JOYY: Accelerating Advertising Momentum Will Drive Stronger Q4 Performance

Analysts nudged up their price target for JOYY from approximately $69.82 to about $72.67, citing stronger than expected Q3 results and a more robust, accelerating advertising business that supports higher revenue growth assumptions, despite slightly lower margin forecasts.

Analyst Commentary

Following the Q3 report, bullish analysts highlighted that the performance reinforced confidence in JOYY's core operations and justified higher valuation multiples, particularly for the advertising segment. Updated models now reflect a stronger revenue trajectory into Q4 and beyond, even as execution risks and competitive pressures remain in focus.

Bullish Takeaways

• Bullish analysts see Q3 as a solid beat that validates JOYY's ability to execute on growth initiatives, supporting higher near term and medium term revenue forecasts.
• Advertising momentum is viewed as a key driver of potential upside, with expectations that ad revenue growth could accelerate significantly in Q4, which would improve the quality and visibility of the revenue mix.
• The uplift in core business valuation, driven by a brighter advertising outlook, is cited as suggesting room for further multiple expansion if JOYY sustains higher growth and monetization efficiency.
• Higher price targets across research models are described as signaling growing conviction that JOYY can deliver growth above consensus expectations, even with only modest improvements in margins.

Bearish Takeaways

• Bearish analysts caution that, despite higher price targets, rating stances remain measured, reflecting uncertainty around the durability of advertising strength beyond the near term.
• Execution risk is flagged around maintaining 60 percent plus year over year ad growth, particularly if macro conditions or competitive dynamics weigh on advertiser budgets.
• Some models still incorporate relatively conservative margin assumptions, indicating concerns that increased investment needs in user acquisition and product may cap profitability upside.
• Valuation, while lifted, is described by cautious analysts as more tightly linked to continued acceleration in advertising, which could leave the stock more vulnerable if growth normalizes faster than expected.

What's in the News

• Declared a fourth quarter 2025 cash dividend of USD 0.97 per ADS, or USD 0.0483 per common share, payable on January 13, 2026 to shareholders of record on January 2, 2026, with an ex dividend date also on January 2, 2026 (company announcement)
• Issued fourth quarter 2025 net revenue guidance in the range of USD 563 million to USD 578 million, reflecting current views on market conditions and macroeconomic uncertainties (company guidance)
• Completed its previously announced share repurchase program, buying back a total of 1,700,000 shares, or about 3.29 percent of shares outstanding, for USD 88.6 million, including 870,000 shares repurchased between July 1, 2025 and November 19, 2025 (buyback update)

Valuation Changes

• The fair value estimate has risen slightly from approximately $69.82 to about $72.67, reflecting a modestly higher intrinsic value assessment for JOYY shares.
• The discount rate has edged down marginally from about 7.82 percent to roughly 7.80 percent, indicating a slightly lower assumed risk profile in the updated model.
• The revenue growth assumption has increased significantly from roughly 4.84 percent to about 8.58 percent, signaling a materially stronger top line outlook.
• The net profit margin assumption has declined moderately from about 11.94 percent to roughly 10.97 percent, incorporating expectations for somewhat lower profitability.
• The future P/E multiple has risen slightly from around 14.59x to approximately 14.88x, implying a modest expansion in the valuation multiple applied to forward earnings.