Hello Group Inc. Q1 FY2025 earnings call

• Q1 2025 was a solid start to 2025. Strategic priorities include maintaining Momo's productivity, improving Tantan's core experience, and deepening overseas presence. • Momo optimized interactive features and developed an in-house AI algorithm for personalized greetings, adjusted user acquisition channels to improve ROI. • Tantan reduced marketing spend, improved ecosystem and product experience, upgraded products with a focus on user authenticity. • Overseas revenue grew 72%, So Cho contributed significantly, other apps like YahaLand and Amaz entered monetization phase, and plans to expand dating products in overseas markets.

Total group revenue for Q1 2025 was RMB2.52 billion, slightly down 1.5% year over year. Domestic revenue reached RMB2.11 billion, down 9% year over year. Overseas revenue was RMB415 million, up 72% year over year. Value-added services (formerly live streaming and WaaS) for Momo totaled RMB1.78 billion, down less than 10% year over year. Tantan's onshore revenue in Q1 was close to RMB170 million, down 19% year over year. Overseas revenue accounted for 16% of total revenue in Q1 2025, up from less than 10% in Q1 2024.

• Q2 revenue is expected to be in the range of RMB2.57 billion to RMB2.67 billion, down 4.5% to 0.8% year over year. • PRC mainland business is expected to decrease mid to low teens year over year, while overseas revenue is projected to grow over 80%. • Full-year domestic revenue is expected to decline by approximately 10% year over year. • Gross margin for 2025 is anticipated to be in the range of 36% to 37% due to the overseas revenue mix. • Operating margin is expected to be in the low teens percentage, likely within the 13% to 14% range.

• Macro-economic uncertainties and geopolitical issues that could impact consumer spending. • Regulatory changes that might affect operations. • Intense competition in overseas markets. • One-off expenses and lower margins in the early stages of overseas business expansion.

Q: Regarding Socho's revenue slowdown, what are the reasons and growth plans?

A: Slowdown is due to high base, Middle East political unrest, but efforts include acquiring paying users, new features, expanding markets. Focus on product innovation and market penetration.

Q: About overseas product growth and revenue estimation?

A: Socho is the largest overseas product, other products show strong growth. Overseas revenue expected to continue accelerating with dual engines of social entertainment in MENA and dating business.

Q: On Momo, Tantan 2025 outlook and China revenue?

A: Momo enhanced product operations and algorithms, Tantan reduced costs and optimized ROI. China revenue expected to decline mid to low teens in Q2, full-year decline around 10%.

Q: On margin outlook for the year?

A: Gross margin expected to be 36%-37% due to overseas mix. Operating expenses to be managed, sales and marketing spend to increase for overseas, operating margin expected in low teens.