What happened
Shares of Momo (MOMO 2.15%) had a good morning on Wednesday, opening the day 11.5% higher before settling down to a less dramatic 6% gain at 12:00 p.m. EST. The Beijing-based social-network operator, loosely known as "the Tinder of China," posted a classic beat-and-raise report before the opening bell.
So what
In the fourth quarter of 2017, Momo's sales rose 57% year over year, to land at $386 million. Adjusted earnings increased 20%, stopping at $0.53 per American Depositary Share (ADS). The analyst consensus only called for earnings near $0.46 per ADS on revenues in the neighborhood of $382 million.
Looking ahead, Momo's management drew up a first-quarter revenue target, at roughly $390 million. Here, the Street would have settled for $350 million.
Momo's mobile app. Image source: Google Play Store.
Now what
These surging financial results sprung from a thriving mobile platform. The number of monthly active users (MAUs) of Momo's location-based networking tools now stands at 99.1 million, a 22% increase from the year-ago period.
Momo's users are also using more value-added features with richer advertising opportunities, including live video streams and virtual gifts.
The substance of this report wasn't very different from the third-quarter outing, but the market reaction could hardly have been more different. Investors are still finding their sea legs here, as Momo's days as an extreme-growth start-up are entering a more mature era.
