
from the Company’s online advertising revenues) to the category
“other revenues” in order to better reflect the Company’s continued
strategic shift towards its live streaming business.
3 Non-GAAP operating income is a non-GAAP
financial measure, which is defined as operating income excluding
share-based compensation expenses, impairment of goodwill and
investments and gain on deconsolidation and disposal of a
subsidiary. Please refer to the section titled "Reconciliation of
GAAP and Non-GAAP Results" for details.
4 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.
5 Following the completion of the Series B
financing of the Company's subsidiary, HUYA Inc. on March 8, 2018,
the conversion features of the Series B-2 and Series A Preferred
Shares were accounted for derivative liabilities and were measured
at fair value. The derivative liabilities were transferred to
shareholders' equity upon the completion of HUYA Inc.'s IPO as all
preferred shares were converted into ordinary shares of HUYA Inc.
upon completion of the IPO.
6 Following the adoption of ASU 2016-01 on
January 1, 2018, the Company measures long-term investments other
than equity method investments at fair value through earnings. For
those investments without readily determinable fair values, the
Company elects to record these investments at cost, less
impairment, and plus or minus subsequent adjustments for observable
price changes. In the second quarter of 2018, the Company
recognised RMB1,205 million (US$182.1 million) of gain on fair
value change on investments (primarily from the gain on fair value
change of Bigo Inc).
7 Non-GAAP net margin is non-GAAP net income
attributable to YY Inc. as a percentage of net revenues.
8 ADS is American Depositary Share. Each
ADS represents twenty Class A common shares of the Company. Diluted
net income per ADS is net income attributable to YY Inc. divided by
weighted average number of diluted ADS.
9 Non-GAAP diluted net income per ADS is a
non-GAAP financial measure, which is defined as non-GAAP net income
attributable to YY Inc. divided by weighted average number of ADS
used in the calculation of diluted net income per ADS. Please refer
to the section titled "Reconciliation of GAAP and Non-GAAP Results"
for details.
|
|
|
|
|
|
|
YY
INC. UNAUDITED
CONDENSED CONSOLIDATED BALANCE
SHEETS(All amounts in thousands, except share, ADS and per
ADS data) |
|
|
|
|
|
|
|
|
|
December 31,2017 |
|
June30,2018 |
|
June30,2018 |
|
|
RMB |
|
RMB |
|
US$ |
Assets |
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
Cash and
cash equivalents |
|
2,617,432 |
|
3,562,329 |
|
538,352 |
Short-term deposits |
|
6,000,104 |
|
9,503,518 |
|
1,436,206 |
Restricted short-term deposits |
|
1,000,000 |
|
727,995 |
|
110,017 |
Short-term investments |
|
124,550 |
|
686,840 |
|
103,798 |
Accounts
receivable, net |
|
153,944 |
|
188,389 |
|
28,470 |
Inventory |
|
315 |
|
269 |
|
41 |
Amount
due from related parties |
|
11,190 |
|
20,427 |
|
3,087 |
Prepayments and other current assets |
|
221,939 |
|
625,729 |
|
94,564 |
|
|
|
|
|
|
|
Total current
assets |
|
10,129,474 |
|
15,315,496 |
|
2,314,535 |
|
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
|
Deferred
tax assets |
|
113,017 |
|
109,019 |
|
16,475 |
Investments |
|
1,153,019 |
|
4,218,457 |
|
637,508 |
Property
and equipment, net |
|
1,016,998 |
|
1,145,356 |
|
173,090 |
Land use
rights, net |
|
1,832,739 |
|
1,808,687 |
|
273,335 |
Intangible assets, net |
|
37,481 |
|
61,580 |
|
9,306 |
Goodwill |
|
11,716 |
|
11,728 |
|
1,772 |
Amount
due from related parties |
|
20,000 |
|
- |
|
- |
Other
non-current assets |
|
144,275 |
|
166,652 |
|
25,185 |
|
|
|
|
|
|
|
Total
non-current assets |
|
4,329,245 |
|
7,521,479 |
|
1,136,671 |
|
|
|
|
|
|
|
Total
assets |
|
14,458,719 |
|
22,836,975 |
|
3,451,206 |
|
|
|
|
|
|
|
Liabilities
,mezzanine equity and shareholders’ equity |
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Convertible bonds |
|
- |
|
6,618 |
|
1,000 |
Accounts
payable |
|
76,351 |
|
85,346 |
|
12,898 |
Deferred
revenue |
|
758,044 |
|
692,025 |
|
104,581 |
Advances
from customers |
|
80,406 |
|
95,311 |
|
14,404 |
Income
taxes payable |
|
146,298 |
|
182,692 |
|
27,609 |
Accrued
liabilities and other current liabilities |
|
1,465,963 |
|
1,622,057 |
|
245,131 |
Amounts
due to related parties |
|
30,502 |
|
24,253 |
|
3,665 |
Short-term loan |
|
588,235 |
|
713,435 |
|
107,817 |
|
|
|
|
|
|
|
Total current
liabilities |
|
3,145,799 |
|
3,421,737 |
|
517,105 |
|
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
|
Convertible bonds |
|
6,536 |
|
- |
|
- |
Deferred
revenue |
|
57,718 |
|
69,272 |
|
10,469 |
Deferred
tax liabilities |
|
10,810 |
|
68,991 |
|
10,426 |
|
|
|
|
|
|
|
Total
non-current liabilities |
|
75,064 |
|
138,263 |
|
20,895 |
|
|
|
|
|
|
|
Total
liabilities |
|
3,220,863 |
|
3,560,000 |
|
538,000 |
|
|
|
|
|
|
|
|
YY INC.UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS (CONTINUED)(All amounts in
thousands, except share, ADS and per ADS data) |
|
|
|
|
|
|
|
|
|
December31,2017 |
|
June 30,2018 |
|
June 30,2018 |
|
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
Mezzanine
equity |
|
524,997 |
|
- |
|
- |
|
|
|
|
|
|
|
Shareholders’
equity |
|
|
|
|
|
|
Class A common shares
(US$0.00001 par value; 10,000,000,000 and 10,000,000,000 shares
authorized, 945,245,908 and 977,240,648 shares issued and
outstanding as of December 31, 2017 and June 30, 2018,
respectively) |
|
57 |
|
59 |
|
9 |
Class B common shares
(US$0.00001 par value; 1,000,000,000 and 1,000,000,000 shares
authorized, 317,982,976 and 288,182,976 shares issued and
outstanding as of December 31, 2017 and June 30, 2018,
respectively) |
|
23 |
|
21 |
|
3 |
Additional paid-in
capital |
|
5,339,844 |
|
10,852,697 |
|
1,640,099 |
Statutory reserves |
|
62,718 |
|
62,718 |
|
9,478 |
Retained
earnings(1) |
|
5,218,110 |
|
5,613,163 |
|
848,281 |
Accumulated other
comprehensive (loss) income(1) |
|
(9,597) |
|
70,206 |
|
10,610 |
|
|
|
|
|
|
|
Total YY Inc.’s
shareholders’ equity |
|
10,611,155 |
|
16,598,864 |
|
2,508,480 |
|
|
|
|
|
|
|
Non-controlling
interests |
|
101,704 |
|
2,678,111 |
|
404,726 |
|
|
|
|
|
|
|
Total
shareholders’ equity |
|
10,712,859 |
|
19,276,975 |
|
2,913,206 |
|
|
|
|
|
|
|
Total
liabilities, mezzanine equity and |
|
|
|
|
|
|
shareholders’ equity |
|
14,458,719 |
|
22,836,975 |
|
3,451,206 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) On January 1, 2018, the Company adopted ASU
2016-1, “Classification and Measurement of Financial Instruments”.
After the adoption of this new guidance, the Company measures
long-term investments other than equity method investments at fair
value through earnings. For those investments without readily
determinable fair values, the Company elects to record these
investments at cost, less impairment, and plus or minus subsequent
adjustments for observable price changes. Changes in the basis of
these investments are reported in current earnings. Following the
adoption of this guidance, accumulated fair value gain, amounting
to RMB87.8 million, was reclassified from accumulated other
comprehensive loss to retained earnings as of January 1, 2018.
|
YY INC.UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS(All amounts in
thousands, except share, ADS and per ADS data) |
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30,2017 |
|
March
31,2018 |
|
June 30,2018 |
|
June 30,2018 |
|
June30,2017 |
|
June30,2018 |
|
June30,2018 |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
Net
revenues(1) |
|
|
|
|
|
|
|
|
|
Live streaming |
|
2,373,397 |
|
3,032,035 |
|
3,559,666 |
|
537,950 |
|
4,430,824 |
|
6,591,701 |
|
996,162 |
Others |
|
235,594 |
|
216,896 |
|
213,564 |
|
32,275 |
|
445,125 |
|
430,460 |
|
65,053 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net
revenues |
|
2,608,991 |
|
3,248,931 |
|
3,773,230 |
|
570,225 |
|
4,875,949 |
|
7,022,161 |
|
1,061,215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues(2) |
|
(1,563,445) |
|
(2,015,797) |
|
(2,313,772) |
|
(349,666) |
|
(2,940,440) |
|
(4,329,569) |
|
(654,300) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
1,045,546 |
|
1,233,134 |
|
1,459,458 |
|
220,559 |
|
1,935,509 |
|
2,692,592 |
|
406,915 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development expenses |
|
(167,359) |
|
(249,465) |
|
(295,946) |
|
(44,724) |
|
(332,920) |
|
(545,411) |
|
(82,424) |
Sales and marketing
expenses |
|
(204,434) |
|
(235,658) |
|
(246,130) |
|
(37,196) |
|
(293,036) |
|
(481,788) |
|
(72,810) |
General and
administrative expenses |
|
(104,545) |
|
(163,976) |
|
(237,532) |
|
(35,897) |
|
(181,197) |
|
(401,508) |
|
(60,677) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses |
|
(476,338) |
|
(649,099) |
|
(779,608) |
|
(117,817) |
|
(807,153) |
|
(1,428,707) |
|
(215,911) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on deconsolidation
and disposal of subsidiaries |
|
- |
|
- |
|
- |
|
- |
|
37,989 |
|
- |
|
- |
Other income |
|
30,166 |
|
12,374 |
|
33,922 |
|
5,126 |
|
49,986 |
|
46,296 |
|
6,996 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
599,374 |
|
596,409 |
|
713,772 |
|
107,868 |
|
1,216,331 |
|
1,310,181 |
|
198,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expenses |
|
(3,459) |
|
(2,019) |
|
(1,548) |
|
(234) |
|
(24,727) |
|
(3,567) |
|
(539) |
Interest income and
investment income |
|
27,317 |
|
92,191 |
|
128,850 |
|
19,472 |
|
58,348 |
|
221,041 |
|
33,405 |
Foreign currency
exchange (losses) gains, net |
|
(281) |
|
6,719 |
|
(2,823) |
|
(427) |
|
(1,574) |
|
3,896 |
|
589 |
Gain on deemed disposal
and disposal of investments |
|
45,861 |
|
- |
|
13,999 |
|
2,116 |
|
45,861 |
|
13,999 |
|
2,116 |
Gain on fair value
change of investments |
|
- |
|
426,547 |
|
1,205,049 |
|
182,111 |
|
- |
|
1,631,596 |
|
246,573 |
Fair value loss on
derivative liabilities |
|
- |
|
(11,868) |
|
(2,273,355) |
|
(343,558) |
|
- |
|
(2,285,223) |
|
(345,351) |
Other non-operating
expenses |
|
- |
|
- |
|
(2,000) |
|
(302) |
|
- |
|
(2,000) |
|
(302) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income tax expenses |
|
668,812 |
|
1,107,979 |
|
(218,056) |
|
(32,954) |
|
1,294,239 |
|
889,923 |
|
134,491 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expenses |
|
(100,531) |
|
(148,245) |
|
(147,419) |
|
(22,278) |
|
(189,604) |
|
(295,664) |
|
(44,682) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before share of income in equity method investments, net of income
taxes |
|
568,281 |
|
959,734 |
|
(365,475) |
|
(55,232) |
|
1,104,635 |
|
594,259 |
|
89,809 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of income in
equity method investments, net of income taxes |
|
4,726 |
|
9,179 |
|
88,992 |
|
13,449 |
|
8,661 |
|
98,171 |
|
14,836 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
(loss) |
|
573,007 |
|
968,913 |
|
(276,483) |
|
(41,783) |
|
1,113,296 |
|
692,430 |
|
104,645 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net (loss) income
attributable to the non-controlling interest shareholders and the
mezzanine classified non-controlling interest shareholders |
|
(701) |
|
35,491 |
|
(139,596) |
|
(21,096) |
|
(3,566) |
|
(104,105) |
|
(15,733) |
Deemed
dividend to subsidiary’s Series A preferred shareholders |
|
- |
|
489,284 |
|
- |
|
- |
|
- |
|
489,284 |
|
73,942 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) attributable to YY Inc. |
|
573,708 |
|
444,138 |
|
(136,887) |
|
(20,687) |
|
1,116,862 |
|
307,251 |
|
46,436 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YY INC.UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)(All
amounts in thousands, except share, ADS and per ADS data) |
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30,2017 |
|
March31,2018 |
|
June 30,2018 |
|
June 30,2018 |
|
June 30,2017 |
|
June 30,2018 |
|
June30,2018 |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per ADS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—Basic |
|
10.09 |
|
6.97 |
|
(2.14) |
|
(0.32) |
|
19.68 |
|
4.82 |
|
0.73 |
—Diluted |
|
9.98 |
|
6.86 |
|
(2.14) |
|
(0.32) |
|
19.21 |
|
4.75 |
|
0.72 |
Weighted average number
of ADS usedin calculating net income (loss) per ADS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—Basic |
|
56,832,278 |
|
63,694,535 |
|
63,839,293 |
|
63,839,293 |
|
56,757,452 |
|
63,780,159 |
|
63,780,159 |
—Diluted |
|
57,488,989 |
|
64,713,421 |
|
63,839,293 |
|
63,839,293 |
|
59,234,872 |
|
64,712,271 |
|
64,712,271 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) On January 1, 2018, the Company adopted ASC
606, "Revenue from Contracts with Customers" using the modified
retrospective method applied to those contracts which were not
completed as of January 1, 2018. Based on the Company’s assessment,
the adoption of ASC 606 did not have any material impact on the
Company’s consolidated financial statements.
(2) Share-based compensation was allocated in cost of revenues
and operating expenses as follows:
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30,2017 |
|
March 31,2018 |
|
June 30,2018 |
|
June
30,2018 |
|
June 30,2017 |
|
June
30,2018 |
|
June
30,2018 |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
3,021 |
|
19,608 |
|
24,059 |
|
3,636 |
|
6,644 |
|
43,667 |
|
6,599 |
Research and
development expenses |
|
10,492 |
|
54,467 |
|
67,912 |
|
10,263 |
|
21,896 |
|
122,379 |
|
18,494 |
Sales and marketing
expenses |
|
303 |
|
1,869 |
|
2,406 |
|
364 |
|
812 |
|
4,275 |
|
646 |
General and
administrative expenses |
|
9,649 |
|
36,563 |
|
124,978 |
|
18,887 |
|
16,706 |
|
161,541 |
|
24,413 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YY INC.RECONCILIATION OF GAAP
AND NON-GAAP RESULTS(All amounts in thousands, except
share, ADS and per ADS data) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, 2017 |
|
March 31, 2018 |
|
June 30, 2018 |
|
June 30, 2018 |
|
June 30, 2017 |
|
June 30, 2018 |
|
June 30, 2018 |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
599,374 |
|
|
596,409 |
|
|
713,772 |
|
|
107,868 |
|
|
1,216,331 |
|
|
1,310,181 |
|
|
198,000 |
|
Share-based compensation expenses |
|
23,465 |
|
|
112,507 |
|
|
219,355 |
|
|
33,150 |
|
|
46,058 |
|
|
331,862 |
|
|
50,152 |
|
Impairment of goodwill and investments |
|
18,634 |
|
|
18,349 |
|
|
- |
|
|
- |
|
|
20,334 |
|
|
18,349 |
|
|
2,773 |
|
Gain on
deconsolidation and disposal of a subsidiary |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(37,989 |
) |
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating income |
|
641,473 |
|
|
727,265 |
|
|
933,127 |
|
|
141,018 |
|
|
1,244,734 |
|
|
1,660,392 |
|
|
250,925 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) |
|
573,007 |
|
|
968,913 |
|
|
(276,483 |
) |
|
(41,783 |
) |
|
1,113,296 |
|
|
692,430 |
|
|
104,645 |
|
Share-based compensation expenses |
|
23,465 |
|
|
112,507 |
|
|
219,355 |
|
|
33,150 |
|
|
46,058 |
|
|
331,862 |
|
|
50,152 |
|
Impairment of goodwill and investments |
|
18,634 |
|
|
18,349 |
|
|
- |
|
|
- |
|
|
20,334 |
|
|
18,349 |
|
|
2,773 |
|
Gain on
deconsolidation and disposal of a subsidiary |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(37,989 |
) |
|
- |
|
|
- |
|
Gain on
deemed disposal and disposal of investments |
|
(45,861 |
) |
|
- |
|
|
(13,999 |
) |
|
(2,116 |
) |
|
(45,861 |
) |
|
(13,999 |
) |
|
(2,116 |
) |
Gain on
fair value change of investments and equity investees’
investments |
|
- |
|
|
(426,547 |
) |
|
(1,287,301 |
) |
|
(194,541 |
) |
|
- |
|
|
(1,713,848 |
) |
|
(259,003 |
) |
Fair
value loss on derivative liabilities |
|
- |
|
|
11,868 |
|
|
2,273,355 |
|
|
343,558 |
|
|
- |
|
|
2,285,223 |
|
|
345,351 |
|
Income
tax effects on non-GAAP adjustments |
|
6,820 |
|
|
44,466 |
|
|
30,601 |
|
|
4,625 |
|
|
12,264 |
|
|
75,067 |
|
|
11,344 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income |
|
576,065 |
|
|
729,556 |
|
|
945,528 |
|
|
142,893 |
|
|
1,108,102 |
|
|
1,675,084 |
|
|
253,146 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) attributable to YY Inc. |
|
573,708 |
|
|
444,138 |
|
|
(136,887 |
) |
|
(20,687 |
) |
|
1,116,862 |
|
|
307,251 |
|
|
46,436 |
|
Share-based compensation expenses |
|
23,465 |
|
|
112,507 |
|
|
219,355 |
|
|
33,150 |
|
|
46,058 |
|
|
331,862 |
|
|
50,152 |
|
Impairment of goodwill and investments |
|
18,634 |
|
|
18,349 |
|
|
- |
|
|
- |
|
|
20,334 |
|
|
18,349 |
|
|
2,773 |
|
Gain on
deconsolidation and disposal of a subsidiary |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(37,989 |
) |
|
- |
|
|
- |
|
Gain on
deemed disposal and disposal of investments |
|
(45,861 |
) |
|
- |
|
|
(13,999 |
) |
|
(2,116 |
) |
|
(45,861 |
) |
|
(13,999 |
) |
|
(2,116 |
) |
Gain on
fair value change of investments and equity investees’
investments |
|
- |
|
|
(426,547 |
) |
|
(1,287,301 |
) |
|
(194,541 |
) |
|
- |
|
|
(1,713,848 |
) |
|
(259,003 |
) |
Fair
value loss on derivative liabilities |
|
- |
|
|
11,868 |
|
|
2,273,355 |
|
|
343,558 |
|
|
- |
|
|
2,285,223 |
|
|
345,351 |
|
Deemed
dividend to subsidiary's Series A preferred shareholders |
|
- |
|
|
489,284 |
|
|
- |
|
|
- |
|
|
- |
|
|
489,284 |
|
|
73,942 |
|
Income
tax effects on non-GAAP adjustments |
|
6,820 |
|
|
44,466 |
|
|
30,601 |
|
|
4,625 |
|
|
12,264 |
|
|
75,067 |
|
|
11,344 |
|
Non-GAAP
adjustments for net (loss) income attributable to the
non-controlling interest shareholders |
|
(561 |
) |
|
5,820 |
|
|
(211,884 |
) |
|
(32,021 |
) |
|
(1,594 |
) |
|
(206,064 |
) |
|
(31,141 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income attributable to YY Inc. |
|
576,205 |
|
|
699,885 |
|
|
873,240 |
|
|
131,968 |
|
|
1,110,074 |
|
|
1,573,125 |
|
|
237,738 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income per ADS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—Basic |
|
10.14 |
|
|
10.99 |
|
|
13.68 |
|
|
2.07 |
|
|
19.56 |
|
|
24.66 |
|
|
3.73 |
|
—Diluted |
|
10.02 |
|
|
10.78 |
|
|
13.46 |
|
|
2.03 |
|
|
19.09 |
|
|
24.24 |
|
|
3.66 |
|
Weighted
average number of ADS used in calculating Non-GAAP net income per
ADS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—Basic |
|
56,832,278 |
|
|
63,694,535 |
|
|
63,839,293 |
|
|
63,839,293 |
|
|
56,757,452 |
|
|
63,780,159 |
|
|
63,780,159 |
|
—Diluted |
|
57,488,989 |
|
|
64,713,421 |
|
|
64,701,643 |
|
|
64,701,643 |
|
|
59,234,872 |
|
|
64,721,304 |
|
|
64,721,304 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YY INC.UNAUDITED
SEGMENT REPORT(All amounts in thousands, except share, ADS
and per ADS data) |
|
|
|
Three Months Ended |
|
|
June 30,
2018 |
|
|
|
|
|
|
|
|
|
YY Live |
|
Huya |
|
Elimination(1) |
|
Total |
|
Total |
|
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live
streaming |
|
2,567,854 |
|
|
991,812 |
|
|
- |
|
|
3,559,666 |
|
|
537,950 |
|
Others |
|
167,044 |
|
|
46,520 |
|
|
- |
|
|
213,564 |
|
|
32,275 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net revenues |
|
2,734,898 |
|
|
1,038,332 |
|
|
- |
|
|
3,773,230 |
|
|
570,225 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of revenues(2) |
|
(1,441,807 |
) |
|
(871,965 |
) |
|
- |
|
|
(2,313,772 |
) |
|
(349,666 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
1,293,091 |
|
|
166,367 |
|
|
- |
|
|
1,459,458 |
|
|
220,559 |
|
Operating expenses(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development expenses |
|
(235,982 |
) |
|
(59,964 |
) |
|
- |
|
|
(295,946 |
) |
|
(44,724 |
) |
Sales
and marketing expenses |
|
(204,448 |
) |
|
(41,682 |
) |
|
- |
|
|
(246,130 |
) |
|
(37,196 |
) |
General and administrative expenses |
|
(149,059 |
) |
|
(88,473 |
) |
|
- |
|
|
(237,532 |
) |
|
(35,897 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
(589,489 |
) |
|
(190,119 |
) |
|
- |
|
|
(779,608 |
) |
|
(117,817 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income |
|
27,463 |
|
|
6,459 |
|
|
- |
|
|
33,922 |
|
|
5,126 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
731,065 |
|
|
(17,293 |
) |
|
- |
|
|
713,772 |
|
|
107,868 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expenses |
|
(1,548 |
) |
|
- |
|
|
- |
|
|
(1,548 |
) |
|
(234 |
) |
Interest income and investment income |
|
86,406 |
|
|
42,444 |
|
|
- |
|
|
128,850 |
|
|
19,472 |
|
Foreign currency exchange losses, net |
|
(2,823 |
) |
|
- |
|
|
- |
|
|
(2,823 |
) |
|
(427 |
) |
Gain
on deemed disposal and disposal of investments |
|
13,999 |
|
|
- |
|
|
- |
|
|
13,999 |
|
|
2,116 |
|
Gain
on fair value change of investments |
|
1,003,050 |
|
|
- |
|
|
201,999 |
|
|
1,205,049 |
|
|
182,111 |
|
Fair
value loss on derivative liabilities |
|
- |
|
|
(2,273,355 |
) |
|
- |
|
|
(2,273,355 |
) |
|
(343,558 |
) |
Other
non-operating expenses |
|
(2,000 |
) |
|
- |
|
|
- |
|
|
(2,000 |
) |
|
(302 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income tax expenses |
|
1,828,149 |
|
|
(2,248,204 |
) |
|
201,999 |
|
|
(218,056 |
) |
|
(32,954 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax (expenses) benefits |
|
(126,522 |
) |
|
6,070 |
|
|
(26,967 |
) |
|
(147,419 |
) |
|
(22,278 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before share of
income in equity method investments, net
of income taxes |
|
1,701,627 |
|
|
(2,242,134 |
) |
|
175,032 |
|
|
(365,475 |
) |
|
(55,232 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
of income in equity method investments, net of income taxes |
|
147,337 |
|
|
116,687 |
|
|
(175,032 |
) |
|
88,992 |
|
|
13,449 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) |
|
1,848,964 |
|
|
(2,125,447 |
) |
|
- |
|
|
(276,483 |
) |
|
(41,783 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Elimination represents the gain resulting from change in
fair value of an investment of one of the Company's subsidiaries,
on which YY Live segment and Huya segment have joint control and
accounted for as equity method investment.
(2) Share-based compensation was allocated in cost of revenues
and operating expenses as follows:
|
|
Three Months Ended |
|
|
June 30,
2018 |
|
|
|
|
|
|
|
|
YY Live |
Huya |
Total |
Total |
|
|
RMB |
RMB |
RMB |
US$ |
|
|
|
|
|
|
Cost
of revenues |
|
21,406 |
2,653 |
24,059 |
3,636 |
Research and development expenses |
|
62,071 |
5,841 |
67,912 |
10,263 |
Sales
and marketing expenses |
|
1,674 |
732 |
2,406 |
364 |
General and administrative expenses |
|
60,100 |
64,878 |
124,978 |
18,887 |
|
|
|
|
|
|
|
YY 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 |
|
|
|
June 30,
2018 |
|
|
|
|
|
|
|
|
|
|
|
YY Live |
|
Huya |
|
Elimination |
|
Total |
|
Total |
|
|
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
Operating income (loss) |
|
731,065 |
|
|
(17,293 |
) |
|
- |
|
|
713,772 |
|
|
107,868 |
|
Share-based compensation expenses |
|
145,251 |
|
|
74,104 |
|
|
- |
|
|
219,355 |
|
|
33,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating income |
|
876,316 |
|
|
56,811 |
|
|
- |
|
|
933,127 |
|
|
141,018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
1,848,964 |
|
|
(2,125,447 |
) |
|
- |
|
|
(276,483 |
) |
|
(41,783 |
) |
Share-based compensation expenses |
|
145,251 |
|
|
74,104 |
|
|
- |
|
|
219,355 |
|
|
33,150 |
|
Gain on deemed disposal and disposal of
investments |
|
(13,999 |
) |
|
- |
|
|
- |
|
|
(13,999 |
) |
|
(2,116 |
) |
Gain on fair value change of investments and equity
investees’ investments |
|
(1,143,680 |
) |
|
(116,654 |
) |
|
(26,967 |
) |
|
(1,287,301 |
) |
|
(194,541 |
) |
Fair value loss on derivative liabilities |
|
- |
|
|
2,273,355 |
|
|
- |
|
|
2,273,355 |
|
|
343,558 |
|
Income tax effects on non-GAAP adjustments |
|
3,634 |
|
|
- |
|
|
26,967 |
|
|
30,601 |
|
|
4,625 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net
income |
|
840,170 |
|
|
105,358 |
|
|
- |
|
|
945,528 |
|
|
142,893 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YY INC.UNAUDITED SEGMENT
REPORT(All amounts in thousands, except share, ADS and per
ADS data) |
|
|
|
Three Months Ended |
|
|
March 31,
2018 |
|
|
|
|
|
|
|
|
|
YY Live |
|
Huya |
|
Elimination(1) |
|
Total |
|
Total |
|
|
RMB |
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Live
streaming |
|
2,239,251 |
|
|
792,784 |
|
|
- |
|
|
3,032,035 |
|
|
483,378 |
|
Others |
|
168,053 |
|
|
50,798 |
|
|
(1,955 |
) |
|
216,896 |
|
|
34,578 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net revenues |
|
2,407,304 |
|
|
843,582 |
|
|
(1,955 |
) |
|
3,248,931 |
|
|
517,956 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of revenues(2) |
|
(1,303,264 |
) |
|
(712,533 |
) |
|
- |
|
|
(2,015,797 |
) |
|
(321,365 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
1,104,040 |
|
|
131,049 |
|
|
(1,955 |
) |
|
1,233,134 |
|
|
196,591 |
|
Operating expenses(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development expenses |
|
(198,007 |
) |
|
(51,458 |
) |
|
- |
|
|
(249,465 |
) |
|
(39,771 |
) |
Sales
and marketing expenses |
|
(211,673 |
) |
|
(25,940 |
) |
|
1,955 |
|
|
(235,658 |
) |
|
(37,569 |
) |
General and administrative expenses |
|
(128,193 |
) |
|
(35,783 |
) |
|
- |
|
|
(163,976 |
) |
|
(26,142 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
(537,873 |
) |
|
(113,181 |
) |
|
1,955 |
|
|
(649,099 |
) |
|
(103,482 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income |
|
2,091 |
|
|
10,283 |
|
|
- |
|
|
12,374 |
|
|
1,973 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
568,258 |
|
|
28,151 |
|
|
- |
|
|
596,409 |
|
|
95,082 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expenses |
|
(2,019 |
) |
|
- |
|
|
- |
|
|
(2,019 |
) |
|
(322 |
) |
Interest income and investment income |
|
81,607 |
|
|
10,584 |
|
|
- |
|
|
92,191 |
|
|
14,697 |
|
Foreign currency exchange gains, net |
|
6,719 |
|
|
- |
|
|
- |
|
|
6,719 |
|
|
1,071 |
|
Gain
on fair value change of investments |
|
426,547 |
|
|
- |
|
|
- |
|
|
426,547 |
|
|
68,002 |
|
Fair
value loss on derivative liabilities |
|
- |
|
|
(11,868 |
) |
|
- |
|
|
(11,868 |
) |
|
(1,892 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax expenses |
|
1,081,112 |
|
|
26,867 |
|
|
- |
|
|
1,107,979 |
|
|
176,638 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax (expenses) benefits |
|
(152,709 |
) |
|
4,464 |
|
|
- |
|
|
(148,245 |
) |
|
(23,634 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before share of
income in equity method investments, net
of income taxes |
|
928,403 |
|
|
31,331 |
|
|
- |
|
|
959,734 |
|
|
153,004 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
of income in equity method investments, net of income taxes |
|
9,103 |
|
|
76 |
|
|
- |
|
|
9,179 |
|
|
1,463 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
937,506 |
|
|
31,407 |
|
|
- |
|
|
968,913 |
|
|
154,467 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The elimination mainly consists of revenues and expenses
generated from advertising services among YY Live and Huya
segments.
(2) Share-based compensation was allocated in cost of revenues
and operating expenses as follows:
|
|
Three Months Ended |
|
|
March 31,
2018 |
|
|
|
|
|
YY Live |
Huya |
Total |
Total |
|
|
RMB |
RMB |
RMB |
US$ |
|
|
|
|
|
|
Cost
of revenues |
|
19,353 |
255 |
19,608 |
3,126 |
Research and development expenses |
|
52,677 |
1,790 |
54,467 |
8,683 |
Sales
and marketing expenses |
|
1,451 |
418 |
1,869 |
298 |
General and administrative expenses |
|
14,659 |
21,904 |
36,563 |
5,829 |
|
|
|
|
|
|
|
YY 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 |
|
|
|
March 31,
2018 |
|
|
|
|
|
|
|
YY Live |
|
Huya |
|
Total |
|
Total |
|
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
568,258 |
|
|
28,151 |
|
596,409 |
|
|
95,082 |
|
Share-based compensation expenses |
|
88,140 |
|
|
24,367 |
|
112,507 |
|
|
17,936 |
|
Impairment of goodwill and investments |
|
18,349 |
|
|
- |
|
18,349 |
|
|
2,925 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating income |
|
674,747 |
|
|
52,518 |
|
727,265 |
|
|
115,943 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
937,506 |
|
|
31,407 |
|
968,913 |
|
|
154,467 |
|
Share-based compensation expenses |
|
88,140 |
|
|
24,367 |
|
112,507 |
|
|
17,936 |
|
Impairment of goodwill and investments |
|
18,349 |
|
|
- |
|
18,349 |
|
|
2,925 |
|
Gain on fair value change of investments and equity
investees’ investments |
|
(426,547 |
) |
|
- |
|
(426,547 |
) |
|
(68,002 |
) |
Fair value loss on derivative liabilities |
|
- |
|
|
11,868 |
|
11,868 |
|
|
1,892 |
|
Income tax effects on non-GAAP adjustments |
|
44,466 |
|
|
- |
|
44,466 |
|
|
7,089 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net
income |
|
661,914 |
|
|
67,642 |
|
729,556 |
|
|
116,307 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YY INC.UNAUDITED SEGMENT
REPORT(All amounts in thousands, except share, ADS and per
ADS data) |
|
|
|
Three Months Ended |
|
|
June 30,
2017 |
|
|
|
|
|
YY Live |
|
Huya |
|
Total |
|
Total |
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
Net revenues |
|
|
|
|
|
Live
streaming |
|
1,931,569 |
|
|
441,828 |
|
|
2,373,397 |
|
|
350,095 |
|
Others |
|
216,058 |
|
|
19,536 |
|
|
235,594 |
|
|
34,752 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net revenues |
|
2,147,627 |
|
|
461,364 |
|
|
2,608,991 |
|
|
384,847 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of revenues(1) |
|
(1,159,554 |
) |
|
(403,891 |
) |
|
(1,563,445 |
) |
|
(230,620 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
988,073 |
|
|
57,473 |
|
|
1,045,546 |
|
|
154,227 |
|
Operating expenses(1) |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development expenses |
|
(132,223 |
) |
|
(35,136 |
) |
|
(167,359 |
) |
|
(24,687 |
) |
Sales
and marketing expenses |
|
(183,119 |
) |
|
(21,315 |
) |
|
(204,434 |
) |
|
(30,156 |
) |
General and administrative expenses |
|
(86,678 |
) |
|
(17,867 |
) |
|
(104,545 |
) |
|
(15,421 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
(402,020 |
) |
|
(74,318 |
) |
|
(476,338 |
) |
|
(70,264 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income |
|
30,156 |
|
|
10 |
|
|
30,166 |
|
|
4,450 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
616,209 |
|
|
(16,835 |
) |
|
599,374 |
|
|
88,413 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expenses |
|
(3,459 |
) |
|
- |
|
|
(3,459 |
) |
|
(510 |
) |
Interest income and investment income |
|
25,445 |
|
|
1,872 |
|
|
27,317 |
|
|
4,029 |
|
Gain
on deemed disposal and disposal of investments |
|
45,861 |
|
|
- |
|
|
45,861 |
|
|
6,765 |
|
Foreign currency exchange losses, net |
|
(281 |
) |
|
- |
|
|
(281 |
) |
|
(41 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income tax
expenses |
|
683,775 |
|
|
(14,963 |
) |
|
668,812 |
|
|
98,656 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expenses |
|
(100,531 |
) |
|
- |
|
|
(100,531 |
) |
|
(14,829 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before share of
income in equity method investments, net
of income taxes |
|
583,244 |
|
|
(14,963 |
) |
|
568,281 |
|
|
83,827 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
of income in equity method investments, net of income taxes |
|
4,726 |
|
|
- |
|
|
4,726 |
|
|
697 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
(loss)(2) |
|
587,970 |
|
|
(14,963 |
) |
|
573,007 |
|
|
84,524 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Share-based compensation was allocated in cost of revenues
and operating expenses as follows:
|
|
Three Months Ended |
|
|
June 30,
2017 |
|
|
|
|
|
|
|
|
YY Live |
Huya |
Total |
Total |
|
|
RMB |
RMB |
RMB |
US$ |
|
|
|
|
|
|
Cost
of revenues |
|
2,372 |
649 |
3,021 |
446 |
Research and development expenses |
|
8,229 |
2,263 |
10,492 |
1,548 |
Sales
and marketing expenses |
|
282 |
21 |
303 |
45 |
General and administrative expenses |
|
6,872 |
2,777 |
9,649 |
1,423 |
|
|
|
|
|
|
(2) Starting from the three months ended December 31, 2017, the
Company reviews the financial performance of the operating segments
up to the net income of each segment. Segment information for
comparative periods has been revised to be presented on the same
basis as the three months ended December 31, 2017
|
YY 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 |
|
|
|
June 30,
2017 |
|
|
|
|
|
|
|
YY Live |
|
Huya |
|
Total |
|
Total |
|
|
|
RMB |
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
|
616,209 |
|
|
(16,835 |
) |
|
599,374 |
|
|
88,413 |
|
Share-based compensation expenses |
|
|
17,755 |
|
|
5,710 |
|
|
23,465 |
|
|
3,462 |
|
Impairment of goodwill and investments |
|
|
18,634 |
|
|
- |
|
|
18,634 |
|
|
2,749 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating income (loss) |
|
|
652,598 |
|
|
(11,125 |
) |
|
641,473 |
|
|
94,624 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
587,970 |
|
|
(14,963 |
) |
|
573,007 |
|
|
84,524 |
|
Share-based compensation expenses |
|
|
17,755 |
|
|
5,710 |
|
|
23,465 |
|
|
3,461 |
|
Impairment of goodwill and investments |
|
|
18,634 |
|
|
- |
|
|
18,634 |
|
|
2,749 |
|
Gain on deemed disposal and disposal of investments |
|
|
(45,861 |
) |
|
- |
|
|
(45,861 |
) |
|
(6,765 |
) |
Income tax effects on non-GAAP adjustments |
|
|
6,820 |
|
|
- |
|
|
6,820 |
|
|
1,006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net
income |
|
|
585,318 |
|
|
(9,253 |
) |
|
576,065 |
|
|
84,975 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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