JOYY Inc. (YY) Refutes Short Seller Muddy Waters' Report

November 19, 2020 8:41 AM EST

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JOYY Inc. (Nasdaq: YY) (“JOYY” or the “Company”), a global video-based social media platform, today issued the following statement in response to allegations made in a report by Muddy Waters.

Yesterday, Muddy Waters issued a short seller report on JOYY, causing anxiety and market disturbance, leading to abnormal share price movements. The Company believes that the report contains numerous errors, unsubstantiated statements, and misleading conclusions and interpretations regarding information relating to the Company.

Muddy Waters’ report shows its lack of a basic understanding of the live streaming industry in China. The operating metrics disclosed by JOYY are commonly used and publicized by its industry peers. Live streaming has become a key revenue engine for companies in the internet sector, including a number of public companies listed in the U.S. and Hong Kong.

JOYY has solid cash balance and has consistently generated strong cash flow. To conclusively refute the report’s false allegation regarding the authenticity of JOYY’s profit figures, the Company is open to cash verification and diligence to be conducted by competent third-party advisers. The Company’s dividend policy of US$300 million announced in August 2020, with US$25 million already paid out in the third quarter of 2020, is also testament to the Company’s confidence in its operating cash flow.

JOYY’s acquisition of BIGO strictly followed the necessary corporate governance procedures and obtained all requisite approvals. In the 20 months since the acquisition, BIGO witnessed rapid revenue growth, with its top-line increasing from US$181 million in the second quarter of 2019 to US$490 million in the third quarter of 2020. Bigo Live ranked as the sixth highest grossing non-game mobile app in the world in September 2020, according to App Annie.

To demonstrate the Company’s confidence in its long-term prospects, JOYY will continue to execute on its US$300 million share repurchase program.

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