UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2018
Commission File Number: 001-36765
Momo Inc.
20th Floor, Block B
Tower 2, Wangjing SOHO
No.1 Futongdong Street
Chaoyang District, Beijing 100102
People’s Republic of China
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Momo Inc. | ||||
| By |
: |
/s/ Jonathan Xiaosong Zhang | ||
| Name |
: |
Jonathan Xiaosong Zhang | ||
| Title |
: |
Chief Financial Officer | ||
Date: December 6, 2018
Exhibit Index
Exhibit 99.1—Press Release
Exhibit 99.1
Momo Announces Unaudited Financial Results for the Third Quarter of 2018
BEIJING, December 5, 2018 / PRNewswire / – Momo Inc. (NASDAQ: MOMO) (“Momo” or the “Company”), a leading mobile social networking platform in China, today announced its unaudited financial results for the third quarter of 2018.
Third Quarter of 2018 Highlights
| • | Net revenues increased 51% year over year to $536.0 million in the third quarter of 2018. |
| • | Net income attributable to Momo Inc. increased to $85.2 million in the third quarter of 2018 from $79.1 million in the same period last year. |
| • | Non-GAAP net income attributable to Momo Inc. (note 1) increased 22% to $114.3 million in the third quarter of 2018 from $93.8 million in the same period last year. |
| • | Diluted net income per American Depositary Share (“ADS”) was $0.39, compared to $0.38 in the same period last year. |
| • | Non-GAAP diluted net income per ADS (note 1) was $0.53, compared to $0.45 in the same period last year. |
| • | Monthly Active Users (“MAU”) on Momo application were 110.5 million in September 2018, compared to 94.4 million in September 2017. |
| • | Total paying users of our live video service and value-added service, without double counting the overlap, including 3.6 million paying users of Tantan Limited (“Tantan”), were 12.5 million for the third quarter of 2018, compared to 7.3 million for the third quarter of 2017. |
First Nine Months of 2018 Highlights
| • | Net revenues increased 57% year over year to $1,465.4 million for the first nine months of 2018. |
| • | Net income attributable to Momo Inc. was $332.8 million for the first nine months of 2018, compared with $221.1 million during the same period of 2017. |
| • | Non-GAAP net income attributable to Momo Inc. (note 1) was $396.7 million for the first nine months of 2018, compared with $258.2 million during the same period of 2017. |
| • | Diluted net income per ADS was $1.57 for the first nine months of 2018, compared with $1.07 during the same period of 2017. |
| • | Non-GAAP diluted income per ADS (note 1) was $1.87 for the first nine months of 2018, compared with $1.24 during the same period of 2017. |
“I am pleased that we delivered solid operational and financial results for the quarter.” Commented Yan Tang, Chairman and CEO of Momo. “At the same time we continued to push forward on product and operational fronts, in order to build up longer term growth drivers as we start to look beyond 2018 into next year.”
Third Quarter of 2018 Financial Results
Net revenues
Total net revenues were $536.0 million in the third quarter of 2018, an increase of 51% from $354.5 million in the third quarter of 2017.
1
Live video service revenues were $406.9 million in the third quarter of 2018, an increase of 34% from $302.6 million during the same period of 2017. The growth in live video revenues was contributed by the increase in the quarterly paying users, as well as the increase in the average revenues per paying user per quarter.
Value-added service revenues mainly include membership subscription revenues and virtual gift revenues. The total value-added service revenues were $84.2 million in the third quarter of 2018, an increase of 221% from $26.3 million during the same period of 2017. The year over year increase was primarily attributable to the continuous growth of the virtual gift business on the Momo application and to a lesser extent, the consolidation of Tantan’s membership subscription revenues for the whole third quarter of 2018. The growth of the virtual gift business was driven by more paying use cases introduced to enhance the social experience for Momo users.
Mobile marketing revenues were $17.2 million in the third quarter of 2018, a decrease of 1% from $17.4 million during the same period of 2017.
Mobile games revenues were $4.1 million in the third quarter of 2018, a decrease of 49% from $8.0 million in the third quarter of 2017. The decrease in game revenues was mainly due to the decrease in quarterly paying users.
Revenues from other services in the third quarter of 2018 mainly consisted of revenues from Phanta City, a TV variety show co-produced by the Company.
Cost and expenses
Cost and expenses were $442.1 million in the third quarter of 2018, an increase of 66% from $266.3 million in the third quarter of 2017. The increase was primarily attributable to: (a) an increase in revenue sharing with the broadcasters related to our live video service and virtual gift recipients; (b) the produced contents in connection with Phanta City; (c) an increase in personnel related costs including share-based compensation expenses as a result of the Company’s rapidly expanding talent pool; (d) an increase in marketing and promotional expenses to enhance our brand awareness and attract users; and (e) an increase in amortization expenses related to the intangible assets from acquisitions.
Non-GAAP cost and expenses (note 1) were $411.7 million in the third quarter of 2018, an increase of 64% from $251.7 million during the same period last year.
Income from operations
Income from operations was $94.6 million in the third quarter of 2018, compared to $89.0 million during the same period last year.
Non-GAAP income from operations (note 1) was $125.1 million in the third quarter of 2018, compared to $103.7 million during the same period last year.
Income tax expenses
Income tax expenses were $21.6 million in the third quarter of 2018, increased from $17.2 million in the third quarter of 2017. The increase was mainly because we generated higher profit in the third quarter of 2018.
2
Net income attributable to Momo Inc.
Net income attributable to Momo Inc. was $85.2 million in the third quarter of 2018, compared to $79.1 million during the same period last year.
Non-GAAP net income (note 1) attributable to Momo Inc. was $114.3 million in the third quarter of 2018, compared to $93.8 million during the same period last year.
Net income per ADS
Diluted net income per ADS was $0.39 in the third quarter of 2018, compared to $0.38 in the third quarter of 2017.
Non-GAAP diluted net income per ADS (note 1) was $0.53 in the third quarter of 2018, compared to $0.45 in the third quarter of 2017.
Cash and cash flow
As of September 30, 2018, Momo’s cash, cash equivalents, term deposits, restricted cash and short-term investment totaled $1,493.6 million, compared to $1,061.2 million as of December 31, 2017. Net cash provided by operating activities in the third quarter of 2018 was $50.9 million, compared to $104.6 million for the same quarter of 2017. The decrease in the operating cash flow for the quarter was primarily because revenues from the TV show Phanta City still sit as accounts receivable on the balance sheet while related costs have largely been paid.
First Nine Months of 2018 Financial Results
Net revenues for the first nine months of 2018 were $1,465.4 million, an increase of 57% from $931.9 million in the same period of 2017, primarily driven by the significant increase in net revenues from live video service and value-added service.
Net income attributable to Momo Inc. was $332.8 million in the first nine months of 2018, compared to $221.1 million during the same period of 2017.
Non-GAAP net income attributable to Momo Inc. (note 1) was $396.7 million in the first nine months of 2018, compared to $258.2 million during the same period of 2017.
Diluted net income per ADS was $1.57 during the first nine months of 2018, compared to $1.07 in the same period of 2017.
Non-GAAP diluted net income per ADS (note 1) was $1.87 during the first nine months of 2018, compared to $1.24 in the same period of 2017.
Net cash provided by operating activities was $336.5 million during the first nine months of 2018, compared to $308.0 million in the same period of 2017.
3
Recent Development - changes to the Board of Directors
The Company also announced several changes to its board of directors (the “Board”). Mr. Yongming Wu, a director and founding partner of Vision Plus Capital and a co-founder of Alibaba Group, has been appointed to be a director of Momo’s Board, effective on December 3, 2018. Mr. Wu founded Vision Plus Capital in 2015 and has led several key business segments of Alibaba Group. In addition, Mr. Neil Nanpeng Shen resigned from the Board on December 1, 2018, effective immediately. The resignation of Mr. Neil Nanpeng Shen was not due to any disagreement with the Company regarding its business, finance, accounting and/or any other affairs.
Business Outlook
For the fourth quarter of 2018, the Company expects total net revenues to be between RMB3,655.0 million to RMB3,755.0 million, representing an increase of 43% to 47% year over year and an increase of 0% to 3% quarter over quarter, on a constant currency basis. Excluding the revenues from Phanta City, the Company expects the total revenues for the fourth quarter of 2018 to be between RMB3,624.0 million to RMB3,724.0 million, representing an increase of 42% to 46% year over year and an increase of 4% to 7% quarter over quarter, on a constant currency basis. The Company is not providing the business outlook in USD terms due to the recent volatility and uncertainty in foreign exchange rate. These estimates reflect the Company’s current and preliminary view, which is subject to change.
Note 1: Non-GAAP measures
To supplement our consolidated financial statements presented in accordance with U.S. generally accepted accounting principles (“GAAP”), we use various non-GAAP financial measures that are adjusted from the most comparable GAAP results to exclude share-based compensation and amortization of intangible assets from acquisitions, and provision for income tax related to the amortization of intangible assets.
Reconciliations of our non-GAAP financial measures to our U.S. GAAP financial measures are shown in tables at the end of this earnings release, which provide more details about the non-GAAP financial measures.
Our non-GAAP financial information is provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors’ overall understanding of the historical and current financial performance of our continuing operations and our prospects for the future. Our non-GAAP financial information should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to the GAAP results. In addition, our calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.
Our non-GAAP information (including non-GAAP cost and operating expenses, income from operations, net income attributable to Momo Inc., and diluted earnings per ADS) is adjusted from the most comparable GAAP results to exclude share-based compensation, amortization of intangible assets from acquisitions, and provision for income tax related to the amortization of intangible assets. A limitation of using these non-GAAP financial measures is that share-based compensation, amortization of intangible assets from acquisitions and provision for income tax related to the amortization of intangible assets charge has been and will continue to be for the foreseeable future a significant recurring expense in our results of operations. We compensate for these limitations by providing reconciliations of our non-GAAP measures to our U.S. GAAP measures. Please see the reconciliation tables at the end of this earnings release.
4
Conference Call
Momo’s management will host an earnings conference call on Thursday, December 6, 2018 at 8:00 a.m. U.S. Eastern Time (9:00 p.m. Beijing / Hong Kong Time on December 6, 2018).
Dial-in details for the earnings conference call are as follows:
International: +65-6713-5090
U.S. Toll Free: +1-866-519-4004
Hong Kong Toll Free: 800-906601
Mainland China: 4006-208038
Passcode: Momo
Please dial in 15 minutes before the call is scheduled to begin.
A telephone replay of the call will be available after the conclusion of the conference call through 8:00 a.m. U.S. Eastern Time, December 14, 2018. The dial-in details for the replay are as follows:
International: +61-2-8199-0299
U.S. Toll Free: +1-855-452-5696
Passcode: 3986625
Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of Momo’s website at http://ir.immomo.com.
About Momo
Momo is a leading mobile social networking platform in China. Momo connects people in a personal and lively way through a revolutionary mobile-based social networking platform. With powerful and precise location-based features, Momo enables users to connect with each other and expand relationships from online to offline. Momo’s platform includes the Momo mobile application and a variety of related features, functionalities, tools and services that it provides to users, customers and platform partners. Leveraging its social interest graph engine and analysis of user behavior data, Momo is able to provide users a customized experience based on their social preferences and needs. Momo users can maintain and strengthen their relationships through private and group communication tools, content creation and sharing functions, as well as the offline social activities promoted on Momo’s platform. Momo users are also able to enjoy live video on our platform. In addition, in May 2018, Momo completed its acquisition of Tantan, a leading social and dating app for the younger generation. Tantan, whose primary users consist of young Chinese singles, is designed to help its users find and establish romantic connections, as well as meet interesting people.
5
For investor and media inquiries, please contact:
Momo Inc.
Investor Relations
Phone: +86-10-5731-0538
Email: ir@immomo.com
Christensen
In China
Mr. Christian Arnell
Phone: +86-10- 5900-1548
E-mail: carnell@christensenir.com
In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: lbergkamp@christensenir.com
Safe Harbor Statement
This news release contains “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include but are not limited to our management quotes and our financial outlook for the fourth quarter of 2018.
Our forward-looking statements are not historical facts but instead represent only our belief regarding expected results and events, many of which, by their nature, are inherently uncertain and outside of our control. Our actual results and other circumstances may differ, possibly materially, from the anticipated results and events indicated in these forward-looking statements. Announced results for the third quarter of 2018 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the fourth quarter of 2018 and may be unable to grow our business in the manner planned. We may also modify our strategy for growth. In addition, there are other risks and uncertainties that could cause our actual results to differ from what we currently anticipate, including those relating to our ability to retain and grow our user base, our ability to attract and retain sufficiently trained professionals to support our operations, and our ability to anticipate and develop new services and enhance existing services to meet the demand of our users or customers. For additional information on these and other important factors that could adversely affect our business, financial condition, results of operations, and prospects, please see our filings with the U.S. Securities and Exchange Commission.
All information provided in this press release and in the attachments is as of the date of the press release. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise, after the date of this release, except as required by law. Such information speaks only as of the date of this release.
6
Momo Inc.
Unaudited Condensed Consolidated Statement of Operations
(US dollars in thousands, except per share data)
| Three months | First nine months | |||||||||||||||
| ended September 30 | ended September 30 | |||||||||||||||
| 2017 | 2018 | 2017 | 2018 | |||||||||||||
| Net revenues: |
||||||||||||||||
| Live video service |
302,603 | 406,905 | 774,597 | 1,189,378 | ||||||||||||
| Value-added service |
26,256 | 84,216 | 73,759 | 176,428 | ||||||||||||
| Mobile marketing |
17,441 | 17,241 | 54,348 | 58,214 | ||||||||||||
| Mobile games |
8,024 | 4,097 | 28,728 | 16,198 | ||||||||||||
| Other services |
129 | 23,511 | 483 | 25,151 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total net revenues |
354,453 | 535,970 | 931,915 | 1,465,369 | ||||||||||||
| Cost and expenses: |
||||||||||||||||
| Cost of revenues |
(177,967 | ) | (298,527 | ) | (449,079 | ) | (777,871 | ) | ||||||||
| Research and development |
(13,855 | ) | (36,097 | ) | (32,731 | ) | (78,699 | ) | ||||||||
| Sales and marketing |
(57,734 | ) | (82,809 | ) | (160,815 | ) | (181,704 | ) | ||||||||
| General and administrative |
(16,792 | ) | (24,713 | ) | (44,870 | ) | (61,947 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total cost and expenses |
(266,348 | ) | (442,146 | ) | (687,495 | ) | (1,100,221 | ) | ||||||||
| Other operating income |
897 | 779 | 9,371 | 17,558 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income from operations |
89,002 | 94,603 | 253,791 | 382,706 | ||||||||||||
| Interest income |
6,029 | 12,155 | 14,409 | 27,934 | ||||||||||||
| Interest expense |
— | (3,588 | ) | — | (5,538 | ) | ||||||||||
| Impairment loss on long-term investments |
— | — | (4,386 | ) | — | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income before income tax and share of income on equity method investments |
95,031 | 103,170 | 263,814 | 405,102 | ||||||||||||
| Income tax expenses |
(17,218 | ) | (21,567 | ) | (46,933 | ) | (79,615 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Income before share of income on equity method investments |
77,813 | 81,603 | 216,881 | 325,487 | ||||||||||||
| Share of income on equity method investments |
1,166 | 2,428 | 3,863 | 5,399 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income |
78,979 | 84,031 | 220,744 | 330,886 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Less: net loss attributable to non-controlling interest |
(110 | ) | (1,125 | ) | (315 | ) | (1,933 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income attributable to Momo Inc. |
79,089 | 85,156 | 221,059 | 332,819 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net income per share attributable to ordinary shareholders |
||||||||||||||||
| Basic |
0.20 | 0.21 | 0.56 | 0.82 | ||||||||||||
| Diluted |
0.19 | 0.20 | * | 0.53 | 0.78 | * | ||||||||||
| Weighted average shares used in calculating net income per ordinary share |
||||||||||||||||
| Basic |
395,926,878 | 409,378,536 | 393,469,398 | 404,744,362 | ||||||||||||
| Diluted |
417,066,439 | 445,871,236 | 414,884,571 | 428,148,904 | ||||||||||||
| * | Net income attributable to Momo is adjusted for interest expense of Convertible Senior Notes for calculation of dilutive EPS. |
7
Momo Inc.
Unaudited Condensed Consolidated Statement of Comprehensive Income
(US dollars in thousands, except per share data)
| Three months | First nine months | |||||||||||||||
| ended September 30 | ended September 30 | |||||||||||||||
| 2017 | 2018 | 2017 | 2018 | |||||||||||||
| Net income |
78,979 | 84,031 | 220,744 | 330,886 | ||||||||||||
| Other comprehensive income (loss), net of tax of nil |
||||||||||||||||
| Foreign currency translation adjustment |
9,021 | (36,753 | ) | 17,964 | (60,755 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Comprehensive income |
88,000 | 47,278 | 238,708 | 270,131 | ||||||||||||
| Less: comprehensive loss attributed to the non-controlling interest |
(115 | ) | (1,192 | ) | (322 | ) | (2,017 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Comprehensive income attributable to Momo Inc. shareholders |
88,115 | 48,470 | 239,030 | 272,148 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
8
Momo Inc.
Unaudited Condensed Consolidated Balance Sheets
( US dollars in thousands)
| December 31 2017 |
September 30 2018 |
|||||||
| Assets |
||||||||
| Current assets |
||||||||
| Cash and cash equivalents |
685,827 | 285,195 | ||||||
| Term deposits |
373,794 | 1,182,454 | ||||||
| Restricted cash |
— | 9,208 | ||||||
| Short-term investment |
1,614 | 16,744 | ||||||
| Accounts receivable, net of allowance for doubtful accounts of $90 and $nil as of December 31, 2017 and September 30, 2018, respectively |
39,597 | 92,404 | ||||||
| Prepaid expenses and other current assets |
82,717 | 91,892 | ||||||
| Amount due from related parties |
5,143 | 8 | ||||||
|
|
|
|
|
|||||
| Total current assets |
1,188,692 | 1,677,905 | ||||||
| Property and equipment, net |
39,762 | 48,776 | ||||||
| Intangible assets |
7,462 | 156,549 | ||||||
| Rental deposits |
2,651 | 2,931 | ||||||
| Long term investments |
44,337 | 67,326 | ||||||
| Deferred tax assets, non-current |
7,197 | 2,608 | ||||||
| Other non-current assets |
8,495 | 10,898 | ||||||
| Goodwill |
3,401 | 626,406 | ||||||
|
|
|
|
|
|||||
| Total assets |
1,301,997 | 2,593,399 | ||||||
|
|
|
|
|
|||||
| Liabilities and equity |
||||||||
| Current liabilities |
||||||||
| Accounts payable |
74,535 | 104,836 | ||||||
| Deferred revenue |
64,865 | 62,525 | ||||||
| Accrued expenses and other current liabilities |
87,809 | 89,732 | ||||||
| Amount due to related parties |
5,804 | 8,380 | ||||||
| Income tax payable |
27,033 | 12,645 | ||||||
| Deferred consideration in connection with business acquisitions |
— | 74,131 | ||||||
|
|
|
|
|
|||||
| Total current liabilities |
260,046 | 352,249 | ||||||
| Deferred tax liabilities, non-current |
1,866 | 39,137 | ||||||
| Share-based compensation liability |
— | 4,323 | ||||||
| Convertible Senior Notes |
— | 708,771 | ||||||
| Other non-current liabilities |
2,305 | 3,807 | ||||||
|
|
|
|
|
|||||
| Total liabilities |
264,217 | 1,108,287 | ||||||
| Shareholder’s equity (Note a) |
1,037,780 | 1,485,112 | ||||||
|
|
|
|
|
|||||
| Total liabilities and shareholder’s equity |
1,301,997 | 2,593,399 | ||||||
|
|
|
|
|
|||||
Note a: As of September 30, 2018, the number of ordinary shares issued and outstanding was 413,200,744.
9
Momo Inc.
Unaudited Condensed Consolidated Statement of Cash Flows
(US dollars in thousands)
| Three months | First nine months | |||||||||||||||
| ended September 30 | ended September 30 | |||||||||||||||
| 2017 | 2018 | 2017 | 2018 | |||||||||||||
| Cash flows from operating activities: |
||||||||||||||||
| Net income |
78,979 | 84,031 | 220,744 | 330,886 | ||||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||
| Depreciation of property and equipment |
3,220 | 5,773 | 7,805 | 16,232 | ||||||||||||
| Amortization of intangible assets |
269 | 5,720 | 452 | 8,007 | ||||||||||||
| Share-based compensation |
14,664 | 24,974 | 37,171 | 58,367 | ||||||||||||
| Share of income on equity method investment |
(1,166 | ) | (2,428 | ) | (3,863 | ) | (5,399 | ) | ||||||||
| Impairment loss on long-term investments |
— | — | 4,386 | — | ||||||||||||
| Income on disposal of property and equipment |
— | (182 | ) | (2 | ) | (182 | ) | |||||||||
| Provision of allowance for doubtful accounts |
— | — | 85 | (92 | ) | |||||||||||
| Changes in operating assets and liabilities: |
||||||||||||||||
| Accounts receivable |
6,605 | (61,716 | ) | 6,287 | (51,595 | ) | ||||||||||
| Prepaid expenses and other current assets |
(10,429 | ) | (26,885 | ) | (23,045 | ) | (14,363 | ) | ||||||||
| Amount due from related parties |
(506 | ) | 1,966 | (1,019 | ) | 5,102 | ||||||||||
| Rental deposits |
(27 | ) | (85 | ) | (1,467 | ) | 44 | |||||||||
| Deferred tax assets |
— | 50 | 73 | 4,535 | ||||||||||||
| Other non-current assets |
(1,046 | ) | (980 | ) | (1,827 | ) | (6,976 | ) | ||||||||
| Accounts payable |
14,339 | 23,363 | 25,960 | 38,089 | ||||||||||||
| Income tax payable |
800 | (726 | ) | 8,843 | (15,365 | ) | ||||||||||
| Deferred revenue |
1,966 | 4,790 | 3,299 | (4,532 | ) | |||||||||||
| Accrued expenses and other current liabilities |
(5,574 | ) | (7,692 | ) | 19,702 | (28,312 | ) | |||||||||
| Amount due to related parties |
2,638 | 2,536 | 3,846 | 2,602 | ||||||||||||
| Deferred tax liability |
(47 | ) | (1,430 | ) | (93 | ) | (2,001 | ) | ||||||||
| Other non-current liabilities |
(109 | ) | (182 | ) | 684 | 1,501 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Net cash provided by operating activities |
104,576 | 50,897 | 308,021 | 336,548 | ||||||||||||
| Cash flows from investing activities: |
||||||||||||||||
| Purchase of property and equipment |
(7,937 | ) | (10,491 | ) | (19,281 | ) | (24,673 | ) | ||||||||
| Payment for acquired intangible assets |
(228 | ) | — | (2,993 | ) | — | ||||||||||
| Proceeds from disposal of property and equipment |
1 | 323 | 8 | 324 | ||||||||||||
| Payment for long term investments |
(1,350 | ) | (1,176 | ) | (4,979 | ) | (9,666 | ) | ||||||||
| Prepayment of long term investments |
— | — | — | (7,398 | ) | |||||||||||
| Payment for business acquisition |
— | — | — | (514,919 | ) | |||||||||||
| Purchase of term deposits |
(127,781 | ) | (1,089,995 | ) | (519,749 | ) | (2,279,078 | ) | ||||||||
| Cash received on maturity of term deposits |
99,984 | 308,569 | 484,093 | 1,442,514 | ||||||||||||
| Payment for short term investments |
(855 | ) | (52,045 | ) | (855 | ) | (52,045 | ) | ||||||||
| Cash received from sales of short term investment |
— | 35,148 | — | 36,801 | ||||||||||||
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|
|
|
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|
|
|
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| Net cash used in investing activities |
(38,166 | ) | (809,667 | ) | (63,756 | ) | (1,408,140 | ) | ||||||||
| Cash flows from financing activities: |
||||||||||||||||
| Proceeds from exercise of options |
51 | 414 | 461 | 807 | ||||||||||||
| Deferred payment of purchase of property and equipment |
(13 | ) | — | (217 | ) | (1,322 | ) | |||||||||
| Capital contribution from non-controlling interest shareholder |
73 | — | 73 | — | ||||||||||||
| Proceeds from bank loan |
— | — | — | 300,000 | ||||||||||||
| Repayment of bank loan |
— | (300,000 | ) | — | (300,000 | ) | ||||||||||
| Proceeds from issuance of Convertible Senior Notes, net of issuance cost of $16,703 |
— | 708,297 | — | 708,297 | ||||||||||||
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|
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| Net cash provided by financing activities |
111 | 408,711 | 317 | 707,782 | ||||||||||||
| Effect of exchange rate changes |
7,110 | (18,932 | ) | 14,573 | (27,614 | ) | ||||||||||
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| Net increase (decrease) in cash, cash equivalent and restricted cash |
73,631 | (368,991 | ) | 259,155 | (391,424 | ) | ||||||||||
| Cash, cash equivalent and restricted cash at beginning of period |
443,088 | 663,394 | 257,564 | 685,827 | ||||||||||||
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| Cash, cash equivalent and restricted cash at end of period |
516,719 | 294,403 | 516,719 | 294,403 | ||||||||||||
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10
Momo Inc.
Reconciliation of Non-GAAP financial measures to comparable GAAP measures
(US dollars in thousands, except per share data)
| 1. | Reconciliation of Non-GAAP cost and operating expenses, income from operations, and net income to comparable GAAP measures. |
| Three months | Three months | |||||||||||||||||||||||||||
| ended September 30, 2017 | ended September 30, 2018 | |||||||||||||||||||||||||||
| GAAP | Share-based compensation |
Non-GAAP | GAAP | Amortization of intangible assets from acquisitions |
Share-based compensation |
Non-GAAP | ||||||||||||||||||||||
| Cost of revenues |
(177,967 | ) | 632 | (177,335 | ) | (298,527 | ) | 2,672 | 864 | (294,991 | ) | |||||||||||||||||
| Research and development |
(13,855 | ) | 2,751 | (11,104 | ) | (36,097 | ) | 339 | 6,747 | (29,011 | ) | |||||||||||||||||
| Sales and marketing |
(57,734 | ) | 3,492 | (54,242 | ) | (82,809 | ) | 2,499 | 6,430 | (73,880 | ) | |||||||||||||||||
| General and administrative |
(16,792 | ) | 7,789 | (9,003 | ) | (24,713 | ) | — | 10,933 | (13,780 | ) | |||||||||||||||||
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| Cost and operating expenses |
(266,348 | ) | 14,664 | (251,684 | ) | (442,146 | ) | 5,510 | 24,974 | (411,662 | ) | |||||||||||||||||
| Income from operations |
89,002 | 14,664 | 103,666 | 94,603 | 5,510 | 24,974 | 125,087 | |||||||||||||||||||||
| Net income attributable to Momo Inc. |
79,089 | 14,664 | 93,753 | 85,156 | 4,133 | (a) | 24,974 | 114,263 | ||||||||||||||||||||
| First nine months | First nine months | |||||||||||||||||||||||||||
| ended September 30, 2017 | ended September 30, 2018 | |||||||||||||||||||||||||||
| GAAP | Share-based compensation |
Non-GAAP | GAAP | Amortization of intangible assets from acquisitions |
Share-based compensation |
Non-GAAP | ||||||||||||||||||||||
| Cost of revenues |
(449,079 | ) | 1,385 | (447,694 | ) | (777,871 | ) | 3,563 | 2,478 | (771,830 | ) | |||||||||||||||||
| Research and development |
(32,731 | ) | 6,218 | (26,513 | ) | (78,699 | ) | 452 | 16,097 | (62,150 | ) | |||||||||||||||||
| Sales and marketing |
(160,815 | ) | 8,601 | (152,214 | ) | (181,704 | ) | 3,332 | 15,136 | (163,236 | ) | |||||||||||||||||
| General and administrative |
(44,870 | ) | 20,967 | (23,903 | ) | (61,947 | ) | — | 24,656 | (37,291 | ) | |||||||||||||||||
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| Cost and operating expenses |
(687,495 | ) | 37,171 | (650,324 | ) | (1,100,221 | ) | 7,347 | 58,367 | (1,034,507 | ) | |||||||||||||||||
| Income from operations |
253,791 | 37,171 | 290,962 | 382,706 | 7,347 | 58,367 | 448,420 | |||||||||||||||||||||
| Net income attributable to Momo Inc. |
221,059 | 37,171 | 258,230 | 332,819 | 5,511 | (b) | 58,367 | 396,697 | ||||||||||||||||||||
Notes:
| (a) | Adjustments to exclude the provision for income tax related to amortization of intangible assets from acquisitions of $1,377 from the unaudited condensed consolidated statements. |
| (b) | Adjustments to exclude the provision for income tax related to amortization of intangible assets from acquisitions of $1,836 from the unaudited condensed consolidated statements. |
11