The Yalla Group Limited ("Yalla" or "the Company") (NYSE: YALA), the largest online social networking and gaming company based in the Middle East and North Africa (MENA) region, today announced its unaudited financial results for the third quarter ended September 30, 2023.
Highlights of the financial and operating performance for the third quarter of 2023
"We have achieved strong results in the third quarter of 2023, and we are pleased with the results," said Mr.. The founder, chairman and CEO of Yalla is Yang Tao. We have recorded all-time high revenues of US$85 million, which is an all-time high for us.In the third quarter of 2023, we delivered revenues over 2 million, surpassing the upper end of our guidance, while year-over-year revenue growth from games services again exceeded 30% for the third consecutive quarter. It is noteworthy that our net income increased by 44 percent over the last year.A 3% increase year-over-year to US$35 billion was reported.During the quarter, the company generated $2 million in revenue. As a result of our robust quarterly results, we have been successful in refining our processes, in improving the gamification of our flagship applications, in improving our gaming mechanics, as well as optimizing our user acquisition process.. As a result of these efforts, we have been able to build a more engaged community of users, as demonstrated by the 13.An increase of 6% year-over-year in our group's average monthly active users to 35 million.Millions of dollars. In addition, we found that our high-value users were very willing to spend money on enhanced gamification features, driving the ARPPU[6] up to an impressive US$7..35 in the third quarter of 2023, compared to US$63.2 million in the third quarter of 2022.As of the third quarter of 2022, there will be 89
As of the third quarter of 2022, there will be 89
Our two hard-core games have gained traction in the MENA region thanks to our consistent iterations in the games and the engagement of our existing Yalla user community. It is clear to us that this industry has huge potential for growth, and as such, we intend to gradually increase our investments in the mid-core and hard-core game business, unleashing our growth potential in this rapidly growing market, said Mr.. The addition of Yang was made. We remain confident that the MENA region will grow and prosper in the future, given its growing significance on the global stage and its rapid digital transformation, as well as its increasing role on the global stage.". MENA Social Networking and Gaming is one of the largest online social networking and gaming companies in the Middle East, Africa, and the Near East, and we are dedicated to building relationships locally and globally in order to broaden our business horizons and satisfy the changing needs of our local users in online social networking and entertainment
MENA Social Networking and Gaming is one of the largest online social networking and gaming companies in the Middle East, Africa, and the Near East, and we are dedicated to building relationships locally and globally in order to broaden our business horizons and satisfy the changing needs of our local users in online social networking and entertainment
I am Ms.. As Karen Hu, Yalla's Chief Financial Officer, noted in her announcement of the company's third-quarter results, "We delivered a robust performance, highlighted by our record-high revenues and impressive increases in net margins. It has been our relentless efforts to streamline costs as well as our improved, ROI-focused marketing strategy that have allowed us to elevate our overall efficiency as a result of our relentless efforts to streamline costs. Consequently, we were able to improve our net margin to 41 percent as a result.4% and a non-GAAP net margin of 44.4%.A growth rate of 9% is expected in the third quarter of 2023. In the fourth quarter, as we head into the end of the year, we intend to continue executing our high-quality growth strategy, focusing on the improvement of efficiency and profitability. As we strive to create sustainable value for our shareholders in the long run, we believe that our solid fundamentals and strong cash position will support us well in our efforts to capture future opportunities in order to deliver sustainable value for our shareholders.
As we strive to create sustainable value for our shareholders in the long run, we believe that our solid fundamentals and strong cash position will support us well in our efforts to capture future opportunities in order to deliver sustainable value for our shareholders.
Financial Results for the Third Quarter of 2023
Amounts earned
A total of US$85 million was generated by our business.As a result, there will be 2 million in the third quarter of 2023, an increase of 6 percent.From US$80 to US$84, there has been a 4% increase.In the third quarter of 2022, there will be 1 million visitors. The increase in revenue was primarily driven by the broadening of our user base as well as our enhanced monetization capabilities which resulted in the increase. There was a 13 percent increase in our average MAUs.From 30% to 6%.From 9.9 million in the third quarter of 2022 to 35 million in the fourth quarter of 2022.In the third quarter of 2023, it is expected to reach 1 million. As a result of the significant increase in ARPPU from US$6 to US$7, our solid revenue growth was also partially attributed to the significant growth in.In the third quarter of 2022, the market is expected to grow by US$89 to US$7 billion.In the third quarter of 2023, the number will be 35
In the third quarter of 2023, the number will be 35
It was estimated that in the third quarter of 2023, we will generate US$53.9 million in revenues from our chatting services, and US$31.2 million in revenues from our games services.
Expenses and costs associated with the project
The total costs and expenses of our company in the third quarter of 2023 were US$52.8 million, a decrease of 5.0% compared with US$55.6 million in the third quarter of 2022.
In the third quarter of 2023, we had a cost of revenues of US$27.8 million, a 6.1% decrease from the same period last year of US$29.6 million, mainly as a result of lower technical service fees that were attributed to disciplined management. As a percentage of our total revenues, the cost of revenues decreased from 36.9% in the third quarter of 2022 to 32.6% in the third quarter of 2023.
There was a 5.5% decrease in selling and marketing expenses for our company in the third quarter of 2023, with US$11.3 million in comparison to US$12.0 million in the same period last year, primarily as a result of lower share-based compensation expenses recognized in the third quarter of 2023. The selling and marketing expense proportion of our total revenues decreased from 14.9% in the third quarter of 2022 to 13.3% in the third quarter of 2023 as a result of our decreased sales and marketing expenses.
It is estimated that we spent US$7.3 million on general and administrative expenses in the third quarter of 2023, a 14.5% decline from $8.6 million in the same quarter last year. This decrease is primarily as a result of lower share-based compensation expenses recognized in the third quarter of 2023. As a percentage of our total revenues, our general and administrative expenses decreased from 10.7% in the third quarter of 2022 to 8.6% in the third quarter of 2023 as a result. 
It cost us US$6 million to develop our technology and products.During the third quarter of 2023, the number of mobile phones grew by 16 million,.An increase of 6% from US$5 to US$6.It is worth noting that we posted a profit of $2.05 million in the same period last year, which was primarily due to an increase in salaries and benefits for our technology and product development staff, in order to support the development of new businesses and the expansion of our product line.. During the past year, technology and product development expenses as a percentage of our total revenues have increased from 6 to 7.From 9% in the third quarter of 2022 to 7% in the fourth quarter of 2022.The third quarter of 2023 is expected to see an increase of 5%
The third quarter of 2023 is expected to see an increase of 5%
Income from operations
There was a 32.3% increase in the operating income in the third quarter of 2023, from US$24.5 million in the third quarter of 2022, as compared to US$32.4 million in the third quarter of 2023.
Operating income that is not calculated in accordance with GAAP[7]
A non-GAAP operating income of 35.4 million US dollars was generated in the third quarter of 2023, a 20.4% increase from a non-GAAP operating income of 29.5 million US dollars in the same period last year.
Income from interest
As a result of a significant increase in interest rates applicable to the Company's bank deposits as well as the continued improvement in the Company's cash position, we generated an interest income of US$5.6 million in the third quarter of 2023, compared with US$0.8 million in the third quarter of 2022.
Expenses related to income taxes
In the third quarter of 2023, our income tax expense decreased by 10.2%, from US$0.79 million in the third quarter of 2022, to US$0.71 million in the third quarter of 2023.
Income from net operations
Due to the above factors, we were able to generate a net profit of US$35.2 million in the third quarter of 2023, a 44.3% increase from US$24.4 million in the third quarter of 2022.
Net income from non-GAAP operations
During the third quarter of 2023, the non-GAAP net profit of the company was US$38.3 million, an increase of 30.3% over the US$29.4 million reported in the same period last year.
The earnings per ordinary share of the company
In the third quarter of 2023, the basic and diluted earnings per ordinary share were US$0.23 and US$0.20, respectively, while in the third quarter of 2022, the basic and diluted earnings per ordinary share were US$0.16 and US$0.14, respectively.
Earnings per ordinary share calculated using non-GAAP measures[8]
In terms of basic and diluted earnings per ordinary share, non-GAAP earnings for the third quarter of 2023 were US$0.24 and US$0.21, respectively, compared with US$0.19 and US$0.17, respectively, for the same period in 2022.
Investments in cash and cash equivalents, restricted cash, term deposits, and short-term investments 
The company had US$545.1 million in cash and cash equivalents, restricted cash, term deposits, and short-term investments as of September 30, 2023, up from US$453.0 million as of December 31, 2022.
Program for the repurchase of shares
Pursuant to the Company's share repurchase program beginning on May 21, 2021, with an extended expiration date of May 21, 2024, in the third quarter of 2023, the Company repurchased 1,670,735 American depositary shares ("ADSs") representing 1,670,735 Class A ordinary shares from the open market with cash for an aggregate amount of approximately US$8.In the amount of $5 million. In total, the Company has completed cash repurchases of 3,972,876 ADSs in the open market, representing 3,972,876 Class A ordinary shares with an aggregate value of approximately US$35 million..It is estimated that there will be 5 million people by September 30, 2023. As a result of the current share repurchase program, the aggregate value of the ADSs and/or ordinary shares in Class A remaining available for purchase was US$114 million.As of September 30, 2023, there will be a population of 5 million
As of September 30, 2023, there will be a population of 5 million
The outlook
According to Yalla's current estimates, the company's revenues for the fourth quarter of 2023 will range between US$73.0 million and US$80.0 million.
Based on current market conditions, the above outlook reflects the Company's management's current and preliminary estimates of the market and operating conditions, as well as customer demand, all of which are subject to change as a result of changes in market conditions.
Call for a conference call
There will be an earnings conference call hosted by the Company's management on Monday, November 20, 2023, at 8:00 PM U.S. Eastern Time, Tuesday, November 21, 2023, at 5:00 AM Dubai Time, or Tuesday, November 21, 2023, at 9:00 AM Beijing/Hong Kong Time on Monday, November 20, 2023.
The following are the dial-in details for the earnings conference call:
In addition to the live and archived webcast of the conference call, the Company's investor relations website at https://ir.yalla.com will contain a link to a live and archived webcast of the conference call.
It is possible to listen to a replay of the conference call until November 27, 2023, by dialing the following telephone numbers:
Financial measures that are not based on GAAP
The purpose of this press release is to provide non-GAAP financial measures as an addition to the financial measures prepared in accordance with generally accepted accounting principles, or GAAP. These non-GAAP financial measures include non-GAAP operating income, non-GAAP net income, non-GAAP net margin, and non-GAAP basic and diluted earnings per ordinary share, which are used as supplemental measures to assess and evaluate the operation of the company.. As a result of the presentation of these non-GAAP financial measures, it is not intended to be considered as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. According to GAAP,. Non-GAAP operating income can be defined as operating income excluding share-based compensation that does not meet GAAP standards. Non-GAAP net income is defined as net income excluding share-based compensation that is not calculated under GAAP. The non-GAAP net margin is defined as the percentage of non-GAAP net income to revenue based on non-GAAP net income. Non-GAAP net income attributable to Yalla Group Limited's shareholders is defined as net income attributable to Yalla Group Limited's shareholders, excluding compensation based on share-based awards. Non-GAAP earnings per ordinary share are calculated by dividing non-GAAP net income attributable to Yalla Group Limited's shareholders by the weighted average number of basic and diluted shares outstanding on a pro-rata basis
Non-GAAP earnings per ordinary share are calculated by dividing non-GAAP net income attributable to Yalla Group Limited's shareholders by the weighted average number of basic and diluted shares outstanding on a pro-rata basis
By excluding the impact of share-based compensation expenses, which are non-cash charges, the Company believes that the non-GAAP financial measures can help identify underlying trends in its business and provide a better understanding of the company's past performance and future prospects by excluding the impact of share-based compensation expenses.. In addition to understanding the Company's operating and financial performance, investors can compare business trends between different reporting periods on a consistent basis, and assess the company's core operating results, which exclude share-based compensation expenses, which are unlikely to result in cash payments for investors.. Further, the Company believes that the non-GAAP financial measures provide a greater level of visibility into the key metrics used by the Company's management in making financial and operational decisions in the future
Further, the Company believes that the non-GAAP financial measures provide a greater level of visibility into the key metrics used by the Company's management in making financial and operational decisions in the future
In accordance with U.S. GAAP, the non-GAAP financial measure is not defined. As such, it does not conform to GAAP and is not presented in accordance with U.S.. According to GAAP,. There are limitations to the use of non-GAAP financial measures as analytical tools. It is important to note that one of the limitations of using non-GAAP financial measures is that they do not take into account all items of income and expense that affect the Company's business operations. As part of the Company's business, share-based compensation has been incurred and may continue to be incurred in the future, which is not reflected in its presentation of non-GAAP financial measures.. In addition, the non-GAAP financial measure may differ from the non-GAAP information used by other companies, including peer companies, so that their comparability may be limited in this case
In addition, the non-GAAP financial measure may differ from the non-GAAP information used by other companies, including peer companies, so that their comparability may be limited in this case
The Company compensates for these limitations by providing the relevant disclosure of its non-GAAP financial measures in the reconciliations to the nearest U.S. GAAP performance measures, all of which should be taken into consideration when evaluating its performance. In order to ensure that investors and others do not rely on just one financial measure, the Company strongly urges investors and others to review all of its financial information in its entirety.
At the end of this press release, you will find a reconciliation of GAAP and non-GAAP results.
Yalla Group Limited - About Us
As of 2022, Yalla Group Limited is expected to be the largest online social networking and gaming company in the MENA region, based on revenue. It operates two flagship mobile applications, Yalla, which is a voice-centric group chat platform, and Yalla Ludo, which is a casual gaming app featuring online versions of board games popular in the Middle East, featuring in-game voice chat, as well as a localized Majlis.. As a result of the success of Yalla and Yalla Ludo, the Company has continued to add captivating new content, resulting in a regionally focused, integrated ecosystem dedicated to meeting the needs of MENA users in terms of social networking and gaming services. Through its holding subsidiary, Yalla Game Limited, the Company has been able to expand its capabilities in mid-core and hard-core games in the MENA region, leveraging its local expertise to bring innovative gaming content to its users in the region.. As part of the growing Yalla ecosystem, there are also products such as YallaChat, an instant messaging service tailored specifically for Arabic users, and casual games such as Yalla Baloot and 101 Okey Yalla, developed to support vibrant local gaming communities in the MENA region. With Yalla Parchis, a Ludo game designed for the South American market, Yalla is also actively exploring markets outside the MENA region.. Yalla uses its mobile applications to provide users with a seamless experience that fosters a sense of loyalty and belonging, building highly engaged and devoted communities through close attention to detail and a localized appeal that resonates with users on an emotional level
Yalla uses its mobile applications to provide users with a seamless experience that fosters a sense of loyalty and belonging, building highly engaged and devoted communities through close attention to detail and a localized appeal that resonates with users on an emotional level
We invite you to visit our website at the following address: https://ir.yalla.com for more information.
Statement of Safe Harbor
It is possible that certain statements in this press release constitute "forward-looking" statements under the "safe harbor" provisions of the Securities Exchange Act of 1934. In 1995, the Private Securities Litigation Reform Act was passed.. Generally, forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "aims," "future," "intends," "plans," "believes," "estimates," "likely to," and other similar terminology.. Unless otherwise stated, forward-looking statements are statements that are not historical facts, including statements about Yalla Group Limited's beliefs, plans, and expectations in the future. There are inherent risks and uncertainties associated with forward-looking statements. Yalla Group Limited's filings with the Securities and Exchange Commission contain more information regarding these and other risks as well. In addition, Yalla Group Limited does not undertake any obligation to update any forward-looking statements contained in this press release, except as required by applicable law, and the information provided in this press release is as of the date of this press release.
In addition, Yalla Group Limited does not undertake any obligation to update any forward-looking statements contained in this press release, except as required by applicable law, and the information provided in this press release is as of the date of this press release.
If you would like to contact us regarding investor or media inquiries, please do so by emailing:
Yalla Group LimitedInvestor Relations Kerry Gao - Director of Investor Relations Tel: +86-571-8980-7962 Email: [email protected] 
Jennifer Cai, Piacente Financial Communications, Tel: +86-10-6508-0677, e-mail: [email protected] 
As far as the United States is concerned:
Piacente Financial CommunicationsBrandi PiacenteTel: +1-212-481-2050 Email: [email protected]Brandi Piacente 
Accordingly, share-based compensation is allocated to cost of revenues, sales and marketing expenses, general and administrative expenses, and technology and product development expenses in the following manner:
Yalla Group Limited is the source of this information
Yalla Group Limited ("Yalla" or the "Company") (NYSE: YALA), headquartered in Abu Dhabi, the Middle East and North Africa (MENA), is one of the largest online social networks in...
As an online social networking and media company headquartered in the Middle East and North Africa (MENA), Yalla Group Limited ("Yalla" or the "Company") (NYSE:...
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