Yalla Group (YALA) AI Stock Analysis

Compare

389 Followers

Top Page

Yalla Group

(NYSE:YALA)

Rating:78Outperform

Price Target:

$9.00

▲(16.88% Upside)

Yalla Group's strong financial performance and positive earnings call results are the primary drivers of its high score. The company's robust revenue growth, profitability, and strategic initiatives in gaming and AI are significant strengths. However, technical analysis shows mixed signals, and the absence of current cash flow data requires careful monitoring. Valuation metrics suggest the stock is undervalued, but the lack of a dividend yield may deter some investors.

Yalla Group (YALA) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$1.20B

Dividend YieldN/A

Average Volume (3M)740.80K

Price to Earnings (P/E)9.3

Beta (1Y)1.07

Revenue Growth6.79%

EPS Growth12.97%

CountryUS

Employees815

SectorTechnology

Sector Strength84

IndustrySoftware - Application

Share Statistics

EPS (TTM)0.20

Shares Outstanding132,801,830

10 Day Avg. Volume470,181

30 Day Avg. Volume740,804

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap0.42

Enterprise Value/Revenue1.51

Enterprise Value/Gross Profit2.32

Enterprise Value/Ebitda4.07

Forecast

1Y Price Target

$9.00

Price Target Upside16.88% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

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 shows strong financial health with high revenue growth, excellent profit margins, and minimal leverage. However, the absence of current cash flow data in 2024 requires attention to ensure liquidity and operational efficiency.

Income Statement

Very Positive

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.

Balance Sheet

Very Positive

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.

Cash Flow

Positive

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.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	337.10M	339.68M	318.88M	303.60M	273.13M	134.93M
Gross Profit	218.80M	219.21M	204.35M	189.80M	177.99M	73.66M
EBITDA	124.90M	122.75M	98.37M	82.77M	83.88M	4.34M
Net Income	141.18M	135.68M	117.34M	79.76M	82.60M	3.21M
Balance Sheet
Total Assets	826.07M	801.63M	638.95M	506.34M	380.81M	254.62M
Cash, Cash Equivalents and Short-Term Investments	689.34M	654.30M	535.27M	453.05M	354.39M	237.65M
Total Debt	784.55K	1.03M	2.10M	1.60M	668.33K	0.00
Total Liabilities	94.30M	103.82M	76.29M	66.47M	44.93M	21.08M
Stockholders Equity	739.03M	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

Technical Analysis Sentiment

Positive

Last Price7.70

Price Trends

50DMA

7.73

Negative

100DMA

7.41

Positive

200DMA

5.91

Positive

Market Momentum

MACD

-0.08

Positive

RSI

48.29

Neutral

STOCH

27.79

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For YALA, the sentiment is Positive. The current price of 7.7 is below the 20-day moving average (MA) of 7.76, below the 50-day MA of 7.73, and above the 200-day MA of 5.91, indicating a neutral trend. The MACD of -0.08 indicates Positive momentum. The RSI at 48.29 is Neutral, neither overbought nor oversold. The STOCH value of 27.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YALA	78 Outperform	$1.20B	9.28	21.16%	―	6.79%	12.97%
OPFI	63 Neutral	$913.22M	50.49	-209.49%	―	6.79%	-593.75%
VTEX	63 Neutral	$736.95M	75.36	5.33%	―	4.51%	8241.83%
Sector *	61 Neutral	$35.83B	9.00	-10.39%	1.87%	8.46%	-7.85%
DSP	59 Neutral	$649.03M	302.38	5.20%	―	30.92%	―
BLND	58 Neutral	$1.13B	―	-93.00%	―	-4.76%	67.62%
BMBL	52 Neutral	$696.87M	―	-75.71%	―	-5.06%	-2318.18%

* Technology Sector Average

Performance Comparison

YALA

Yalla Group

7.70

3.40

79.07%

OPFI

OppFi

10.44

6.26

149.76%

DSP

Viant Technology

10.16

-0.07

-0.68%

BMBL

Bumble

6.62

0.32

5.08%

BLND

Blend Labs

4.23

0.92

27.79%

VTEX

4.07

-2.63

-39.25%

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.Date of analysis: Sep 10, 2025