【行业研究报告】欢聚-Looking beyond 2Q24E’s soft seasonality

30May2024
CMBInternationalGlobalMarkets|EquityResearch|CompanyUpdate
JOYYInc(YYUS)
Lookingbeyond2Q24E’ssoftseasonality
JOYYdeliveredanupbeat1Q24,butrevenueguidancefor2Q24Eslightly
missedconsensusby2%.Givensoftseasonalityoflivestreaming,we
expecttotalrevenue+1.2%YoYin2Q24E,withadj.netprofitatUS$50mn.
WeestimateBigo’sramp-upofadswouldpartlyoffsetlivestreaming
softness.ForBigolivestreamingbusiness,theUSandSEAmarkets’
momentumtrendswell,whilerecoveryintheMiddleEastneedsmore
time.ForFY24E,weremainpositiveongrouprevenuetoresumepositive
growth,butslightlytrimFY24Eadj.netprofittoUS$242mntoreflectHello
impactandlowerinterestincome.WetrimourFY24-26Enetprofitforecast
by12%-14%.MaintainBUYwithalowerSOTP-basedTPatUS$47.
Upbeat1Q24butsoft2Q24guidance.1Q24revenuefell3.3%YoY,2%
aheadofconsensus.Bigorevenuegrowthacceleratedto+8%YoY(vs.
aheadofconsensus.Bigorevenuegrowthacceleratedto+8%YoY(vs.
+3.1%in4Q23),backedbyrisingpayingusers(+6.9%YoY)and
outperformanceofdevelopedmarkets(withlivestreamingrevenueat
double-digitgrowthYoY).Non-GAAPNPreachedUS$67mnin1Q24(non-
GAAPNPMat11.9%vs.11.3%in4Q23),24%aboveconsensus,mainly
oncostoptimizationandimprovingS&MROI.NetlossofAllotherssegment
continuedtonarrowsequentially.In1Q24,JOYYrepurchasedUS$54.5mn
worthofshares.However,2Q24Erevenuegrowthguidanceof+1%YoY
(midpoint)slightlymissedconsensusby2%.
Strongadstooffsetsoftseasonalityinlivestreaming.Weexpecttotal
revenue+1.2%YoYin2Q24E,withadj.netprofitatUS$50mn.ForBigo,
weforecastBigorevenue+5.1%YoYin2Q24E(-2%QoQ),inwhich
livestreamingmayseeamid-single-digitQoQdeclineforseasonalityanda
highbasefromGalacampaign.TheUSandSEAmarkets’momentum
trendswellwithrisingpayingusers,whilerecoveryintheMiddleEastneeds
moretime.HellobusinessmaystaystableQoQin2Q24E.Givensolidads
environmentandrisingbudgets,Bigoadsrevenuemayachievehigh-single-
digitQoQgrowth,inourestimates.WeforecastBigonon-GAAPOPMat
12%in2Q24EandFY24E.ForAllotherssegment,weexpectrevenue-
23%YoYin2Q24E,owingtoproactiveadjustments.Lookingaheadto
FY24E,weremainpositiveongrouprevenuetoresumepositivegrowth,but
slightlytrimFY24Eadj.netprofittoUS$242mntoreflectHelloimpactand
lowerinterestincome.
MaintainBUY.WetrimourFY24-26Enetprofitforecastby12%-14%.
MaintainBUYwithalowerSOTP-basedTPatUS$47,byassigning6x
FY23EP/EtoBigoLive.