Technology
Hello Group Inc. Announces Unaudited Financial Results for the First Quarter of 2024
Published
7 months agoon
By
BEIJING, May 28, 2024 /PRNewswire/ — Hello Group Inc. (NASDAQ: MOMO) (“Hello Group” or the “Company”), a leading player in mainland China’s online social networking space, today announced its unaudited financial results for the first quarter of 2024.
First Quarter of 2024 Highlights
Net revenues decreased by 9.2% year over year to RMB2,560.4 million (US$354.6 million*) in the first quarter of 2024.Net income attributable to Hello Group Inc. decreased to RMB5.2 million (US$0.7 million) in the first quarter of 2024, from RMB390.3 million in the same period of 2023.Non-GAAP net income attributable to Hello Group Inc. (note 1) decreased to RMB59.9 million (US$8.3 million) in the first quarter of 2024, from RMB471.9 million in the same period of 2023, mainly due to the accrual of withholding income tax of RMB448.6 million (US$62.1 million) on historical undistributed earnings generated by our wholly-foreign owned enterprise (“WFOE”).Diluted net income per American Depositary Share (“ADS”) was RMB0.03 (US$0.00) in the first quarter of 2024, compared to RMB1.96 in the same period of 2023.Non-GAAP diluted net income per ADS (note 1) was RMB0.31 (US$0.04) in the first quarter of 2024, compared to RMB2.36 in the same period of 2023.Monthly Active Users (“MAU”) on Tantan app were 13.7 million in March 2024, compared to 19.5 million in March 2023.For the Momo app total paying users was 7.1 million for the first quarter of 2024, compared to 7.8 million for the same period last year. Tantan had 1.1 million paying users for the first quarter of 2024 compared to 1.6 million from the year ago period.
“We have made steady progress in implementing our strategic priorities for Momo, Tantan, and our new endeavors since the beginning of the year,” commented Yan Tang, Chairman and CEO of Hello Group. “Product innovation and our ability to leverage technological advancements have enabled Momo to play an important role in helping users discover new relationships and build meaningful interactions. This has laid a solid foundation for us to maintain user and revenue scale over the long term. I am also glad to see that our overseas team has accelerated the localization process to drive continued growth in the new endeavors. We look forward to delivering high quality social and entertainment services to a much broader user base global wise.”
* This press release contains translations of certain Renminbi amounts into U.S. dollars at specified rate solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars, in this press release, were made at a rate of RMB7.2203 to US$1.00, the effective noon buying rate for March 29, 2024 as set forth in the H.10 statistical release of the Federal Reserve Board.
First Quarter of 2024 Financial Results
Net revenues
Total net revenues were RMB2,560.4 million (US$354.6 million) in the first quarter of 2024, a decrease of 9.2% from RMB2,818.9 million in the first quarter of 2023.
Live video service revenues were RMB1,238.5 million (US$171.5 million) in the first quarter of 2024, a decrease of 13.3% from RMB1,429.3 million during the same period of 2023. The decrease was primarily attributable to our proactive operational adjustments to de-emphasise large scale competition events in the Momo app and a soft consumer sentiment in the current macro environment, and to a lesser degree, Tantan pivoting away from the less dating-centric live video service.
Value-added service revenues mainly include virtual gift revenues and membership subscription revenues. Total value-added service revenues were RMB1,294.4 million (US$179.3 million) in the first quarter of 2024, a decrease of 4.9% from RMB1,361.5 million during the same period of 2023. The decrease was primarily due to our product adjustments to improve Momo app’s ecosystem as well as the impact of the macro economy on consumer sentiment, and to a lesser extent, the decline in Tantan’s paying users. The decrease was partially offset by the rapid revenue growth from the new standalone apps.
Mobile marketing revenues were RMB26.6 million (US$3.7 million) in the first quarter of 2024, an increase of 26.2% from RMB21.1 million during the same period of 2023.
Mobile games revenues were RMB0.4 million (US$0.1 million) in the first quarter of 2024, a decrease of 88.3% from RMB3.7 million in the first quarter of 2023.
Net revenues from the Momo segment decreased from RMB2,510.1 million in the first quarter of 2023 to RMB2,318.9 million (US$321.2 million) in the first quarter of 2024, primarily due to the decrease in net revenues from value-added service and live video service on Momo app. The decrease was partially offset by the revenue growth of the new standalone apps. Net revenues from the Tantan segment decreased from RMB308.6 million in the first quarter of 2023 to RMB241.5 million (US$33.4 million) in the first quarter of 2024, mainly due to the decrease in net revenues from live video service, and to a lesser extent, the decrease from value-added service.
Cost and expenses
Cost and expenses were RMB2,120.0 million (US$293.6 million) in the first quarter of 2024, a decrease of 12.4% from RMB2,419.1 million in the first quarter of 2023. The decrease was primarily attributable to: (a) a decrease in revenue sharing with broadcasters related to live video service on Momo app and Tantan app, and a decrease in revenue sharing with virtual gift recipients of virtual gift service on Momo app. The decrease was partially offset by an increase in revenue sharing with virtual gift recipients for new standalone apps; (b) a decrease in salary expenses and share-based compensation expenses, due to our continuous optimization in personnel costs and the newly granted share options which had lower fair value; (c) a decrease in sales and marketing expenses due to less marketing and promotional spend on live video service and our strategy to trim inefficient channel marketing spend.
Non-GAAP cost and expenses (note 1) were RMB2,065.3 million (US$286.0 million) in the first quarter of 2024, a decrease of 11.6% from RMB2,337.4 million during the same period of 2023.
Income from operations
Income from operations was RMB460.3 million (US$63.8 million) in the first quarter of 2024, compared to RMB436.2 million during the same period of 2023. Income from operations of the Momo segment was RMB434.0 million (US$60.1 million) in the first quarter of 2024, which decreased from RMB435.0 million in the first quarter of 2023. Income from operations of the Tantan segment was RMB28.6 million (US$4.0 million) in the first quarter of 2024, which increased from RMB5.2 million in the first quarter of 2023.
Non-GAAP income from operations (note 1) was RMB515.0 million (US$71.3 million) in the first quarter of 2024, compared to RMB517.8 million during the same period of 2023. Non-GAAP income from operations of the Momo segment was RMB488.5 million (US$67.7 million) in the first quarter of 2024, which decreased from RMB507.5 million in the first quarter of 2023. Non-GAAP income from operations of the Tantan segment was RMB28.8 million (US$4.0 million) in the first quarter of 2024, compared to RMB14.5 million in the first quarter of 2023.
Income tax expenses
Income tax expenses were RMB557.6 million (US$77.2 million) in the first quarter of 2024, compared to RMB122.6 million in the first quarter of 2023. In the first quarter of 2024, we accrued an income tax expenses of RMB109.0 million (US$15.1 million) associated with the profit generated in this quarter. Additionally, we accrued a withholding income tax of RMB448.6 million (US$62.1 million) associated with our WFOE’s historical undistributed earnings for the potential remittance of earnings from our WFOE to its offshore parent company in the form of dividend distribution. Because we believe that we might continue to distribute the WFOE’s undistributed earnings in the future to fund our demands in overseas business operations, payments of dividends, potential investments, etc, to be prudent, we accrued withholding tax on the total balance of undistributed earnings of our WFOE as of March 31, 2024. From the first quarter of 2024, dividends paid by our wholly foreign-owned subsidiary in the Chinese mainland to its offshore parent company in Hong Kong are qualified for the preferential withholding tax rate of 5% under the Arrangement between the PRC and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income, instead of the normal withholding tax rate of 10%.
Net income
Net income was RMB5.2 million (US$0.7 million) in the first quarter of 2024, compared to RMB389.5 million during the same period of 2023. Net loss of the Momo segment was RMB20.8 million (US$2.9 million) in the first quarter of 2024, compared to a net income of RMB389.0 million in the same period of 2023. Net income from the Tantan segment was RMB28.2 million (US$3.9 million) in the first quarter of 2024, compared to RMB4.5 million in the first quarter of 2023.
Non-GAAP net income (note 1) was RMB59.9 million (US$8.3 million) in the first quarter of 2024, compared to RMB471.1 million during the same period of 2023. Non-GAAP net income from the Momo segment was RMB33.7 million (US$4.7 million) in the first quarter of 2024, which decreased from RMB461.5 million in the first quarter of 2023. Non-GAAP net income of the Tantan segment was RMB28.4 million (US$3.9 million) in the first quarter of 2024, compared to RMB13.7 million in the first quarter of 2023.
Net income attributable to Hello Group Inc.
Net income attributable to Hello Group Inc. was RMB5.2 million (US$0.7 million) in the first quarter of 2024, compared to RMB390.3 million during the same period of 2023.
Non-GAAP net income (note 1) attributable to Hello Group Inc. was RMB59.9 million (US$8.3 million) in the first quarter of 2024, compared to RMB471.9 million during the same period of 2023.
Net income per ADS
Diluted net income per ADS was RMB0.03 (US$0.00) in the first quarter of 2024, compared to RMB1.96 in the first quarter of 2023.
Non-GAAP diluted net income per ADS (note 1) was RMB0.31 (US$0.04) in the first quarter of 2024, compared to RMB2.36 in the first quarter of 2023.
Cash and cash flow
As of March 31, 2024, the Company’s cash, cash equivalents, short-term deposits, long-term deposits, short-term restricted cash and long-term restricted cash totaled RMB15,115.8 million (US$2,093.5 million), compared to RMB13,478.5 million as of December 31, 2023.
Net cash provided by operating activities in the first quarter of 2024 was RMB400.2 million (US$55.4 million), compared to RMB451.1 million in the first quarter of 2023.
Recent Development
Payment of a special cash dividend
In March 2024, Hello Group’s board of directors declared a special cash dividend in the amount of US$0.54 per ADS, or US$0.27 per ordinary share. The cash dividend was paid on April 30, 2024 to shareholders of record at the close of business on April 12, 2024. The aggregate amount of cash dividends paid was US$98.9 million.
Share repurchase program
On June 7, 2022, Hello Group’s board of directors authorized a share repurchase program under which the Company may repurchase up to US$200 million of its shares up to June 6, 2024 (the “Share Repurchase Program”). On March 14, 2024, Hello Group’s board of directors approved to amend the Share Repurchase Program to (i) extend the term of the Share Repurchase Program up to June 30, 2026, and (ii) upsize the Share Repurchase Program so that the Company is authorized to, from time to time, acquire up to an aggregate of US$286.1 million worth of its shares in the form of ADSs and/or the ordinary shares of the Company in the open market and through privately negotiated transactions, in block trades and/or through other legally permissible means, depending on market conditions and in accordance with applicable rules and regulations.
As of May 28, 2024, the Company has repurchased 22.3 million ADSs for US$122.6 million on the open market under Share Repurchase Program announced on June 7, 2022 and amended on March 14, 2024, at an average purchase price of US$5.48 per ADS.
Business Outlook
For the second quarter of 2024, the Company expects total net revenues to be between RMB2.65 billion to RMB2.75 billion, representing a decrease of 15.5% to 12.4% year over year. This forecast reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change.
Note 1: Non-GAAP measures
To supplement our consolidated financial statements presented in accordance with U.S. generally accepted accounting principles (“GAAP”), we, Hello Group, use various non-GAAP financial measures that are adjusted from the most comparable GAAP results to exclude share-based compensation.
Reconciliations of our non-GAAP financial measures to our U.S. GAAP financial measures are shown in tables at the end of this earnings release, which provide more details about the non-GAAP financial measures.
Our non-GAAP financial information is provided as additional information to help investors compare business trends among different reporting periods on a consistent basis and to enhance investors’ overall understanding of the historical and current financial performance of our continuing operations and our prospects for the future. Our non-GAAP financial information should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to the GAAP results. In addition, our calculation of the non-GAAP financial measures may be different from the calculation used by other companies, and therefore comparability may be limited.
Our non-GAAP information (including non-GAAP cost and operating expenses, income (loss) from operations, net income (loss), net income attributable to Hello Group Inc., and diluted net income per ADS) is adjusted from the most comparable GAAP results to exclude share-based compensation. A limitation of using these non-GAAP financial measures is that share-based compensation has been and will continue to be for the foreseeable future significant recurring expenses in our results of operations. We compensate for such limitation by providing reconciliations of our non-GAAP measures to our U.S. GAAP measures. Please see the reconciliation tables at the end of this earnings release.
Conference Call
Hello Group’s management will host an earnings conference call on Tuesday, May 28, 2024, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing / Hong Kong Time on May 28, 2024).
Participants can register for the conference call by navigating to:
https://s1.c-conf.com/diamondpass/10039014-cp8m51.html.
Upon registration, each participant will receive details for the conference call, including dial-in numbers, conference call passcode and a unique access PIN. Please dial in 10 minutes before the call is scheduled to begin.
A telephone replay of the call will be available after the conclusion of the conference call through June 4, 2024. The dial-in details for the replay are as follows:
U.S. / Canada: 1-855-883-1031
Hong Kong: 800-930-639
Passcode: 10039014
Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of Hello Group’s website at https://ir.hellogroup.com.
About Hello Group Inc.
We are a leading player in mainland China’s online social networking space. Through Momo, Tantan and other properties within our product portfolio, we enable users to discover new relationships, expand their social connections and build meaningful interactions. Momo is a mobile application that connects people and facilitates social interactions based on location, interests and a variety of online recreational activities. Tantan, which was added into our family of applications through acquisition in May 2018, is a leading social and dating application. Tantan is designed to help its users find and establish romantic connections as well as meet interesting people. Starting from 2019, we have incubated a number of other new apps, such as Hertz, Soulchill, Duidui and Tietie, which target more niche markets and more selective demographics.
For investor and media inquiries, please contact:
Hello Group Inc.
Investor Relations
Phone: +86-10-5731-0538
Email: ir@hellogroup.com
Christensen
In China
Ms. Xiaoyan Su
Phone: +86-10-5900-1548
E-mail: Xiaoyan.Su@christensencomms.com
In U.S.
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: linda.bergkamp@christensencomms.com
Safe Harbor Statement
This news release contains “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include but are not limited to our management quotes, our financial outlook for the second quarter of 2024, as well as the amount of, timing, methods and funding sources for repurchases of our shares under the share repurchase program.
Our forward-looking statements are not historical facts but instead represent only our belief regarding expected results and events, many of which, by their nature, are inherently uncertain and outside of our control. Our actual results and other circumstances may differ, possibly materially, from the anticipated results and events indicated in these forward-looking statements. Announced results for the first quarter of 2024 are preliminary, unaudited and subject to audit adjustment. In addition, we may not meet our financial outlook for the second quarter of 2024 and may be unable to grow our business in the manner planned. We may also modify our strategy for growth. Moreover, there are other risks and uncertainties that could cause our actual results to differ from what we currently anticipate, including those relating to our ability to retain and grow our user base, our ability to attract and retain sufficiently trained professionals to support our operations, our ability to anticipate and develop new services and enhance existing services to meet the demand of our users or customers, the market price of the Company’s stock prevailing from time to time, the nature of other investment opportunities presented to the Company from time to time, the Company’s cash flows from operations, general economic conditions, and other factors. For additional information on these and other important factors that could adversely affect our business, financial condition, results of operations, and prospects, please see our filings with the U.S. Securities and Exchange Commission.
All information provided in this press release and in the attachments is as of the date of the press release. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise, after the date of this release, except as required by law. Such information speaks only as of the date of this release.
Hello Group Inc.
Unaudited Condensed Consolidated Statement of Operations
(All amounts in thousands, except share and per share data)
Three months
Ended March 31
2023
2024
2024
RMB
RMB
US$
Net revenues:
Live video service
1,429,340
1,238,541
171,536
Value-added service
1,361,469
1,294,376
179,269
Mobile marketing
21,071
26,595
3,683
Mobile games
3,699
432
60
Other services
3,279
476
66
Total net revenues
2,818,858
2,560,420
354,614
Cost and expenses:
Cost of revenues
(1,664,188)
(1,503,008)
(208,164)
Research and development
(236,803)
(192,191)
(26,618)
Sales and marketing
(379,786)
(293,431)
(40,640)
General and administrative
(138,298)
(131,381)
(18,196)
Total cost and expenses
(2,419,075)
(2,120,011)
(293,618)
Other operating income, net
36,394
19,906
2,757
Income from operations
436,177
460,315
63,753
Interest income
99,787
121,107
16,773
Interest expense
(10,415)
(23,698)
(3,282)
Other gain or loss, net
–
(9,245)
(1,280)
Income before income tax and share of (loss) income on equity method
investments
525,549
548,479
75,964
Income tax expenses
(122,613)
(557,613)
(77,229)
Income (loss) before share of income on equity method investments
402,936
(9,134)
(1,265)
Share of (loss) income on equity method investments
(13,475)
14,318
1,983
Net income
389,461
5,184
718
Less: net loss attributable to non-controlling interest
(828)
–
–
Net income attributable to the shareholders of Hello Group Inc.
390,289
5,184
718
Net income per share attributable to ordinary shareholders
Basic
1.04
0.01
0.00
Diluted
0.98
0.01
0.00
Weighted average shares used in calculating net income per ordinary share
Basic
377,017,080
374,650,649
374,650,649
Diluted
409,102,277
389,278,806
389,278,806
Hello Group Inc.
Unaudited Condensed Consolidated Statement of Comprehensive Income
(All amounts in thousands, except share and per share data)
Three months
Ended March 31
2023
2024
2024
RMB
RMB
US$
Net income
389,461
5,184
718
Other comprehensive income, net of tax:
Foreign currency translation adjustment
2,181
54,894
7,603
Comprehensive income
391,642
60,078
8,321
Less: comprehensive (loss) income attributed to the non-controlling interest
(1,670)
3,084
427
Comprehensive income attributable to Hello Group Inc.
393,312
56,994
7,894
Hello Group Inc.
Unaudited Condensed Consolidated Balance Sheets
(All amounts in thousands, except share and per share data)
December 31
March 31
March 31
2023
2024
2024
RMB
RMB
US$
Assets
Current assets
Cash and cash equivalents
5,620,466
6,023,224
834,207
Short-term deposits
1,270,626
1,129,454
156,428
Restricted cash
10,147
1,504,307
208,344
Accounts receivable, net of allowance for doubtful accounts of
RMB12,780 and RMB12,497 as of December 31, 2023 and March 31,
2024, respectively
201,517
189,561
26,254
Amounts due from related parties
7,258
–
–
Prepaid expenses and other current assets
723,364
823,251
114,019
Total current assets
7,833,378
9,669,797
1,339,252
Long-term deposits
3,924,975
3,805,075
526,997
Long-term restricted cash
2,652,299
2,653,744
367,539
Right-of-use assets, net
109,572
116,607
16,150
Property and equipment, net
659,033
688,699
95,384
Intangible assets, net
17,086
15,806
2,189
Rental deposits
12,962
13,766
1,907
Long-term investments
786,911
710,557
98,411
Amounts due from RPT-non current
20,000
–
–
Other non-current assets
180,052
200,649
27,790
Deferred tax assets
31,741
34,240
4,742
Total assets
16,228,009
17,908,940
2,480,361
Liabilities and equity
Current liabilities
Accounts payable
616,681
604,398
83,711
Deferred revenue
442,805
459,797
63,681
Accrued expenses and other current liabilities
630,617
564,205
78,141
Amounts due to related parties
4,314
–
–
Lease liabilities due within one year
60,008
66,136
9,160
Income tax payable
94,719
100,756
13,955
Deferred consideration in connection with business acquisitions
27,261
27,723
3,840
Long-term borrowings, current portion
215,615
217,094
30,067
Dividends payable
–
714,120
98,904
Short-term borrowings
–
1,334,664
184,849
Total current liabilities
2,092,020
4,088,893
566,308
Deferred tax liabilities
24,987
391,502
54,222
Convertible Senior Notes
19,571
19,920
2,759
Long-term borrowings
1,938,385
1,938,169
268,433
Lease liabilities
52,171
52,487
7,269
Other non-current liabilities
114,085
139,721
19,351
Total liabilities
4,241,219
6,630,692
918,342
Shareholder’s equity (i)
11,986,790
11,278,248
1,562,019
Total liabilities and shareholder’s equity
16,228,009
17,908,940
2,480,361
(i): As of March 31, 2024, the number of ordinary shares outstanding was 370,162,906.
Hello Group Inc.
Unaudited Condensed Consolidated Statement of Cash Flows
(All amounts in thousands, except share and per share data)
Three months
Ended March 31
2023
2024
2024
RMB
RMB
US$
Cash flows from operating activities:
Net income
389,461
5,184
718
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment
22,844
14,310
1,982
Amortization of intangible assets
1,279
1,279
177
Share-based compensation
81,657
54,670
7,572
Share of loss (income) on equity method investments
13,475
(14,318)
(1,983)
Loss on long-term investments
–
9,245
1,280
Gain or loss on disposal of property and equipment
67
258
36
Provision of loss on receivable and other assets
9,182
1,776
246
Changes in operating assets and liabilities:
Accounts receivable
(548)
10,980
1,521
Prepaid expenses and other current assets
24,352
(9,677)
(1,340)
Amounts due from related parties
55
–
–
Rental deposits
–
(802)
(111)
Deferred tax assets
440
(2,498)
(346)
Other non-current assets
(7,485)
(7,597)
(1,052)
Accounts payable
20,379
(17,454)
(2,417)
Income tax payable
(6,393)
6,036
836
Deferred revenue
(8,811)
16,674
2,309
Accrued expenses and other current liabilities
(132,733)
(56,800)
(7,867)
Amount due to related parties
3,169
–
–
Deferred tax liabilities
34,120
365,011
50,553
Other non-current liabilities
6,564
23,893
3,309
Net cash provided by operating activities
451,074
400,170
55,423
Cash flows from investing activities:
Purchase of property and equipment
(10,234)
(44,176)
(6,118)
Purchase of short-term deposits
(497,342)
–
–
Cash received on maturity of short-term deposits
900,000
300,000
41,550
Purchase of long-term deposits
–
(718,860)
(99,561)
Cash received on maturity of long-term deposits
–
718,860
99,561
Cash received from sales of long-term investment
–
2,000
277
Other investing activities
738
385
53
Net cash provided by investing activities
393,162
258,209
35,762
Cash flows from financing activities:
Proceeds from exercise of share options
3
11
2
Payment in relation to the share repurchase program
(3,237)
(112,261)
(15,548)
Repurchase of subsidiary’s share options
(1,539)
–
–
Proceeds from short-term borrowings
–
1,331,635
184,429
Repayment of long-term borrowings
–
(215)
(30)
Payment for redemption of convertible bonds
(478,786)
–
–
Net cash (used in) provided by financing activities
(483,559)
1,219,170
168,853
Effect of exchange rate changes
(9,426)
20,814
2,882
Net increase in cash and cash equivalents
351,251
1,898,363
262,920
Cash, cash equivalents and restricted cash at the beginning of period
5,198,601
8,282,912
1,147,170
Cash, cash equivalents and restricted cash at the end of period
5,549,852
10,181,275
1,410,090
Hello Group Inc.
Reconciliation of Non-GAAP financial measures to comparable GAAP measures
(All amounts in thousands, except per share data)
1.
Reconciliation of Non-GAAP cost and operating expenses, income from operations, and net income to comparable GAAP measures.
Three months
Three months
Three months
Ended March 31, 2023
Ended March 31, 2024
Ended March 31, 2024
GAAP
Share-based
compensation
Non-GAAP
GAAP
Share-based
compensation
Non-GAAP
GAAP
Share-based
compensation
Non-GAAP
RMB
RMB
RMB
RMB
RMB
RMB
US$
US$
US$
Cost of revenues
(1,664,188)
1,635
(1,662,553)
(1,503,008)
1,882
(1,501,126)
(208,164)
261
(207,903)
Research and development
(236,803)
22,372
(214,431)
(192,191)
8,786
(183,405)
(26,618)
1,217
(25,401)
Sales and marketing
(379,786)
7,746
(372,040)
(293,431)
6,117
(287,314)
(40,640)
847
(39,793)
General and administrative
(138,298)
49,904
(88,394)
(131,381)
37,885
(93,496)
(18,196)
5,247
(12,949)
Cost and operating expenses
(2,419,075)
81,657
(2,337,418)
(2,120,011)
54,670
(2,065,341)
(293,618)
7,572
(286,046)
Income from operations
436,177
81,657
517,834
460,315
54,670
514,985
63,753
7,572
71,325
Net income attributable to Hello Group Inc.
390,289
81,657
471,946
5,184
54,670
59,854
718
7,572
8,290
Unaudited Condensed Segment Report
(All amounts in thousands, except share and per share data)
Three months
Ended March 31, 2024
Momo
Tantan
QOOL
Total
Total
RMB
RMB
RMB
RMB
US$
Net revenues:
Live video service
1,150,844
87,697
–
1,238,541
171,536
Value-added service
1,149,285
145,091
–
1,294,376
179,269
Mobile marketing
17,893
8,702
–
26,595
3,683
Mobile games
432
–
–
432
60
Other services
434
–
42
476
66
Total net revenues
2,318,888
241,490
42
2,560,420
354,614
Cost and expenses (ii):
Cost of revenues
(1,392,824)
(110,184)
–
(1,503,008)
(208,164)
Research and development
(150,861)
(41,330)
–
(192,191)
(26,618)
Sales and marketing
(236,659)
(54,482)
(2,290)
(293,431)
(40,640)
General and administrative
(123,752)
(7,591)
(38)
(131,381)
(18,196)
Total cost and expenses
(1,904,096)
(213,587)
(2,328)
(2,120,011)
(293,618)
Other operating income
19,158
724
24
19,906
2,757
Income (loss) from operations
433,950
28,627
(2,262)
460,315
63,753
Interest income
120,958
147
2
121,107
16,773
Interest expense
(23,698)
–
–
(23,698)
(3,282)
Other gain or loss, net
(9,245)
–
–
(9,245)
(1,280)
Income (loss) before income tax and share of income on equity
method investments
521,965
28,774
(2,260)
548,479
75,964
Income tax expenses
(557,079)
(534)
–
(557,613)
(77,229)
(Loss) income before share of income on equity method
investments
(35,114)
28,240
(2,260)
(9,134)
(1,265)
Share of income on equity method investments
14,318
–
–
14,318
1,983
Net (loss) income
(20,796)
28,240
(2,260)
5,184
718
(ii) Share-based compensation was allocated in cost of revenues and operating expenses as follows:
Three months
Ended March 31, 2024
Momo
Tantan
QOOL
Total
Total
RMB
RMB
RMB
RMB
US$
Cost of revenues
1,878
4
–
1,882
261
Research and development
8,638
148
–
8,786
1,217
Sales and marketing
6,117
–
–
6,117
847
General and administrative
37,874
11
–
37,885
5,247
Total cost and expenses
54,507
163
–
54,670
7,572
Hello Group Inc.
Reconciliation of GAAP and NON-GAAP Results of Unaudited Segment Report
(All amounts in thousands, except share and per share data)
Three months
Ended March 31, 2024
Momo
Tantan
QOOL
Total
Total
RMB
RMB
RMB
RMB
US$
Income (loss) from operations
433,950
28,627
(2,262)
460,315
63,753
Share-based compensation
54,507
163
–
54,670
7,572
Non-GAAP income (loss) from operations
488,457
28,790
(2,262)
514,985
71,325
Net (loss) income
(20,796)
28,240
(2,260)
5,184
718
Share-based compensation
54,507
163
–
54,670
7,572
Non-GAAP net income (loss)
33,711
28,403
(2,260)
59,854
8,290
Hello Group Inc.
Unaudited Condensed Segment Report
(All amounts in thousands, except share and per share data)
Three months
Ended March 31, 2023
Momo
Tantan
QOOL
Total
Total
RMB
RMB
RMB
RMB
US$[1]
Net revenues:
Live video service
1,289,718
139,622
–
1,429,340
208,128
Value-added service
1,193,544
167,925
–
1,361,469
198,246
Mobile marketing
20,021
1,050
–
21,071
3,068
Mobile games
3,699
–
–
3,699
539
Other services
3,137
–
142
3,279
477
Total net revenues
2,510,119
308,597
142
2,818,858
410,458
Cost and expenses (iii):
Cost of revenues
(1,500,531)
(163,114)
(543)
(1,664,188)
(242,325)
Research and development
(169,308)
(67,495)
–
(236,803)
(34,481)
Sales and marketing
(312,640)
(65,852)
(1,294)
(379,786)
(55,301)
General and administrative
(128,078)
(7,746)
(2,474)
(138,298)
(20,138)
Total cost and expenses
(2,110,557)
(304,207)
(4,311)
(2,419,075)
(352,245)
Other operating income, net
35,478
854
62
36,394
5,299
Income (loss) from operations
435,040
5,244
(4,107)
436,177
63,512
Interest income
99,531
204
52
99,787
14,530
Interest expense
(10,415)
–
–
(10,415)
(1,517)
Income (loss) before income tax and share of income on equity
method investments
524,156
5,448
(4,055)
525,549
76,525
Income tax expenses
(121,642)
(971)
–
(122,613)
(17,854)
Income (loss) before share of income on equity method investments
402,514
4,477
(4,055)
402,936
58,671
Share of loss on equity method investments
(13,475)
–
–
(13,475)
(1,962)
Net income (loss)
389,039
4,477
(4,055)
389,461
56,709
(iii) Share-based compensation was allocated in cost of revenues and operating expenses as follows:
Three months
Ended March 31, 2023
Momo
Tantan
QOOL
Total
Total
RMB
RMB
RMB
RMB
US$
Cost of revenues
1,618
17
–
1,635
238
Research and development
13,170
9,202
–
22,372
3,258
Sales and marketing
7,741
5
–
7,746
1,128
General and administrative
49,896
8
–
49,904
7,267
Total cost and expenses
72,425
9,232
–
81,657
11,891
[1] All translations from RMB to U.S. dollars are made at a rate of RMB6.8676 to US$1.00, the effective noon buying rate for March 31, 2023 as set forth in the H.10 statistical release of the Federal Reserve Board.
Hello Group Inc.
Reconciliation of GAAP and NON-GAAP Results of Unaudited Segment Report
(All amounts in thousands, except share and per share data)
Three months
Ended March 31, 2023
Momo
Tantan
QOOL
Total
Total
RMB
RMB
RMB
RMB
US$
Income (loss) from operations
435,040
5,244
(4,107)
436,177
63,512
Share-based compensation
72,425
9,232
–
81,657
11,891
Non-GAAP income (loss) from operations
507,465
14,476
(4,107)
517,834
75,403
Net income (loss)
389,039
4,477
(4,055)
389,461
56,709
Share-based compensation
72,425
9,232
–
81,657
11,891
Non-GAAP net income (loss)
461,464
13,709
(4,055)
471,118
68,600
View original content:https://www.prnewswire.com/news-releases/hello-group-inc-announces-unaudited-financial-results-for-the-first-quarter-of-2024-302156503.html
SOURCE Hello Group Inc.
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Technology
Edge Data Center Market to Grow by USD 45.1 Billion (2025-2029), Driven by Video Streaming Demand and AI Redefining the Market Landscape – Technavio
Published
27 seconds agoon
January 7, 2025By
NEW YORK, Jan. 7, 2025 /PRNewswire/ — Report with market evolution powered by AI – The global edge data center market size is estimated to grow by USD 45.1 billion from 2025-2029, according to Technavio. The market is estimated to grow at a CAGR of almost 32.8% during the forecast period. Rising demand for video streaming services is driving market growth, with a trend towards implementation of ai in data centers. However, monitoring edge data center equipment across multiple locations poses a challenge. Key market players include 365 Data Centers, Compass Datacenters LLC, DC BLOX Inc., Dell Technologies Inc., Digital Realty Trust Inc., Eaton Corp plc, EdgeConneX Inc., Equinix Inc., Flexential Corp., Friedhelm Loh Stiftung and Co. KG, Fujitsu Ltd., Hewlett Packard Enterprise Co., Hitachi Ltd., Huawei Technologies Co. Ltd., International Business Machines Corp., Johnson Controls International Plc, Panduit Corp., Schneider Electric SE, Vapor IO Inc., Vertiv Holdings Co., ATC IP LLC; Cisco Systems Inc; Endeavor Business Media LLC, IBM, NVIDIA Corporation, CommScope.
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Edge Data Center Market Scope
Report Coverage
Details
Base year
2024
Historic period
2019 – 2023
Forecast period
2025-2029
Growth momentum & CAGR
Accelerate at a CAGR of 32.8%
Market growth 2025-2029
USD 45102 million
Market structure
Fragmented
YoY growth 2022-2023 (%)
24.8
Regional analysis
North America, APAC, Europe, South America, and Middle East and Africa
Performing market contribution
North America at 47%
Key countries
US, Germany, China, Canada, UK, France; Italy; Spain; India; Japan; Australia; South Korea; Brazil; Mexico; Argentina; UAE; Saudi Arabia; South Africa
Key companies profiled
365 Data Centers, Compass Datacenters LLC, DC BLOX Inc., Dell Technologies Inc., Digital Realty Trust Inc., Eaton Corp plc, EdgeConneX Inc., Equinix Inc., Flexential Corp., Friedhelm Loh Stiftung and Co. KG, Fujitsu Ltd., Hewlett Packard Enterprise Co., Hitachi Ltd., Huawei Technologies Co. Ltd., International Business Machines Corp., Johnson Controls International Plc, Panduit Corp., Schneider Electric SE, Vapor IO Inc., Vertiv Holdings Co, ATC IP LLC; Cisco Systems Inc; Endeavor Business Media LLC, IBM, NVIDIA Corporation, CommScope
Market Driver
Edge data centers are gaining popularity in today’s digital world due to the increasing demand for real-time data analysis, low latency, and improved application performance. Big data, artificial intelligence, cloud, streaming services, and 5G are driving this trend. Edge data centers enable businesses to process data closer to the source, reducing network traffic and improving the streaming experience for customers. E-commerce platforms like Walmart, branch offices, production floors, and remote sites benefit from edge data centers for data processing and industrial automation. Industries like logistics, healthcare, and retail are adopting edge data centers for AI applications, machine learning, and natural language processing. Companies like Dell Technologies, Equinix Inc, and EdgeConneX Inc provide components and services for edge data centers, including modular data centers, IT racks & enclosures, DCIM software, and colocation services. The edge data center market is expected to grow as more industries seek to enhance business agility and application performance while minimizing operating costs. Additionally, industries like gaming & entertainment, industrial automation, and autonomous automobiles are expected to drive further growth in the edge data center market. However, challenges such as dust, heat, and vibration must be addressed to ensure reliable remote operations.
Edge data centers are enhancing energy efficiency through the application of Artificial Intelligence (AI). By computing server, power system, and cooling system performance, AI enables faster decision-making and efficiency. Service providers utilize AI in data center automation software to reduce human resources and optimize energy use. Additionally, AI facilitates energy-efficient cooling through controlled mechanical cooling processes, maximizing power usage effectiveness in the overall data center operation.
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Market Challenges
Edge data centers are becoming essential for businesses to address the challenges of big data, artificial intelligence, cloud, streaming services, and 5G. These centers enable real-time data analysis, improved application performance, and better streaming experience for customers. E-commerce platforms like Walmart and industrial applications in sectors such as logistics, healthcare, and retail rely on edge data centers for business agility and reduced latency. Edge data centers are also crucial for industrial automation, autonomous automobiles, and AI applications like machine learning and natural language processing. Dell Technologies, Equinix Inc, EdgeConneX Inc, and vXchnge are key players in this market, offering components, services, and IT racks & enclosures. Edge data centers help businesses operate efficiently by minimizing network traffic and managing operating costs. Modular data centers are a popular solution for branch offices, production floors, and remote sites. However, challenges such as dust, heat, vibration, and remote operations require specialized solutions.Managing edge data centers involves overseeing unique power and cooling systems at multiple locations. Accurately maintaining an inventory of assets across these sites necessitates real-time monitoring of cabinet equipment, including servers, networking devices, power distribution units (PDUs), and patch panels, as well as infrastructure devices and structured cabling. To effectively address this challenge, end-users require a centralized dashboard displaying real-time power and environmental status of their edge data centers. This information enables early detection of potential issues such as hot spot formation, power capacity limitations, and redundancy loss. However, to efficiently manage IT equipment from the core to the edge data center, organizations must employ Network Operations Center (NOC) technicians and experts.
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Segment Overview
This edge data center market report extensively covers market segmentation by
End-user 1.1 IT and telecommunication1.2 Manufacturing and automotive1.3 BFSI1.4 Healthcare and life sciences1.5 OthersComponent 2.1 IT infrastructure2.2 General construction2.3 Power management systems2.4 Cooling systems2.5 OthersGeography 3.1 North America3.2 APAC3.3 Europe3.4 South America3.5 Middle East and AfricaFacility size
1.1 IT and telecommunication- The edge data center market in the IT and telecommunication sectors refers to the provision of decentralized facilities designed to cater to the specific needs of these industries. Edge data centers, located near end-users or data sources, offer low latency and high-bandwidth processing and storage. In the IT segment, they support services like cloud computing, CDNs, IoT, AI, and real-time analytics, by providing local processing power, storage, and network connectivity. Telecommunication companies benefit from edge data centers by minimizing latency, offering high bandwidth, and enabling localized data processing. These data centers also enhance reliability and security. In the telecom industry, they support activities such as NFV and SDN, optimizing network performance and reducing infrastructure costs. The growth of data-intensive applications, IoT devices, real-time analytics, and cloud-based services is driving the demand for edge data centers in both IT and telecommunication sectors, leading to market expansion during the forecast period.
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Research Analysis
The Edge Data Center Market is experiencing significant growth due to the increasing demand for real-time data analysis, low latency, and high performance in various industries. Big data, artificial intelligence, cloud, streaming services, and 5G are driving this trend, as businesses seek to improve business agility and enhance the streaming experience for customers. Edge data centers are being deployed in diverse settings, from e-commerce platforms and Walmart’s supply chain to branch offices, production floors, remote sites, and industrial automation. Edge data centers are essential for AI applications, machine learning, natural language processing, and other data-intensive tasks. However, they present unique challenges, such as managing operating costs, network traffic, and dealing with dust, heat, vibration, and other environmental factors. Dell Technologies and other key players are addressing these challenges with innovative solutions for remote operations and maintenance.
Market Research Overview
The Edge Data Center Market is experiencing significant growth due to the increasing demand for real-time data analysis and application performance in various industries. Big data, artificial intelligence, cloud, streaming services, and 5G are driving the need for data processing at the edge, closer to the source of data generation. Network traffic and latency are key concerns, as businesses seek to improve the streaming experience for customers, enhance business agility, and support industrial automation and AI applications. E-commerce platforms, branch offices, production floors, remote sites, and the logistics industry are among the sectors benefiting from edge data centers. Dust, heat, and vibration are challenges to be addressed in edge data center design and operations. Modular data centers, components, IT racks & enclosures, DCIM software, and services are essential for building and managing edge data centers. Industries such as healthcare & life science, retail & e-commerce, gaming & entertainment, and industrial automation are also leveraging edge data centers for data processing and AI applications, including machine learning and natural language processing. Dell Technologies, Equinix Inc, EdgeConneX Inc, and vXchnge are some of the companies providing edge data center solutions.
Table of Contents:
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation
End-userIT And TelecommunicationManufacturing And AutomotiveBFSIHealthcare And Life SciencesOthersComponentIT InfrastructureGeneral ConstructionPower Management SystemsCooling SystemsOthersGeographyNorth AmericaAPACEuropeSouth AmericaMiddle East And Africa
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix
About Technavio
Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.
With over 500 specialized analysts, Technavio’s report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio’s comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.
Contacts
Technavio Research
Jesse Maida
Media & Marketing Executive
US: +1 844 364 1100
UK: +44 203 893 3200
Email: media@technavio.com
Website: www.technavio.com/
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SOURCE Technavio
Technology
Sports Coaching Market , 36% of Growth to Originate from Europe, Technavio
Published
29 seconds agoon
January 7, 2025By
NEW YORK, Jan. 7, 2025 /PRNewswire/ — The global sports coaching market size is estimated to grow by USD 4.77 billion from 2025 to 2029, according to Technavio. The market is estimated to grow at a CAGR of 6.2% during the forecast period.
For comprehensive forecast and historic data on regions,market segments, customer landscape, and companies- Click for the snapshot of this report
Report Attribute
Details
Base Year
2024
Forecast period
2025-2029
Historic Data for
2019 – 2023
Segments Covered
Type (Sports camps and personalized trainings and Recreational camps), Application (Men, Women, and Kids), and Geography (North America, Europe, APAC, South America, and Middle East and Africa)
Key Companies Covered
Challenger Sports, CMT Learning Ltd., Elle Football Academy, ESM Academy, Firstbeat Technologies Oy, FRONT RUSH LLC, Global Sports PD Network, Ignite Sport UK Ltd., IMG Academy, ISM Sports, Khelomore Sports Pvt. Ltd., Mentally Fit Institute, Neuro Training For Athletes, Smaller Earth Ltd., TENVIC, The Coach Crew, TrainingPeaks LLC, UK Coaching, and US Sports Camps
Regions Covered
North America, Europe, APAC, South America, and Middle East and Africa
Region Outlook
North AmericaEuropeAsiaRest of World
1. North America – Europe is estimated to contribute 36%. To the growth of the global market. The Sports Coaching Market report forecasts market growth by revenue at global, regional & country levels from 2017 to 2027.
In 2024, North America held the largest share of the global sports coaching market, with the US being the primary contributor. The US is the leading market for sports coaching worldwide. The North American sports coaching market is projected to significantly contribute to the expansion of the global market. The continuous increase in sports participation fuels the demand for sports coaches and coaching services in the region. Government initiatives to encourage sports participation further boost market growth in North America.
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Segmentation Overview
Type 1.1 Sports camps and personalized trainings1.2 Recreational campsApplication 2.1 Men2.2 Women2.3 KidsGeography 3.1 North America3.2 Europe3.3 APAC3.4 South America3.5 Middle East and Africa
1.1 Fastest growing segment:
The sports coaching market’s largest segment in 2024 was sports camps and personalized training. This sector’s growth is significant due to the increasing player participation in international sports and domestic leagues. In emerging countries, the launch of new domestic leagues, such as Pro Kabbadi League (PKL), Indian Super League (ISL), Hockey India League (HIL), and Premier Badminton League (PBL), provides young talents an opportunity to showcase their abilities. These leagues have been successful in identifying and nurturing new talents, leading to an increase in enrolment in sports coaching centers. Additionally, government initiatives to promote sports participation in countries like China, the US, and Singapore contribute to the segment’s growth. Overall, the sports camps and personalized training segment is expected to witness a year-over-year growth during the forecast period.
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Research Analysis
The Sports Coaching Market is experiencing significant growth due to the integration of software technology into coaching and training. Coaches and trainers are leveraging online platforms, smartphones, and laptops to provide real-time analysis and individualized assistance to athletes in various sports industries. Virtual platforms offer democratic, autocratic, and holistic coaching styles, allowing sportspersons to choose the approach that best suits their needs. Wearable devices like Fitbit trackers and smartwatches provide performance tracking and data analysis, enhancing training plans and virtual coaching sessions. Educational materials, video lectures, and customized training plans are also available online, offering professional advice and access to expertise that was once limited to in-person interactions. Overall, technology is revolutionizing the sports coaching landscape, enabling more effective and efficient training and performance analysis.
Market Overview
The Sports Coaching Market is experiencing significant growth due to the integration of software technology into coaching and training. Coaches and trainers are leveraging online platforms, smartphones, and laptops to connect with athletes, regardless of location. Virtual platforms and video analytics platforms enable data collection through biometric sensors, wearable devices like Fitbit trackers and smartwatches, and real-time performance tracking. Artificial Intelligence and Machine Learning are used for data analytics, software development, and hardware infrastructure. Schools and sports clubs are adopting these technologies for individualized assistance, performance analysis, communication tools, and training plans. Pricing models range from one-time license-based to subscription-based. Various sports, including baseball, fitness, soccer, basketball, swimming, and golf, are utilizing these technologies. Autocratic, democratic, and holistic coaching styles are being augmented by sports coaching platforms, virtual coaching sessions, and educational materials. Virtual reality technologies offer personalized coaching experiences, while video analysis and biomechanics provide professional advice. Referees, physiotherapists, physiologists, nutritionists, and sports scientists are also benefiting from these advancements. The Sports industry is embracing digital platforms for non-professional and professional sports, with baseball, fitness, soccer, basketball, swimming, and other sports segments adopting these technologies. Virtual simulations, gamification, interactive learning, leaderboards, badges, points, and polls are enhancing the user experience. Wearable technologies, such as heart rate monitors and performance metrics, offer real-time insights. Overall, the Sports Coaching Market is revolutionizing the way coaches, trainers, and athletes interact and improve performance.
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Key Topics Covered:
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Venodr Landscape
11 Vendor Analysis
12 Appendix
About Technavio
Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.
With over 500 specialized analysts, Technavio’s report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio’s comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.
Contacts
Technavio Research
Jesse Maida
Media & Marketing Executive
US: +1 844 364 1100
UK: +44 203 893 3200
Email: media@technavio.com
Website: www.technavio.com/
View original content to download multimedia:https://www.prnewswire.com/news-releases/sports-coaching-market–36-of-growth-to-originate-from-europe-technavio-302342859.html
SOURCE Technavio
Technology
CNC Vertical Machining Centers Market to Grow by USD 1.09 Billion (2025-2029), Driven by Demand for CNC Tools and AI-Powered Market Evolution – Technavio
Published
31 seconds agoon
January 7, 2025By
NEW YORK, Jan. 7, 2025 /PRNewswire/ — Report on how AI is driving market transformation – The global CNC vertical machining centers market size is estimated to grow by USD 1.09 billion from 2025-2029, according to Technavio. The market is estimated to grow at a CAGR of almost 5% during the forecast period. Increasing demand for cnc-incorporated machine tools is driving market growth, with a trend towards emergence of autonomous and electric cars. However, availability of horizontal machining centers and refurbished vertical machining centers poses a challenge. Key market players include Bharat Fritz Werner Ltd., Chiron Group SE, DMG MORI Co. Ltd., DN Solutions Co. Ltd., Gebr. Heller Maschinenfabrik GmbH, GF Machining Solutions AG, Haas Automation Inc., Hurco Companies Inc., Jyoti CNC Automation Ltd., Komatsu Ltd., Makino Milling Machine Co. Ltd., Maschinenfabrik Berthold Hermle AG, Maxmill Machinery Co. Ltd., Micromatic Machine Tools Pvt. Ltd., Mitsubishi Electric Corp., Okuma Corp, SCM GROUP Spa, Shandong Luzhong Machine Tool Co. Ltd., Shenyang Yiji Machine Tool Sales Co. Ltd., and Yamazaki Mazak Corp..
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CNC Vertical Machining Centers Market Scope
Report Coverage
Details
Base year
2024
Historic period
2019 – 2023
Forecast period
2025-2029
Growth momentum & CAGR
Accelerate at a CAGR of 5%
Market growth 2025-2029
USD 1090.8 million
Market structure
Fragmented
YoY growth 2022-2023 (%)
4.8
Regional analysis
APAC, Europe, North America, South America, and Middle East and Africa
Performing market contribution
APAC at 38%
Key countries
US, China, Germany, Japan, Canada, Italy, India, South Korea, UK, and France
Key companies profiled
Bharat Fritz Werner Ltd., Chiron Group SE, DMG MORI Co. Ltd., DN Solutions Co. Ltd., Gebr. Heller Maschinenfabrik GmbH, GF Machining Solutions AG, Haas Automation Inc., Hurco Companies Inc., Jyoti CNC Automation Ltd., Komatsu Ltd., Makino Milling Machine Co. Ltd., Maschinenfabrik Berthold Hermle AG, Maxmill Machinery Co. Ltd., Micromatic Machine Tools Pvt. Ltd., Mitsubishi Electric Corp., Okuma Corp, SCM GROUP Spa, Shandong Luzhong Machine Tool Co. Ltd., Shenyang Yiji Machine Tool Sales Co. Ltd., and Yamazaki Mazak Corp.
Market Driver
The CNC vertical machining centers market is experiencing significant growth due to increased demand for metal components in various industries. Hard metals, steel, and aluminum are popular materials in manufacturing, particularly for complex jobs and industrial processes. Templates and cams are essential tools for CNC machining, enabling efficient manufacturing of metal components. Vertical machining centers are ideal for manufacturing molds, die cavities, engine propellers, and impellers. Advanced CNC controls, high-speed spindles, and automatic tool changers enhance production capacity and efficiency. Giant manufacturing countries lead the market, with trends towards automation technologies such as collaborative robots and lights-out production. The manufacturing industry segment is a major consumer, with the electrical industry, automotive, and aerospace sectors driving demand. Raw materials like steel, carbon, and electricity costs impact CNC machining capacity. CNC machining centers are used for milling, drilling, and cutting various workpieces, including metals and wood. The market for CNC machining centers is expanding, with applications in the industrial automation market, electronic products, semiconductors, and consumer electronics. Horizontal machining centers and CNC milling machines are alternative solutions, with 3-axis and advanced tool axes offering flexibility for milling and rotary cutting. The market for CNC machining centers is expected to grow, driven by the increasing demand for automation and the need for high-precision components.
The global shift towards electric vehicles (EVs) is significantly impacting the CNC vertical machining centers market. With the elimination of traditional internal combustion engine (ICE) components like exhaust systems, pistons, valves, crankshafts, engine blocks, and exhaust headers, the demand for machined parts is decreasing. This reduction in demand may lead to market contraction, potentially affecting numerous vendors in this complex industry. Simultaneously, the automotive sector’s growing focus on autonomous vehicles presents new opportunities for innovation and growth in manufacturing processes.
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Market Challenges
The CNC vertical machining centers market faces several challenges in manufacturing metal components for various industries. Hard metals and steel require high CNC machining capacity and advanced controls for efficient production. Aluminum, used in flat works and manufacturing molds and die cavities, presents challenges due to its heat sensitivity. Manufacturing complex jobs in hard metals, steel, and aluminum for industries like aerospace, automotive, and heavy machinery requires vertical machining centers with high-speed spindles and automatic tool changers. The cost of raw materials, such as steel and carbon, as well as electricity, impacts the profitability of CNC machining centers. The manufacturing industry segment seeks automation technologies like collaborative robots and lights-out production for increased efficiency. In contrast, horizontal machining centers cater to industries producing large components, such as engine propellers and impellers. The industrial automation market’s growth in sectors like the electrical industry, electronic products, semiconductors, and consumer electronics drives the demand for CNC machining centers. CNC milling machines, with their tool axes, are essential for milling and cutting workpieces made of metal, wood, and other raw materials. The use of CAM software and rotary cutters enhances the productivity of CNC machining centers. Ferrous and non-ferrous metals, including metals used in industrial processes, present unique challenges for CNC machining centers. Overall, the CNC machining centers market must adapt to these challenges to remain competitive in the evolving manufacturing landscape.The CNC vertical machining center market in mature industries of the US and Europe is facing challenges due to rising labor costs and stringent emission norms, leading to the closure of several manufacturing operations. This surplus of used equipment has increased the availability of refurbished CNC vertical machining centers in the market, making it a cost-effective option for industries in developing countries like China, India, and Singapore. However, the affordability of refurbished machines may hinder the demand for new CNC vertical machining centers. Additionally, CNC horizontal machining centers can serve as viable alternatives, adding complexity to the market dynamics.
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Segment Overview
This cnc vertical machining centers market report extensively covers market segmentation by
Product 1.1 Less than 5-axis1.2 5-axis or moreEnd-user 2.1 Automotive2.2 Aerospace2.3 Metal fabrication2.4 OthersGeography 3.1 APAC3.2 Europe3.3 North America3.4 South America3.5 Middle East and Africa
1.1 Less than 5-axis- CNC vertical machining centers come in three variants: 2.5-axis, 3-axis, and 4-axis. In 2.5-axis machines, only two axes can rotate simultaneously. In contrast, 3-axis and 4-axis models enable the cutting tool to move around three axes (X, Y, and Z) and a rotating X-axis, respectively. While 2.5-axis machines are mostly outdated, 4-axis models have gained popularity. However, 5-axis CNC vertical machining centers lead the market due to their extensive capabilities. For simple metal designs like gear cutting, 3-axis and 4-axis machines are preferred due to their affordability. The adoption of 3+2 CNC vertical machining centers is increasing, offering a cost-effective way to upgrade capabilities. SMEs and start-ups, constrained by budgets, will continue to drive demand for 3-axis CNC vertical machining centers, fueling market growth.
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Research Analysis
CNC Vertical Machining Centers (VMCs) are essential machines in the manufacturing industry for producing metal components from hard metals, steel, aluminum, and various ferrous and non-ferrous metals. VMCs utilize Computer Numerical Control (CNC) technology, including templates, cams, and rotary devices, to precisely machine parts along the spindle axis. These machines are widely used in the manufacturing industry segment for producing complex components in large quantities. CNC VMCs can be integrated with collaborative robots for lights-out production and CAM software for optimized tool path planning. Rotary cutters and milling machines are common types of VMCs used for cutting and milling materials like wood, steel, and electrical industry components. The tool axes in VMCs can be configured to accommodate various cutting tools, enabling the production of intricate parts for diverse industries, including automotive, aerospace, and industrial automation market.
Market Research Overview
CNC Vertical Machining Centers (VMCs) are essential machines used in manufacturing industry for producing metal components from hard metals, steel, and aluminum. VMCs utilize Computer Numerical Control (CNC) technology, templates, cams, and rotary devices to machine complex jobs on flat works, molds, die cavities, engine propellers, and impellers. Industrial processes, including manufacturing activities in giant manufacturing countries, increasingly rely on VMCs for their high precision and efficiency. VMCs can be distinguished from Horizontal Machining Centers (HMCs) by their vertical spindle axis. Advanced CNC controls, high-speed spindles, automatic tool changers, and automation technologies such as collaborative robots enable lights-out production. CNC machining capacity is influenced by raw material costs, including steel, carbon, and electricity, as well as the manufacturing industry segment. CNC machining centers are used in various industries, including electrical, automotive, aerospace, and consumer electronics, to produce parts for semiconductors, printed circuit boards, heat sinks, and more. Milling, rotary cutters, and milling machines are common applications for VMCs, which can machine metal, wood, and other materials using tool axes.
Table of Contents:
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation
ProductLess Than 5-axis5-axis Or MoreEnd-userAutomotiveAerospaceMetal FabricationOthersGeographyAPACEuropeNorth AmericaSouth AmericaMiddle East And Africa
7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix
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