HONG KONG, Aug. 10, 2021 /PRNewswire/ — On 9 August 2021, Newborn Town Inc. (9911.HK), China’s top social networking enterprise focusing on global markets, announced a profit alert as it expects to record a net profit of approximately RMB120 million to RMB150 million for the 6 months ended 30 June 2021, representing year-on-year growth of over 3,400%.
The expected increase is mainly attributable to the rapid development of audio and video social networking applications outside China. Recently, the company has achieved excellent performance in developed markets, including Europe, the US, Japan, and South Korea, where the user value continues to grow. With the expanded user base and continuous leading market position in the Middle East, Southeast Asia and South Asia, revenue and net profit continued to rise rapidly.
Diversified social networking apps proved attractive to developed markets. Net profit is expected to multiply by over 34 times.
In the first half of 2021, Newborn Town Inc. continued to expand its portfolio of products.
On top of Yiyo, the video social platform, MICO, the open-social app and YoHo, the audio-based social app, the company further launched a new social app, Yumy, to penetrate the overseas market. With a leading market share in emerging markets such as the Middle East, Southeast Asia and South Asia, the company has explored other markets with high user value, including Europe, North America, Japan and South Korea, with considerable success.
For example, since July, the newly launched Yumy has reached Google Play’s list of Top20 most-downloaded social apps in the UK, Denmark, Belgium, Netherlands, and several other European countries. Meanwhile, Yumy ranked the 21st on Google Play’s July list of the US market. The daily downloads of Yumy by US users in July rose nearly threefold compared to the past few months.
Newborn Town Inc. expects to see strong growth in the first half of 2021, with revenue reaching RMB1.02 billion to RMB1.05 billion – a year-on-year increase of over 5.7 times compared with the same period of 2020. The expected revenue of the first half of 2021 is close to the total revenue of 2020, which amounted to RMB1.18 billion. The exponential growth is the result of the rapidly growing number of users and effective monetization.
Enhanced investments in social and gaming business with foreseeable returns in the long run
Newborn Town Inc. continues to invest in developing its social networking products and games portfolio and strengthening marketing efforts in Japan, South Korea, Europe, and North America to expand its market share. With increases in marketing and R&D expenditures, the company is expected to increase its market share and generate higher profit and long-term investment returns.
The company has concentrated efforts on promoting the new product, Yumy, which achieved high rankings on the most downloaded social apps charts in North America and several European countries. It also organized various marketing events for MICO and other social networking products, including ambitious OOH at famous landmarks and arranging crossovers for its products with other brands.
As for the gaming business, the company invested in AFunTeam, a mid-core to hardcore mobile games developer, to enrich the game portfolio and strengthen development abilities. It also continues to increase investments in developing new games and expanding marketing efforts to promote the mid-core game Solitaire Chapters.
The company focuses on product development and marketing, which are crucial in penetrating the overseas market. In the foreseeable future, with a wide variety of outstanding products being launched in the market, the company is expected to generate continuous and stable returns.
Conclusion: Newborn Town Inc. continues to flourish with outstanding business performance anticipated in the future
Newborn Town Inc. has devoted itself to expanding the overseas market by developing best-fit products that are heavily localized, thus building a long-lasting social ecosystem with efficient monetization.
Recently, reputable international investors, including BlackRock Inc., State Street Global Advisors Inc., Wellington Management Group LLP and Acadian Asset Management LLC, have invested in Newborn Town Inc., showing their strong confidence in its business and growth potential.
The company will announce its interim results in late August of 2021. The capital market should keep a close eye on the date.
SOURCE Newborn Town Inc.
