Momo and BlueCity Report Fourth Quarter and 2020 Financial Results

Written by Dominic Whitlock

Momo and BlueCity, the two leading Chinese dating companies on the Nasdaq market, have published their respective Fourth Quarter and Full Fiscal Year financial reports.

Despite a year-on-year revenue decrease, Momo’s results beat analyst predictions fairly comprehensively. Total revenue for the quarter was $581.6 million, a 13.6% fall on 2019, but $16.7 million ahead of estimates.

The number of active and paying users also dropped over the past 12 months, as the business was adversely affected by the pandemic. Tantan lost 700,000 premium subscribers compared to last year.

However, the management team remains confident that the worst is behind them and believe recent positive trends indicate a promising period of development.

CEO Li Wang explained in a statement: “Our commitment to the core mission enabled us to make difficult but right decisions in the past year for the long term wellbeing of our company and our community.

“After several months of hard work, we have started seeing positive trends in the content ecosystem as well as business of the core Momo. Getting through the bumpy journey last year was a valuable growth experience for our team. I am happy to see we have finally come out of the temporary drawbacks, stronger and better poised to seize the growth opportunities ahead of us.”

BlueCity reported its earnings before the market opened yesterday and the following activity could indicate that investors weren’t happy with the numbers. The share price dropped by just over 19%, with a sharp fall off towards the end of the trading day.

Fourth Quarter revenues hit $42.7 million. While this was an increase of almost 25% from the same period last year, it was on the very low end of previously provided guidance.

There is speculation that BlueCity has also been overly optimistic about its predictions for 2021, with the company aiming for revenue growth of up to 42%. There’s evidence that some investors are concerned about what might happen if these targets aren’t achieved.

The integration of LESDO and Finka has so far been smooth, with user numbers on both platforms continuing to increase. The total number of users across the whole portfolio has moved above 7.5 million.

BlueCity also announced it will be terminating its family planning business which has not had the desired revenue impact.

Founder, Chairman and CEO Baoli Ma said: “2020 was a breakthrough year for BlueCity as we continued to strengthen our leadership in LGBTQ community in China and overcame the challenges associated with global operation and expansion. 

“Through our continued focus on improving our product offerings and user experience, we have fostered a greater sense of belonging in the LGBTQ community, which, in turn, solidifies our leadership position in the industry.”

Read more about Momo’s results here and BlueCity’s results here.

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