Yalla Group Limited ("Yalla" or the "Company") (NYSE: YALA), the largest Middle East and North Africa (MENA)-based online social networking and gaming company, has announced its unaudited financial results for the fourth quarter and full year ending on December 31, 2023.
The company achieved a significant milestone, registering a full-year revenue of AED 1.171 billion ($318.8 million), a significant increase from the AED 1.1 billion recorded in 2022.
The fourth quarter underscored Yalla's robust financial health, with revenues soaring to AED 297.1 million ($80.9 million), a 7.7% upsurge from AED 275.9 million ($75.1 million) in the corresponding quarter of the previous year. This increment reflects the company’s enduring business growth and formidable financial standing.
The last quarter of the fiscal year 2023 witnessed Yalla achieving a robust net margin of 36.6% alongside an impressive non-GAAP net margin of 41.3%. Highlighting its effective monetization strategies and judicious SG&A (Selling, General & Administrative expenses) management, Yalla reported a fourth-quarter net income of AED 109 million ($29.7 million), an increase of 79% from AED 60.9 million in the fourth quarter of 2022.
Additionally, the company observed a 13.3% year-over-year increase in average monthly active users (MAUs), reaching 36.2 million in the final quarter of 2023, escalating from 32 million in 2022's fourth quarter.
Despite a slight reduction in the number of paying users, down by 4.2% to 11.9 million in the fourth quarter of 2023 from 12.5 million in the previous year's corresponding quarter, the company attributes this adjustment to short-term game mechanism modifications, reaffirming its commitment to enhancing user engagement and monetization strategies in the forthcoming periods.
Yang Tao, Founder, Chairman and CEO of Yalla, stressed that 2023 was a pivotal year for Yalla. "Amid the dynamic global landscape, we forged ahead with our effective strategy for high-quality growth and capped the year with strong fourth quarter financial and operational results."
“Our revenues increased by 7.7% year-over-year to US$80.9 million for the fourth quarter, exceeding the upper end of our guidance, primarily driven by robust revenue growth from games services of 35.2% year-over-year. Furthermore, our game mechanism enhancements aimed at boosting user engagement and delivering better user experiences are bearing fruit,” Tao added.
“Along with our constant efforts to optimize our flagship applications, we made great strides with our mid- and hard-core games in the past year. With the successful launch of our two hard-core games, we have deepened our engagement in the mid- and hard-core game business and gained vast experience across key aspects of MENA’s gaming market,” he further said.
Lauding the remarkable growth in Yalla’s revenues, Saifi Ismail, Group President at Yalla Group, said: "We achieved robust 2023 results with full-year revenue rising to US$318.9 million, another testament to our ability to deliver growth in a rapidly evolving environment. Yalla aspires to become the No. 1 online social networking and entertainment platform in the MENA region. We will therefore continue to build relationships locally and globally to broaden our business horizons and embrace the opportunities brought by MENA’s digital transformation.
“With the entire region set to embark on a new era of growth, we are more committed than ever to providing the people of MENA with better access to a digital life. We believe we are well-positioned to capture the potential growth opportunities in the MENA region, and we look forward to delivering value to all our stakeholders as we strive to achieve our mission.
Moving forward, we will remain committed to developing more social networking and gaming applications tailored specifically for MENA users. Moreover, we will keep nurturing strong relationships with global channels to ensure that we continue to reach users effectively and provide them with the best possible experience," Ismail added.
