DouYu Q3 2024 Earnings Results

DouYu International Holdings Limited experienced a significant financial downturn in the third quarter of 2024, characterized by a 21.8% year-over-year decline in total net revenues to ¥1.06 billion RMB ($146.3 million USD). Net income also saw a sharp contraction, falling to ¥3.4 million ($0.5 million) from ¥76.4 million ($1.05 million) in the same period of the previous year. This performance reflects broader challenges within the Chinese live-streaming industry, including a soft macroeconomic environment that contributed to a reduction in both the number of paying users and average revenue per paying user. Average mobile monthly active users dropped to 42.1 million, down from 51.7 million in the third quarter of 2023.

The primary driver of this decline was a 34.7% drop in core live-streaming revenues, which fell to ¥752.1 million ($103.8 million). In response to these pressures, the company is aggressively pursuing a strategic shift toward revenue diversification. Revenues from innovative business segments, advertising, and other services grew by 49.4% to ¥311 million ($42.9 million), now representing 29.3% of total revenue compared to 15.3% in the prior year. This growth is supported by new initiatives in voice-based social networking and game membership services.

To maintain financial resilience, the company has implemented comprehensive cost-optimization measures, resulting in reduced expenditures across sales and marketing, research and development, and general and administrative categories. Despite these efforts, gross profit margins narrowed to 5.7% from 14.2%. As of September 30, 2024, the company held ¥4.38 billion ($604.5 million) in cash and cash equivalents, a decrease attributed to a $300 million special cash dividend distribution and a $20 million share repurchase program.