#China #Beijing #Hello Group #Momo app #Tantan app

Hello Group Inc. Reports Q2 2025 Financial Results

Hello Group Inc., a leading firm in Asia's online social networking industry, has recently disclosed its unaudited financial performance for the second quarter of 2025. The company witnessed a slight decrease in net revenues, reaching RMB 2,620.4 million (approximately $365.8 million), reflecting a 2.6% dip compared to the same quarter last year.

Key Highlights

During the second quarter, a significant contrast emerged in the company's revenue sources. While domestic revenue took a hit, overseas revenue surged by an impressive 72.7%, totaling RMB 442.4 million (about $61.8 million). This disparity indicates a growing demand for Hello Group's services beyond the domestic market.

However, the overall balance sheet presented a stark reality for Hello Group, as it grappled with a net loss amounting to RMB 140.2 million ($19.6 million). In comparison, the same period in 2024 registered a net income of RMB 397.8 million, highlighting the challenges the company is currently navigating.

Financial Breakdown

The company attributed its revenue decline primarily to a sluggish consumer sentiment affecting its flagship Momo app, which provides social networking services. Monthly Active Users (MAU) for the Tantan app fell to 10.2 million in June 2025, down from 12.9 million a year earlier. Similarly, total paying users for the Momo app dropped to 3.5 million from 7.2 million in the previous year. This downturn in user engagement has significantly influenced revenue streams and operational performance.

In a separate note, Hello Group recorded an additional withholding tax accrual of RMB 547.9 million ($76.5 million), stemming from new tax regulations applied to dividends from its entity in mainland China to its Hong Kong parent company.

Cost Management Strategy

Despite the revenue challenges, Hello Group managed its costs effectively with total expenses standing at RMB 2,227.7 million, down 2.1% from the previous year. The company emphasized its efforts to control marketing expenses and optimize its operational strategies, particularly related to the Tantan app, to mitigate the impact of declining revenues.

Look Ahead

Looking forward, Hello Group's management anticipates total net revenues for Q3 2025 to range between RMB 2.59 billion and RMB 2.69 billion. This forecast reflects an expected decrease of up to 3.2% or a marginal increase of 0.6% compared to the previous year.

Chairman and CEO Yan Tang expressed optimism regarding the company's strategic moves, especially regarding cost controls and overseas business expansion. He stated, "Our overseas business has successfully maintained rapid growth while effectively managing costs and expenses. This approach ensures our overseas operations contribute more significantly to our overall financial performance."

In light of the ongoing challenges, Hello Group continues to focus on user acquisition and engagement strategies, alongside exploring innovative features for its platforms, Momo and Tantan, while also nurturing new applications that cater to emerging market segments.

Conclusion

In summary, while Hello Group faces considerable headwinds characterized by declining revenues and net losses, there are notable signs of resilience in its overseas performance and ongoing strategic initiatives aimed at long-term growth and sustainability in the highly competitive online social networking landscape. Investors and stakeholders will be keenly observing the company's progress as it adapts to the evolving market dynamics.