Chinese social network app developer Momo delivered a strong quarterly result early Tuesday, with a 214 percent year-on-year increase in revenue to US$312.2 million.
After a reinvention of its business model, Momo has transformed from a dating app into a social and live streaming platform. Live video service, launched in the third quarter of 2015, continued to provide a significant boost to its business, generating US$259 million during the second quarter alone and accounting for 83 percent of the company’s total income.
The rocket-like growth of Momo’s live video service is best illustrated by the income of the “anchors” on the platform. Users can buy virtual “gifts” that they send to their favorite broadcasters to get attention, convey their gratitude, etc. That part of revenue, incorporated in value-added service, is split between the broadcaster and Momo.
According to statistics provided by the company, the top 10 live streaming broadcasters on the platform made a total 115 million yuan (US$17.2 million) last year. On average, each of them earned about US$958,000 yuan per month. Value-added service revenue, mainly from virtual gift and membership subscription, soared to US$24.6 million, up 58 percent from the year-ago quarter.
The top social network app continued its impressive user growth from last year.
As of June 2017, monthly active users were 91.3 million from 74.8 million a year ago. Paying users for its live video service rose to 4.1 million.
Momo is turning to new tactics to leverage its live streaming success.
In June, the company announced a partnership with BMG, the music division of European media giant Bertelsmann SE, and worked with the Rolling Stones and Avril Lavigne.
Momo will host an annual online competition that its users can vote on, and BMG will help groom the final winners for a possible contract and global debut. The deal will provide an international showcase for Momo as a platform for emerging social media stars from China.
The social network app issued its 8.0 update in July. During the earnings conference call, chief operating officer Wang Li introduced new features the company hopes to capitalize on for its streaming success, including one-on-one “fast chat”, group “party” video streaming, as well as one of China’s most popular party games Werewolf.
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