Hello Group courts big spenders abroad as Chinese daters economize

The social-app operator is boosting its paid user base at home, but weaker spending and setbacks overseas are prolonging its long-awaited turnaround

Key Takeaways:

• Hello Group’s revenue fell 5.1% in the second quarter of 2026, and management now expects a steeper full-year decline than previously anticipated
• The dating app operator’s overseas quarterly revenue grew 52%, but setbacks at its SoulChill app are likely to leave the business short of its annual target

By Hu Minghe

Hello Group Inc. (MOMO.US) is getting more people to pay for Momo, its core offering once known as the “Tinder of China,” but now trying to become a more mainstream dating app. The problem is that some of its biggest spenders are buying less in a sluggish Chinese economy filled with uncertainties.

That retreat helped push the company’s revenue down 5.1% year-on-year to 2.49 billion yuan ($366.4 million) in the second quarter, according to its latest financial report released last Thursday. Even rapid overseas growth wasn’t enough to offset falling sales in China.

Hello said the declines would continue and even accelerate in the third quarter, forecasting a year-on-year drop of 5.7% to 9.4%. CFO Peng Hui said full-year revenue would likely fall by a mid-single-digit percentage, marking a setback from the roughly 2% decline envisioned in June.

Hello’s shares fell about 7% on the results day as investors fretted about the downward adjustment, before rebounding 5.3% the next day.

Once China’s leading “hook up” app, Hello built its business around Momo, which launched in 2011 to help strangers meet other people nearby. The app later added live broadcasts and chatrooms, earning money from memberships and virtual gifts that users could send to hosts or one another.

But Hello has struggled to retain its early momentum. Its annual revenue has fallen every year since 2020, a slump that has outlasted the pandemic. Its current market value of about $700 million is more than 90% below the more than $10 billion it reached in 2018.

When the big spenders retreat

The latest quarter shows why attracting more paying users has not been enough – a reality many companies are discovering in the current environment of growing consumer caution. The company’s China revenue fell about 17% year-on-year, even as Momo’s paying users rose to 3.9 million from 3.5 million a year earlier.

The weakness was concentrated among the biggest-spending customers who historically spent hundreds of thousands of yuan a month, management said. Spending by other customers remained relatively stable.

For Momo, weaker spending has coincided with tax scrutiny of its hosts and their agencies. That prompted some agencies to scale back their operations on the app, forcing Hello to offer subsidies and a larger share of revenue to win them back. The pressure was visible in the company’s operating profit, which fell 41% year-on-year to 238 million yuan.

Hello did return to profitability on its bottom line, but its year-ago loss was largely due to a separate tax charge during that period. Its net income reached 237.4 million yuan in the latest quarter, against a 140.2 million yuan loss a year earlier that included a 547.9 million yuan dividend-tax charge.

Hello’s other major domestic app, Tantan, is also struggling. Acquired in 2018, Tantan generated just 156 million yuan in second-quarter revenue, down 18%. And unlike Momo, the app’s, paying users fell notably to 500,000 from 700,000 a year earlier. Management blamed disrupted subscription renewals following a rule change on the Alipay payment service. In one slightly positive sign, Tantan’s overall audience in China held steady from the preceding quarter for the first time since it began paring back its user acquisition spending in early 2022.

While Hello works to steady its domestic business, domestic rivals are offering different ways to get people talking. Milian, which has filed for a Hong Kong IPO, uses human hosts on its Yidui app to introduce strangers and keep conversations moving, while group activities such as karaoke give hesitant users something to do together. Milian’s revenue rose 73.7% to 4.12 billion yuan in 2025, according to its listing application – sharply contrasting with Hello’s 1.9% decline that year to 10.37 billion yuan.

Soulgate, which has also filed for a Hong Kong listing, takes another approach with its Soul app. It puts virtual identities and shared interests at the center of socializing, using AI to suggest conversation starters. Users pay to personalize avatars, send gifts and unlock membership perks. Those services generated more than 90% of its 1.68 billion yuan revenue in the first eight months of 2025, according to its listing application.

Hello is trying to make introductions easier too. Tantan uses AI to suggest opening lines based on users’ photographs, a feature management says has helped retain female users. Such tools could help its apps appeal to younger adults, but their value depends on whether those first exchanges become conversations people want to continue.

Finding an audience abroad

With its domestic business still shrinking, Hello is increasingly looking overseas for growth. Its revenue outside China rose 52% to 672.7 million yuan in the second quarter, supplying 27% of sales, up from 17% a year earlier. Newer regional apps and dating businesses acquired last year drove the increase.

In the Middle East, Hello offers voice chatrooms through SoulChill, games through Yaahlan and video through Amar. It said Yaahlan reached breakeven during the quarter, while Amar continued to lose money.

But regulatory and political setbacks have complicated that expansion. In February, a Turkish court approved a regulator’s request to remove a range of apps, including SoulChill, from local app stores, according to Hello’s latest annual report. Management said the loss of App Store access in Turkey, and the recent Middle East conflict were holding back SoulChill’s business.

As a result, CFO Peng said the company’s overseas revenue would likely fall 100 million yuan to 200 million yuan short of its 3 billion yuan target this year.

Outside the Middle East, Hello is also buying established dating communities in other markets. It acquired French app Happn, which introduces users who have crossed paths, for 537.7 million yuan in cash in September 2025, according to its latest annual report.

That purchase takes Hello deeper into a global dating market facing its own growth problems. Global giant Match Group (MTCH.US), owner of Tinder, reported a 1% revenue decline and 6% fewer paying users in the second quarter. Yet its Hinge app’s revenue grew by 22%, suggesting there is still room for individual services to grow even as the wider business struggles.

Hello’s results show why a larger audience, be it at home or abroad, is only part of the answer. At home, it needs users to keep spending as well as chatting. Abroad, its new apps and acquired communities must earn enough to justify the cost of expansion. So far, overseas growth has softened the impact of Momo’s decline, but has yet to deliver a company-wide turnaround.

That could change soon, as analysts finally see the company returning to revenue growth next year, according to the average of seven polled by Yahoo Finance. But a simple return to low single-digit growth may not be enough to bring investors back to Hello Group’s languishing stock.

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