Momo's Operator Reports 1.5% Revenue Drop, 580% Profit Surge

Zhitong Group, the operator of Momo, reported a 1.5% year-over-year decrease in net revenue for the first quarter of 2025, totaling 25.208 billion yuan. This decline in revenue was accompanied by a significant increase in net profit attributable to the company, which rose to 3.580 billion yuan from 520 million yuan in the same period last year. The diluted earnings per American Depositary Share (ADS) also saw a substantial increase, reaching 2.07 yuan compared to 0.03 yuan in the previous year.

The decrease in net revenue can be attributed to various factors, including changes in user behavior and market conditions. Despite the decline in revenue, the company's net profit and earnings per ADS showed strong growth, indicating improved operational efficiency and cost management. The increase in net profit suggests that the company has been able to control its expenses effectively, leading to higher profitability.

One notable aspect of the report is the decrease in the number of paying users on Momo, which fell to 4.2 million. This reduction in paying users could be a result of increased competition in the social networking and dating app market, as well as changes in user preferences and behaviors. The decline in paying users may have contributed to the decrease in net revenue, as fewer users are generating income through in-app purchases and subscriptions.

The company's performance in the first quarter of 2025 highlights the challenges faced by social networking and dating app providers in maintaining user engagement and revenue growth. Despite the decline in revenue and paying users, the company's ability to increase net profit and earnings per ADS demonstrates its resilience and adaptability in a competitive market. As the company continues to navigate the evolving landscape of social networking and dating apps, it will be important for it to focus on user acquisition, retention, and monetization strategies to drive future growth.