On March 21, 2023, Huya Inc., a leading game live streaming platform in China, has released its 2022Q4 and full year financial results, achieving steady quarterly and yearly user scales, with its 2022Q4 total net revenues in line with market consensus.
As Huya continued to push its efforts in providing users with a diverse content portfolio of professional e-sports tournaments and self-produced programs in the fourth quarter and the whole year, the average mobile MAU of Huya Live for 2022Q4 achieved slight growth year-on-year, and full year mobile MAU of Huya Live grew by 4.2% to 84.3 million. In addition, on the annual basis, Huya Live’s next month user retention rate has remained above a 70% average for the full year. The results have been encouraging as the company adopted stringent policies for marketing spend to kept expenses down, lowering Q4 sales and marketing expenses by 48% year-over-year.
According to Dong Rongjie, CEO of Huya, in 2022Q4, the Company “enhanced the interactive experience between broadcasters and viewers through in-depth collaborations with game studios, helping Huya stabilize the user scale and achieve healthy user engagement levels.”
2022 has been quite challenging. Against the backdrop of a volatile macro environment，Huya has been focusing on promoting operational efficiencies. To be more specific, in 2022Q4, Huya has reduced its total operating expenses by 35% year-on-year and 10% quarter-on-quarter, which was mainly driven by lower sales and marketing expenses. Ashley Wu Xin, Vice President of Finance of Huya expressed that Huya “will further optimize our cost and expense structure and focus our resources on areas with better returns to strengthen our operational and financial performance.”
In terms of total net revenues, Huya has experienced year-on-year decrease, which mainly attributed to the relatively weak market environment that affected user spending capabilities. Huya’s total net revenues for 2022Q4 and the full year stood at 2,102.2 million yuan (US$304.8 million) and 9,220.5 million yuan, respectively. On the other hand, Douyu, another live streaming platform in China, its 2022Q4 and full year revenues witnessed greater decreases, standing at 1,681.1 million yuan (US$243.7 million) and 7,108.2 million yuan, respectively. In addition, Douyu’s average mobile MAU for 2022Q4 and full year were also down by 8.0% and 7.7%, correspondingly.
For 2022, Huya has spared no efforts in advancing its business in content diversification, product and technology upgrade, as well as conducting corporate social responsibility (CSR) initiatives. Just as Dong Rongjie, Huya CEO said at the conference call, that “our focus has been on controlling the aspects of our business where we can make improvements to shore up our solid foundation and prepare for growth in a more favorable market environment ahead. In the meantime, we’ve honed our content and product offerings, as well as improved our operational efficiency, while fulfilling our commitment to corporate social responsibility.”
In 2022Q4, Huya has further conducted product updates and collaborated more with game companies. For instance, Huya has expanded its portfolio of live streaming interactive features by introducing an upgraded “Treasure Digging” feature. The additions have further linked broadcasters’ streaming performance with audiences, which not only allow participating viewers to earn rewards, but also for streamers to collect rewards for their live streaming activities. The new additions are warmly welcomed by users of the platform, demonstrating Huya’s continuous efforts to provide more services around games and its ambition to diversify and increase presence in the game industry value chain.
Its video business is also developing at a steady pace. Together with Huya’s AI real-time editing function being utilized more often by content creators, the total number of video uploads on its platform in 2022 was up by nearly 50% year-on-year. Dong Rongjie believed that Huya’s increasingly comprehensive video content ecosystem will “increase user stickiness and also drive communitization across Huya platform.”
It is also worth mentioning that besides providing users with tailor-made e-sports venue for the 2022 Season of League of Legends World Championship finals in Q4, Huya launched a CSR campaign by using a new virtual gallery digital format and integrating it into this virtual e-sports venue. It reached millions of tournament viewers, helping promote the campaign’s influence and contribute to the healthy development of the live streaming industry. In the meanwhile, Huya has continued to expand its CSR efforts. In 2022, Huya partnered with over 9,800 broadcasters and held more than 8,000 live streaming sessions promoting positive social impact, covering topics of rural revitalization, youth protection, intangible cultural heritage revival, as well as environmental protection and animal conservation, among others.
Regarding Huya’s content portfolio, the company has adopted a relatively strict screening process for content procurement and production, while the total viewing data for 2022 remained steady. In 2022Q4, Huya broadcasted more than 70 third-party professional e-sports tournaments, and the total viewership of those events reached approximately 360 million. The largest viewership during the quarter was for LoL Worlds 2022, Honor of Kings International Championship, Demacia Cup and CFS Grand Finals.
During the same period, Huya also broadcasted over 45 Huya-organized e-sports tournaments and entertainment PGC shows, generating total viewership of approximately 150 million. Ashley Wu Xin said at the conference call that “we will stay true to our focus of covering key events that are popular among users, while striving to achieve better ROIs,” and with respect to Huya’s international business Nimo TV, Ashley updated that its operating loss has been further narrowed in the fourth quarter, thanks to the company’s strategy to concentrate on key markets and promote greater localization.
Looking ahead, Huya CEO Dong Rongjie said at the conference call that “we will continue to strengthen our services for users and content creators, and provide high-quality content in 2023 and going forward. We will also advance our product development capabilities and implement innovative technology to further consolidate Huya’s core competencies. In doing so, we can maximize our advantages and maintain our leading position in the game live streaming market in China. In the meantime, we will actively explore opportunities to diversify our revenue streams and broaden our business ecosystem.”