How JOYY’s (JOYY) Exit From China Livestreaming Has Changed Its Investment Story

• Earlier this month, JOYY announced it has liquidated its China-based YY Live business to streamline operations and focus on its international platforms, with a particular emphasis on its AI-driven BIGO Ads segment.
• This move highlights JOYY's pivot towards higher-margin advertising and non-livestreaming initiatives, underpinned by strong shareholder returns through dividends and buybacks despite ongoing user and revenue headwinds.
• We'll now explore how JOYY’s exit from its domestic livestreaming operations may reshape expectations for its growth, profitability, and capital returns.

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JOYY Investment Narrative Recap

To be a shareholder in JOYY right now, you’d need to believe that its push into international AI-driven advertising can offset headwinds from slower user growth and revenue declines. The liquidation of YY Live marks a tangible break from domestic livestreaming, with little direct impact on the short-term catalyst, the expansion and monetization of BIGO Ads, but it does reduce exposure to China-specific risks. The most pressing risk remains whether international growth in advertising can consistently offset competitive and regulatory pressures.

Among recent corporate actions, the completed buyback of 830,000 shares for US$36.5 million stands out as most relevant, reinforcing management’s ongoing commitment to capital returns now that the business mix is shifting further toward advertising. This commitment is particularly significant as the company seeks to reassure investors about value creation with cash generated from higher-margin international operations, making capital allocation a recurring focus for near-term performance.

But before assuming that international expansion can fully compensate for user and revenue headwinds, consider the challenge of scaling new business lines in the face of...

Read the full narrative on JOYY (it's free!)

JOYY's narrative projects $2.4 billion revenue and $267.8 million earnings by 2028. This requires 4.0% yearly revenue growth and a $1.43 billion decrease in earnings from $1.7 billion today.

Uncover how JOYY's forecasts yield a $59.69 fair value, in line with its current price.

Exploring Other Perspectives

Community price targets for JOYY range widely from US$37 to US$235, based on four different Simply Wall St Community analyses. With global digital ad growth a catalyst, your outlook may depend heavily on whether you think international momentum can outpace ongoing challenges.

Explore 4 other fair value estimates on JOYY - why the stock might be worth 39% less than the current price!

Build Your Own JOYY Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your JOYY research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
• Our free JOYY research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate JOYY's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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