Momo (NASDAQ:MOMO) is a market leader in mobile-based social networking services in China, a sector that offers abundant potential for growth over the years and even decades ahead. According to data from China Internet Network Information Centre, there are currently 772 million internet users in China, and 97.5% of China’s online population can access the internet via a smartphone.
Based on financial reports for the first quarter of 2018, Momo has 103.3 million monthly active users as of March of 2018, a vigorous increase of 21% versus 85.2 million monthly active users in the first quarter of 2017. Total paying users in the company’s live video service and value-added services, without double counting the overlap, were 8.1 million for the first quarter of 2018, compared to 7.0 million for the first quarter of 2017.
Momo has reached a considerable size, and it’s growing rapidly, but the company still has a lot of room for expansion when considering the size of the addressable market opportunity.
The company has produced impressive financial performance over the long term, with key variables such as revenue, free cash flow, and earnings per share moving in the right direction at a considerable speed over the past several years.
MOMO Revenue (TTM) data by YCharts
Total revenue during the first quarter of 2018 amounted to $435.1 million, a vigorous increase of 64% from $265.2 million in the first quarter of 2017. Revenue from live video services was $371.5 million in the period, an increase of 74.8% from $212.6 million during the same quarter in the prior year. Value-added services, which includes membership subscription revenues and virtual gift revenues, amounted to $37 million in the first quarter of 2018, an increase of 62% from $22.9 million during the same period of 2017. Mobile marketing and mobile games