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Yalla Group (YALA)
NYSE:YALA
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Yalla Group
(NYSE:YALA)
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Rating:75Outperform
Price Target:
$8.50
▲(13.18% Upside)
Yalla Group's overall stock score reflects its strong financial performance and positive earnings call highlights, tempered by mixed technical indicators and valuation concerns. The company's robust profit margins and strategic initiatives in gaming and AI innovation are significant strengths, while the lack of current cash flow data and potential revenue decline in Q3 warrant caution.
Yalla Group (YALA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.19B
Dividend YieldN/A
Average Volume (3M)427.76K
Price to Earnings (P/E)9.4
Beta (1Y)1.09
Revenue Growth6.79%
EPS Growth12.97%
CountryUS
Employees815
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.20
Shares Outstanding132,801,830
10 Day Avg. Volume314,014
30 Day Avg. Volume427,764
Financial Highlights & Ratios
PEG Ratio0.32
Price to Book (P/B)0.92
Price to Sales (P/S)1.92
P/FCF Ratio3.79
Enterprise Value/Market Cap0.43
Enterprise Value/Revenue1.46
Enterprise Value/Gross Profit2.23
Enterprise Value/Ebitda4.02
Forecast
1Y Price Target
$8.50Price Target Upside13.18% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering0
Yalla Group Business Overview & Revenue Model
Company DescriptionYalla Group Limited operates a voice-centric social networking and entertainment platform under the Yalla name primarily in the Middle East and North Africa region. Its platform offers group chatting and games services; and sells virtual items, as well as provides upgrade services. The company was formerly known as FYXTech Corporation. Yalla Group Limited was founded in 2016 and is headquartered in Dubai, the United Arab Emirates.
How the Company Makes MoneyYalla Group generates revenue primarily through in-app purchases and subscriptions. The company's voice-centric social networking platform, Yalla, allows users to purchase virtual items and gifts to enhance their user experience and interactions. Additionally, Yalla Ludo offers monetization through in-app purchases where users can buy game-related items and features. The subscription model also plays a significant role, as users can subscribe to premium services for enhanced functionality and access. The company's revenue streams are bolstered by its ability to attract and retain users, leveraging localized content and culturally relevant experiences to strengthen user engagement in the MENA region.
Yalla Group Earnings Call Summary
Earnings Call Date:Aug 11, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 17, 2025
Earnings Call Sentiment Positive
Yalla Group delivered strong financial results with impressive revenue and user engagement growth, a robust gaming pipeline, and successful share repurchase initiatives. However, challenges such as anticipated revenue decline in Q3, increased administrative expenses, and short-term MAU fluctuations present concerns. Overall, the highlights significantly outweigh the lowlights.Q2-2025 Updates
Positive Updates
Impressive Revenue and Net Margin Growth
Yalla Group's total revenues reached USD 84.6 million, beating the high end of guidance with a net margin expansion to 43.2%, demonstrating high-quality efficient growth.
Significant User Engagement
The group's average monthly active users increased by 8.8% year-over-year to 42.4 million, with a strategic focus on acquiring high-quality users.
Successful Share Repurchase Program
Yalla repurchased over 6.2 million shares, totaling USD 41 million, completing 82% of the 2025 minimum goal, with plans to potentially exceed the full-year target.
Strong Gaming Pipeline
Yalla plans to release multiple new games in the coming quarters, including Match-3 titles and a self-developed roguelike game, strengthening its product portfolio.
Technological Innovation in AI
Yalla initiated internship collaborations with Mohamed Bin Zayed University of Artificial Intelligence, focusing on AI application projects to enhance technology innovation.
Negative Updates
Expected Revenue Decline in Q3
The Q3 revenue outlook indicates a potential year-over-year decline, raising concerns about maintaining growth momentum.
Increased General and Administrative Expenses
General and administrative expenses rose by 18.8% due to increased incentive compensation and higher exchange losses, impacting overall profitability.
Short-term MAU Fluctuation
Despite long-term growth plans, there was a short-term dip in MAU during Q2, attributed to strategic adjustments in user acquisition.
Company Guidance
During the second quarter of 2025, Yalla Group Limited reported total revenues of approximately USD 84.6 million, surpassing the high end of their guidance. The company achieved a year-over-year net margin expansion to 43.2%, driven by optimized user acquisition strategies and refined internal processes. The group's average monthly active users (MAUs) increased by 8.8% year-over-year to 42.4 million, despite a short-term sequential dip in MAUs. Yalla's net income rose by 16.4% year-over-year to USD 36.5 million, with non-GAAP net income reaching USD 39.4 million, an 11.7% increase from the previous year. Operating income for the second quarter was USD 30.6 million, up 3.4% year-over-year. The company executed a share repurchase program, acquiring over 6.2 million shares totaling USD 41 million, achieving 82% of its 2025 minimum goal. Looking forward, Yalla provided a revenue outlook for the third quarter of 2025, projecting revenues between USD 78 million and USD 85 million, while maintaining a strategic focus on expanding its gaming pipeline and user base in the MENA region.Yalla Group Financial Statement Overview
Summary
Yalla Group demonstrates strong financial health with robust revenue growth, high profit margins, and minimal leverage. However, the lack of current cash flow data in 2024 requires attention to ensure liquidity and operational efficiency.Income Statement
Yalla Group has demonstrated strong revenue growth over the years, with a notable increase of 6.52% from 2023 to 2024. The company maintains a high gross profit margin of 64.55% and a robust net profit margin of 39.94% in 2024. The EBIT margin of 35.74% and EBITDA margin of 36.34% also reflect operational efficiency and profitability. These metrics indicate a solid financial performance and growth trajectory in the competitive software industry.87
Very Positive
Balance Sheet
The balance sheet of Yalla Group shows a very strong position with a low debt-to-equity ratio of 0.0015, indicating minimal leverage. The company has a high return on equity (ROE) of 19.26%, reflecting effective use of shareholder funds to generate profits. The equity ratio stands at 87.85%, showcasing Yalla's strong capitalization and low reliance on debt. This stability provides a solid foundation for future growth and resilience against market fluctuations.92
Very Positive
Cash Flow
Yalla Group's cash flow statement reveals a lack of positive operating and free cash flow in 2024, posing potential risks to liquidity. The company has historically shown strong free cash flow growth, but the lack of current data prevents a complete analysis. While past performance shows effective cash generation, the absence of current cash flow metrics suggests a need for careful monitoring of cash reserves and operational cash management.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 348.19M | 339.68M | 318.88M | 303.60M | 273.13M | 134.93M |
| Gross Profit | 228.17M | 219.21M | 204.35M | 189.80M | 177.99M | 73.66M |
| EBITDA | 126.41M | 122.75M | 98.37M | 82.77M | 85.30M | 4.34M |
| Net Income | 146.31M | 135.68M | 117.34M | 79.76M | 82.60M | 3.21M |
Balance Sheet | ||||||
| Total Assets | 832.92M | 801.63M | 638.95M | 506.34M | 380.81M | 254.62M |
| Cash, Cash Equivalents and Short-Term Investments | 702.52M | 654.30M | 535.27M | 453.05M | 354.39M | 237.65M |
| Total Debt | 1.06M | 1.03M | 2.10M | 1.60M | 668.33K | 0.00 |
| Total Liabilities | 96.82M | 103.82M | 76.29M | 66.47M | 44.93M | 21.08M |
| Stockholders Equity | 743.63M | 704.35M | 567.69M | 440.59M | 335.89M | 233.53M |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 171.97M | 137.67M | 103.22M | 142.75M | 63.76M |
| Operating Cash Flow | 0.00 | 172.81M | 139.32M | 119.55M | 144.24M | 64.79M |
| Investing Cash Flow | 0.00 | 18.58M | -226.12M | -62.57M | -5.36M | 2.48M |
| Financing Cash Flow | 0.00 | -12.82M | -7.55M | 371.00K | -24.56M | 123.77M |
Yalla Group Technical Analysis
Neutral
7.51
Price Trends
7.81
Negative
7.47
Positive
6.20
Positive
Market Momentum
-0.07
Positive
46.87
Neutral
31.85
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For YALA, the sentiment is Neutral. The current price of 7.51 is below the 20-day moving average (MA) of 7.57, below the 50-day MA of 7.81, and above the 200-day MA of 6.20, indicating a neutral trend. The MACD of -0.07 indicates Positive momentum. The RSI at 46.87 is Neutral, neither overbought nor oversold. The STOCH value of 31.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for YALA.
Yalla Group Risk Analysis
Yalla Group disclosed 66 risk factors in its most recent earnings report. Yalla Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Yalla Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $1.19B | 9.39 | 21.16% | ― | 6.79% | 12.97% | |
72 Outperform | $1.29B | 102.37 | 3.26% | ― | -1.35% | -59.67% | |
70 Neutral | $802.46M | 81.66 | 5.33% | ― | 4.51% | 208.14% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $735.10M | ― | -32.50% | ― | 14.79% | 27.52% | |
60 Neutral | $1.49B | ― | -8.04% | ― | 8.20% | 82.75% | |
60 Neutral | $1.34B | ― | -33.99% | ― | 9.93% | -11.15% |
* Technology Sector Average
YALA
Yalla Group
7.51
2.81
59.79%
PD
PagerDuty
16.03
-1.77
-9.94%
SPT
Sprout Social
12.49
-15.66
-55.63%
VMEO
Vimeo
7.77
3.02
63.58%
VTEX
VTEX
4.41
-2.78
-38.66%
AMPL
Amplitude
10.14
1.51
17.50%
Yalla Group Corporate Events
Yalla Group Reports Strong Q2 2025 Financial Results Amidst MENA Expansion
Aug 12, 2025
Yalla Group Limited announced its unaudited financial results for the second quarter of 2025, revealing a 4.1% increase in revenues to $84.6 million compared to the same period in 2024. The company experienced a 16.4% rise in net income to $36.5 million, driven by improved operational efficiency and a broadening user base. Despite a decrease in the number of paying users, the average monthly active users grew by 8.8%. Yalla Group’s continued expansion into new verticals and product innovation, including upcoming game releases, positions it to capitalize on MENA’s digital transformation, enhancing shareholder value and market presence.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.