HUYA May 18, 2026

HUYA Inc. Q1 2026 Earnings Call - Game Publishing and AI Pivot Drives Record Non-Streaming Revenue

Summary

HUYA Inc. is no longer just a live-streaming platform. It is actively repositioning itself as a full-service game ecosystem, and the Q1 2026 results prove the pivot is working. Game-related services, advertising, and publishing revenues surged 69% year-over-year to RMB 627 million, capturing 36% of total revenue for the first time. This structural shift is directly improving the company's profitability profile, pushing gross margins up to 14.6% and narrowing non-GAAP operating losses to just RMB 3 million. The star performer is the newly published mobile title Goose Goose Duck Mobile, which dominated iOS charts and is now being scaled through WeChat mini-game integration and aggressive UGC expansion.

Management is simultaneously betting on AI and content-driven marketing to future-proof the business. AI initiatives are being deployed across four distinct verticals: live streaming support, game tools, physical AI companions, and casual game production. While live streaming revenue saw a minor sequential dip to RMB 1.1 billion, the company is doubling down on self-produced tournaments and cross-platform distribution to maintain relevance. With a robust publishing pipeline featuring titles from Tencent and Kingsoft, and a cash position of RMB 3.46 billion, HUYA is using its content moat to capture higher-margin revenue streams while systematically reducing reliance on traditional tipping models.

Key Takeaways

Game-related services, advertising, and other revenues surged 69% year-over-year to RMB 627 million, marking a record 36% share of total net revenue and signaling a successful structural shift away from pure live-streaming dependency.
Goose Goose Duck Mobile has emerged as a breakout hit, ranking number one on the iOS free games chart for most of Q1 and climbing into the top five on the iOS top-grossing chart by April, validating HUYA's publishing capabilities.
Total net revenues grew 15% year-over-year to RMB 1.73 billion, driven primarily by the explosive growth in game publishing, in-game item sales, and advertising, which offset a slight dip in traditional live-streaming revenue.
Gross margins expanded to 14.6% in Q1, up from 12.5% in the prior year period, as the revenue mix improved with higher-margin business lines contributing more to the top line.
Non-GAAP operating losses narrowed significantly to RMB 3 million, compared to RMB 36 million in the same quarter last year, demonstrating improved operating leverage and cost discipline.
HUYA's estimated reach across external platforms, including Douyin and WeChat, has doubled year-over-year to exceed 200 million users, establishing the company as the largest gaming MCN on WeChat and a top-three player on Douyin.
The company is aggressively integrating AI across four core areas: AI-powered live streaming, real-time game tools, physical AI companions, and AI-assisted casual game production, aiming to enhance user engagement and R&D efficiency.
A robust game publishing pipeline is scheduled for 2026, featuring collaborations with major developers like Tencent and Kingsoft across casual, SLG, and MMO genres, with a proven 3D puzzle matching title launching this summer.
Live streaming revenue remained steady at RMB 1.1 billion despite market headwinds, supported by a strategy focused on high-ROI self-produced tournaments like the UZI Cup, which generated over 100 million views across the internet.
HUYA maintains a fortress balance sheet with RMB 3.46 billion in cash, short-term deposits, and long-term deposits, providing ample runway to fund content updates, AI development, and new game launches while paying special cash dividends.

Full Transcript

Hanyu Liu, Investor Relations, HUYA Inc.: Sixth earnings webinar. I’m Hanyu Liu from the HUYA’s Investor Relations. At this time, all participants are in listen only mode. Please be advised that today’s webinar is being recorded. The company’s financial and operational results were issued earlier today and are posted online. You can also view the earnings press release by visiting the IR website at ir.huya.com. A replay of the call will be available on the IR website soon. Participants of management on today’s call will be Mr. Vincent Junhong Huang, our Acting CEO, Mr. Raymond Peng Lei, our CFO, and Ms. Margaret Shi, Head of Capital Markets. Management will begin with prepared remarks, and the call will conclude with a Q&A session. Before we continue, please note that today’s discussion will contain forward-looking statements made under the Safe Harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995.

Forward-looking statements involve inherent risks and uncertainties. As such, the company’s results may be materially different from the views expressed today. Further information regarding this and other risks and uncertainties is included in the company’s latest annual reports on Form 20-F and other public filings as filed with the U.S. Securities and Exchange Commission. The company does not assume any obligation to update any forward-looking statements, except as required under applicable law. Please also note that HUYA’s earnings press release and this conference call include discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial measures. HUYA’s press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures. With that, I’m pleased to turn the call over to Mr. Huang. Please go ahead.

Vincent Junhong Huang, Acting CEO, HUYA Inc.: Okay. Hello, everyone, and thank you for joining our earnings call today. First, I would like to share our overall performance for the quarter. In the first quarter, total net revenues grew by 15% year-over-year to RMB 1.73 billion, primarily driven by continuous strong growth from game-related services, advertising and other businesses. Game-related services, advertising and other revenues reached RMB 627 million, up 69% year-over-year, and further increased to record 36% of total net revenues. Live streaming revenues were RMB 1.1 billion for the quarter, underpinned by our vibrant, diversified and high-quality live streaming content ecosystem. With the integration of AI, we are able to offer an enriched, more creative experiences to our users. Our ecosystem of game content live streamer is becoming increasingly influential across the broader social platforms.

While our own channels, including the HUYA Live app, continue to enjoy a stable user base. Our estimated reach across external platforms doubled from last year, exceeding 200 million users, including those on Douyin and WeChat platforms. According to our internal data, HUYA is the largest gaming MCN on WeChat channels and remain among the top three on Douyin. Across multiple leading game titles, nearly half of the core streamer are connected to HUYA. This broad content network enables us to provide games with strong content-driven marketing and user reach, which is what’s driving our growth in our collaboration with game developers in game item sales and advertising, as well as game publishing. On the game publishing front, Goose Goose Duck Mobile continued to deliver impressive results.

Since its launch on January 7th, the game ranked number one on the iOS free games chart for most of the first quarter. We have been accelerating the pace of content updates since March, and on April 1, we launched season two, introducing a new map, Ancient Desert, as well as new roles, including Dueling Dodo and Raven. At the same time, we continue to work on our UGC mechanism, which we believe will be an important driver of player engagement, social interaction, and long-term content vitality for the game. Building on this foundation, we launched our first PGC gameplay mode, Goose Hunt, on April 29, which received positive feedback from players and further expanded the game’s content ecosystem. As we continue to focus on building a healthy user ecosystem with robust and fun game content, we are also ramping up its monetization gradually.

In April, Goose Goose Duck Mobile reached the top five on the iOS top-grossing game chart, with new skin offered, validating its monetization potential. Looking ahead, we will further enrich the game’s content and social environment with new features such as party mode and a home decoration system, and introduce more IP collaborations to meet players’ growing demand for role-playing experiences. Meanwhile, we are working on the WeChat mini game version, which is currently scheduled for launch this summer. By integrating Goose Goose Duck Mobile more deeply with the WeChat user ecosystem, we hope to leverage WeChat social graph to further reactivate existing users and attract new ones. With the successful debut of Goose Goose Duck Mobile, we are gaining more recognition from game developers of our publishing capabilities through our content ecosystem.

We now have a handful of new titles in the pipeline to launch this year across various genres, including casual, SLG, and MMO. For in-game item sales, revenues continue to grow solidly year-over-year. On the domestic front, item for titles including Peacekeeper Elite, Honor of Kings, and CrossFire continue to contribute incremental growth. For example, our large-scale outdoor live-streaming event for Peacekeeper Elite Journey Season Two, not only effectively drove in-game item sales, but also generated strong social buzz for the game IP. On the overseas front, in-game item sales for PUBG Mobile, Genshin Impact, and Arena Breakout also delivered impressive performance. On the advertising side, leveraging our influence across streamer networks, tournament production capabilities, and UGC creation know-how, we provide fully integrated content marketing solution for game developers.

Some of our earlier advertising campaign have proven very effective, gaining further recognition from leading advertisers, including Tencent, NetEase, and Hypergryph. For example, for Hypergryph recognized Arknights: Endfield open beta campaign in the first quarter. We connected multiple top streamers to generate in-depth live-streaming content, generating more than 70 million views across the internet. This not only drove strong live-streaming traction on HUYA Live app, but also sparked extensive UGC content across all social platforms, broadening the game’s user reach. In terms of our content offerings on our own platform, we continue to enhance our live-streaming tournament ecosystem, introducing 55 licensed tournaments, as well as more than 20 self-produced tournaments and variety shows. In late March, we created UZI Cup, named after esports legend UZI, attracting more than 200 League of Legends teams across China.

The event generated more than 100 million views across the internet and appeared on Weibo’s trending list 22 times. Building on this momentum, we hosted additional self-produced events, including the Delta Force Qijia Cup and Dota 2 Immortal Cup Season two. We have also become the official production partner for multiple top-tier game tournaments, such as VALORANT 2026 National Tournament and 2026 Jiangsu Esports Super League. Hosting and producing these events creates organic synergies with our live-streaming content, in-game item sales, and other businesses. On the product side, we remain committed to upgrading our platform ecosystem through game services and enriching users’ e-entertainment experience with a suite of game tools. In March, we officially launched the real-time navigation feature for our Delta Force map tool, as well as the League of Legends Hextech ARAM assistant tool, helping players make better in-game decisions.

Beyond this, we are actively developing assistant tools for more titles, including Golden Spatula and Goose Goose Duck Mobile, further establishing game tools as differentiated products gateway. We are also developing a physical AI companion around the appeal of Goose Goose Duck, creating richer and differentiated game play and companionship value. Overall, we deliver solid progress across multiple business lines in the first quarter. Game publishing, in-game item sales, advertising, marketing, and tournament operations all achieved meaningful breakthroughs. HUYA is accelerating its strategic evolution from a game live-streaming platform into a full service game services platform, with game-related revenues reaching a record high percentage of total revenues, and our revenue mix continue to improve.

We will continue to deepen our game content ecosystem and focus on high-value opportunities across the game industry value chain. While scaling the business, we will continue to enhance earnings quality and strive to deliver resilient and sustainable growth for our shareholders. With that, I will now turn the call over to our CFO, Raymond Lei. He will share more details on our results. Raymond, please go ahead.

Raymond Peng Lei, Chief Financial Officer (CFO), HUYA Inc.: Thank you, Vincent, and hello, everyone. I’ll start with an overview of our financial performance. In the first quarter, we delivered a steady top-line growth with continued improvement in both our revenue mix and operating performance. Notably, the increased revenue contribution from business with higher gross margins led to both year-over-year and the sequential gross margin expansion to 14.6% this quarter. Furthermore, we achieved a non-GAAP net income of RMB 21 million for the quarter, despite lower interest income. Let’s move on to more details of our Q1 financial results. Total net revenues were RMB 1.73 billion for Q1, up 15% from the same period last year. Live streaming revenues were RMB 1.1 billion for Q1, compared with RMB 1.14 billion from the same period last year, primarily reflecting the live streaming industry’s current environment.

Game-related services, advertising and other revenues were RMB 627 million for Q1, up 69% from the same period last year. The increase was primarily driven by higher revenues from in-game item sales and advertising, mainly attributable to the company’s deepened and broadened collaboration with game companies. Cost of revenues increased by 12% year-over-year to RMB 1.48 billion for Q1, primarily due to increased cost of in-game virtual items, as well as increased revenue sharing fees and content costs. Within this, revenue sharing fees and content costs rose by 7% year-over-year to RMB 1.23 billion, mainly reflecting growth in our top line. Gross profits was RMB 253 million for Q1, up 34% from the same period last year.

Gross margin was 14.6% for Q1, improving from 12.5% from the same period last year. Excluding share-based compensation expenses, non-GAAP gross profit was RMB 256 million, and the non-GAAP gross margin was 14.8% for Q1. Research and development expenses increased by 2% year-over-year to RMB 132 million for Q1. Sales and marketing expenses increased by 45% year-over-year to RMB 88 million for Q1, primarily due to marketing and the promotion efforts related to the launch of Goose Goose Duck Mobile. General and administrative expenses increased by 6% year-over-year to RMB 65 million for Q1, primarily due to increased share-based compensation expenses. Other income was RMB 3 million for Q1, compared with RMB 4 million for the same period last year, primarily due to lower government subsidies.

Operating loss narrowed to RMB 29 million for Q1, compared with a loss of RMB 60 million for the same period last year. Excluding share-based compensation expenses and amortization of intangible assets from business acquisition, non-GAAP operating loss narrowed to RMB 3 million for Q1, compared with a loss of RMB 36 million in the same period last year. Interest income was RMB 30 million for Q1, down from RMB 65 million for the same period last year, primarily due to a lower time deposit balance following the payment of special cash dividends. Net loss attributable to Huya Inc. was RMB 4 million for Q1, compared with a net income attributable to Huya Inc. of RMB 1 million for the same period last year. Excluding share-based compensation expenses and the amortization of intangible assets from business acquisitions, net of income tax, non-GAAP net income attributable to Huya Inc.

was CNY 21 million for Q1, compared with CNY 24 million for the same period last year. Diluted net loss per ADS was approximately CNY 0.02 for Q1. non-GAAP diluted net income per ADS was CNY 0.09 for Q1. As of March 31, 2026, the company had a cash and cash equivalent, short-term deposits, and a long-term deposit of CNY 3.46 billion, compared with CNY 3.82 billion as of December 31, 2025. With that, I’d like to open the call to your questions.

Hanyu Liu, Investor Relations, HUYA Inc.: Thanks, Raymond, and hello, everyone. If you are dialing in by phone, please press five to ask a question, then press six to unmute yourself. If you are accessing the call from the Tencent Meeting or both meeting applications, please click the raise hand button at the bottom left. For the benefit of all participants on today’s call, if you wish to ask your question to management in Chinese, please immediately repeat your question in English. Today’s first question comes from Ritchie Sun from HSBC. Hello, Ritchie, your line is open. Please go ahead.

Ritchie Sun, Analyst, HSBC: Vincent, Raymond, Margaret, [Non- English content] Thank you management for taking my questions. Congrats on a solid start from Goose Goose Duck. I want to ask about the latest operating and strategy and also commercialization progress for this game. What is the this year’s operating strategy going to be?

Thank you.