JOYY NASDAQ: YY reported its strongest year-over-year revenue growth in recent years in the first quarter of 2026, as its social entertainment business returned to growth and newer businesses in advertising technology and commerce continued to scale.
The company said total net revenue rose 12.4% year-over-year to $555.7 million. Non-GAAP operating profit increased 22.5% to $38 million, while non-GAAP EBITDA rose 13.2% to $45.7 million. Operating cash flow was $46 million for the quarter, and JOYY ended March with approximately $3.18 billion in net cash.
The quarter was also the first in which JOYY reported results under a new three-segment structure: Social Entertainment, BIGO Ads and Shopline. Management described the shift as reflecting the growing importance of BIGO Ads and Shopline as scalable growth engines alongside the company’s foundational social entertainment business.
Social entertainment returns to growth
Social entertainment revenue was $400.4 million in the first quarter, up 3.2% year-over-year. Live streaming revenue increased 2.4% year-over-year, while core live streaming paying users grew 5.9%.
Jane Xie, JOYY’s senior manager of investor relations, reading prepared remarks on behalf of Chairperson and CEO Ting Li, said the company’s global average mobile monthly active users reached 276 million, up 6.1% from a year earlier and 1.5% sequentially. She said traffic from the company’s instant messenger increased 3.1% quarter-over-quarter, supported by user stickiness and organic growth.
Management attributed the recovery in live streaming to improved streamer incentive structures, support for higher-quality content categories and new AI capabilities. Xie said active streamers increased 1.5% sequentially and average effective streaming hours per streamer rose 1.4%, despite typical seasonal pressure in the first quarter.
The company also highlighted the impact of AI tools on engagement. Xie said AI-generated interactive virtual gifts accounted for 34% of total virtual gift consumption on BIGO LIVE as of April. JOYY’s new product lineup also gained traction, with revenue rising more than 500% year-over-year and 45% quarter-over-quarter.
In response to a question from Jefferies analyst Thomas Chong, Ting Li said, through a translator, that structural enhancements launched since the second half of 2024 had strengthened the live streaming ecosystem. She said the company expects low- to mid-single-digit year-over-year growth in social entertainment revenue in the second quarter and believes social entertainment and live streaming revenue can achieve steady positive growth in 2026.
BIGO Ads continues rapid expansion
BIGO Ads generated $124.8 million in first-quarter revenue, up 55.6% year-over-year. The company’s third-party advertising business, BIGO Audience Network, grew 78.8% from a year earlier.
Management said growth was driven by broader traffic coverage, advertiser expansion across multiple verticals and algorithm improvements. SDK traffic rose 109% year-over-year and 7% sequentially. Web-based demand, primarily from lead generation and e-commerce advertisers, increased 90% year-over-year, while IAA spending rose 97%.
JOYY said South America remained the largest market for BIGO Ads, while Western Europe showed momentum with revenue up 27% sequentially.
During the question-and-answer session, Ting Li said BIGO Ads’ better-than-expected performance reflected progress in lead generation, direct-to-consumer e-commerce and IAA, along with upgrades to algorithm capabilities. She said JOYY had completed a framework upgrade to its core predictive model and was seeing improvements in monetization efficiency, advertiser retention and average advertiser spending.
Management reiterated its goal for BIGO Audience Network to reach $1 billion in revenue by 2028. Alex Liu, vice president of finance, said the business remains profitable while the company continues investing in research and development, sales, network infrastructure and computing capacity.
Shopline moves into standalone reporting
Shopline revenue was $30.5 million in the first quarter, up 16.1% year-over-year. Gross margin expanded 6.8 percentage points from a year earlier to 51.5%, which Liu attributed to growth in higher-margin subscription revenue and improving margins in value-added services.
Management described Shopline as an “AI-native” omnichannel commerce infrastructure platform, designed to support merchants across store setup, transactions, fulfillment, payments, logistics, marketing and customer retention.
Revenue from cross-border merchants grew 66% year-over-year, and Xie said cross-border merchant revenue continued to grow at more than 60%. The company expects Shopline revenue growth to accelerate to above 25% year-over-year in the second quarter.
Asked by BOCI Research analyst Raphael Chen about Shopline’s profitability path, Ting Li said the business has a differentiated model based on recurring subscription fees and value-added services such as payments and marketing. She said research and development spending, the largest component of Shopline’s operating expenses, has largely stabilized, creating operating leverage as revenue and gross profit grow. Management said Shopline is on a path to reach breakeven by 2028.
New $1.5 billion shareholder return plan
JOYY also announced an expanded three-year shareholder return program totaling $1.5 billion for fiscal years 2026 through 2028. The program includes up to $600 million in share repurchases and approximately $900 million in dividends.
Through May 22, the company had repurchased $87.9 million of shares and paid $69 million in dividends since the start of 2026, returning a total of $156.8 million to shareholders.
In response to a question from CICC analyst Xueqing Zhang, Liu said the new plan replaces a previous $900 million program and represents a roughly 67% increase in the company’s shareholder return commitment. He said the updated plan includes $300 million in annual dividends and an annualized buyback authorization of $200 million.
Liu said the decision reflected the growth trajectory of all three segments, JOYY’s net cash position and management’s view that the current share price “materially undervalues” the company’s long-term potential.
Second-quarter and full-year outlook
For the second quarter of 2026, JOYY guided for net revenue of $562 million to $581 million, implying year-over-year growth of 10.7% to 14.4%.
By segment, Liu said management expects social entertainment to grow in the low- to mid-single-digit range, BIGO Ads to sustain mid-double-digit growth and Shopline to accelerate to more than 25% growth. For the full year, JOYY expects solid positive group revenue growth, with social entertainment delivering steady growth, BIGO Ads producing strong mid-double-digit growth and Shopline sustaining double-digit growth.
On profitability, Liu said JOYY expects group non-GAAP operating profit and EBITDA to continue the improving trend seen in 2025, with “steady teens” year-over-year growth in 2026. He noted that unrealized foreign-exchange losses weighed on first-quarter net income due to the weakening U.S. dollar against the renminbi and said similar effects are expected in the second quarter.
About JOYY NASDAQ: YY
JOYY Inc NASDAQ: YY is a global technology-driven social media company specializing in video-based content creation and real-time social entertainment. The company develops and operates platforms that enable users to broadcast live video, engage with audiences and participate in interactive social communities. Its flagship global products include Bigo Live, a live-streaming application, and Likee, a short-video creation and sharing platform, which collectively support real-time interaction through virtual gifting and in-app social features.
Originally founded in Guangzhou, China in 2005 by David Xueling Li under the name YY Inc, the company pioneered real-time group communication and live streaming services in its domestic market.
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