User base growth boosts live-streaming platform Huya’s Q3 profits

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Screenshot of Huya’s logo (Image Credit: Tony Xu / Technode)

Chinese game live-streaming platform Huya reported substantial increases in monthly active users (MAUs) and paying users in the third quarter, powering the company’s strong revenue and profit growth for the period.

Why it matters: As one of China’s largest game live-streaming platforms, Huya has been expanding its content offerings to include other entertainment genres such as talent shows and anime.

Details: Total net revenues for the third quarter rose 77.4% year on year to RMB 2.27 billion ($317 million).

  • Live-streaming revenues for the period surged 77.2% year on year to RMB 2.16 billion, accounting for around 95.2% of Huya’s total revenue for the quarter. The company attributed the growth to higher average spending per paying user and an overall increase in paying users, though it did not disclose specifics.
  • The company’s gross profit more than doubled year on year in the three months ended Sep. 30, reaching RMB 406 million. Gross margin rose to 17.9% compared with 16.7% in the previous quarter and 15.2% in the third quarter of 2018.
  • Average mobile MAUs grew 29.1% year on year to 64 million, while total MAUs—including users from all of Huya’s domestic platforms—increased 47.6% year on year to 146 million.
  • Huya recorded 5.3 million domestic paying users for the third quarter, a 28.5% increase compared with the same period last year.
  • Cost of revenues for the third quarter also expanded 71.7% year on year to RMB 1.86 billion, primarily due to increases in revenue-sharing fees and content costs.

Context: In addition to including more diverse entertainment content, Huya has also recently started to construct its own mini program ecosystem to enrich user experience.

  • One of the mini programs Huya unveiled (in Chinese) in November is an artificial intelligence-powered virtual pet assistant that performs at the command of livestreamers and responds to live comments from users.
  • Huya also pledged to invest RMB 1 billion-worth of resources over the next three years to support mini program developers.