GUANGZHOU, China, Nov. 14, 2017 (GLOBE NEWSWIRE) -- 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 third quarter of 2017.
Third Quarter 2017 Highlights
Net revenues increased by 48.0% to RMB3,092.3 million (US$464.8 million) from RMB2,089.8 million in the corresponding period of 2016.
Net income attributable to YY increased by 59.0% to RMB636.0 million (US$95.6 million) from RMB400.0 million in the corresponding period of 2016.
Non-GAAP net income attributable to YY1 increased by 46.7% to RMB639.1 million (US$96.1 million) from RMB435.6 million in the corresponding period of 2016.
“We continued to deliver robust financial and operating results in the third quarter of 2017,” stated Mr. David Xueling Li, Chairman and acting Chief Executive Officer of YY. “Our mobile live streaming monthly active users (MAU) increased by 36.6% year over year to 73.0 million, and our total live streaming paying users increased by 46.5% year over year to over 6.3 million. Our solid performance is a testament to our highly effective strategies in introducing more initiatives to attract younger generation users and to enhance existing user’s engagement and consumption on our live streaming social media platform. In the past quarter, we rolled out a series of innovative social functionalities and features in the latest version of YY Live 7.0, including Accompany Me, Happy Basketball, and Clip Doll Online. In addition, we launched several new short-form video products to tap into more segmented video verticals and fulfill the diversified demands of users across China. On the Huya side, we are pleased to see that it continued its trajectory of user growth and revenue generation in the third quarter. Looking ahead, by leveraging our dual growth engines, YY Live and Huya, we will continue to invent new ways to attract users and stimulate user engagement, further build our content ecosystem, and explore more monetization opportunities. We believe that we have the right strategy in place to stay ahead of the competition in China’s live streaming social media industry.”
Mr. Bing Jin, Chief Financial Officer of YY, further commented, “This was another quarter with solid financial growth for YY. In the third quarter, our total net revenues increased by 48.0% year over year to RMB3,092.3 million, exceeding the high end of our previous guidance range. The growth was primarily attributable to the significant increase of our live streaming revenues, which grew by 60.4% year over year to RMB2,871.6 million. Both YY Live and Huya broadcasting contributed to such rapid revenue growth. Our non-GAAP net income attributable to YY increased by 46.7% to RMB639.1 million in the quarter, of which Huya’s Non-GAAP operating loss further shrank year over year from RMB159.3 million to RMB10.1 million. In addition, during the quarter, we completed a secondary offering and received approximately USD442.2 million in net proceeds, thus further demonstrating investors’ confidence in YY and laying a solid capital foundation for YY’s future development.”
Third Quarter 2017 Financial Results
NET REVENUES Net revenues increased by 48.0% to RMB3,092.3 million (US$464.8 million) in the third quarter of 2017 from RMB2,089.8 million in the corresponding period of 2016, primarily driven by the increase in live streaming revenues. Live streaming revenues increased by 60.4% to RMB2,871.6 million (US$431.6 million) in the third quarter of 2017 from RMB1,790.4 million in the corresponding period of 2016. Live streaming revenues from the YY Live segment were RMB2,319.2 million (US$348.6 million) and from the Huya segment were RMB552.4 million (US$83.0 million) in the third quarter of 2017.
Revenues from online games were RMB122.0 million (US$18.3 million) in the third quarter of 2017 as compared to RMB149.5 million in the corresponding period of 2016.
Revenues from membership were RMB49.5 million (US$7.4 million) in the third quarter of 2017 as compared to RMB68.8 million in the corresponding period of 2016.
Other revenues, mainly representing revenues from the Company's online advertising revenues, were RMB49.2 million (US$7.4 million) in the third quarter of 2017, compared with RMB81.1 million in the corresponding period of 2016. The declines in online gaming, membership, and other revenues mainly reflected the Company’s continued strategic shift towards its live streaming business.
COST OF REVENUES AND GROSS PROFIT Cost of revenues increased by 48.2% to RMB1,889.3 million (US$284.0 million) in the third quarter of 2017 from RMB1,275.0 million in the corresponding period of 2016, primarily attributable to an increase in revenue-sharing fees and content costs to RMB1,604.9 million (US$241.2 million) in the third quarter of 2017 from RMB967.4 million in the corresponding period of 2016. The increase in revenue-sharing fees and content costs paid to performers, guilds and content providers was in line with the increase in revenues and was primarily due to the higher level of user engagement and spending driven by promotional activities. In addition, bandwidth costs increased to RMB160.5 million (US$24.1 million) in the third quarter of 2017 from RMB149.2 million in the corresponding period of 2016, primarily reflecting continued user base expansion and video quality improvements, but largely offset by the Company’s improved efficiency and pricing terms.
Gross profit increased by 47.6% to RMB1,203.0 million (US$180.8 million) in the third quarter of 2017 from RMB814.8 million in the corresponding period of 2016. Gross margin was 38.9% in the third quarter of 2017 as compared to 39.0% in the corresponding period of 2016 and 40.1% in the second quarter of 2017. The sequential decline of gross margin was mainly attributable to the increased revenue sharing with entry-level hosts on the Company’s platform to develop a more healthy and balanced ecosystem.
OPERATING INCOME Operating expenses in the third quarter of 2017 increased by 49.4% to RMB560.3 million (US$84.2 million) from RMB375.0 million in the corresponding period of 2016.
Operating income in the third quarter of 2017 increased by 39.9% to RMB661.4 million (US$99.4 million) from RMB472.9 million in the corresponding period of 2016. Operating margin in the third quarter of 2017 was 21.4% as compared to 22.6% in the corresponding period of 2016.
Non-GAAP operating income2 increased by 30.7% to RMB664.5 million (US$99.9 million) in the third quarter of 2017 from RMB508.4 million in the corresponding period of 2016. Non-GAAP operating margin3 was 21.5% in the third quarter of 2017 as compared to 24.3% in the corresponding period of 2016.
NET INCOME Net income attributable to YY Inc. increased by 59.0% to RMB636.0 million (US$95.6 million) in the third quarter of 2017 from RMB400.0 million in the corresponding period of 2016. Net margin in the third quarter of 2017 increased to 20.6% from 19.1% in the corresponding period of 2016.
Non-GAAP net income attributable to YY Inc. increased by 46.7% to RMB639.1 million (US$96.1 million) from RMB435.6 million in the corresponding period of 2016. Non-GAAP net margin in the third quarter of 2017 was 20.7% as compared to 20.8% in the corresponding period of 2016.
NET INCOME PER ADS Diluted net income per ADS4 increased by 52.3% to RMB10.51 (US$1.58) in the third quarter of 2017 from RMB6.90 in the corresponding period of 2016.
Non-GAAP diluted net income per ADS5 increased by 41.2% to RMB10.56 (US$1.59) in the third quarter of 2017 from RMB7.48 in the corresponding period of 2016.
BALANCE SHEET AND CASH FLOWS As of September 30, 2017, the Company had cash and cash equivalents of RMB1,129.0 million (US$169.7 million), short-term deposits of RMB6,474.2 million (US$973.1 million) and restricted short-term deposits of RMB1,000.0 million (US$150.3 million). For the third quarter of 2017, net cash from operating activities was RMB1,045.0 million (US$157.1 million).
SHARES OUTSTANDING As of September 30, 2017, the Company had a total of 1,260.8 million common shares, or the equivalent of 63.0 million ADSs outstanding.
Business Outlook For the fourth quarter of 2017, the Company expects net revenues to be between RMB3.4 billion and RMB3.5 billion, representing a year-over-year growth of 36.5% to 40.6%. This forecast reflects the Company's current and preliminary view on the market and operational conditions, which are subject to change.
Conference Call Information The Company will hold a conference call on Tuesday, November 14, 2017 at 8:00 pm Eastern Time, or Wednesday, November 15, 2017 at 9:00 am Beijing Time to discuss the financial results. Participants may access the call by dialing the following numbers:
United States:
+1-845-675-0438
International Toll Free:
+1-855-500-8701
China Domestic:
400-1200-654
Hong Kong:
+852-3018-6776
Conference ID:
# 4599539
The replay will be accessible through November 22, 2017 by dialing the following numbers:
United States Toll Free:
+1-855-452-5696
International:
+61-2-9003-4211
Conference ID:
# 4599539
A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://investors.yy.com/.
Exchange Rate This 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 RMB6.6533 to US$1.00, the noon buying rate in effect on September 30, 2017 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 Statement This 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 Measures The unaudited condensed consolidated financial information is prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), except that the consolidated statement of changes in shareholders’ equity, consolidated statements of cash flows, and the detailed notes have not been presented. YY uses non-GAAP operating income, non-GAAP operating margin, non-GAAP net income attributable to YY Inc., non-GAAP net margin, non-GAAP net income attributable to common shareholders, 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. Non-GAAP operating margin is non-GAAP operating income as a percentage of net revenues. Non-GAAP net income attributable to YY Inc. is net income attributable to YY Inc. excluding share-based compensation expenses. Non-GAAP net margin is non-GAAP net income attributable to YY Inc. as a percentage of net revenues. Non-GAAP net income attributable to common shareholders is net income attributable to common shareholders excluding share-based compensation expenses. Basic and diluted non-GAAP net income per ADS is non-GAAP net income attributable to common shareholders 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 share-based compensation 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 effect of non-cash share-based compensation expenses, which have been and will continue to be significant recurring expenses in its business. 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 Contact YY Inc. Matthew Zhao Tel: +86 (20) 8212-0000 Email: [email protected]
ICR, Inc. Xueli Song Tel: +1 (646) 915-1611 Email: [email protected]
__________________________________
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. Please refer to the section titled "Reconciliation of GAAP and Non-GAAP Results" for details.
2 Non-GAAP operating income is a non-GAAP financial measure, which is defined as operating income excluding share-based compensation expenses. Please refer to the section titled "Reconciliation of GAAP and Non-GAAP Results" for details.
3 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.
4 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 common shareholders divided by weighted average number of diluted ADS.
5 Non-GAAP diluted net income per ADS is a non-GAAP financial measure, which is defined as non-GAAP net income attributable to common shareholders 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 CONDENSEDCONSOLIDATED BALANCE SHEETS
(All amounts in thousands, except share, ADS and per ADS data)
December 31, 2016
September 30, 2017
September 30, 2017
RMB
RMB
US$
Assets
Current assets
Cash and cash equivalents
1,579,743
1,129,024
169,694
Short-term deposits
3,751,519
6,474,206
973,082
Restricted short-term deposits
-
1,000,000
150,301
Short-term investment
-
89,070
13,387
Accounts receivable, net
169,571
167,551
25,183
Inventory
2,266
332
50
Amount due from related parties
135,245
52,876
7,947
Prepayments and other current assets
224,732
180,422
27,118
Total current assets
5,863,076
9,093,481
1,366,762
Non-current assets
Deferred tax assets(1)
117,811
121,637
18,282
Investments
918,602
1,076,111
161,741
Property and equipment, net
838,750
925,233
139,064
Land use rights, net
1,872,394
1,836,493
276,027
Intangible assets, net
58,926
37,488
5,634
Goodwill
14,300
14,257
2,143
Amount due from related parties
-
20,000
3,006
Other non-current assets
101,933
71,334
10,722
Total non-current assets
3,922,716
4,102,553
616,619
Total assets
9,785,792
13,196,034
1,983,381
Liabilities, mezzanine equity and shareholders’ equity
(All amounts in thousands, except share, ADS and per ADS data)
December 31, 2016
September 30, 2017
September 30, 2017
RMB
RMB
US$
Mezzanine equity
9,272
522,426
78,521
Shareholders’ equity
Class A common shares (US$0.00001 par value; 10,000,000,000 and 10,000,000,000 shares authorized, 750,115,028 and 922,793,788 shares issued and outstanding as of December 31, 2016 and September 30, 2017, respectively)
44
56
8
Class B common shares (US$0.00001 par value; 1,000,000,000 and 1,000,000,000 shares authorized, 359,557,976 and 337,982,976 shares issued and outstanding as of December 31, 2016 and September 30, 2017, respectively)
26
24
4
Additional paid-in capital
2,165,766
5,161,606
775,796
Statutory reserves
58,857
58,857
8,846
Retained earnings
2,728,736
4,471,612
672,089
Accumulated other comprehensive income
93,066
60,671
9,119
Total YY Inc.’s shareholders’ equity
5,046,495
9,752,826
1,465,862
Non-controlling interests
6,060
54,984
8,264
Total shareholders’ equity
5,052,555
9,807,810
1,474,126
Total liabilities, mezzanine equity and shareholders’ equity
(1) Effectively January 2017, ASU 2015-17 issued by FASB requires entities to reclassify deferred tax assets and liabilities as non-current in the balance sheet. Accordingly, the Company retrospectively reclassified RMB107.3 million of deferred tax assets from current assets into non-current assets as of December 31, 2016.
YY INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(All amounts in thousands, except share, ADS and per ADS data)
Three Months Ended
Nine Months Ended
September 30, 2016
June 30, 2017
September 30, 2017
September 30, 2017
September 30, 2016
September 30, 2017
September 30, 2017
RMB
RMB
RMB
US$
RMB
RMB
US$
Net revenues
Live streaming
1,790,373
2,373,397
2,871,610
431,607
4,809,037
7,302,434
1,097,566
Online games
149,530
153,959
122,035
18,342
508,901
415,742
62,487
Membership
68,768
52,204
49,486
7,438
210,210
147,111
22,111
Others
81,134
29,431
49,174
7,391
191,752
102,967
15,476
Total net revenue
2,089,805
2,608,991
3,092,305
464,778
5,719,900
7,968,254
1,197,640
Cost of revenues(1)
(1,275,002
)
(1,563,445
)
(1,889,313
)
(283,966
)
(3,543,873
)
(4,829,753
)
(725,918
)
Gross profit
814,803
1,045,546
1,202,992
180,812
2,176,027
3,138,501
471,722
Operating expenses(1)
Research and development expenses
(163,236
)
(167,359
)
(166,139
)
(24,971
)
(515,112
)
(499,059
)
(75,009
)
Sales and marketing expenses
(109,075
)
(204,434
)
(249,480
)
(37,497
)
(275,735
)
(542,516
)
(81,541
)
General and administrative expenses
(102,683
)
(104,545
)
(144,678
)
(21,745
)
(276,245
)
(325,875
)
(48,979
)
Total operating expenses
(374,994
)
(476,338
)
(560,297
)
(84,213
)
(1,067,092
)
(1,367,450
)
(205,529
)
Gain on deconsolidation and disposal of subsidiaries
-
-
-
-
-
37,989
5,710
Other income
33,065
30,166
18,667
2,806
64,477
68,653
10,319
Operating income
472,874
599,374
661,362
99,405
1,173,412
1,877,693
282,222
Gain on partial disposal of investments
-
45,861
-
-
-
45,861
6,893
Interest expense
(20,357
)
(3,459
)
(3,651
)
(549
)
(60,327
)
(28,378
)
(4,265
)
Interest income
17,162
27,317
47,505
7,140
40,713
105,853
15,910
Foreign currency exchange gains (losses), net
(16
)
(281
)
(251
)
(38
)
773
(1,825
)
(274
)
Other non-operating expense
-
-
-
-
(23,474
)
-
-
Income before income tax expenses
469,663
668,812
704,965
105,958
1,131,097
1,999,204
300,486
Income tax expenses
(69,909
)
(100,531
)
(74,684
)
(11,225
)
(194,710
)
(264,288
)
(39,723
)
Income before share of (loss) income in equity method investments, net of income taxes
399,754
568,281
630,281
94,733
936,387
1,734,916
260,763
Share of (loss) income in equity method investments, net of income taxes
(1,867
)
4,726
6,806
1,023
3,879
15,467
2,325
Net Income
397,887
573,007
637,087
95,756
940,266
1,750,383
263,088
Less: Net loss attributable to the non-controlling interest shareholders and the mezzanine classified non-controlling interest shareholders
(2,152
)
(701
)
1,120
168
(11,398
)
(2,446
)
(368
)
Net income attributable to YY Inc.
400,039
573,708
635,967
95,588
951,664
1,752,829
263,456
YY INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (CONTINUED)
(All amounts in thousands, except share, ADS and per ADS data)
Three Months Ended
Nine Months Ended
September 30, 2016
June 30, 2017
September 30, 2017
September 30, 2017
September 30, 2016
September 30, 2017
September 30, 2017
RMB
RMB
RMB
US$
RMB
RMB
US$
Net income attributable to YY Inc.
400,039
573,708
635,967
95,588
951,664
1,752,829
263,456
Other comprehensive income:
Unrealized gain (loss) of available-for-sales securities, net of nil tax
13,354
(39,818
)
(22,128
)
(3,326
)
190,506
(19,710
)
(2,962
)
Foreign currency translation adjustments, net of nil tax
(562
)
(712
)
(12,592
)
(1,893
)
(1,671
)
(12,685
)
(1,907
)
Comprehensive income attributable to YY Inc.
412,831
533,178
601,247
90,369
1,140,499
1,720,434
258,587
Net income per ADS
—Basic
7.07
10.09
10.60
1.59
16.91
30.30
4.55
—Diluted
6.90
9.98
10.51
1.58
16.64
29.72
4.47
Weighted average number of ADS used in calculating net income per ADS
—Basic
56,560,174
56,832,278
60,008,235
60,008,235
56,290,231
57,857,025
57,857,025
—Diluted
60,814,662
57,488,989
60,503,529
60,503,529
60,773,398
59,681,394
59,681,394
(1) Share-based compensation was allocated in cost of revenues and operating expenses as follows:
Three Months Ended
Nine Months Ended
September 30, 2016
June 30, 2017
September 30, 2017
September 30, 2017
September 30, 2016
September 30, 2017
September 30, 2017
RMB
RMB
RMB
US$
RMB
RMB
US$
Cost of revenues
3,701
3,021
(434
)
(65
)
12,454
6,210
933
Research and development expenses
11,120
10,492
(6,049
)
(909
)
64,893
15,847
2,382
Sales and marketing expenses
612
303
(74
)
(11
)
2,392
738
111
General and administrative expenses
20,086
9,649
9,700
1,458
51,199
26,406
3,969
YY INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
(All amounts in thousands, except share, ADS and per ADS data)
Three Months Ended
Nine Months Ended
September 30, 2016
June 30, 2017
September 30, 2017
September 30, 2017
September 30, 2016
September 30, 2017
September 30, 2017
RMB
RMB
RMB
US$
RMB
RMB
US$
Operating income
472,874
599,374
661,362
99,405
1,173,412
1,877,693
282,222
Share-based compensation expenses
35,519
23,465
3,143
473
130,938
49,201
7,395
Non-GAAP operating income
508,393
622,839
664,505
99,878
1,304,350
1,926,894
289,617
Net income attributable to YY Inc.
400,039
573,708
635,967
95,588
951,664
1,752,829
263,456
Share-based compensation expenses
35,519
23,465
3,143
473
130,938
49,201
7,395
Non-GAAP net income attributable to YY Inc.
435,558
597,173
639,110
96,061
1,082,602
1,802,030
270,851
Non-GAAP net income per ADS
—Basic
7.70
10.51
10.65
1.60
19.23
31.15
4.68
—Diluted
7.48
10.39
10.56
1.59
18.79
30.54
4.59
Weighted average number of ADS used in calculating Non-GAAP net income per ADS
—Basic
56,560,174
56,832,278
60,008,235
60,008,235
56,290,231
57,857,025
57,857,025
—Diluted
60,814,662
57,488,989
60,503,529
60,503,529
60,773,398
59,681,394
59,681,394
YY INC.
UNAUDITED SEGMENT REPORT
(All amounts in thousands, except share, ADS and per ADS data)
Three Months Ended
September 30, 2017
YY Live(2)
Huya(2)
Total
Total
RMB
RMB
RMB
US$
Net revenues
Live streaming
2,319,251
552,359
2,871,610
431,607
Online games
113,188
8,847
122,035
18,342
Membership
46,139
3,347
49,486
7,438
Others
30,193
18,981
49,174
7,391
Total net revenue
2,508,771
583,534
3,092,305
464,778
Cost of revenues(1)
(1,379,016
)
(510,297
)
(1,889,313
)
(283,966
)
Gross profit
1,129,755
73,237
1,202,992
180,812
Operating expenses(1)
Research and development expenses
(117,231
)
(48,908
)
(166,139
)
(24,971
)
Sales and marketing expenses
(228,318
)
(21,162
)
(249,480
)
(37,497
)
General and administrative expenses
(127,342
)
(17,336
)
(144,678
)
(21,745
)
Total operating expenses
(472,891
)
(87,406
)
(560,297
)
(84,213
)
Other income
18,569
98
18,667
2,806
Operating income (loss)
675,433
(14,071
)
661,362
99,405
Share-based compensation was allocated in cost of revenues and operating expenses as follows:
Three Months Ended
September 30, 2017
YY Live
Huya
Total
Total
RMB
RMB
RMB
US$
Cost of revenues
(1,190
)
756
(434
)
(65
)
Research and development expenses
(7,973
)
1,924
(6,049
)
(909
)
Sales and marketing expenses
(106
)
32
(74
)
(11
)
General and administrative expenses
8,473
1,227
9,700
1,458
The Company revamped its internal organization and one sub-business stream previously presented and reviewed under YY Live was changed to be presented and reviewed under Huya from the first quarter of 2017. Segment information for the 3 months ended 30 September 2016 has been restated accordingly.
As the Company has disposed of a great majority of its online education business before the end of 2016 and disposed of the remaining portion of its online education business in the beginning of 2017, 100 Education ceased to be an operating segment starting from the first quarter of 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
September 30, 2017
YY Live
Huya
Total
Total
RMB
RMB
RMB
US$
Operating income (loss)
675,433
(14,071
)
661,362
99,405
Share-based compensation expenses
(796
)
3,939
3,143
473
Non-GAAP operating income (loss)
674,637
(10,132
)
664,505
99,878
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
Online games
147,010
6,949
153,959
22,710
Membership
50,014
2,190
52,204
7,701
Others
19,034
10,397
29,431
4,341
Total net revenue
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
)
Gain on deconsolidation and disposal of subsidiaries
-
-
-
-
Other income
30,156
10
30,166
4,450
Operating income (loss)
616,209
(16,835
)
599,374
88,413
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
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
Non-GAAP operating income (loss)
633,964
(11,125
)
622,839
91,875
YY INC.
UNAUDITED SEGMENT REPORT
(All amounts in thousands, except share, ADS and per ADS data)
Three Months Ended
September 30, 2016
YY Live
Huya
100 Education
Total
Total
RMB
RMB
RMB
RMB
US$
Net revenues
Live streaming
1,593,495
196,878
-
1,790,373
268,482
Online games
149,530
-
-
149,530
22,423
Membership
68,768
-
-
68,768
10,312
Others
20,240
-
60,894
81,134
12,167
Total net revenue
1,832,033
196,878
60,894
2,089,805
313,384
Cost of revenues(1)
(962,250
)
(279,710
)
(33,042
)
(1,275,002
)
(191,198
)
Gross profit (loss)
869,783
(82,832
)
27,852
814,803
122,186
Operating expenses(1)
Research and development expenses
(109,495
)
(47,551
)
(6,190
)
(163,236
)
(24,479
)
Sales and marketing expenses
(68,794
)
(21,753
)
(18,528
)
(109,075
)
(16,357
)
General and administrative expenses
(63,984
)
(18,087
)
(20,612
)
(102,683
)
(15,398
)
Total operating expenses
(242,273
)
(87,391
)
(45,330
)
(374,994
)
(56,234
)
Gain on deconsolidation and disposal of subsidiaries
-
-
-
-
-
Other income
33,065
-
-
33,065
4,958
Operating income (loss)
660,575
(170,223
)
(17,478
)
472,874
70,910
Share-based compensation was allocated in cost of revenues and operating expenses as follows:
Three Months Ended
September 30, 2016
YY Live
Huya
100 Education
Total
Total
RMB
RMB
RMB
RMB
US$
Cost of revenues
2,231
1,429
41
3,701
555
Research and development expenses
6,108
4,234
778
11,120
1,668
Sales and marketing expenses
575
37
-
612
92
General and administrative expenses
1,435
5,177
13,474
20,086
3,012
YY INC.
RECONCILIATION OF GAAP AND NON-GAAP RESULTS OF UNAUDITED SEGMENT REPORT
(All amounts in thousands, except share, ADS and per ADS data)