Why Did Investors Dump Momo After Its Earnings Beat?

Why Did Investors Dump Momo After Its Earnings Beat?

Shares of Momo (NASDAQ: MOMO) are down over 20% this week after the Chinese social media company reported its third-quarter earnings. That decline is surprising, given Momo easily beat top-and bottom-line estimates.

Revenue rose 126% annually to $354.5 million, beating expectations by $15 million. Its non-GAAP net income rose 89% to $93.8 million, or $0.45 per share, surpassing expectations by $0.07. Its GAAP net income roughly doubled to $79.1 million.

Momo's mobile app. Image source: Google Play.

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Source: Fool.com