- Total Net Revenues: RMB1.03 billion, a decrease of 25.9% year-over-year.
- Livestreaming Revenues: RMB0.79 billion, down 37.2% from RMB1.26 billion in the same period of 2023.
- Quarterly Average Mobile MAUs: 44.1 million, a decrease of 12.3% year-over-year.
- Number of Paying Users: 3.4 million.
- Quarterly ARPU: RMB243, down 25.5% from RMB326 in the same period last year.
- Innovative Business, Advertising and Other Revenues: RMB242 million, up 80.7% from RMB133.9 million in the same period of 2023.
- Cost of Revenues: RMB0.95 billion, a decrease of 21.2% year-over-year.
- Revenue-Sharing Fees and Content Costs: RMB0.8 billion, down 18.1% from RMB0.98 billion in the same period of 2023.
- Bandwidth Costs: RMB79.6 million, down 33% from RMB118.8 million in the same period of 2023.
- Gross Profit: RMB84.2 million, compared with RMB188.9 million in the same period of 2023.
- Gross Margin: 8.2%, compared with 13.6% in the same period of 2023.
- Sales and Marketing Expenses: RMB77 million, down 11.5% from RMB87 million in the same period of 2023.
- Research and Development Expenses: RMB50.1 million, down 29.4% from RMB71 million in the same period of 2023.
- General and Administrative Expenses: RMB48.5 million, up 3.4% from RMB46.9 million in the same period of 2023.
- Loss from Operations: RMB119.6 million, compared with RMB7.5 million in the same period of 2023.
- Net Loss: RMB49.2 million, compared with net income of RMB6.8 million in the same period of 2023.
- Adjusted Net Loss: RMB45.5 million, compared with adjusted net income of RMB61.4 million in the same period of 2023.
- Cash and Cash Equivalents: RMB6.56 billion as of June 30, 2024, compared with RMB6.86 billion as of December 31, 2023.
- Share Repurchase Program: USD11.2 million in ADS repurchased as of June 30, 2024, under the USD20 million program.
- Special Cash Dividend: Approximately USD300 million declared in early July.
Release Date: September 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- DouYu International Holdings Ltd (DOYU, Financial) has undertaken several initiatives to foster a healthy, vibrant game-centric content ecosystem, focusing on top-tier streamers and premium content.
- The company has deepened its cooperation with game developers, exploring diverse and sustainable partnership models.
- DouYu broadcasted nearly 30 large-scale official tournaments and over 50 self-produced eSports tournaments during the quarter, enhancing user engagement and driving monetization.
- The company has implemented various streamer recruitment initiatives, widening the recruitment scope and improving streaming incentives.
- Innovative business, advertising, and other revenues increased significantly by 80.7% year-over-year, driven by new revenue streams such as voice-based social networking services.
Negative Points
- Quarterly average mobile MAUs decreased by 12.3% year-over-year, primarily due to competition from short video platforms.
- Total net revenues decreased by 25.9% year-over-year, with livestreaming revenues down 37.2% due to challenging macroeconomic conditions.
- The number of paying users declined, and quarterly ARPU decreased by 25.5% year-over-year.
- Gross profit and gross margin both declined year-over-year, primarily due to decreased livestreaming revenues outpacing the reduction in cost of revenues.
- Net loss for the second quarter of 2024 was RMB49.2 million, compared with net income of RMB6.8 million in the same period of 2023.
Q & A Highlights
Highlights of DouYu International Holdings Ltd (DOYU) Q2 2024 Earnings Call
Q: How does management view the current macro challenges and changes and the impact on the operations?
A: Mingming Su, Chief Strategy Officer, explained that DouYu faces intense market competition and macroeconomic headwinds. Despite a decline in MAUs due to competition from short video platforms, core user metrics like viewing hours and activity levels remain stable. The company is focusing on fostering a game-centric content ecosystem and diversifying revenue streams to enhance resilience.
Q: Based on the current competition environment, how's the stability of the streamers on your platform and any large investment on streamer resources in the future?
A: Simin Ren, Vice President, stated that DouYu's streamer assets remain stable. The company is enhancing streamer content quality and efficiency, focusing on niche game segments, and providing streamers with diverse income opportunities. Recruitment models have been revised to give streamers more freedom, and the company is continuously upgrading streaming technologies and support tools.
Q: Can you share the driver behind the year-on-year decline in the second quarter's gross margin? How should we look at the full-year gross margin and the overall margin trend?
A: Hao Cao, Vice President of Finance, attributed the decline in gross margin to decreased livestreaming revenue. Fixed costs like copyright and base compensation for streamers did not decrease proportionally. The company is optimizing content costs, enhancing production efficiency, and controlling operational expenses to improve financial stability.
Q: What is the estimated cash balance by the end of this year, and any cash usage pecking order plan?
A: Hao Cao mentioned that as of the end of Q2, DouYu had RMB6.56 billion in cash and equivalents. Despite significant expenditures on share repurchases and dividends, the cash balance remains healthy. The company will continue to invest in community ecosystems and new businesses to enhance user experience and platform competitiveness.
Q: Can management share the latest development plan and progress regarding cooperation with game developers and your expectation on revenue growth?
A: Simin Ren highlighted that DouYu is focusing on commercial collaborations with game developers, particularly in game prop sales. The company has launched game membership services and exclusive boutiques, contributing to revenue growth. Innovative business revenue is expected to account for over 20% of total net revenue in 2024.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
