Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2018shares | |
Document Information [Line Items] | |
Document Type | 20-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2018 |
Document Fiscal Year Focus | 2018 |
Document Fiscal Period Focus | FY |
Entity Registrant Name | YY Inc. |
Entity Central Index Key | 0001530238 |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Trading Symbol | YY |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Class A common shares [Member] | |
Document Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 981,740,848 |
Class B common shares [Member] | |
Document Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 288,182,976 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Current assets | |||
Cash and cash equivalents | ¥ 6,004,231 | $ 873,279 | ¥ 2,617,432 |
Short-term deposits | 7,326,996 | 1,065,667 | 6,000,104 |
Restricted short-term deposits | 0 | 0 | 1,000,000 |
Short-term investments | 979,053 | 142,397 | 124,550 |
Accounts receivable, net | 198,428 | 28,860 | 153,944 |
Inventory | 0 | 0 | 315 |
Amounts due from related parties | 193,559 | 28,152 | 11,190 |
Financing receivables, net | 768,343 | 111,751 | 0 |
Prepayments and other current assets | 1,019,019 | 148,210 | 221,939 |
Total current assets | 16,489,629 | 2,398,316 | 10,129,474 |
Non-current assets | |||
Long-term deposits | 1,000,000 | 145,444 | 0 |
Deferred tax assets | 70,834 | 10,302 | 113,017 |
Investments | 4,591,524 | 667,809 | 1,153,019 |
Property and equipment, net | 1,296,319 | 188,542 | 1,016,998 |
Land use rights, net | 1,784,639 | 259,565 | 1,832,739 |
Intangible assets, net | 74,685 | 10,862 | 37,481 |
Goodwill | 11,763 | 1,711 | 11,716 |
Amounts due from related parties | 0 | 0 | 20,000 |
Financing receivables, net | 224,793 | 32,695 | 0 |
Other non-current assets | 223,859 | 32,559 | 144,275 |
Total non-current assets | 9,278,416 | 1,349,489 | 4,329,245 |
Total assets | 25,768,045 | 3,747,805 | 14,458,719 |
Current liabilities | |||
Convertible bonds (including convertible bonds of the consolidated variable interest entity without recourse to the Company of nil and nil as of December 31, 2017 and 2018, respectively) | 6,863 | 998 | 0 |
Accounts payable (including accounts payable of the consolidated variable interest entity without recourse to the Company of RMB67,817 and RMB112,167 as of December 31, 2017 and 2018, respectively) | 114,589 | 16,666 | 76,351 |
Deferred revenue (including deferred revenue of the consolidated variable interest entity without recourse to the Company of RMB757,244 and RMB950,816 as of December 31, 2017 and 2018, respectively) | 951,616 | 138,407 | 758,044 |
Advances from customers (including advances from customers of the consolidated variable interest entity without recourse to the Company of RMB80,406 and RMB101,690 as of December 31, 2017 and 2018, respectively) | 101,690 | 14,790 | 80,406 |
Income taxes payable (including income taxes payable of the consolidated variable interest entity without recourse to the Company of RMB142,204 and RMB162,118 as of December 31, 2017 and 2018, respectively) | 235,561 | 34,261 | 146,298 |
Accrued liabilities and other current liabilities (including accrued liabilities and other current liabilities of the consolidated variable interest entity without recourse to the Company of RMB1,404,877 and RMB2,207,138 as of December 31, 2017 and 2018, respectively) | 2,414,371 | 351,156 | 1,465,963 |
Amounts due to related parties (including amounts due to related parties of the consolidated variable interest entity without recourse to the Company of RMB30,502 and RMB28,336 as of December 31, 2017 and 2018, respectively) | 28,336 | 4,121 | 30,502 |
Short-term loans (including short-term loans of the consolidated variable interest entity without recourse to the Company of nil and nil as of December 31, 2017 and 2018, respectively) | 0 | 0 | 588,235 |
Total current liabilities | 3,853,026 | 560,399 | 3,145,799 |
Non-current liabilities | |||
Convertible bonds (including convertible bonds of the consolidated variable interest entity without recourse to the Company of nil and nil as of December 31, 2017 and 2018, respectively) | 0 | 0 | 6,536 |
Deferred revenue(including deferred revenue of the consolidated variable interest entity without recourse to the Company of RMB52,185 and RMB86,977 as of December 31, 2017 and 2018, respectively) | 91,710 | 13,339 | 57,718 |
Deferred tax liabilities (including deferred tax liabilities of the consolidated variable interest entity without recourse to the Company of RMB8,404 and nil as of December 31, 2017 and 2018, respectively) | 27,505 | 4,000 | 10,810 |
Total non-current liabilities | 119,215 | 17,339 | 75,064 |
Total liabilities | 3,972,241 | 577,738 | 3,220,863 |
Commitments and contingencies | |||
Mezzanine equity | 418,673 | 60,893 | 524,997 |
Shareholders' equity | |||
Additional paid-in capital | 11,168,866 | 1,624,444 | 5,339,844 |
Statutory reserves | 101,725 | 14,795 | 62,718 |
Retained earnings | 6,913,469 | 1,005,522 | 5,218,110 |
Accumulated other comprehensive (loss) income | 336,152 | 48,891 | (9,597) |
Total YY Inc.'s shareholders' equity | 18,520,292 | 2,693,664 | 10,611,155 |
Non-controlling interests | 2,856,839 | 415,510 | 101,704 |
Total shareholders' equity | 21,377,131 | 3,109,174 | 10,712,859 |
Total liabilities, mezzanine equity and shareholders' equity | 25,768,045 | 3,747,805 | 14,458,719 |
Class A common shares [Member] | |||
Shareholders' equity | |||
Common shares | 59 | 9 | 57 |
Class B common shares [Member] | |||
Shareholders' equity | |||
Common shares | ¥ 21 | $ 3 | ¥ 23 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017CNY (¥)shares | Dec. 31, 2017USD ($)$ / sharesshares |
Convertible Debt, Current | ¥ 6,863 | $ 998 | ¥ 0 | |
Accounts payable | 114,589 | 16,666 | 76,351 | |
Deferred revenue | 951,616 | 138,407 | 758,044 | |
Advances from customers | 101,690 | 14,790 | 80,406 | |
Income taxes payable | 235,561 | 34,261 | 146,298 | |
Accrued liabilities and other current liabilities | 2,414,371 | 351,156 | 1,465,963 | |
Amounts due to related parties | 28,336 | 4,121 | 30,502 | |
Short-term Debt | 0 | 0 | 588,235 | |
Convertible Debt, Noncurrent | 0 | 0 | 6,536 | |
Deferred revenue | 91,710 | 13,339 | 57,718 | |
Deferred tax liabilities | ¥ 27,505 | $ 4,000 | ¥ 10,810 | |
Class A common shares [Member] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Common shares, shares authorized | shares | 10,000,000,000 | 10,000,000,000 | 10,000,000,000 | 10,000,000,000 |
Common shares, shares issued | shares | 981,740,848 | 981,740,848 | 945,245,908 | 945,245,908 |
Common shares, shares outstanding | shares | 981,740,848 | 981,740,848 | 945,245,908 | 945,245,908 |
Class B common shares [Member] | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Common shares, shares authorized | shares | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 |
Common shares, shares issued | shares | 288,182,976 | 288,182,976 | 317,982,976 | 317,982,976 |
Common shares, shares outstanding | shares | 288,182,976 | 288,182,976 | 317,982,976 | 317,982,976 |
Variable interest entity [Member] | ||||
Convertible Debt, Current | ¥ 0 | ¥ 0 | ||
Accounts payable | 112,167 | 67,817 | ||
Deferred revenue | 950,816 | 757,244 | ||
Advances from customers | 101,690 | 80,406 | ||
Income taxes payable | 162,118 | 142,204 | ||
Accrued liabilities and other current liabilities | 2,207,138 | 1,404,877 | ||
Amounts due to related parties | 28,336 | 30,502 | ||
Short-term Debt | 0 | 0 | ||
Convertible Debt, Noncurrent | 0 | 0 | ||
Deferred revenue | 86,977 | 52,185 | ||
Deferred tax liabilities | ¥ 0 | ¥ 8,404 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||||
Dec. 31, 2018CNY (¥)¥ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017CNY (¥)¥ / sharesshares | Dec. 31, 2016CNY (¥)¥ / sharesshares | ||||||
Net revenues | |||||||||
Other revenues | ¥ 885,890 | $ 128,847 | ¥ 923,838 | ¥ 1,176,823 | |||||
Total net revenues | 15,763,557 | 2,292,714 | 11,594,792 | 8,204,050 | |||||
Cost of revenues | [2] | (10,017,134) | [1] | (1,456,932) | (7,026,402) | [3] | (5,103,430) | [4] | |
Gross profit | 5,746,423 | 835,782 | 4,568,390 | 3,100,620 | |||||
Operating expenses | |||||||||
Research and development expenses | [2] | (1,192,052) | [1] | (173,377) | (781,886) | [3] | (675,230) | [4] | |
Sales and marketing expenses | [2] | (1,149,316) | [1] | (167,161) | (691,281) | [3] | (387,268) | [4] | |
General and administrative expenses | [2] | (883,225) | [1] | (128,460) | (544,641) | [3] | (482,437) | [4] | |
Goodwill impairment | 0 | [2] | 0 | [2] | (2,527) | (17,665) | [2],[4] | ||
Total operating expenses | (3,224,593) | (468,998) | (2,020,335) | (1,562,600) | |||||
Gain on deconsolidation and disposal of subsidiaries | 0 | 0 | 37,989 | 103,960 | |||||
Other income | 117,860 | 17,142 | 113,187 | 129,504 | |||||
Operating income | 2,639,690 | 383,926 | 2,699,231 | 1,771,484 | |||||
Interest expense | (8,616) | (1,253) | (32,122) | (81,085) | |||||
Interest income and investment income | 485,552 | 70,621 | 180,384 | 67,193 | |||||
Foreign currency exchange gains (losses), net | (514) | (75) | (2,176) | 1,158 | |||||
Gain on deemed disposal and disposal of investments | 16,178 | 2,353 | 45,861 | 25,061 | |||||
Gain on fair value changes of investments | 1,689,404 | 245,714 | 0 | 0 | |||||
Fair value loss on derivative liabilities | (2,285,223) | (332,372) | 0 | 0 | |||||
Other non-operating expenses | (2,000) | (291) | 0 | 0 | |||||
Income before income tax expenses | 2,534,471 | 368,623 | 2,891,178 | 1,783,811 | |||||
Income tax expenses | (477,707) | (69,480) | (415,811) | (280,514) | |||||
Income before share of income in equity method investments, net of income taxes | 2,056,764 | 299,143 | 2,475,367 | 1,503,297 | |||||
Share of income in equity method investments, net of income taxes | 58,933 | 8,571 | 33,024 | 8,279 | |||||
Net income | 2,115,697 | 307,714 | 2,508,391 | 1,511,576 | |||||
Less: Net (loss) income attributable to the non-controlling interest shareholders and the mezzanine equity classified non-controlling interest shareholders | (93,310) | (13,571) | (4,532) | (12,342) | |||||
Net income attributable to controlling interest of the Company | 2,209,007 | 321,285 | 2,512,923 | 1,523,918 | |||||
Less: Accretion of subsidiaries' redeemable convertible preferred shares to redemption value | 73,159 | 10,641 | 19,688 | 0 | |||||
Deemed dividend to subsidiary's Series A preferred shareholders | 489,284 | 71,163 | 0 | 0 | |||||
Cumulative dividend on subsidiary's Series A Preferred Shares | 4,606 | 669 | 0 | 0 | |||||
Net income attributable to common shareholders of the Company | 1,641,958 | 238,812 | 2,493,235 | 1,523,918 | |||||
Other comprehensive income (loss): | |||||||||
Unrealized gain (loss) of available-for-sale securities, net of nil tax | 0 | 0 | (41,150) | 134,768 | |||||
Foreign currency translation adjustments, net of nil tax | 434,080 | 63,134 | (61,513) | (5,317) | |||||
Comprehensive income attributable to the common shareholders of YY Inc. | ¥ 2,076,038 | $ 301,946 | ¥ 2,390,572 | ¥ 1,653,369 | |||||
Net income per common share | |||||||||
-Basic (in CNY/dollars per share) | (per share) | [5] | ¥ 1.28 | $ 0.19 | ¥ 2.10 | ¥ 1.35 | ||||
-Diluted (in CNY/dollars per share) | (per share) | [5] | ¥ 1.27 | $ 0.18 | ¥ 2.07 | ¥ 1.32 | ||||
Weighted average number of common shares used in calculating net income per common share | |||||||||
-Basic (in shares) | [5] | 1,280,847,795 | 1,280,847,795 | 1,186,460,144 | 1,127,343,312 | ||||
-Diluted (in shares) | [5] | 1,294,089,406 | 1,294,089,406 | 1,216,637,741 | 1,216,111,329 | ||||
ADSs [Member] | |||||||||
Net income per common share | |||||||||
-Basic (in CNY/dollars per share) | (per share) | [5] | ¥ 25.64 | $ 3.73 | ¥ 42.03 | ¥ 27.04 | ||||
-Diluted (in CNY/dollars per share) | (per share) | [5] | ¥ 25.38 | $ 3.69 | ¥ 41.33 | ¥ 26.40 | ||||
Weighted average number of common shares used in calculating net income per common share | |||||||||
-Basic (in shares) | [5] | 64,042,390 | 64,042,390 | 59,323,007 | 56,367,166 | ||||
-Diluted (in shares) | [5] | 64,704,470 | 64,704,470 | 60,831,887 | 60,805,566 | ||||
Live streaming [Member] | |||||||||
Net revenues | |||||||||
Total net revenues | ¥ 14,877,667 | $ 2,163,867 | ¥ 10,670,954 | ¥ 7,027,227 | |||||
[1] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 63,867 10,472 74,339 Research and development expenses 194,530 30,643 225,173 Sales and marketing expenses 3,891 1,832 5,723 General and administrative expenses 159,042 183,748 342,790 | ||||||||
[2] | Share-based compensation was allocated in cost of revenues and operating expenses as follows:RMB RMB RMB US$ Cost of revenues 15,894 42,759 74,339 10,812 Research and development expenses 78,816 122,348 225,173 32,750 Sales and marketing expenses 3,107 4,417 5,723 832 General and administrative expenses 59,469 88,137 342,790 49,857 | ||||||||
[3] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 39,882 2,877 42,759 Research and development expenses 113,174 9,174 122,348 Sales and marketing expenses 3,626 791 4,417 General and administrative expenses 60,871 27,266 88,137 | ||||||||
[4] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya 100 Education Total RMB RMB RMB RMB Cost of revenues 9,893 5,677 324 15,894 Research and development expenses 53,085 19,538 6,193 78,816 Sales and marketing expenses 2,781 326 - 3,107 General and administrative expenses 19,523 26,557 13,389 59,469 | ||||||||
[5] | Each ADS represents 20 common shares. |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Share-based compensation | ¥ 648,025 | $ 94,251 | ¥ 257,661 | ¥ 157,286 |
Cost of revenues [Member] | ||||
Share-based compensation | 74,339 | 10,812 | 42,759 | 15,894 |
Research and development expenses [Member] | ||||
Share-based compensation | 225,173 | 32,750 | 122,348 | 78,816 |
Sales and marketing expenses [Member] | ||||
Share-based compensation | 5,723 | 832 | 4,417 | 3,107 |
General and administrative expenses [Member] | ||||
Share-based compensation | ¥ 342,790 | $ 49,857 | ¥ 88,137 | ¥ 59,469 |
Class A common shares [Member] | ||||
Number of common shares represented by each ADS | 20 | 20 | 20 | 20 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY ¥ in Thousands, $ in Thousands | CNY (¥) | USD ($) | Class A common shares [Member]shares | Class B common shares [Member]shares | common Stock [Member]Class A common shares [Member]CNY (¥)shares | common Stock [Member]Class B common shares [Member]CNY (¥)shares | Additional paid-in capital [Member]CNY (¥) | Statutory reserves [Member]CNY (¥) | Retained Earnings [Member]CNY (¥) | Accumulated other comprehensive (loss) income [Member]CNY (¥) | Total YY Inc.'s shareholders' equity [Member]CNY (¥) | Non-controlling interests [Member]CNY (¥) |
Balance at Dec. 31, 2015 | ¥ 3,246,819 | ¥ 43 | ¥ 27 | ¥ 2,011,799 | ¥ 56,507 | ¥ 1,207,168 | ¥ (36,385) | ¥ 3,239,159 | ¥ 7,660 | |||
Balance (in shares) at Dec. 31, 2015 | shares | 728,227,848 | 369,557,976 | ||||||||||
Issuance of common shares for exercised share options | 9 | ¥ 0 | ¥ 0 | 9 | 0 | 0 | 0 | 9 | 0 | |||
Issuance of common shares for exercised share options (in shares) | shares | 234,720 | 0 | ||||||||||
Issuance of common shares for vested restricted shares and restricted share units | 0 | ¥ 0 | ¥ 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
Issuance of common shares for vested restricted shares and restricted share units (in shares) | shares | 11,652,460 | 0 | ||||||||||
Class B common shares converted to Class A common shares (issued) | ¥ 1 | |||||||||||
Class B common shares converted to Class A common shares (issued) (in shares) | shares | 10,000,000 | |||||||||||
Class B common shares converted to Class A common shares (converted) | ¥ (1) | |||||||||||
Class B common shares converted to Class A common shares (converted) (in shares) | shares | (10,000,000) | |||||||||||
Share-based compensation | 143,922 | ¥ 0 | ¥ 0 | 143,922 | 0 | 0 | 0 | 143,922 | 0 | |||
Deemed disposal of partial interest in a subsidiary arising from conversion of liability | 5,718 | 0 | 0 | 5,718 | 0 | 0 | 0 | 5,718 | 0 | |||
Other change in equity in an equity investment | 4,800 | 0 | 0 | 4,800 | 0 | 0 | 0 | 4,800 | 0 | |||
Deemed disposal of partial interest in an equity investment | (482) | 0 | 0 | (482) | 0 | 0 | 0 | (482) | 0 | |||
Appropriation to statutory reserves | 0 | 0 | 0 | 0 | 2,350 | (2,350) | 0 | 0 | 0 | |||
Set-up of subsidiaries with non-controlling interest shareholders | 6,500 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 6,500 | |||
Capital injection in subsidiaries from non-controlling interest shareholders | 4,142 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 4,142 | |||
Acquisition of subsidiaries with non-controlling interest shareholders | 291 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 291 | |||
Components of comprehensive income | ||||||||||||
Net income (loss) attributable to YY Inc. and non-controlling interest shareholders | 1,511,385 | 0 | 0 | 0 | 0 | 1,523,918 | 0 | 1,523,918 | (12,533) | |||
Unrealized gain (loss) of available-for-sale securities | 134,768 | 0 | 0 | 0 | 0 | 0 | 134,768 | 134,768 | 0 | |||
Foreign currency translation adjustments, net of nil tax | (5,317) | 0 | 0 | 0 | 0 | 0 | (5,317) | (5,317) | 0 | |||
Balance at Dec. 31, 2016 | 5,052,555 | ¥ 44 | ¥ 26 | 2,165,766 | 58,857 | 2,728,736 | 93,066 | 5,046,495 | 6,060 | |||
Balance (in shares) at Dec. 31, 2016 | shares | 750,115,028 | 359,557,976 | ||||||||||
Issuance of common shares for exercised share options | 20 | ¥ 0 | ¥ 0 | 20 | 0 | 0 | 0 | 20 | 0 | |||
Issuance of common shares for exercised share options (in shares) | shares | 379,120 | 0 | ||||||||||
Issuance of common shares for vested restricted shares and restricted share units | 0 | ¥ 1 | ¥ 0 | (1) | 0 | 0 | 0 | 0 | 0 | |||
Issuance of common shares for vested restricted shares and restricted share units (in shares) | shares | 20,926,760 | 0 | ||||||||||
Issuance of common shares | 2,946,134 | ¥ 9 | 2,946,125 | 0 | 0 | 0 | 2,946,134 | 0 | ||||
Issuance of common share (in shares) | shares | 132,250,000 | |||||||||||
Class B common shares converted to Class A common shares (issued) | ¥ 3 | |||||||||||
Class B common shares converted to Class A common shares (issued) (in shares) | shares | 41,575,000 | |||||||||||
Class B common shares converted to Class A common shares (converted) | ¥ (3) | |||||||||||
Class B common shares converted to Class A common shares (converted) (in shares) | shares | (41,575,000) | |||||||||||
Share-based compensation | 257,661 | ¥ 0 | ¥ 0 | 229,435 | 0 | 0 | 0 | 229,435 | 28,226 | |||
Deemed disposal of partial interest in an equity investment | (1,501) | 0 | 0 | (1,501) | 0 | 0 | 0 | (1,501) | 0 | |||
Appropriation to statutory reserves | 0 | 0 | 0 | 0 | 3,861 | (3,861) | 0 | 0 | 0 | |||
Set-up of subsidiaries with non-controlling interest shareholders | 20,816 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 20,816 | |||
Capital injection in subsidiaries from non-controlling interest shareholders | 44,059 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 44,059 | |||
Acquisition of subsidiaries with non-controlling interest shareholders | 453 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 453 | |||
Disposal of subsidiaries with non-controlling interest shareholders | 12,833 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 12,833 | |||
Components of comprehensive income | ||||||||||||
Net income (loss) attributable to YY Inc. and non-controlling interest shareholders | 2,502,334 | 0 | 0 | 0 | 0 | 2,512,923 | 0 | 2,512,923 | (10,589) | |||
Accretion of subsidiaries' redeemable convertible preferred shares to redemption value | (19,842) | 0 | 0 | (19,688) | 0 | (19,688) | (154) | |||||
Unrealized gain (loss) of available-for-sale securities | (41,150) | 0 | 0 | 0 | 0 | 0 | (41,150) | (41,150) | 0 | |||
Foreign currency translation adjustments, net of nil tax | (61,513) | 0 | 0 | 0 | 0 | 0 | (61,513) | (61,513) | 0 | |||
Balance at Dec. 31, 2017 | 10,712,859 | ¥ 57 | ¥ 23 | 5,339,844 | 62,718 | 5,218,110 | (9,597) | 10,611,155 | 101,704 | |||
Balance (in shares) at Dec. 31, 2017 | shares | 945,245,908 | 317,982,976 | 945,245,908 | 317,982,976 | ||||||||
Adoption of ASU 2016-01 at Dec. 31, 2017 | 0 | ¥ 0 | ¥ 0 | 0 | 0 | 87,802 | (87,802) | 0 | 0 | |||
Issuance of common shares for exercised share options | 7 | ¥ 0 | ¥ 0 | 7 | 0 | 0 | 0 | 7 | 0 | |||
Issuance of common shares for exercised share options (in shares) | shares | 154,260 | 0 | ||||||||||
Issuance of common shares for vested restricted shares and restricted share units | 0 | ¥ 0 | ¥ 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
Issuance of common shares for vested restricted shares and restricted share units (in shares) | shares | 6,540,680 | 0 | ||||||||||
Class B common shares converted to Class A common shares (issued) | ¥ 2 | |||||||||||
Class B common shares converted to Class A common shares (issued) (in shares) | shares | 29,800,000 | |||||||||||
Class B common shares converted to Class A common shares (converted) | ¥ (2) | |||||||||||
Class B common shares converted to Class A common shares (converted) (in shares) | shares | (29,800,000) | |||||||||||
Share-based compensation | 648,025 | ¥ 0 | ¥ 0 | 648,025 | 0 | 0 | 0 | 648,025 | 0 | |||
Appropriation to statutory reserves | 0 | 0 | 0 | 0 | 39,007 | (39,007) | 0 | 0 | 0 | |||
Capital injection in subsidiaries from non-controlling interest shareholders | 658 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 658 | |||
Acquisition of subsidiaries with non-controlling interest shareholders | (13,315) | 0 | 0 | (13,315) | 0 | 0 | 0 | (13,315) | 0 | |||
Conversion of a subsidiary's preferred shares to ordinary shares upon the completion of its IPO | 6,290,417 | 0 | 0 | 4,009,874 | 0 | 0 | 0 | 4,009,874 | 2,280,543 | |||
Proceed from a subsidiary's IPO, net of issuance cost | 1,207,749 | 0 | 0 | 795,073 | 0 | 0 | 0 | 795,073 | 412,676 | |||
Disposal of subsidiaries with non-controlling interest shareholders | 354,748 | 0 | 0 | 389,358 | 0 | 0 | (529) | 388,829 | (34,081) | |||
Components of comprehensive income | ||||||||||||
Net income (loss) attributable to YY Inc. and non-controlling interest shareholders | 2,114,341 | 0 | 0 | 0 | 0 | 2,209,007 | 0 | 2,209,007 | (94,666) | |||
Accretion of subsidiaries' redeemable convertible preferred shares to redemption value | (77,851) | 0 | 0 | (73,159) | 0 | (73,159) | (4,692) | |||||
Unrealized gain (loss) of available-for-sale securities | 0 | $ 0 | ||||||||||
Deemed dividend to subsidiary's Series A Preferred shareholders | (496,995) | 0 | 0 | 0 | 0 | (489,284) | 0 | (489,284) | (7,711) | |||
Foreign currency translation adjustments, net of nil tax | 636,488 | 0 | 0 | 0 | 0 | 0 | 434,080 | 434,080 | 202,408 | |||
Balance at Dec. 31, 2018 | ¥ 21,377,131 | $ 3,109,174 | ¥ 59 | ¥ 21 | ¥ 11,168,866 | ¥ 101,725 | ¥ 6,913,469 | ¥ 336,152 | ¥ 18,520,292 | ¥ 2,856,839 | ||
Balance (in shares) at Dec. 31, 2018 | shares | 981,740,848 | 288,182,976 | 981,740,848 | 288,182,976 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Parenthetical) - CNY (¥) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Foreign currency translation adjustments, tax portion |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | ||||
Cash flows from operating activities | |||||||
Net income | ¥ 2,115,697 | $ 307,714 | ¥ 2,508,391 | ¥ 1,511,576 | |||
Adjustments to reconcile net income to net cash provided by operating activities | |||||||
Depreciation of property and equipment | 150,991 | 21,961 | 176,715 | 173,625 | |||
Amortization of acquired intangible assets and land use rights | 69,095 | 10,049 | 62,419 | 100,892 | |||
Allowance for doubtful accounts | 54,073 | 7,865 | 15,106 | 45,914 | |||
Loss (gain) on disposal of property and equipment | (799) | (116) | 17,620 | 891 | |||
Impairment of investments | 35,348 | 5,141 | 43,205 | 80,104 | |||
Impairment of intangible assets | 0 | 0 | 0 | 3,828 | |||
Impairment of goodwill | 0 | [1] | 0 | [1] | 2,527 | 17,665 | [1],[2] |
Share-based compensation | 648,025 | 94,251 | 257,661 | 157,286 | |||
Share of income in equity method investments, net of income taxes | (58,933) | (8,571) | (33,024) | (8,279) | |||
Gain on deemed disposal and disposal of investments | (16,178) | (2,353) | (45,861) | (25,061) | |||
Gain on deconsolidation and disposal of subsidiaries | 0 | 0 | (37,989) | (103,960) | |||
Deferred income taxes, net | 49,646 | 7,221 | 3,919 | (7,768) | |||
Foreign currency exchange (gains) losses, net | 514 | 75 | 2,176 | (1,158) | |||
Investment income | (17,093) | (2,486) | 0 | 0 | |||
Gain on fair value changes of investments | (1,689,404) | (245,714) | 0 | 0 | |||
Fair value loss on derivative liabilities | 2,285,223 | 332,372 | 0 | 0 | |||
Changes in operating assets and liabilities, net of business acquisition and disposal of subsidiaries | |||||||
Accounts receivable | (45,682) | (6,644) | 18,383 | (34,293) | |||
Interest receivables recorded in financing receivables | (832) | (121) | 0 | 0 | |||
Prepayments and other assets | (380,834) | (55,391) | (48,277) | (97,888) | |||
Amounts due from related parties | 486 | 71 | 155 | 1,839 | |||
Inventory | 315 | 46 | 1,434 | 680 | |||
Amounts due to related parties | (1,896) | (276) | (18,615) | 66,328 | |||
Accounts payable | 8,699 | 1,265 | (39,060) | 36,888 | |||
Deferred revenue | 227,564 | 33,098 | 366,634 | 81,513 | |||
Advances from customers | 21,284 | 3,096 | 24,254 | 10,783 | |||
Income taxes payable | 62,520 | 9,093 | 5,544 | 33,351 | |||
Accrued liabilities and other current liabilities | 946,985 | 137,733 | 435,135 | 376,379 | |||
Net cash provided by operating activities | 4,464,814 | 649,379 | 3,718,452 | 2,421,135 | |||
Cash flows from investing activities | |||||||
Placements of short-term deposits | (9,512,818) | (1,383,582) | (9,667,447) | (8,027,325) | |||
Maturities of short-term deposits | 8,649,150 | 1,257,967 | 7,361,225 | 6,324,897 | |||
Placements of long-term deposits | (1,000,000) | (145,444) | 0 | 0 | |||
Placements of short-term investments | (3,505,075) | (509,792) | (189,550) | 0 | |||
Maturities of short-term investments | 2,667,665 | 387,996 | 65,000 | 0 | |||
Purchase of property and equipment | (333,994) | (48,577) | (397,327) | (162,395) | |||
Purchase of intangible assets and land use right | (58,838) | (8,558) | (17,749) | (70,029) | |||
Purchase of other non-current assets | 0 | 0 | (82,645) | (5,403) | |||
Prepayments for investments | (67,250) | (9,781) | 0 | 0 | |||
Cash paid for investments | (2,335,537) | (339,690) | (325,647) | (197,244) | |||
Cash received from disposal of investments | 718,476 | 104,498 | 86,714 | 22,608 | |||
Cash dividend received from an equity investee | 6,125 | 891 | 0 | 6,720 | |||
Acquisition of businesses, net of cash and cash equivalents acquired | 0 | 0 | (6,161) | (1,946) | |||
Deconsolidation and disposal of subsidiaries, net of cash disposed | 0 | 0 | 117,005 | (5,370) | |||
Payments on behalf of related parties, net of repayment | 2,543 | 370 | 23,116 | (10,699) | |||
Loans to related parties | (188,000) | (27,343) | (24,962) | (44,500) | |||
Repayments of loans from related parties | 20,000 | 2,909 | 35,462 | 0 | |||
Loans to employees and third parties | (282,031) | (41,020) | (20,550) | (6,605) | |||
Repayments of loans from employees and third parties | 35,067 | 5,100 | 4,641 | 4,751 | |||
Payments to originate financing receivables | (1,458,012) | (212,059) | 0 | 0 | |||
Principal collection from financing receivables | 346,028 | 50,328 | 0 | 0 | |||
Proceeds from disposal of property and equipment | 1,115 | 161 | 1,359 | 181 | |||
Net cash used in investing activities | (6,295,386) | (915,626) | (3,037,516) | (2,172,359) | |||
Cash flows from financing activities | |||||||
Proceeds from exercise of vested share options | 7 | 1 | 20 | 9 | |||
Capital contributions from the non-controlling interests shareholders | 658 | 96 | 64,875 | 10,642 | |||
Capital contributions from mezzanine equity holders | 3,231,261 | 469,967 | 509,535 | 0 | |||
Proceeds from issuance of subsidiary's ordinary shares upon its Initial Public Offering | 1,207,749 | 175,660 | 0 | 0 | |||
Acquisition of subsidiary's shares from mezzanine equity holders | (30,000) | (4,363) | 0 | 0 | |||
Partial disposal of subsidiary's interests to non-controlling interest shareholders | 378,548 | 55,058 | 0 | 0 | |||
Proceeds from bank borrowings | 691,612 | 100,591 | 621,118 | 0 | |||
Repayment of bank borrowings | (1,308,092) | (190,254) | 0 | 0 | |||
Proceeds from issuance of common shares, net of issuance cost | (4,473) | (651) | 2,950,607 | 0 | |||
Repayment of convertible bonds | 0 | 0 | (2,753,630) | 0 | |||
Net cash provided by financing activities | 4,167,270 | 606,105 | 1,392,525 | 10,651 | |||
Net increase in cash, and cash equivalents and restricted cash | 2,336,698 | 339,858 | 2,073,461 | 259,427 | |||
Cash, cash equivalents and restricted cash at the beginning of the year | 3,617,432 | 526,134 | 1,579,743 | 1,318,155 | |||
Effect of exchange rate changes on cash, and cash equivalents and restricted cash | 50,101 | 7,287 | (35,772) | 2,161 | |||
Cash, cash equivalents and restricted cash at the end of the year | 6,004,231 | 873,279 | 3,617,432 | 1,579,743 | |||
Supplemental disclosure of cash flows information: | |||||||
Cash paid for interest, net of amounts capitalized | (9,354) | (1,360) | (41,729) | (59,884) | |||
Income taxes paid | (365,541) | (53,166) | (406,348) | (254,931) | |||
Supplemental disclosures of non-cash investing and financing activities: | |||||||
—Acquisition of property and equipment | 64,041 | 9,314 | 16,865 | 37,649 | |||
—Conversion of subsidiary's preferred shares to ordinary shares | 6,290,417 | 914,903 | 0 | 0 | |||
—Amounts receivable from issuance of subsidiary's preferred shares | 102,951 | 14,974 | 0 | 0 | |||
—Disposal of subsidiaries and investments | ¥ 77,423 | $ 11,261 | ¥ 7,986 | ¥ 153,310 | |||
[1] | Share-based compensation was allocated in cost of revenues and operating expenses as follows:RMB RMB RMB US$ Cost of revenues 15,894 42,759 74,339 10,812 Research and development expenses 78,816 122,348 225,173 32,750 Sales and marketing expenses 3,107 4,417 5,723 832 General and administrative expenses 59,469 88,137 342,790 49,857 | ||||||
[2] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya 100 Education Total RMB RMB RMB RMB Cost of revenues 9,893 5,677 324 15,894 Research and development expenses 53,085 19,538 6,193 78,816 Sales and marketing expenses 2,781 326 - 3,107 General and administrative expenses 19,523 26,557 13,389 59,469 |
Organization and principal acti
Organization and principal activities | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and principal activities | 1. Organization and principal activities (a) Organization and principal activities YY Inc. (the “Company”), through its subsidiaries, its variable interest entities (“VIEs”, also refer to VIEs and their subsidiaries as a whole, where appropriate) (collectively, the “Group”) is principally engaged in live streaming business in the People’s Republic of China (the “PRC” or “China”) through its two key platforms, namely YY Live and Huya, which are leading live streaming and live game broadcasting platforms. (b) Initial Public Offering The Company completed its initial public offering (“IPO”) on November 21, 2012 on the NASDAQ Global Market. (c) Principal subsidiaries and VIEs The details of the principal subsidiaries and VIEs through which the Company conducts its business operations as of December 31, 2018 are set out below: Name Place of incorporation Date of incorporation or acquisition % of direct or indirect economic ownership Principal activities Principal subsidiaries Duowan Entertainment Corporation (“Duowan BVI”) British Virgin Islands (“BVI”) November 6, 2007 100 % Investment holding Huanju Shidai Technology (Beijing) Co., Ltd. (“Beijing Huanju Shidai” or “Duowan Entertainment”) PRC March 19, 2008 100 % Investment holding Guangzhou Huanju Shidai Information Technology Co., Ltd. (“Guangzhou Huanju Shidai”) PRC December 2, 2010 100 % Software development Engage Capital Partners I, L.P. (“Engage L.P.”) Cayman Islands March 23, 2015 93.5 % Investment HUYA Inc. (“Huya”) Cayman Islands March 30, 2017 44.0 % Investment holding Guangzhou Huya Technology Co., Ltd. (“Huya Technology”) PRC June 16, 2017 44.0 % Software development Hago Singapore Pte. Ltd. (“Hago Singapore”) Singapore May 7, 2018 100 % Internet value added services Principal VIEs Guangzhou Huaduo Network Technology Co., Ltd. (“Guangzhou Huaduo”) PRC April 11, 2005 100 % Holder of internet content provider licenses and internet value added services Zhuhai Huanju Interactive Entertainment Technology Co., Ltd. (“Zhuhai Huanju Interactive”) PRC May 4, 2015 100 % Software development Shanghai Yilian Equity Investment Partnership (LP) (“Shanghai Yilian”) PRC June 23, 2015 93.5 % Investment Guangzhou Huanju Microfinance Co., Ltd. (“Guangzhou Microfinance”) PRC January 11, 2016 100 % Financing services Guangzhou Huya Information Technology Co., Ltd. (“Guangzhou Huya”) PRC August 10, 2016 44.0 % Holder of internet content provider licenses and internet value added services Guangzhou Yilianyixing Investment Partnership (LP) (“Guangzhou Yilianyixing”) PRC June 28, 2017 99 % Investment (d) Variable Interest Entities To comply with PRC laws and regulations that prohibit or restrict foreign ownership of companies that provide internet-content, the Group conducts its operations primarily through its principal VIEs Guangzhou Huaduo and Guangzhou Huya, which hold the internet value-added service license and approvals to provide such internet services in the PRC. (i) VIE agreements amongst Beijing Huanju Shidai, Guangzhou Huaduo and its nominee shareholders The following is a summary of the contractual arrangements entered among Beijing Huanju Shidai, Guangzhou Huaduo and its nominee shareholders: • Exclusive Technology Support and Technology Services Agreement Under the exclusive technology support and technology services agreement between Beijing Huanju Shidai and Guangzhou Huaduo, Beijing Huanju Shidai has the exclusive right to provide to Guangzhou Huaduo technology support and technology services related to all technologies needed for its business. Beijing Huanju Shidai owns the exclusive intellectual property rights created as a result of the performance of this agreement. The service fee payable by Guangzhou Huaduo to Beijing Huanju Shidai is determined by various factors, including the expenses Beijing Huanju Shidai incurs for providing such services and Guangzhou Huaduo’s revenues. The term of this agreement will expire in 2028 and may be extended with Beijing Huanju Shidai’s written confirmation prior to the expiration date. Beijing Huanju Shidai is entitled to terminate the agreement at any time by providing 30 days’ prior written notice to Guangzhou Huaduo. • Exclusive Business Cooperation Agreement Under the exclusive business cooperation agreement between Beijing Huanju Shidai and Guangzhou Huaduo, Beijing Huanju Shidai has the exclusive right to provide to Guangzhou Huaduo technology support, business support and consulting services related to the services provided by Guangzhou Huaduo, the scope of which is to be determined by Beijing Huanju Shidai from time to time. Beijing Huanju Shidai owns the exclusive intellectual property rights created as a result of the performance of this agreement. The service fee payable by Guangzhou Huaduo to Beijing Huanju Shidai is a certain percentage of its earnings. The term of this agreement will expire in 2039 and may be extended with Beijing Huanju Shidai’s written confirmation prior to the expiration date. Beijing Huanju Shidai is entitled to terminate the agreement at any time by providing 30 days’ prior written notice to Guangzhou Huaduo. • Exclusive Option Agreement The parties to the exclusive option agreement are Beijing Huanju Shidai, Guangzhou Huaduo and each of the shareholders of Guangzhou Huaduo. Under the exclusive option agreement, each of the shareholders of Guangzhou Huaduo irrevocably granted Beijing Huanju Shidai or its designated representative(s) an exclusive option to purchase, to the extent permitted under PRC law, all or part of his or its equity interests in Guangzhou Huaduo. Beijing Huanju Shidai or its designated representative(s) have sole discretion as to when to exercise such options, either in part or in full. Without Beijing Huanju Shidai’s prior written consent, Guangzhou Huaduo’s shareholders shall not sell, transfer, mortgage or otherwise dispose their equity interests in Guangzhou Huaduo. The term of this agreement is ten years and may be extended at Beijing Huanju Shidai’s sole discretion. • Powers of Attorney Pursuant to the irrevocable power of attorney executed by each shareholder of Guangzhou Huaduo, each such shareholder appointed Beijing Huanju Shidai as its attorney-in-fact to exercise such shareholders’ rights in Guangzhou Huaduo, including, without limitation, the power to vote on its behalf on all matters of Guangzhou Huaduo requiring shareholder approval under PRC laws and regulations and the articles of association of Guangzhou Huaduo. Each power of attorney will remain in force until the shareholder ceases to hold any equity interest in Guangzhou Huaduo. • Share Pledge Agreement Pursuant to the share pledge agreement between Beijing Huanju Shidai and the shareholders of Guangzhou Huaduo, the shareholders of Guangzhou Huaduo have pledged all of their equity interests in Guangzhou Huaduo to Beijing Huanju Shidai to guarantee the performance by Guangzhou Huaduo and its shareholders’ performance of their respective obligations under the exclusive business cooperation agreement, exclusive option agreement, exclusive technology support and technology services agreement and powers of attorney. If Guangzhou Huaduo and/or its shareholders breach their contractual obligations under those agreements, Beijing Huanju Shidai, as pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests. (ii) VIE agreements amongst Huya Technology, Guangzhou Huya and its nominee shareholders In 2017, Huya undertook a reorganization (the “Huya Reorganization”) through setting up Huya Technology, a wholly owned subsidiary, and entering into a series of VIE agreements with Guangzhou Huya and its nominee shareholders. The Huya Reorganization was completed on July 10, 2017. The following is a summary of the contractual arrangements entered among Huya Technology, Guangzhou Huya and its nominee shareholders: • Exclusive Business Cooperation Agreement Huya Technology and Guangzhou Huya entered into exclusive business cooperation agreement under which Guangzhou Huya engages Huya Technology as its exclusive provider of technology support, business support and consulting services. Guangzhou Huya shall pay to Huya Technology service fees, which is determined by Huya Technology at its sole discretion. Huya Technology shall have exclusive and proprietary rights and interests in all rights, ownership, interests and intellectual properties arising from the performance of the agreement. During the term of the agreement, Guangzhou Huya shall not accept any consultations and/or services provided by any third party and shall not cooperate with any third party for the provision of identical or similar services without prior consent of Huya Technology. The term of this agreement is ten years and will be extended for ten years automatically after expiration, unless otherwise agreed by both parties in a written agreement. Huya Technology is entitled to terminate the agreement at any time by providing 30 days’ prior written notice to Guangzhou Huya. • Exclusive Purchase Option Agreement Under the exclusive purchase option agreement, the nominee shareholders of Guangzhou Huya have granted Huya Technology or its designated representative(s) irrevocably an exclusive option to purchase, to the extent permitted under PRC law, all or part of their equity interests in Guangzhou Huya at the lowest price permitted by the laws of the PRC applicable at the time of exercise. Huya Technology or its designated representative(s) have sole discretion as to when to exercise such options, either in part or in full. Without Huya Technology’s prior written consent, the nominee shareholders shall not sell, transfer, mortgage or otherwise dispose their equity interests in Guangzhou Huya. The term of this agreement is ten years and may be extended for another ten years at Huya Technology’s sole discretion. Huya Technology is entitled to terminate the agreement at any time by providing 30 days’ prior written notice to Guangzhou Huya. • Equity Pledge Agreement Pursuant to the equity pledge agreement, the nominee shareholders of Guangzhou Huya have pledged all of their equity interests in Guangzhou Huya to Huya Technology to guarantee the performance by Guangzhou Huya and its nominee shareholders’ performance of their respective obligations under the exclusive business cooperation agreement, exclusive purchase option agreement, and powers of attorney. The nominee shareholders shall not transfer or assign the equity interests, the rights and obligations in the equity pledge agreement or create or permit to create any pledges which may have an adverse effect on the rights or benefits of Huya Technology without Huya Technology’s written consent. If Guangzhou Huya and/or its nominee shareholders breach their contractual obligations under those agreements, Huya Technology, as pledgee, will be entitled to certain rights, including the right to sell the pledged equity interests. • Power of Attorney Pursuant to the irrevocable power of attorney, Huya Technology is authorized by each of the nominee shareholders as its attorney-in-fact to exercise such nominee shareholders’ rights in Guangzhou Huya, including, without limitation, the power to vote on its behalf on all matters of Guangzhou Huya requiring nominee shareholder approval under PRC laws and regulations and the articles of association of Guangzhou Huya and rights to information relating to all business aspects of Guangzhou Huya. The term of this agreement is ten years from the execution date of this agreement and will be automatically extended for one more year indefinitely. Huya Technology has sole discretion to terminate the agreement at any time by providing 30 days’ prior written notice to Guangzhou Huya. Through the aforementioned contractual agreements, Guangzhou Huaduo and Guangzhou Huya are considered VIEs in accordance with Generally Accepted Accounting Principles in the United States (“U.S. GAAP”) because the Company, through Beijing Huanju Shidai and Huya Technology, respectively, has the ability to: • exercise effective control over Guangzhou Huaduo and Guangzhou Huya; • receive substantially all of the economic benefits and residual returns, and absorb substantially all the risks and expected losses from these VIEs as if it were their sole shareholder; and • have an exclusive option to purchase all of the equity interests in these VIEs. In addition to the aforementioned contractual agreements, Beijing Huanju Shidai also entered into similar contractual agreements with Beijing Tuda Science and Technology Co., Ltd. (“Beijing Tuda”). Guangzhou Bilin Changxiang Information Technology Co., Ltd. (“Bilin Changxiang”) and Guangzhou 100 Education Technology Co., Ltd. (“100 Edu Technology”), subsidiaries of the Company, also entered into similar contractual agreements with Guangzhou Bilin Online Information Technology Co., Ltd. (“Bilin Online”) and Guangzhou Sanrenxing 100 Education Technology Co., Ltd. (“Guangzhou Sanrenxing”), respectively. Through these contractual agreements, Beijing Tuda, Bilin Online and Guangzhou Sanrenxing are considered VIEs of the Group. In accordance with the aforementioned agreements, the Company has power to direct activities of the VIEs, and can have assets transferred out of the VIEs. Therefore the Company considers that there is no asset in the VIEs that can be used only to settle obligations of the VIEs, except for registered capital and PRC statutory reserves of the VIEs amounting to RMB4,660,890 as of December 31, 2018. As the VIEs were incorporated as limited liability companies under the PRC Company Law, the creditors do not have recourse to the general credit of the Company for all the liabilities of the VIEs. Currently there is no contractual arrangement that could require the Company to provide additional financial support to the VIEs. As the Company is conducting its PRC internet value-added services business through the VIEs, the Company will, if needed, provide such support on a discretional basis in the future, which could expose the Company to a loss. There is no VIE where the Company has variable interest but is not the primary beneficiary. Please refer to Note 3(a) for the consolidated financial information of the Group’s VIEs as of December 31, 2018. |
Principal accounting policies
Principal accounting policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Principal accounting policies | 2. Principal accounting policies (a) Basis of presentation The consolidated financial statements of the Group have been prepared in accordance with the U.S. GAAP to reflect the financial position, results of operations and cash flows of the Group. Significant accounting policies followed by the Group in the preparation of the consolidated financial statements are summarized below. (b) Consolidation The Group’s consolidated financial statements include the financial statements of the Company, its subsidiaries and VIEs for which the Company or its subsidiary is the primary beneficiary. All transactions and balances among the Company, its subsidiaries and VIEs have been eliminated upon consolidation. A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting powers; or has the power to appoint or remove the majority of the members of the board of directors; or to cast a majority of votes at the meeting of directors; or has the power to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders. A VIE is an entity in which the Company, or its subsidiary, through contractual agreements, bears the risks of, and enjoys the rewards normally associated with ownership of the entity, and therefore the Company or its subsidiary is the primary beneficiary of the entity. In determining whether the Company or its subsidiaries are the primary beneficiary, the Company considered whether it has the power to direct activities that are significant to the VIEs economic performance, and also the Company’s obligation to absorb losses of the VIEs that could potentially be significant to the VIEs or the right to receive benefits from the VIEs that could potentially be significant to the VIEs. Beijing Huanju Shidai, Bilin Changxiang, Huya Technology, 100 Edu Technology and ultimately the Company hold all the variable interests of the VIEs and have been determined to be the primary beneficiary of the VIEs. The Company deconsolidates its subsidiaries in accordance with ASC 810 as of the date the Company ceased to have a controlling financial interest in the subsidiaries. The Company accounts for the deconsolidation of its subsidiaries by recognizing a gain or loss in net income/loss attributable to the Company in accordance with ASC 810. This gain or loss is measured at the date the subsidiaries are deconsolidated as the difference between (a) the aggregate of the fair value of any consideration received, the fair value of any retained non-controlling interest in the subsidiaries being deconsolidated, and the carrying amount of any non-controlling interest in the subsidiaries being deconsolidated, including any accumulated other comprehensive income/loss attributable to the non-controlling interest, and (b) the carrying amount of the assets and liabilities of the subsidiaries being deconsolidated. (c) Use of estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, mezzanine equity and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period in the consolidated financial statements and accompanying notes. Actual results could differ materially from such estimates. The Company believes that the assessment of whether the Group acts as a principal or an agent in different revenue streams, classification of perpetual items versus consumable items under item-based model, the determination of estimated selling prices of multiple elements revenue contracts, income taxes, allowances for doubtful accounts, determination of share-based compensation expenses, impairment assessment of goodwill, long-lived assets and intangible assets, tax considerations for earnings retained in the Group’s VIEs, assessment on the probability of performance condition affiliated in equity-classified award under ASC 718 that affect vesting, determination of the fair value of derivative liabilities arising from Huya’s Preferred Shares prior to Huya’s IPO, subsequent adjustment due to significant observable price change for the equity investments without readily determinable fair values and not accounted for by the equity method, represent critical accounting policies that reflect more significant judgments and estimates used in the preparation of its consolidated financial statements. Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from these estimates. (d) Foreign currency translation The Group uses Renminbi (“RMB”) as its reporting currency. The functional currency of the Company and its subsidiaries incorporated in the Cayman Islands, British Virgin Islands, Hong Kong and Singapore is United States dollar (“US$”), while the functional currency of the other entities and VIEs in the Group is RMB, which is their respective local currency. In the consolidated financial statements, the financial information of the Company and its subsidiaries, which use US$ as their functional currency, have been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, expenses, gains, and losses are translated using the average exchange rate for the period. Translation adjustments arising from these are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income or loss in the statement of comprehensive income. Foreign currency transactions denominated in currencies other than functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are remeasured at the applicable rates of exchange in effect at that date. Foreign exchange gains and losses resulting from the settlement of such transactions and from remeasurement at year-end are recognized in foreign currency exchange gains/losses, net in the consolidated statement of comprehensive income. (e) Convenience translation Translations of amounts from RMB into US$ for the convenience of the reader were calculated at the noon buying rate of US$1.00 = RMB 6.8755 on December 31, 2018 as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted into US$ at such rate. (f) Cash and cash equivalents Cash includes currency on hand and deposits held by financial institutions that can be added to or withdrawn without limitation. Cash equivalents represent short-term and highly liquid investments placed with banks, which have both of the following characteristics: i) Readily convertible to known amounts of cash throughout the maturity period; ii) So near their maturity that they present insignificant risk of changes in value because of changes in interest rates. The Group considers all highly liquid investments with original maturities of three months or less as cash equivalents. In November 2016, the FASB issued new guidance related to the classification of restricted cash in the statement of cash flows. The new standard requires that a statement of cash flows explain any change during the year in total cash, cash equivalents, and restricted cash. The new standard is effective for fiscal years beginning after December 15, 2017, and should be applied retrospectively. The Company adopted the new standard during the beginning of 2018 and applied the standard retrospectively for all periods presented. Cash, cash equivalents and restricted cash presented on the consolidated statements of cash flows included cash and cash equivalents and restricted short-term deposits in the consolidated balance sheets. As of Decmber 31, 2017, cash, cash equivalents and restricted cash presented in the consolidated statement of cash flows is 3,617,432, including cash and cash equivalents of RMB2,617,432 and restricted short-term deposits of RMB1,000,000 in the consolidated balance sheet, respectively. As of Decmber 31, 2018, cash, cash equivalents and restricted cash presented in the consolidated statement of cash flows is 6,004,231, including cash and cash equivalents of RMB6,004,231 and restricted short-term deposits of nil in the consolidated balance sheet, respectively. (g) Short-term deposits Short-term deposits represent time deposits placed with banks with original maturities between three months and one year. Interest earned is recorded as interest income in the consolidated statements of comprehensive income during the periods presented. (h) Long-term deposits Long-term deposits represent time deposits placed with banks with original maturities more than one year. Interest earned is recorded as interest income in the consolidated statements of comprehensive income during the periods presented. (i) Short-term investments For investments in financial instruments with a variable interest rate indexed to the performance of underlying assets, the Group elected the fair value method at the date of initial recognition and carried these investments subsequently at fair value. Changes in fair values are reflected in the consolidated statements of comprehensive income. (j) Accounts receivable Accounts receivable are presented net of allowance for doubtful accounts. The Group uses specific identification in providing for bad debts when facts and circumstances indicate that collection is doubtful and a loss is probable and estimable. If the financial conditions of its customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowance may be required. The Group maintains an allowance for doubtful accounts which reflects its best estimate of amounts that potentially will not be collected. The Group determines the allowance for doubtful accounts on an individual basis taking into consideration various factors including but not limited to historical collection experience and credit-worthiness of the debtors as well as the age of the individual receivables balance. Additionally, Group makes specific bad debt provisions based on any specific knowledge Group has acquired that might indicate that an account is uncollectible. The facts and circumstances of each account may require Group to use substantial judgment in assessing its collectability. (k) Financing receivables Financing receivables represent receivables derived from finance business, including micro-credit personal loans and corporate loans. Financing receivables are recorded at amortized cost, reduced by a valuation allowance estimated as of the balance sheet date. The amortized cost is equal to the unpaid principal amount, accrued interest receivables and net deferred origination costs. The origination costs are the direct costs attributable to originating the financing charged by third-party companies. The cash flows related to the principal of finance business are included in the investing activities category in the consolidated statement of cash flows. Micro-credit personal loans The Group provides micro loans to qualified individual borrowers. The micro loan periods granted to the borrowers generally range from one month to twelve months. Corporate loans The Group provides loans to corporate borrowers mainly through sales-and-leaseback model. Under the sales-and-leaseback arrangement, the Group, who is also the lender, purchases machinery and equipment from lessees, who are also the borrowers, and leases the purchased equipment back to the lessees for a number of years. In a sales-and-leaseback arrangement, the transaction is in substance a collateral financing. Allowance for financing receivables The Group assesses the allowance for financing receivables either on an individual or collective basis. The Group estimates and evaluates the allowance amounts and whether such amounts are adequate to cover potential losses, and periodic reviews are performed to ensure such amounts continue to reflect the best estimate of the losses inherent in the outstanding portfolio of debts. The estimate is based on a pooled basis due to the composition of homogeneous financing with similar size and general credit risk characteristics for similar finance businesses. The Group considers the credit worthiness of the individuals and the companies receiving financing, aging of the outstanding financing receivables, value of the collateral assets and other specific circumstances related to the financing when determining the allowance for financing receivables. Financing receivables are placed on non-accrual status upon reaching 90 days past due or when reasonable doubt exists in timely collection of the financing receivables. When a financing receivable is placed on non-accrual status, the Group stops accruing financing income. Financing receivable is returned to accrual status if the related individual or company has performed in accordance with the contractual terms for a reasonable period of time and, in the Group’s judgment, will continue to make period principal and financing income payments as scheduled. (l) Investments ASU 2016-01 (“ASU 2016-01”), Recognition and Measurement of Financial Assets and Financial Liabilities amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The main provisions require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value through earnings, unless they qualify for a measurement alternative. The new guidance requires modified retrospective application to all outstanding instruments beginning January 1, 2018, with a cumulative effect adjustment recorded to opening accumulated deficit as of the beginning of the first period in which the guidance becomes effective. However, changes to the accounting for equity securities without a readily determinable fair value would be applied prospectively. The Group adopted the new financial instruments accounting standard from January 1, 2018. Following the adoption of this guidance, accumulated fair value gain, amounting to RMB87.8 million, was reclassified from accumulated other comprehensive loss to retained earnings as of January 1, 2018. Equity Investments with Readily Determinable Fair Values Equity investments with readily determinable fair values are measured and recorded at fair value using the market approach based on the quoted prices in active markets at the reporting date. The Group classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. Equity Investments without Readily Determinable Fair Values After the adoption of this new accounting standard, the Group elected to record equity investments without readily determinable fair values and not accounted for under the equity method at cost, less impairment, adjusted for subsequent observable price changes on a nonrecurring basis, and report changes in the carrying value of the equity investments in current earnings. Changes in the carrying value of the equity investments are required to be made whenever there are observable price changes in orderly transactions for the identical or similar investment of the same issuer. The implementation guidance notes that an entity should make a “reasonable effort” to identify price changes that are known or that can reasonably be known. Equity Investments Accounted for Using the Equity Method The Group accounts for its equity investment over which it has significant influence but does not own a majority equity interest or otherwise control using the equity method. The Group adjusts the carrying amount of the investment and recognizes investment income or loss for share of the earnings or loss of the investee after the date of investment. The Group assesses its equity investment for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, operating performance of the entities, including current earnings trends and undiscounted cash flows, and other entity-specific information. The fair value determination, particularly for investment in privately held entities, requires judgment to determine appropriate estimates and assumptions. Changes in these estimates and assumptions could affect the calculation of the fair value of the investment and determination of whether any identified impairment is other-than-temporary. (m) Property and equipment Property and equipment are stated at historical cost less accumulated depreciation and impairment loss, if any. Depreciation is calculated using the straight-line method over their estimated useful lives. Residual rate is determined based on the economic value of the property and equipment at the end of the estimated useful lives as a percentage of the original cost. Estimated useful lives Residual rate Buildings 40 years 0 % Servers, computers and equipment 3 years 0%-5 % Leasehold improvements Shorter of lease term or 5 years 0 % Decoration of buildings 10 years 0 % Motor vehicles 4 years 5 % Furniture, fixture and office equipment 5 years 0%-5 % Expenditures for maintenance and repairs are expensed as incurred. The gain or loss on the disposal of property and equipment is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the consolidated statements of comprehensive income. All direct and indirect costs that are related to the construction of property and equipment and incurred before the assets are ready for their intended use are capitalized as construction in progress. Construction in progress is transferred to specific property and equipment items and depreciation of these assets commences when they are ready for their intended use. (n) Business combinations Business combinations are recorded using the purchase method of accounting, and the cost of an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued as well as the contingent considerations and all contractual contingencies as of the acquisition date. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total of consideration of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the subsidiary acquired over (ii) the fair value of the identifiable net assets of the subsidiary acquired is recorded as goodwill. If the consideration of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of comprehensive income. (o) Intangible assets Intangible assets mainly consist of operating rights, software, domain names, technology and license. Identifiable intangible assets are carried at acquisition cost less accumulated amortization and impairment loss, if any. Finite-lived intangible assets are tested for impairment if impairment indicators arise. Amortization of finite-lived intangible assets is computed using the straight-line method over their estimated useful lives, which are as follows: Estimated useful lives Operating rights Shorter of the economic life or contract terms Software 3 -5 years Domain names 15 years Technology 5 years License 15 years (p) Land use rights Land use rights are carried at cost less accumulated amortization. Amortization of the land use rights is made on straight-line basis over 40 years from the date when the Group first obtained the land use rights certificate from the local authorities. (q) Impairment of long-lived assets For long-lived assets other than investments and goodwill whose impairment policy is discussed elsewhere in the financial statements, the Group evaluates for impairment whenever events or changes (triggering events) indicate that the carrying amount of an asset may no longer be recoverable. The Group assesses the recoverability of the long-lived assets by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to receive from use of the assets and their eventual disposition. Such assets are considered to be impaired if the sum of the expected undiscounted cash flows is less than the carrying amount of the assets. The impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Group tests impairment of long-lived assets at the reporting unit level when impairment indicator appeared and recognizes impairment in the event that the carrying value exceeds the fair value of each reporting unit. The impairment charges of intangible assets recorded in general and administrative expenses for the years ended December 31, 2016, 2017 and 2018 were amounting to RMB3,828, nil and nil, respectively. (r) Goodwill Goodwill represents the excess of the purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of an acquired business. (s) Annual test for impairment of goodwill Goodwill assessment for impairment is performed on at least an annual basis on October 1 or whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. The Group performs a two-step goodwill impairment test. The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of the affected reporting unit’s goodwill to the carrying value of that goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities. An impairment loss is recognized for any excess in the carrying value of goodwill over the implied fair value of goodwill. The judgment in estimating the fair value of reporting units includes estimating future cash flows, determining appropriate discount rates and making other assumptions. Changes in these estimates and assumptions could materially affect the determination of the fair value of each reporting unit. (t) Convertible bonds The Group determines the appropriate accounting treatment of its convertible bonds in accordance with the terms in relation to the conversion feature, call and put options, and beneficial conversion feature. After considering the impact of such features, the Group may account for such instrument as a liability in its entirety, or separate the instrument into debt and equity components following the respective guidance described under ASC 815 Derivatives and Hedging and ASC 470 Debt. The debt discount, if any, together with related issuance cost are subsequently amortized as interest expense, using the effective interest method, from the issuance date to the earliest conversion date. Interest expenses are recognized in the statement of comprehensive income in the period in which they are incurred. (u) Mezzanine equity and non-controlling interests Mezzanine equity For the Company’s majority-owned subsidiaries and consolidated VIEs, a non-controlling interest is recognized to reflect the portion of their equity which is not attributable, directly or indirectly, to the Company. When the non-controlling interest is contingently redeemable upon the occurrence of a conditional event, which is not solely within the control of the Company, the non-controlling interest is classified as mezzanine equity. In accordance with ASC subtopic 480-10, the Group calculated, on an accumulative basis from the acquisition date, (i) the amount of accretion that would increase the balance of non-controlling interests to their estimated redemption value over the period from the date of acquisition to the earliest redemption date of the non-controlling interests and (ii) the amount of net (loss) profit attributable to non-controlling shareholders of certain subsidiaries based on their ownership percentage. The carrying value of the non-controlling interests as mezzanine equity was adjusted by an accumulative amount equal to the higher of (i) and (ii). Each type of increase in carrying amount shall be recorded as charges against retained earnings or, in the absence of retained earnings, by charges against additional paid-in capital. Non-controlling interests Non-controlling interests are recognized to reflect the portion of the equity of majority-owned subsidiaries and VIEs which is not attributable, directly or indirectly, to the controlling shareholder. (v) Revenue Revenue recognition and significant judgments For the year ended December 31, 2018, revenue presentation has been changed to live streaming and others to better reflect the way the Group generates revenues. The revenue presentation for the years ended December 31, 2016 and 2017 are also retrospectively changed to be consistent with the year ended December 31, 2018. Revenues from live streaming are mainly generated from YY Live platform and Huya platform. Other revenues are mainly generated from online games, membership, online education, advertising and finance business. Disaggregated revenues are disclosed in Note 33 “Segment Reporting”. On January 1, 2018, the Group adopted ASC 606, “Revenue from Contracts with Customers” using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Group’s historic accounting under Topic 605. Based on the Group’s assessment, the adoption of ASC 606 did not result in any adjustment on the Group’s consolidated financial statements, and there were no material differences between the Group’s adoption of ASC 606 and its historic accounting under ASC 605. Revenues are recognized when control of the promised virtual items or services is transferred to the Group’s customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those virtual items or services. The Group has a recharge system for users to purchase the Group’s virtual currency. Users can recharge via various online payment platforms provided by third parties. Virtual currency is non-refundable and without expiry. As the virtual currency is often consumed soon after it is purchased based on history of turnover, the Group considers the impact of the breakage amount for virtual currency coupons is insignificant. Unconsumed virtual currency is recorded as deferred revenue. Virtual currencies used to purchase virtual items are recognized as revenue according to the prescribed revenue recognition policies of virtual items addressed below unless otherwise stated. (i) Live streaming Live streaming mainly consists of YY Live platform and Huya platform. It generates revenue from sales of virtual items in the platforms. Users can access the platforms and view the live streaming content showed by the performers. The Group shares a portion of the sales proceeds of virtual items (“revenue sharing fee”) with performers and talent agencies in accordance with their revenue sharing arrangements. Those performers who do not have revenue sharing arrangements with the Group are not entitled to any revenue sharing fee. The Group evaluates and determines that it is the principal and views users to be its customers. The Group reports live streaming revenues on a gross basis. Accordingly, the amounts billed to users are recorded as revenues and revenue sharing fee paid to performers and talent agencies are recorded as cost of revenues. Where the Group is the principal, it controls the virtual items before they are transferred to users. Its control is evidenced by the Group’s sole ability to monetize the virtual items before they are transferred to users, and is further supported by the Group being primarily responsible to users and having a level of discretion in establishing pricing. The Group designs, creates and offers various virtual items for sales to users with pre-determined selling price. Sales proceeds are recorded as deferred revenue and recognized as revenue based on the consumption of the virtual items. Virtual items are categorized as consumable and time-based items. Consumable items are consumed upon purchase and use while time-based items could be used for a fixed period of time. Users can purchase and present consumable items to performers to show support for their favorite performers, or purchase time-based virtual items for one or multiple months for a monthly fee, which provide users with recognized status, such as priority speaking rights or special symbols over a period of time. Accordingly, live streaming revenue is recognized immediately when the consumable virtual item is used, or in the case of time-based virtual items, revenue is recognized ratably over the fixed period on a straight-line basis. The Group does not have further obligations to the user after the virtual items are consumed immediately or after the stated period of time for time-based items. The Group may also enter into contracts that can include various combinations of virtual items, which are generally capable of being distinct and accounted for as separate performance obligations, such as noble member program. Judgments are required as follow: 1) determining whether those virtual items are considered distinct performance obligations that should be accounted for separately versus together, 2) determining the standalone selling price for each distinct performance obligation, and 3) allocating of the arrangement consideration to the separate accounting of each distinct performance obligation based on their relative standalone selling prices. In instances where standalone selling price is not directly observable as the Group does not sell the virtual item separately, the Group determines the standalone selling price based on pricing strategies, market factors and strategic objectives. The Group recognizes revenue for each of the distinct performance obligations identified in accordance with the applicable revenue recognition method relevant for that obligation. As the Group’s live streaming virtual items are generally sold without right of return and the Group does not provide any other credit and incentive to its users, therefore accounting of variable consideration when estimating the amount of revenue to recognize is not applicable to the Group’s live streaming business. (ii) Others Other revenues mainly generated from online games, membership, online education, advertising and finance business. (1) Online games revenues The Group generates revenues from offering virtual items in online games developed by third parties or the Group itself to game players. Historically, the majority of online games revenues for the three years ended December 31, 2016, 2017 and 2018 were derived from third parties developed games. Users play games through the Group’s platform free of charge and are charged for purchases of virtual items, including consumable and perpetual items, which can be utilized in the online games to enhance their ga |
Certain risks and concentration
Certain risks and concentration | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Certain risks and concentration | 3. Certain risks and concentration (a) PRC regulations Foreign ownership of internet-based businesses is subject to significant restrictions under the current PRC laws and regulations. The PRC government regulates internet access, the distribution of online information and the conduct of online commerce through strict business licensing requirements and other government regulations. These laws and regulations also limit foreign ownership in PRC companies that provide internet information distribution services. Specifically, foreign ownership in an internet information provider or other value-added telecommunication service providers may not exceed 50%. Foreigners or foreign invested enterprises are currently not able to apply for the required licenses for operating online games in the PRC. The Company is incorporated in the Cayman Islands and accordingly, the Company is considered as a foreign invested enterprise under PRC law. As mentioned in Note 1(d), in order to comply with the PRC laws restricting foreign ownership in the online business in China, the Group operates the online business in China through contractual arrangements with its principal VIEs, namely Guangzhou Huaduo and Guangzhou Huya. As of December 31, 2018, Beijing Tuda and Guangzhou Huaduo own the majority equity interests of Guangzhou Huaduo and Guangzhou Huya, respectively. Guangzhou Huaduo and Guangzhou Huya hold the licenses and permits necessary to conduct its internet value-added services and online advertising in the PRC. If the Company had direct ownership of the VIE, it would be able to exercise its rights as a shareholder to effect changes in the board of directors, which in turn could affect changes at the management level, subject to any applicable fiduciary obligations. However, under the current contractual arrangements, it relies on the VIE and its shareholders’ performance of their contractual obligations to exercise effective control. In addition, the Group’s contractual agreements have terms range from 10 to 30 years, which are subject to Beijing Huanju Shidai and Huya Technology’s unilateral termination right. Under the respective service agreements, Beijing Huanju Shidai and Huya Technology will provide services including technology support, technology services, business support and consulting services to Guangzhou Huaduo and Guangzhou Huya, respectively, in exchange for service fees. The amount of service fees payable is determined by various factors, including (a) a percentage of Guangzhou Huaduo and Guangzhou Huya’s revenues or earnings, and (b) the expenses that Beijing Huanju Shidai and Huya Technology incur for providing such services. Beijing Huanju Shidai and Huya Technology may charge up to 100% of the income in Guangzhou Huaduo and Guangzhou Huya and a multiple of the expenses incurred for providing such services, as determined by Beijing Huanju Shidai and Huya Technology, respectively, from time to time. The service fees payable by Guangzhou Huaduo and Guangzhou Huya to Beijing Huanju Shidai and Huya Technology are determined to be up to 100% of the profits of Guangzhou Huaduo and Guangzhou Huya, with the timing of such payment to be determined at the sole discretion of Beijing Huanju Shidai and Huya Technology. If fees were incurred, it would be significant to the Company and the operating companies’ economic performance because it will be incurred and paid at up to 100% of the earnings of the VIE. Fees incurred would be remitted, subject to further PRC restrictions. None of the VIEs or their shareholders are entitled to terminate the contracts prior to the expiration date, unless under remote circumstances such as a material breach of agreement or bankruptcy as it pertains to the service and business operation agreements and their amendment. For the years ended December 31, 2016, 2017 and 2018, the Company’s wholly owned foreign enterprises determined that service fees of RMB305,792, RMB279,828 and RMB744,339 were charged to the Group’s VIEs, respectively. Further, the Group believes that the contractual arrangements among Beijing Huanju Shidai, Huya Technology and Bilin Changxiang, the VIEs, and their shareholders are in compliance with PRC law and are legally enforceable. However, there are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including those that govern the contractual arrangements, which could limit the Group’s ability to enforce these contractual arrangements and if the nominee shareholders of the VIEs were to reduce their interests in the Group, their interest may diverge from that of the Group and that may potentially increase the risk that they would seek to act contrary to the contractual arrangements. In March 2019, the National People’s Congress enacted PRC Foreign Investment Law which would be effective starting from January 1, 2020. The Foreign Investment Law does not explicitly classify contractual arrangements as a form of foreign investment, but it contains a catch-all provision under the definition of “foreign investment,” which includes investments made by foreign investors through means stipulated in laws or administrative regulations or other methods prescribed by the State Council. Existing laws or administrative regulations remain unclear whether the contractual arrangements with variable interest entities will be deemed to be in violation of the market access requirements for foreign investment under the PRC laws and regulations. However, the possibility that such entities will be deemed as foreign invested enterprise and subject to relevant restrictions in the future shall not be excluded. If VIEs fall within the definition of foreign investment entities, the Group’s ability to use the contractual arrangements with its VIEs and the Group’s ability to conduct business through the VIEs could be severely limited. The Group’s ability to control the VIEs also depends on the power of attorney that the wholly owned subsidiary of the Group has to vote on all matters requiring shareholder approval in the VIEs. As noted above, the Group believes these power of attorney are legally enforceable but may not be as effective as direct equity ownership. In addition, if the Group’s corporate structure and the contractual arrangements with the VIEs through which the Group conducts its business in the PRC were found to be in violation of any existing or future PRC laws and regulations, the Group’s relevant PRC regulatory authorities could: • revoke or refuse to grant or renew the Group’s business and operating licenses; • restrict or prohibit related party transactions between the wholly owned subsidiary of the Group and the VIE; • impose fines, confiscate income or other requirements which the Group may find difficult or impossible to comply with; • require the Group to alter, discontinue or restrict its operations; • restrict or prohibit the Group’s ability to finance its operations, and; • take other regulatory or enforcement actions against the Group that could be harmful to the Group’s business. The imposition of any of these restrictions or actions could result in a material adverse effect on the Group’s ability to conduct its business. In such case, the Group may not be able to operate or control the VIEs, which may result in deconsolidation of the VIEs in the Group’s consolidated financial statements. In the opinion of management, the likelihood for the Group to lose such ability is remote based on current facts and circumstances. The Group’s operations depend on the VIEs to honor their contractual arrangements with the Group. These contractual arrangements are governed by PRC law and disputes arising out of these agreements are expected to be decided by arbitration in the PRC. The management believes that each of the contractual arrangements constitutes valid and legally binding obligations of each party to such contractual arrangements under PRC laws. However, the interpretation and implementation of the laws and regulations in the PRC and their application to an effect on the legality, binding effect and enforceability of contracts are subject to the discretion of competent PRC authorities, and therefore there is no assurance that relevant PRC authorities will take the same position as the Group herein in respect of the legality, binding effect and enforceability of each of the contractual arrangements. Meanwhile, since the PRC legal system continues to rapidly evolve, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involve uncertainties, which may limit legal protections available to the Group to enforce the contractual arrangements should the VIEs or the nominee shareholders of the VIEs fail to perform their obligations under those arrangements. The following consolidated financial information of the Group’s VIEs excluding the intercompany items with the Group’s subsidiaries was included in the accompanying consolidated financial statements as of and for the years ended: December 31, 2017 2018 RMB RMB Assets Current assets Cash and cash equivalents 1,343,731 4,665,938 Short-term deposits 3,400,000 2,100,000 Restricted short-term deposits 1,000,000 - Short-term investments 124,550 979,052 Accounts receivable, net 149,958 192,932 Inventory 315 - Amounts due from related parties 9,309 172,258 Financing receivables, net - 725,336 Prepayments and other current assets 190,456 663,437 Total current assets 6,218,319 9,498,953 Non-current assets Long-term deposits - 1,000,000 Deferred tax assets 113,017 70,834 Investments 582,775 862,272 Property and equipment, net 359,912 655,402 Intangible assets, net 15,504 57,050 Land use rights, net 1,832,739 1,784,639 Amounts due from related parties 20,000 - Other non-current assets 133,812 143,240 Total non-current assets 3,057,759 4,573,437 Total assets 9,276,078 14,072,390 Liabilities Current liabilities Accounts payable 67,817 112,167 Deferred revenue 757,244 950,816 Advances from customers 80,406 101,690 Income taxes payable 142,204 162,118 Accrued liabilities and other current liabilities 1,404,877 2,207,138 Amounts due to related parties 30,502 28,336 Total current liabilities 2,483,050 3,562,265 Non-current liabilities Deferred revenue 52,185 86,977 Deferred tax liabilities 8,404 - Total non-current liabilities 60,589 86,977 Total liabilities 2,543,639 3,649,242 For the year ended December 31, 2016 2017 2018 RMB RMB RMB Net revenues 8,164,100 11,577,104 15,740,097 Net income 1,874,435 2,766,279 3,475,109 For the year ended December 31, 2016 2017 2018 RMB RMB RMB Net cash provided by operating activities 2,538,836 3,974,085 4,672,879 Net cash used in investing activities (1,313,002 ) (3,571,668 ) (1,212,622 ) Net cash provided by financing activities 8,508 66,875 - 1,234,342 469,292 3,460,257 (b) Foreign exchange risk The revenues and expenses of the Group’s entities in the PRC are generally denominated in RMB and their assets and liabilities are denominated in RMB. The Group’s oversea operation and financing activities are denominated in U.S. dollars. The RMB is not freely convertible into foreign currencies. Remittances of foreign currencies into the PRC or remittances of RMB out of the PRC as well as exchange between RMB and foreign currencies require approval by foreign exchange administrative authorities and certain supporting documentation. The State Administration for Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into other currencies. (c) Credit risk Assets that potentially expose the Group to credit risk primarily consist of cash and cash equivalents, short-term deposits, long-term deposits, short-term investments, accounts receivable, financing receivables, amounts due from related parties, prepayments and other current assets. As of December 31, 2017 and 2018, substantially all of the Group’s cash and cash equivalents, short-term deposits, short-term investments and long-term deposits were placed with the PRC and international financial institutions. Management chooses these institutions because of their reputations and track records for stability, and their known large cash reserves, and management periodically reviews these institutions’ reputations, track records, and reported reserves. Management expects that any additional institutions that the Group uses for its cash and bank deposits will be chosen with similar criteria for soundness. Nevertheless under the PRC law, it is required that a commercial bank in the PRC that holds third party cash deposits should maintain a certain percentage of total customer deposits taken in a statutory reserve fund for protecting the depositors’ rights over their interests in deposited money. PRC banks are subject to a series of risk control regulatory standards; PRC bank regulatory authorities are empowered to take over the operation and management of any PRC bank that faces a material credit crisis. The Group believes that it is not exposed to unusual risks as these financial institutions are either PRC banks or international banks with high credit quality. The Group had not experienced any losses on its deposits of cash and cash equivalents and term deposits during the years ended December 31, 2016, 2017 and 2018 and believes that its credit risk to be minimal. The risk with respect to accounts receivable is mitigated by credit evaluations the Group performs on the payment platforms, game platforms, customers and the ongoing monitoring process of outstanding balances. The Group is exposed to default risk on its financing receivables. The Group conducts credit evaluations of customers in finance business, either on an individual or collective basis. The Group also considers the value of collateral assets when assessing the collectability of certain financing receivables. Credit risk is controlled by the application of credit approvals, limits and monitoring procedures. Amounts due from related parties, prepayments and other current assets are typically unsecured. In evaluating the collectability of the balance, the Group considers many factors, including the related parties and third parties’ repayment history and their credit-worthiness. An allowance for doubtful accounts is made when collection of the full amount is no longer probable. |
Business combination and dispos
Business combination and disposal of subsidiaries | 12 Months Ended |
Dec. 31, 2018 | |
Business Combinations [Abstract] | |
Business combination | 4. Business combination and disposal of subsidiaries Disposal of Shanghai Beifu Culture Communication Co., Ltd. (“Beifu”) Beifu, a company engaged in the operation of E-commerce, was acquired by the Group in 2015. In June 2016, the Group disposed of 60% equity interest of Beifu for a total consideration of RMB3,500. After the disposal, the Group retained 10% equity interest of Beifu and accounted for the investment in Beifu as an equity investment as the Group still had significant influence over Beifu. As a result, Beifu ceased to be a subsidiary of the Group. A total loss of RMB23,474 was recognized, which was the difference between (a) the aggregate of the fair value of consideration received, the fair value of the retained non-controlling interests and the carrying amount of non-controlling interests being deconsolidated, amounting to RMB13,236 collectively and (b) the carrying amount of the assets and liabilities being deconsolidated, amounting to RMB36,710. As part of the total loss recognized, the loss related to the remeasurement of the retained non-controlling investment to fair value was RMB3,088. Disposal of Beijing Huanqiu Xingxue Technology Development Co., Ltd. (“Xingxue”) Xingxue, a company engaged in online vocational education, was acquired by the Group in 2014. In December 2016, the Group disposed of 33.86% equity interest of Xingxue for a total consideration of RMB118,500, which was collected in 2017. After the disposal, the Group retained 31.14% equity interest of Xingxue. As a result, Xingxue ceased to be a subsidiary of the Group. A total income of RMB127,434 was recognized, which is the difference between (a) the aggregate of the fair value of consideration received, the fair value of the retained non-controlling interests and the carrying amount of non-controlling interests being deconsolidated, amounting to RMB282,433 collectively and (b) the carrying amount of the assets and liabilities being deconsolidated, amounting to RMB154,999. As part of the total gains recognized, the gain related to the remeasurement of the retained non-controlling investment to fair value was RMB57,791. Disposal of Beijing Yunke Online Technology Development Co., Ltd. (“Yunke Online”) Yunke Online, a company engaged in online language education, was acquired by the Group in 2014. In January 2017, the Group disposed of 46% equity interest of Yunke Online. After the disposal, the Group retained 34% equity interest of Yunke Online. As a result, Yunke Online ceased to be a subsidiary of the Group. A total income of RMB37,989 was recognized. |
Cash and cash equivalents
Cash and cash equivalents | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Cash and cash equivalents | 5. Cash and cash equivalents Cash and cash equivalents represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with maturities of three months or less. Cash and cash equivalents balance as of December 31, 2017 and 2018 primarily consist of the following currencies: December 31, 2017 December 31, 2018 Amount RMB equivalent Amount RMB equivalent RMB 1,627,044 1,627,044 4,707,868 4,707,868 US$ 151,529 990,388 188,869 1,296,284 Others - - N/A 79 Total 2,617,432 6,004,231 |
Short-term and Long-term deposi
Short-term and Long-term deposits | 12 Months Ended |
Dec. 31, 2018 | |
Deposit Assets Disclosure [Abstract] | |
Deposit Assets Disclosures | 6. Short-term and Long-term deposits Short-term deposits represent time deposits placed with banks with original maturities between three months and one year. Long-term deposits represent time deposits placed with banks with original maturities more than one year. The term deposits balance as of December 31, 2017 and 2018 primarily consist of the following currencies: December 31, 2017 December 31, 2018 Amount RMB equivalent Amount RMB equivalent Short-term deposits RMB 3,400,000 3,400,000 2,100,000 2,100,000 US$ 397,816 2,600,104 761,573 5,226,996 Total 6,000,104 7,326,996 Long-term deposits RMB - - 1,000,000 1,000,000 |
Restricted short-term deposits
Restricted short-term deposits | 12 Months Ended |
Dec. 31, 2018 | |
Restricted Cash and Investments [Abstract] | |
Restricted short-term deposits | 7. Restricted short-term deposits As of December 31, 2017, the Group had restricted short-term deposits balance of RMB1,000 million representing pledged deposit with banks in China in order to obtain banking facilities amounting to US$160 million. As of December 31, 2018, no short-term deposit was restricted. |
Short-term investments
Short-term investments | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents, and Short-term Investments | 8. Short-term investments As of December 31, 2017 and 2018, the investments in financial instruments were RMB124,550 and RMB979,053, respectively. Since these investments’ maturity dates are within one year, they are classified as short-term investments. |
Accounts receivable, net
Accounts receivable, net | 12 Months Ended |
Dec. 31, 2018 | |
Financing receivables,net [Abstract] | |
Accounts receivable, net | 9. Accounts receivable, net December 31, 2017 2018 RMB RMB Accounts receivable, gross 161,300 206,772 Less: allowance for doubtful receivables (7,356 ) (8,344 ) Accounts receivable, net 153,944 198,428 The following table summarizes the details of the allowance for doubtful accounts: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Balance at the beginning of the year (58,791 ) (55,220 ) (7,356 ) Reversals (additions) charged to general and administrative expenses, net 3,571 (3,049 ) (1,198 ) Write-off during the year - 50,913 210 Balance at the end of the year (55,220 ) (7,356 ) (8,344 ) |
Financing receivables, net
Financing receivables, net | 12 Months Ended |
Dec. 31, 2018 | |
Financing receivables,net [Abstract] | |
Financing Receivables | 10. Financing receivables, net Financing receivables consist of the following: December 31, 2018 RMB Financing receivables, gross Micro-credit personal loans 734,108 Corporate loans 274,857 Total 1,008,965 Less: allowance for financing receivables (15,829 ) Financing receivables, net 993,136 Current portion 768,343 Non-current portion 224,793 As of December 31, 2018, micro-credit personal loans amounting to RMB 371,031 were guaranteed by a third party corporation. The following table presents the aging of financing receivables as of December 31, 2018. 1-90 days past due 91-180 days past due 181-360 days past due Total past due Current Total financing receivables Micro-credit personal loans 13,074 6,590 1,411 21,075 713,033 734,108 Corporate loans - - - - 274,857 274,857 13,074 6,590 1,411 21,075 987,890 1,008,965 The non-accrual financing receivables related to personal loans as of December 31, 2018 amounted to RMB 8,001, due to the 90 days past due. A majority of the Group’s corporate loan business was in the form of sale-and-leaseback arrangements, under which the Group purchases equipment from third party companies and lease back the equipment to the third party companies. In January 2019, one of the lessees was unable to repay the principal amount of around RMB15 million due in January 2019. The total financing receivable due from this lessee was RMB199 million as of December 31, 2018. The Group has brought a lawsuit against this lessee to the court, claiming the lessee to repay all the outstanding amount due to the Group. Pursuant to the finance lease agreement, the legal titles of the equipment purchased by the Group have been transferred to the Group and the fair value of the equipment exceeds the total financing receivable due from the lessee. The Group also pledged or applied to the court to preserve certain assets of the lessee or the lessee’s related entity. The Group believed that the financing receivable due from the lessee can be recovered based on the measures taken and therefore no loss allowance was provided against the receivable. The financing receivable was placed on non-accrual status after the lessee was unable to repay the principal due in January 2019. The Group has decided not to further develop corporate loan business so as to avoid further potential risk arising from such business. Movement of allowance for financing receivables is as follows: For the year ended December 31, 2018 RMB Balance at the beginning of the year - Charge for the year (15,829 ) Balance at the end of the year (15,829 ) |
Prepayments and other current a
Prepayments and other current assets | 12 Months Ended |
Dec. 31, 2018 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepayments and other current assets | 11. Prepayments and other current assets December 31, 2017 2018 RMB RMB Interests receivable 78,274 218,553 Prepayments and deposits to vendors and content providers 81,319 183,293 Loans to third parties - 180,964 Receivables from payment platforms - 112,061 Amounts receivables from issuance of a subsidiary’s preferred shares - 102,951 Value added taxes to be deducted - 69,563 Receivables from disposal of subsidiaries and investments 7,986 59,255 Rental and other deposits 14,214 22,457 Employee advances 16,697 11,536 Others 23,449 58,386 Total 221,939 1,019,019 |
Investments
Investments | 12 Months Ended |
Dec. 31, 2018 | |
Investments [Abstract] | |
Investments | 12. Investments December 31, 2017 2018 RMB RMB Equity investments accounted for using the equity method (i) 309,241 378,378 Equity investments with readily determinable fair values (ii) 138,251 238,915 Equity investments without readily determinable fair values (iii) 703,566 3,974,231 Available-for-sale debt securities 1,961 - Total 1,153,019 4,591,524 (i) In 2017 and 2018, the Group acquired minority stake of a number of privately-held entities with total consideration of RMB21,740 and RMB14,277, respectively. Investments have been accounted for under the equity method where the Group has significant influence on these investments and the investments are considered as in-substance ordinary shares. (ii) In 2018, the Group made an investment in a third party investment fund with total consideration of RMB204,499. The Group does not have the ability to exercise significant influence over the investment. Therefore, it has been precluded from applying the equity method of accounting. In 2018, fair value loss of RMB113,677 (iii) Equity securities without readily determinable fair values and over which the Company has neither significant influence nor control through investments in common stock or in-substance common stock. In 2017 and 2018, the Group acquired minority preffered shares or ordinary shares of a number of privately-held entities with total consideration of RMB301,848 and RMB2,118,648, In 2018, fair value gain of RMB1,803,081 due to the observable price change, was recognized in gain on fair value changes of investments (Note 29). Out of the fair value gain of RMB1,803,081, RMB356,545 was realized and RMB1,446,536 was unrealized. In 2018, The Group disposed or partially disposed 7 investments and deemed disposed 1 investment. The total consideration of the disposals was RMB780,071. RMB16,178. The Group assesses the existence of indicators for other-than-temporary impairment of the investments by considering factors including, but not limited to, current economic and market conditions, the operating performance of the entities including current earnings trends and other entity-specific information. In 2016, 2017 and 2018, based on the Group’s assessment, an impairment charge of RMB80,104, RMB43,205 and RMB35,348 was recognized in general and administrative expenses, respectively, against the carrying value of the investments due to significant deterioration in earnings or unexpected changes in business prospects of the investees as compared to the original investment plans. |
Property and equipment, net
Property and equipment, net | 12 Months Ended |
Dec. 31, 2018 | |
Property and equipment, net [Abstract] | |
Property and equipment, net | 13. Property and equipment, net Property and equipment consists of the following: December 31, 2017 2018 RMB RMB Gross carrying amount Buildings 731,640 857,020 Servers, computers and equipment 588,589 679,735 Construction in progress 44,103 211,657 Decoration of buildings 100,711 103,305 Motor vehicles 27,330 38,407 Furniture, fixture and office equipment 24,102 26,439 Leasehold improvements 18,651 22,913 Total 1,535,126 1,939,476 Less: accumulated depreciation (518,128 ) (643,157 ) Property and equipment, net 1,016,998 1,296,319 Depreciation expense for the years ended December 31, 2016, 2017 and 2018 were RMB173,625, RMB176,715, and RMB150,991, respectively. |
Land use rights, net
Land use rights, net | 12 Months Ended |
Dec. 31, 2018 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Land Use Right Disclosure | 14. Land use rights, net Land use rights consist of the following: December 31, 2018 RMB Gross carrying amount 1,924,563 Less: accumulated amortization (139,924 ) Land use rights, net 1,784,639 Amortization expense for the years ended December 31, 2016, December 31, 2017 and 2018 were RMB43,915, RMB47,909, and RMB48,100, respectively. The estimated amortization expenses for each of the following five years are as follows: Amortization expense of land use rights RMB 2019 48,096 2020 48,096 2021 48,096 2022 48,096 2023 48,096 |
Intangible assets, net
Intangible assets, net | 12 Months Ended |
Dec. 31, 2018 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible assets, net | 15. Intangible assets, net The following table summarizes the Group’s intangible assets: December 31, 2017 2018 RMB RMB Gross carrying amount Operating rights 47,020 67,080 Software 34,413 39,535 License - 32,000 Domain names 25,774 26,819 Technology 17,676 18,094 Total of gross carrying amount 124,883 183,528 Less: accumulated amortization Operating rights (40,320 ) (48,451 ) Software (19,448 ) (28,406 ) License - (1,422 ) Domain names (9,687 ) (11,213 ) Technology (10,695 ) (11,856 ) Total accumulated amortization (80,150 ) (101,348 ) Less: accumulated impairment (7,252 ) (7,495 ) Intangible assets, net 37,481 74,685 Amortization expense for the years ended December 31, 2016, 2017 and 2018 were RMB56,977, RMB14,510 and RMB20,995, respectively. The estimated amortization expenses for each of the following five years are as follows: Amortization expense of intangible assets RMB 2019 22,710 2020 13,010 2021 4,563 2022 4,060 2023 3,978 The weighted average amortization periods of intangible assets as of December 31, 2017 and 2018 are as below: December 31, 2017 2018 Domain names 15 years 15 years License Not applicable 15 years Software 4 years 4 years Operating rights 1 year 2 year Technology 5 years Not applicable |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | 16. Goodwill The changes in the carrying amount of goodwill for the years ended December 31, 2017 and 2018 are as follows: YY Live RMB Balance as of December 31, 2016 14,300 Impairment charges (i) (2,527 ) Foreign currency translation adjustments (57 ) Balance as of December 31, 2017 11,716 Foreign currency translation adjustments 47 Balance as of December 31, 2018 11,763 (i) The Group performs its annual goodwill impairment test of each reporting unit as of October 1, or more frequently, if certain events or circumstances warrant. Events or changes in circumstances which might indicate potential impairment in goodwill include the entity-specific factors, including, but not limited to, stock price volatility, market capitalization relative to net book value, and projected revenue, market growth and operating results. In December 2017, the Group has identified impairment indicator for Guangzhou Zhuque Information Technology Co., Ltd. (“Zhuque”). Based on the results of the impairment assessment, an impairment charge of RMB2,527 for Zhuque was recognized. The above goodwill impairment assessments on Zhuque adopted the income approach and considered a combination of factors, including, but not limited to, market conditions, expected future cash flows, growth rates and discount rates, which required the Group to make certain estimates and assumptions regarding industry economic factors and future profitability of the business. |
Deferred revenue
Deferred revenue | 12 Months Ended |
Dec. 31, 2018 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Revenue | 17. Deferred revenue December 31, 2017 2018 RMB RMB Deferred revenue, current Live streaming 637,346 842,040 Others 120,698 109,576 Total current deferred revenue 758,044 951,616 Deferred revenue, non-current Live streaming 45,267 80,734 Others 12,451 10,976 Total non-current deferred revenue 57,718 91,710 |
Accrued liabilities and other c
Accrued liabilities and other current liabilities | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accrued liabilities and other current liabilities | 18. Accrued liabilities and other current liabilities December 31, 2017 2018 RMB RMB Revenue sharing fees 839,745 1,318,561 Salaries and welfare 220,539 329,169 Marketing and promotion expenses 109,901 213,216 Bandwidth costs 102,064 131,252 Value added taxes and other taxes payable 23,204 109,040 Deposits from third parties 27,440 82,771 Payables to merchants 15,442 75,471 Other payable to content providers 20,849 30,313 Others 106,779 124,578 Total 1,465,963 2,414,371 |
Short-term loans
Short-term loans | 12 Months Ended |
Dec. 31, 2018 | |
Convertible bonds [Abstract] | |
Short-term Debt | 19. Short - term loans December 31, 2017 2018 RMB RMB Short-term loans 588,235 - The Group entered into agreements with banks, pursuant to which the Group borrowed three loans with total principal amount of US$90 million (equal to RMB588,235) within a credit facility of US$160 million in 2017. These loans were all with a maturity of less than one year and the annual interest rates of these loans ranged from 2.0% to 3.0%. Term deposit of RMB1,000 million was pledged as collateral for the banking facilities of US$160 million. In 2018, the Group repaid the loans. |
Convertible bonds
Convertible bonds | 12 Months Ended |
Dec. 31, 2018 | |
Convertible bonds [Abstract] | |
Convertible bonds | 20. Convertible bonds December 31, 2017 2018 RMB RMB Convertible bonds, current 2019 Convertible Senior Notes - 6,863 Convertible bonds, non-current 2019 Convertible Senior Notes 6,536 - On March 18, 2014, the Company issued Convertible Senior Notes due 2019 with principal amount of US$400 million (the “Notes”). The Notes bear interest at a rate of 2.25% per year, payable semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2014. The Notes will mature on April 1, 2019. The value of the Notes is initially measured by the cash received and is subsequently stated at amortized cost. The Notes are not redeemable prior to the maturity date of April 1, 2019, except that the holders of the Notes (the “Holders”) have a noncontingent option to require the Company to repurchase for cash all or any portion of their Notes on April 1, 2017. The repurchase price will equal 100% of the principal amount of the Notes to be repurchased plus accrued and unpaid interest, if any, to, but excluding, the repurchase date. US$399 million aggregate principal amount of the Notes were redeemed on April 1, 2017. Following the repurchase, US$1 million aggregate principal amount of the Notes remains outstanding and will be due in 2019. As of December 31, 2017 and 2018, RMB 6.5 million (US$1.0 million) and RMB 6.9 million (US$1.0 million) has been accounted for as the value of the Notes in non-current liabilities and current liabilities respectively. Interest expense recognized during the years ended December 31, 2017 and 2018 was RMB20,820 and RMB149. The remaining outstanding balance of the Notes was repaid on April 1, 2019. |
Cost of revenues
Cost of revenues | 12 Months Ended |
Dec. 31, 2018 | |
Cost of Revenue [Abstract] | |
Cost of revenues | 21. Cost of revenues For the year ended December 31, 2016 2017 2018 RMB RMB RMB Revenue sharing fees and content costs 3,790,624 5,727,081 8,272,696 Bandwidth costs 651,652 695,839 967,436 Salary and welfare 232,497 237,063 323,623 Depreciation and amortization 173,048 128,639 117,293 Payment handling costs 67,474 72,953 104,772 Share-based compensation 15,894 42,759 74,339 Other taxes and surcharges 44,659 48,360 48,724 Other costs 127,582 73,708 108,251 Total 5,103,430 7,026,402 10,017,134 |
Other income
Other income | 12 Months Ended |
Dec. 31, 2018 | |
Component of Operating Income [Abstract] | |
Other income | 22. Other income For the year ended December 31, 2016 2017 2018 RMB RMB RMB Government grants 128,550 88,873 88,488 Others 954 24,314 29,372 Total 129,504 113,187 117,860 |
Income tax
Income tax | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income tax | 23. Income tax (i) Cayman Islands Under the current tax laws of Cayman Islands, the Company and its subsidiaries are not subject to tax on income or capital gains. Besides, upon payment of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed. (ii) BVI Duowan BVI is exempted from income tax on its foreign-derived income in the BVI. There are no withholding taxes in the BVI. (iii) Hong Kong profits tax Under the current Hong Kong Inland Revenue Ordinance, the subsidiaries of the Group in Hong Kong are subject to 16.5% Hong Kong profit tax on its taxable income generated from operations in Hong Kong. Additionally, payments of dividends by the subsidiary incorporated in Hong Kong to the Company are not subject to any Hong Kong withholding tax. (iv) Singapore The subsidiaries of the Group in Singapore are subject to a tax rate of 17% on its taxable income. (v) PRC The Company’s subsidiaries and VIEs in China are governed by the Enterprise Income Tax Law (“EIT Law”), which became effective on January 1, 2008. Pursuant to the EIT Law and its implementation rules, enterprises in China are generally subject to tax at a statutory rate of 25%. Certified High and New Technology Enterprises (“HNTE”) are entitled to a favorable statutory tax rate of 15%, but need to re-apply every three years. During this three-year period, an HNTE must conduct a qualification self-review each year to ensure it meets the HNTE criteria and is eligible for the 15% preferential tax rate for that year. If an HNTE fails to meet the criteria for qualification as an HNTE in any year, the enterprise cannot enjoy the 15% preferential tax rate in that year, and must instead use the regular 25% EIT rate. Enterprises qualified as software enterprises can enjoy an income tax exemption for two years beginning with their first profitable year and a 50% tax reduction to the applicable tax rate for the subsequent three years. An entity that qualifies as a “Key National Software Enterprise” (a “KNSE”) is entitled to a further reduced preferential income tax rate of 10%. Enterprises wishing to enjoy the status of a Software Enterprise or a KNSE must perform a self-assessment each year to ensure they meet the criteria for qualification and file required supporting documents with the tax authorities before using the preferential EIT rates. These enterprises will be subject to the tax authorities’ assessment each year as to whether they are entitled to use the relevant preferential EIT treatments. If at any time during the preferential tax treatment years an enterprise uses the preferential EIT rates but the relevant authorities determine that it fails to meet applicable criteria for qualification, the relevant authorities may revoke the enterprise’s Software Enterprise/KNSE status. The EIT Law also provides that an enterprise established under the laws of a foreign country or region but whose “de facto management body” is located in the PRC be treated as a resident enterprise for PRC tax purposes and consequently be subject to the PRC income tax at the rate of 25% for its global income. The Implementing Rules of the EIT Law merely define the location of the “de facto management body” as “the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, properties, etc., of a non-PRC company is located.” Based on a review of surrounding facts and circumstances, the Group does not believe that it is likely that its entities registered outside of the PRC should be considered as resident enterprises for the PRC tax purposes. The Group’s PRC entities provided for enterprise income tax are as follows: Guangzhou Huaduo applied for the renewal of HNTE qualification and received approval in December 2016. Guangzhou Huaduo is entitled to continue to enjoy the beneficial tax rate of 15% as an HNTE for the years 2016 through 2018, and will need to re-apply for HNTE qualification renewal in 2019. In 2017, Guangzhou Huanju Shidai was qualified as a KNSE after the relevant government authorities’ assessment and was entitled to a preferential income tax rate of 10 In June 2017, Guangzhou Juhui Information Technology Co., Ltd. was qualified as a Software Enterprise, and started to enjoy the zero 12.5 Huya Technology was qualified as a Software Enterprise, and started to enjoy the zero 12.5 Guangzhou Huya applied for the HNTE qualification and received approval in November 2018. Guangzhou Huya is entitled to enjoy the preferential tax rate of 15 Other PRC subsidiaries and VIEs were subject to 25 According to a policy promulgated by the State Tax Bureau of the PRC and effective from 2008 onwards, enterprises engaged in research and development activities are entitled to claim an additional tax deduction amounting to 50% of the qualified research and development expenses incurred in determining its tax assessable profits for that year. The additional tax deducting amount of the qualified research and development expenses have been increased from 50% to 75%, effective from 2018 to 2020, according to a new tax incentives policy promulgated by the State Tax Bureau of the PRC in September 2018 (“Super Deduction”). Certain subsidiaries and VIEs of the Group successfully claimed the Super Deduction in ascertaining the tax assessable profits for the periods reported. The EIT Law also imposes a withholding income tax of 10% on dividends distributed by an FIE to its immediate holding company outside of China, if such immediate holding company is considered as a non-resident enterprise without any establishment or place within China or if the received dividends have no connection with the establishment or place of such immediate holding company within China, unless such immediate holding company’s jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. The Cayman Islands, where the Company incorporated, does not have such tax treaty with China. According to the arrangement between the mainland China and Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion in August 2006, dividends paid by an FIE in China to its immediate holding company in Hong Kong will be subject to withholding tax at a rate of no more than 5% (if the foreign investor owns directly at least 25% of the shares of the FIE). In accordance with accounting guidance, all undistributed earnings are presumed to be transferred to the parent company and are subject to the withholding taxes. All FIEs are subject to the withholding tax from January 1, 2008. The presumption may be overcome if the Group has sufficient evidence to demonstrate that the undistributed dividends will be re-invested and the remittance of the dividends will be postponed indefinitely. Aggregate undistributed earnings and reserves of the Group entities located in the PRC that are available for distribution to the Company as of December 31, 2017 and 2018 are approximately RMB7,605,499 and RMB11,519,699, respectively. In 2017, the Group determined to cause one of its PRC subsidiaries, Guangzhou Huanju Shidai, to declare and distribute a cash dividend of part of its stand-alone earnings from 2014 to 2016, amounting to US$15,000, to its direct oversea parent company, Duowan BVI. Guangzhou Huanju Shidai paid for the withholding tax in the amount of US$1,500 in 2017. The Group has a plan to indefinitely reinvest its funds and any future earnings for use in the operation and expansion of its business. Accordingly, no deferred tax liability on 10% withholding tax of aggregate undistributed earnings and reserves of the Company’s subsidiaries located in the PRC has been accrued that would be payable upon the distribution of those amounts to the Company as of December 31, 2017 and 2018. Composition of income tax expense The current and deferred portions of income tax expense included in the consolidated statements of comprehensive income are as follows: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Income (loss) before income tax expenses PRC entities 1,914,432 2,919,350 3,494,192 Non-PRC entities (a) (130,621 ) (28,172 ) (959,721 ) Total 1,783,811 2,891,178 2,534,471 Current income tax expenses PRC entities (288,282 ) (402,012 ) (379,130 ) Non-PRC entities - (9,880 ) (48,931 ) Total (288,282 ) (411,892 ) (428,061 ) Deferred income tax benefit (expenses) PRC entities 7,768 (3,919 ) (25,081 ) Non-PRC entities - - (24,565 ) Total 7,768 (3,919 ) (49,646 ) Income tax expenses PRC entities (280,514 ) (405,931 ) (404,211 ) Non-PRC entities - (9,880 ) (73,496 ) Total (280,514 ) (415,811 ) (477,707 ) (a) The loss before tax incurred by non-PRC entities for the year ended December 31, 2018 was mainly due to the fair value loss on derivative liabilities amouting to RMB2,285,223. This fair value loss was incurred by Huya whose applicable tax rate is zero, therefore the tax impact related to this fair value loss was included in “effect of different tax rates available to different jurisdictions” in the reconciliation table below. Reconciliation of the differences between statutory tax rate and the effective tax rate The reconciliation of total tax expense computed by applying the respective statutory income tax rate to pre-tax income is as follows: For the year ended December 31, 2016 2017 2018 PRC Statutory income tax rate (25.0 )% (25.0 )% (25.0 )% Effect of tax holiday and preferential tax benefit 11.6 % 13.2 % 16.5 % Effect of different tax rates available to different jurisdictions (1.7 )% (0.3 )% (10.1 )% Permanent differences (i) (1.1 )% (1.8 )% (3.5 )% Change in valuation allowance (1.5 )% (2.3 )% (1.6 )% Effect of Super Deduction available to the Group 2.0 % 1.8 % 4.9 % Effective income tax rate (15.7 )% (14.4 )% (18.8 )% Per ADS effect of tax holiday (RMB) 3.52 4.71 5.35 Per share effect of tax holiday (RMB) 0.18 0.24 0.27 (i) Permanent differences mainly arise from expenses not deductible for tax purposes including primarily share-based compensation costs and expenses incurred by subsidiaries and VIEs. Deferred tax assets and liabilities Deferred taxes are measured using the enacted tax rates for the periods in which they are expected to be reversed. The tax effects of temporary differences that give rise to the deferred tax asset balances as of December 31, 2017 and 2018 are as follows: December 31, 2017 2018 RMB RMB Deferred tax assets: Tax loss carried forward 74,951 148,899 Allowance for doubtful receivable, accrued expense and 62,177 84,249 Deferred revenue 97,858 36,007 Impairment of investment 12,783 17,180 Others 753 753 Valuation allowance (i) (135,505 ) (175,793 ) Amounts offset by deferred tax liabilities - (40,461 ) Total deferred tax assets, net 113,017 70,834 Deferred tax liabilities: Related to the fair value changes of investments 3,627 61,658 Related to acquired intangible assets 2,406 1,531 Others 4,777 4,777 Amounts offset by deferred tax assets - (40,461 ) Total deferred tax liabilities, net 10,810 27,505 (i) Valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group considered factors including future taxable income exclusive of reversing temporary differences and tax loss carry forwards. Valuation allowance was provided for net operating loss carry forward because it was more likely than not that such deferred tax assets would not be realized based on the Group’s estimate of its future taxable income. If events occur in the future that allow the Group to realize more of its deferred income tax than the presently recorded amounts, an adjustment to the valuation allowances will result in a decrease in tax expense when those events occur. Movement of valuation allowance For the year ended December 31, 2016 2017 2018 RMB RMB RMB Balance at beginning of the year (53,316 ) (80,712 ) (135,505 ) Additions (45,491 ) (78,978 ) (113,597 ) Reversals 18,095 24,185 73,309 Balance at end of the year (80,712 ) (135,505 ) (175,793 ) Tax loss carry forwards As of December 31, 2018, total tax loss carry forwards of the Company’s subsidiaries and VIEs in the PRC amounted to RMB355,685 RMB113,645 and RMB242,735, respectively, are allowed to be carried forward to offset against future taxable profits. Such carry forward of tax losses in Hong Kong and Singapore have no time limit. In accordance with PRC Tax Administration Law on the Levying and Collection of Taxes, the PRC tax authorities generally have up to five years to claw back underpaid tax plus penalties and interest for PRC entities’ tax filings. In the case of tax evasion, which is not clearly defined in the law, there is no limitation on the tax years open for investigation. There were no ongoing examinations by tax authorities as of December 31, 2018. |
Mezzanine equity
Mezzanine equity | 12 Months Ended |
Dec. 31, 2018 | |
Temporary Equity Disclosure [Abstract] | |
Temporary Equity Disclosure | 24. Mezzanine equity On July 10, 2017, Huya issued 22,058,823 shares of redeemable convertible preferred shares (“Series A Preferred Shares”) at a price of US$3.4 per share with total cash consideration of US$75,000 (equivalent to RMB509,730 as of the issuance date). On March 8, 2018, Huya issued 64,488,235 shares of redeemable convertible preferred shares (“Series B-2 Preferred Shares”) for cash consideration of US$461,600 (equivalent to RMB2,919,112 RMB489,284. The initial recognition of the derivative liabilities for Series A Preferred Shares and Series B-2 Preferred Shares amounted to RMB892 million and the fair value loss on derivative liabilities of RMB2,285,223 was recognized in the consolidated statement of comprehensive income for the year ended December 31, 2018. Prior to the completion of Huya’s IPO, the Group recorded accretion of redemption value in accordance with ASC 480-10. The Group used the interest method to accrete the changes in redemption value over the period from the date of issuance to the earliest redemption date of the redeemable convertible preferred shares. In 2017 and 2018, the accretion charges of redeemable convertible preferred shares to redemption value were RMB19,842 and RMB71,628, respectively. Upon the completion of Huya’s IPO on May 11, 2018, all the redeemable convertible preferred shares were automatically converted into ordinary share of Huya. As a result, the Group held 44.0% of the outstanding ordinary shares of Huya. However, the Group is able to control Huya under Huya’s dual voting structure by gaining the simple majority of the voting right of Huya immediately after the IPO. Accordingly, the Group continues to consolidate the operations and the financial results of Huya and provides for non-controlling interests reflecting ordinary shares in Huya held by shareholders other than the Group in the consolidated financial statements. The Group derecognized the derivative liability mentioned above and recognized a one-time credit to additional paid-in capital of RMB4,804,947 In 2018, another subsidiary of the Group issued 500,000,000 shares of redeemable convertible preferred shares for cash consideration of US$50,000 (equivalent to RMB345,420 as of the issuance date) to certain third-party investors. The Group classifies the redeemable convertible preferred shares as mezzanine equity and records accretion of redemption value in accordance with ASC 480-10. The Group used the interest method for the changes of redemption value over the period from the date of issuance to the earliest redemption date of the non-controlling interests. In 2018, accretion of redeemable convertible preferred shares to redemption value of RMB5,758 was recognized. |
Common shares
Common shares | 12 Months Ended |
Dec. 31, 2018 | |
Equity [Abstract] | |
Common shares | 25. Common shares During the year ended December 31, 2016, 11,887,180 Class A common shares were issued for the exercised share options, vested restricted shares and restricted share units and 10,000,000 Class B common shares were converted to Class A common shares. As of December 31, 2016, 10,000,000,000 Class A common shares and 1,000,000,000 Class B common shares had been authorized, 750,115,028 Class A common shares and 359,557,976 Class B common shares had been issued and outstanding, respectively. On August 21, 2017, the Group completed its follow-on equity offering. The Company issued a total of 132,250,000 Class A common shares at US$3.5 per share. The net proceeds received by the Company, after deducting commissions and offering expenses, amounted to approximately US$442.2 million. During the year ended December 31, 2017, 21,305,880 Class A common shares were issued for the exercised share options, vested restricted shares and restricted share units and 41,575,000 Class B common shares were converted to Class A common shares. As of December 31, 2017, 10,000,000,000 Class A common shares and 1,000,000,000 Class B common shares had been authorized, 945,245,908 Class A common shares and 317,982,976 Class B common shares had been issued and outstanding, respectively. During the year ended December 31, 2018, 6,694,940 Class A common shares were issued for the exercised share options, vested restricted shares and restricted share units and 29,800,000 Class B common shares were converted to Class A common shares. As of December 31, 2018, 10,000,000,000 Class A common shares and 1,000,000,000 Class B common shares had been authorized, 981,740,848 Class A common shares and 288,182,976 Class B common shares had been issued and outstanding, respectively. |
Share-based compensation
Share-based compensation | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based compensation | 26. Share-based compensation (a) YY’s share-based awards (i) Restricted Share Units On September 16, 2011, the board of directors of the Company approved the 2011 Share Incentive Scheme. In October 2012, the board of directors of the Company resolved that the maximum aggregate number of Class A common shares which may be issued pursuant to all awards under the 2011 Share Incentive Scheme shall be 43,000,000 plus an annual increase of 20,000,000 on the first day of each fiscal year, or such lesser amount of Class A common shares as determined by the board of directors of the Company. During the years ended December 31, 2016, 2017 and 2018, the Company granted restricted share units to employees of 1,530,008 , 22,090,030 and 11,977,794 respectively pursuant to the 2011 Share Incentive Plan. During the years ended December 31, 2016, 2017 and 2018, the Company granted restricted share units to non-employees of nil, 150,000 and nil pursuant to the 2011 Share Incentive Plan. The following table summarizes the restricted share units activity for the years ended December 31, 2016, 2017 and 2018: Number of restricted shares Weighted average grant-date fair value (US$) Outstanding, December 31, 2015 36,283,602 2.3535 Granted 1,530,008 1.8618 Forfeited (4,628,202 ) 2.7386 Vested (12,229,688 ) 2.0151 Outstanding, December 31, 2016 20,955,720 2.4320 Granted 22,090,030 5.3001 Forfeited (4,007,728 ) 2.5561 Vested (8,163,878 ) 2.3227 Outstanding, December 31, 2017 30,874,144 4.4969 Granted 11,977,794 4.7052 Forfeited (5,115,304 ) 4.6843 Vested (12,507,000 ) 3.6776 Outstanding, December 31, 2018 25,229,634 4.9639 Expected to vest at December 31, 2018 23,742,895 4.9552 For the years ended December 31, 2016, 2017 and 2018, the Company recorded share-based compensation of RMB143,350, RMB211,189 and RMB372,281 using the graded-vesting attribution method. As of December 31, 2018, total unrecognized compensation expense relating to the restricted share units was RMB442,094. The expense is expected to be recognized over a weighted average period of 1.11 years using the graded-vesting attribution method. (ii) Share options Pre-2009 Scheme Options Before the adoption of the Employee Equity Incentive Scheme (the “2009 Incentive Scheme”), 12,705,700 and 8,499,050 share options were granted to employees through individually signed share option agreements, to acquire common shares of Duowan BVI on a one-to-one basis on January 1, 2008 and 2009 respectively. In addition, on January 1, 2008, 3,832,290 share options were granted to one non-employee for the provision of consulting services to the Group (collectively defined as “Pre-2009 Scheme Options”). The vesting of the Pre-2009 Scheme Options has already been completed before January 1, 2016. As of December 31, 2017, the outstanding, vested and exercisable share options was 154,535. As of December 31, 2018, all outstanding, vested and exercisable share options have been exercised. 2011 Share Incentive Scheme Grant of options During the year ended December 31, 2018, the Company granted 10,934,300 share options to employees, pursuant to the 2011 Share Incentive Scheme. Vesting of options There are three types of vesting schedule, which are: i) options will be vested in three equal installments over the following 36 months, ii) 50% of the options will be vested after 24 months of the grant date and the remaining 50% will be vested in two equal installments over the following 24 months, and iii) 50% of the options will be vested after 24 months of the grant date and the remaining 50% will be vested in one installments over the following 12 months. Movements in the number of share options granted and their related weighted average exercise prices are as follows: Number of options Weighted average exercise price (US$) Weighted average remaining contractual life (years) Aggregate intrinsic value (US$) Outstanding, January 1, 2018 - - - Granted 10,934,300 4.7025 5.29 Outstanding, December 31, 2018 10,934,300 4.7025 5.29 - Expected to vest at December 31, 2018 10,934,300 4.7025 5.29 - Exercisable at December 31, 2018 - - - - Forfeitures are estimated at the time of grant. If necessary, forfeitures are revised in subsequent periods if actual forfeitures differ from those estimates. The aggregate intrinsic value in the table above represents the difference between the Company’s common shares as of December 31, 2017 and 2018 and the exercise price. The total intrinsic value of options exercised during the year ended December 31, 2018 is nil. For the year ended December 31, 2018, the Company recorded share-based compensation of RMB41,739 using the graded vesting attribution method. The Company has used binomial option-pricing model to determine the fair value of the share options as of the grant dates. Key assumptions are set as below: Weighted average fair value per option granted US$ 2.6425 Weighted average exercise price US$ 4.7025 Weighted average Risk-free interest rate (1) 2.77 % Expected term (in year) (2) 5-6 Expected volatility (3) 57 % Dividend yield (4) - (1) The risk-free interest rate of periods within the contractual life of the share option is based on US Treasury Bonds of similar tenor at the valuation dates. (2) The expected term is the contract life of the option. (3) Expected volatility is estimated based on the average of historical volatilities of the Company at the valuation dates. (4) The Company has no history or expectation of paying dividend on its ordinary shares. The expected dividend yield was estimated based on the Company’s expected dividend policy over the expected term of the option. (b) Huya’s share-based awards On July 10, 2017, the Board of Directors of Huya approved the establishment of 2017 Share Incentive Plan (“Huya’s 2017 Share Incentive Plan”), the purpose of which is to provide an incentive for employees contributing to Huya. Huya’s 2017 Share Incentive Plan shall be valid and effective for 10 years from the establishment date. The maximum number of shares that may be issued pursuant to all awards under 2017 Share Incentive Plan shall be 17,647,058 shares. On March 31, 2018, the Board of Directors of Huya approved to increase the maximum number of shares, that may be issued, from 17,647,058 shares to 28,394,117 shares, including incentive share options and restricted share units. (i) Share options Grant of options During the year ended December 31, 2017, Huya granted 11,737,705 share options to employees. During the year ended December 31, 2018, Huya granted 5,918,353 and 220,000 share options to employees and non-employees, respectively. Vesting of options There are three types of vesting schedule, which are: i) 50% of the options will be vested after 24 months of the grant date and the remaining 50% will be vested in two equal installments over the following 24 months, ii) options will be vested in four equal installments over the following 48 months, and iii) options will be vested in four equal installments over the following 24 months. These options shall (i) be exercisable during its term cumulatively according to the vesting schedule set out in the grant notice and with the applicable provisions of Huya’s 2017 Share Incentive Plan, provided that the performance conditions otherwise agreed by the parties (if any) to which the option is subject have been fulfilled upon each corresponding vesting date; (ii) be deemed vested and exercisable immediately in the event of a change of control, regardless of the vesting schedule; (iii) be exercisable upon any arrangement as otherwise agreed by the parties based on their discussion in good faith. Movements in the number of share options granted and their related weighted average exercise prices are as follows: Number of options Weighted average exercise price (US$) Weighted average remaining contractual life (years) Aggregate intrinsic value (US$) As at January 1, 2016 and December 31, 2016 - - - - Granted 11,737,705 2.5500 Forfeited (18,000 ) 2.5500 As at December 31, 2017 11,719,705 2.5500 9.75 2,227 Granted 6,138,353 2.4672 Forfeited (75,000 ) 2.5500 Cancelled (262,503 ) 2.5500 As at December 31, 2018 17,520,555 2.5210 8.82 227,049 Expected to vest at December 31, 2018 13,982,830 2.5338 8.87 181,024 Exercisable as of December 31, 2018 2,736,927 2.4572 8.63 35,642 Huya has used binomial option-pricing model to determine the fair value of the share options as of the grant dates. Key assumptions are set as below: 2017 2018 Weighted average fair value per option granted US$ 1.3798 US$ 5.2130 Weighted average exercise price US$ 2.55 US$ 2.47 Risk-free interest rate (1) 2.25 % 2.83 % Expected term (in year) (2) 10 10 Expected volatility (3) 55 % 55 % Dividend yield (4) - - (1) The risk-free interest rate of periods within the contractual life of the share option is based on the China Government Bond yield as at the valuation dates. (2) The expected term is the contract life of the option. (3) Expected volatility is estimated based on the average of historical volatilities of the comparable companies in the same industry as at the valuation dates. (4) Huya has no history or expectation of paying dividend on its ordinary shares. The expected dividend yield was estimated based on Huya’s expected dividend policy over the expected term of the option. For the years ended December 31, 2016, 2017 and 2018, the Group recorded share-based compensation of nil, RMB19,473 and RMB151,242, using the graded-vesting attribution method, including accelerated compensation cost amounted to RMB1,869 due to that 262,503 share options were cancelled without concurrent grant of replacement awards, which is treated as a settlement for no consideration at the time of cancellation under ASC 718. The share-based compensation above also included the share options granted to non-employees, amounting to nil, nil and RMB20,980, recognized in general and administrative expenses, for the years ended December 31, 2016, 2017 and 2018, respectively. As of December 31, 2018, there was RMB169,604 unrecognized share-based compensation expense of options relating to Huya 2017 Share Incentive Plan. The expense is expected to be recognized over a weighted-average remaining vesting period of 1.14 years using the graded vesting attribution method. (ii) Restricted share units Grant of restricted share units During the year ended December 31, 2018, Huya granted 4,183,685 and 10,000 restricted share units to employees and non-employees, respectively. Vesting of restricted share units There are two types of vesting schedule for employees, which are: i) 50% of the restricted share units will be vested after 24 months of the grant date and the remaining 50% will be vested in two equal installments over the following 24 months, and ii) restricted share units will be vested in four equal installments over the following 48 months. The following table summarizes the activity of restricted share units for the year ended December 31, 2018: Number of restricted share units Weighted average grant-date fair value (US$) Outstanding, January 1, 2016, December 31, 2016 and 2017 - - Granted 4,193,685 9.0242 Forfeited (76,500 ) 7.1600 Vested (10,000 ) 19.5900 Outstanding, December 31, 2018 4,107,185 9.0331 Expected to vest at December 31, 2018 3,795,535 8.9944 For the years ended December 31, 2016, 2017 and 2018, Huya recorded share-based compensation of nil, nil and RMB69,620 using the graded vesting attribution method. The share-based compensation above also included the restricted share units granted to non-employees, amounting to nil, nil and RMB1,076, recognized in general and administrative expenses, for the years ended December 31, 2016, 2017 and 2018, respectively. As of December 31, 2018, total unrecognized compensation expense relating to the restricted share units was RMB166,010. The expense is expected to be recognized over a weighted average period of 1.21 year using the graded-vesting attribution method. (iii) Ordinary shares awards In October 2017, the Company transferred, at nominal consideration, 1,551,495 ordinary shares of Huya to the management of the Group, for their service provided. The share awards were immediately vested and the Company recorded a share-based compensation charge of RMB28,226 for the year ended December 31, 2017. In 2018, the Company transferred 367,870 ordinary shares of Huya to the management of the Group, for the service provided. The shares awards will be vested over 5 years. For the year ended December 31, 2018, the Company recorded share-based compensation of RMB5,227. The fair value of the ordinary shares of Huya was determined at the grant date by the Company. (c) Other subsidiaries’ share-based awards For the years ended December 31, 2016, 2017 and 2018, the Company recorded share-based compensation of RMB13,936, a reversal of RMB1,227 and RMB 7,916 for restricted shares to the founders or management of the subsidiaries of a variable interest entity. |
Basic and diluted net income pe
Basic and diluted net income per share | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Basic and diluted net income per share | 27. Basic and diluted net income per share Basic and diluted net income per share for the years ended December 31, 2016, 2017 and 2018 are calculated as follows: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Numerator: Net income attrib utable to common shareholders of the Compa ny 1,523,918 2,493,235 1,641,958 Interest expenses of convertible notes 81,085 20,820 149 Numerator for diluted income per share 1,605,003 2,514,055 1,642,107 Denominator: Denominator for basic calculation—weighted average number of Class A and Class B common shares outstanding 1,127,343,312 1,186,460,144 1,280,847,795 Dilutive effect of share options 684,455 376,918 94,254 Dilutive effect of restricted share units 15,816,362 11,598,378 12,966,689 Dilutive effect of convertible bonds 72,267,200 18,202,301 180,668 Denominator for diluted calculation 1,216,111,329 1,216,637,741 1,294,089,406 Basic net income per Class A and Class B common share 1.35 2.10 1.28 Diluted net income per Class A and Class B common share 1.32 2.07 1.27 Basic net income per ADS* 27.04 42.03 25.64 Diluted net income per ADS* 26.40 41.33 25.38 * Each ADS represents 20 |
Related party transactions
Related party transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related party transactions | 28. Related party transactions The table below sets forth the major related parties and their relationships with the Group: Major related parties Relationship with the Group Guangzhou Sunhongs Corp., Ltd. (“Guangzhou Sunhongs”) (Formerly known as Guangzhou Shanghang Information Technology Co., Ltd.) Significant influence exercised by a principal shareholder of the Company Kingsoft Corporation Limited (“Kingsoft Group”) Significant influence exercised by a principal shareholder of the Company Bigo Inc. (“Bigo”) Investment with significant influence Shanghai Ansha Network Technology Co., Ltd.(“Shanghai Ansha”) Investment with significant influence Guangzhou Chenjun Equity Investment Limited Partnership(“Guangzhou Chenjun”) Investment with significant influence Guangzhou Kuyou Information Technology Co., Ltd.(“Guangzhou Kuyou”) Investment with significant influence Beijing Huanqiu Xingxue Technology Development Co., Ltd.(“Xingxue”) Investment with significant influence Yunke Online Investment with significant influence During the years ended December 31, 2016, 2017 and 2018, significant related party transactions are as follows: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Loan to related parties 44,500 24,962 188,000 Bandwidth service provided by Guangzhou Sunhongs 96,224 92,068 103,439 Online games revenue shared from related parties 100,078 87,414 31,366 Repayment of loans from related parties - 35,462 20,000 Bandwidth service provided by Kingsoft Group - 711 11,314 Payments on behalf of related parties, net of repayments 10,699 (23,116 ) (2,543 ) Partial disposal of investments to Guangzhou Chenjun 33,750 35,160 - Partial disposal of a subsidiary to Guangzhou Chenjun 24,394 - - Others 13,573 14,276 11,833 As of December 31, 2017 and 2018, the amounts due from/to related parties are as follows: December 31, 2017 2018 RMB RMB Amounts due from related parties, current Due from Bigo (1) 9,831 191,800 Others 1,359 1,759 Total 11,190 193,559 Amounts due from related parties, non-current Due from Yunke Online 20,000 - Amounts due to related parties Due to Guangzhou Sunhongs 8,432 11,062 Due to Guangzhou Kuyou 7,583 4,144 Due to Shanghai Ansha 6,178 5,364 Due to Kingsoft Group - 5,239 Others 8,309 2,527 Total 30,502 28,336 (1) The amounts due from Bigo mainly consisted of unsecured loans provided to Bigo.The maturities of the loans were all within one year. Other receivables and payables from/to related parties are unsecured and payable on demand. |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | 29. Fair value measurements Fair value reflects the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the assets or liabilities. The Group applies a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. This guidance specifies a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The hierarchy is as follows: Level 1—Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. Level 2—Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and/or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are Level 2 valuation techniques. Level 3—Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect the Group’s own assumptions about the assumptions that market participants would use in pricing an asset or liability. The fair value guidance describes three main approaches to measure the fair value of assets and liabilities: (1) market approach; (2) income approach and (3) cost approach. The market approach uses prices and other relevant information generated from market transactions involving identical or comparable assets or liabilities. The income approach uses valuation techniques to convert future amounts to a single present value amount. The measurement is based on the value indicated by current market expectations about those future amounts. The cost approach is based on the amount that would currently be required to replace an asset. When available, the Group uses quoted market prices to determine the fair value of an asset or liability. If quoted market prices are not available, the Group will measure fair value using valuation techniques that use, when possible, current market-based or independently sourced market parameters, such as interest rates and currency rates. The Group did not have any other financial instruments that were required to be measured at fair value on a recurring basis as of December 31, 2018 except for short-term investments and equity investment with readily determinable fair values. The following table summarizes the Company’s assets that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy as of December 31, 2017 and December 31, 2018: As of December 31, 2017 Level 1 Level 2 Level 3 Total Assets Short-term investments 29,570 94,980 - 124,550 Equity investment with readily determinable fair values 138,251 - - 138,251 Available-for-sale debt securities - - 1,961 1,961 167,821 94,980 1,961 264,762 As of December 31, 2018 Level 1 Level 2 Level 3 Total Assets Short-term investments (i) 78,605 900,448 - 979,053 Equity investment with readily determinable fair values (ii) 238,915 - - 238,915 317,520 900,448 - 1,217,968 Liabilities Derivative liabilities (iii) - - - - (i) Short-term investments represented the investments issued by commercial banks or other financial institutions with a variable interest rate indexed to the performance of underlying assets within one year. For the instruments whose fair value is provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. For the instruments whose fair value is estimated based on quoted prices of similar products provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements. (ii) Equity investments with readily determinable fair values are valued using the market approach based on the quoted prices in active markets at the reporting date. The Group classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. (iii) The Company has determined that conversion feature embedded in the Huya’s Series B-2 Preferred Shares is required to be bifurcated and accounted for as a derivative liability which would be measured at fair value (Note 24). Upon the completion of Huya’s IPO, the derivative liabilities were derecognized and the balance was transferred to additional paid-in capital accordingly. The following table presents the changes in Level 3 liabilities for the year ended December 31, 2018. Conversion feature embedded in Series A Preferred Shares Conversion feature embedded in Series B-2 Preferred Shares Total RMB RMB RMB Balance as of January 1, 2018 - - - Initial recognition upon the extinguishment of Huya’s Series A Preferred Shares and the issuance of Huya’s Series B-2 Preferred Shares as of March 8, 2018 572,237 320,097 892,334 Fair value loss on derivative liabilities 628,298 1,656,925 2,285,223 Foreign exchange 4,573 6,697 11,270 Derecognition of derivative liabilities upon the completion of Huya’s IPO (1,205,108 ) (1,983,719 ) (3,188,827 ) Balance as of December 31, 2018 - - - In determining the fair value of these preferred shares, the Group has adopted the equity allocation model. For purposes of determining the conversion features of Huya’s Pre-IPO Preferred Shares as of March 8, 2018 and May 10, 2018, the Company has re-performed the equity allocation model for Huya’s Pre-IPO Preferred Shares in scenarios assuming the conversion feature is removed, the difference between the with embedded conversion features scenario and the without embedded conversion features scenario is considered to be value of the conversion features of Huya’s Pre-IPO Preferred Shares. The Company assumed Huya’s Pre-IPO Preferred Shares would not be converted to common shares in neither the IPO scenario, the liquidation scenario nor the redemption scenario. Such approach involves certain significant estimates which are as follows: Valuation Date March 8, 2018 May 10, 2018 Volatility 50 % 50 % Risk-free rate (3 months) 1.66 % 1.58 % Risk-free rate (4 years) 2.52 % 2.46 % Dividend yield 0 % 0 % Fair value measurement on a non-recurring basis The Company measures investments without readily determinable fair value on a nonrecurring basis when impairment charges and fair value change due to observable price change are recognized. These nonrecurring fair value measurements use significant unobservable inputs (Level 3). The Company uses a combination of valuation methodologies, including market and income approaches based on the Company’s best estimate to determine the fair value of these investments. An observable price change is usually resulting from new rounds of financing of the investees. The Company determines whether the securities offered in new rounds of financing are similar to the equity securities held by the Company by comparing the rights and obligations of the secutiries. When the securities offered in new rounds of financing are determined to be similar to the securities beld by the Company, the Company adjusts the observable price of the similar security to determine the amount that should be recorded as an adjustment in the carrying value of the security to reflect the current fair value of the security held by the Company by using the back-solve method based on the equity allocation model with adoption of some key parameters such as risk-free rate and equity volatility. Inputs used in these methodologies primarily include discount rate, the selection of comparable companies operating in similar businesses and etc. In 2018, fair value gain of RMB 1 ,803,081 Apart from the short-term investments, equity investment measured at fair value through earnings and derivative liabilities, the Company’s other financial instruments principally consist of cash and cash equivalent, short-term deposits, long-term deposits, accounts receivable, financing receivables, other receivables, amounts due to/from related parties, accounts payable, certain accrued expenses and convertible bonds. The recorded values of cash, short-term deposits, long-term deposits, accounts receivable, financing receivables, other receivables, amounts due to/from related parties, accounts payable, certain accrued expenses and convertible bonds are recorded at cost which approximates fair value. The fair value of convertible bonds is within Level 2 of the fair value hierarchy. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | 30. Commitments and contingencies (a) Operating lease commitments The Group leases facilities in the PRC under non-cancellable operating leases expiring on different dates. Payments under operating leases are expensed on a straight-line basis over the periods of the respective leases. Total office rental expenses under all operating leases were RMB76,753, RMB62,211 and RMB50,206 for the years ended December 31, 2016, 2017 and 2018, respectively. As of December 31, 2018, future minimum payments under non-cancellable operating leases consist of the following: Office rental RMB 2019 84,689 2020 53,609 2021 35,871 2022 and after 47,726 221,895 (b) Capital commitments As of December 31, 2018, the Group had outstanding capital commitments totaling RMB193,412 which consisted of capital expenditures related to properties and additional investments in equity investments. (c) Litigation In October 2014, Guangzhou NetEase Computer System Co., Ltd. (“Guangzhou NetEase”) brought a copyright infringement claim against the Group in the Intermediate People’s Court of Guangzhou, alleging that the Group’s live game broadcasting program has infringed the copyright of one of their online games called Fantasy Westward Journey. The claimant is seeking RMB100 million for their potential damages, requesting YY to cease the copyright infringement practices and apologize publicly. In November 2017, the local court passed a judgment requesting the Company to compensate such game publisher for its loss amounting to RMB20 million, as a result of the alleged copyright infringement. Based on its estimate as of December 31, 2017, the Company recorded an estimated loss contingency of RMB20 million in its financial statements. Up to the date of this report, there has been no judgment from the appellate court yet and the Group’s estimate on the loss contingency remained the same as last year. |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent events | 31. Subsequent events (a) In 2019, the Group entered into a share purchase agreement with Bigo and its shareholders. Under the agreement, the Group agreed to purchase all outstanding shares of Bigo which were not yet owned by the Group. Pursuant to the agreement, the Company paid US$343.1 million in cash and issued 313,888,496 38,326,579 (b) In 2019, the Group signed an agreement with a third party company to dispose its game business in exchange of certain equity interests of this third party company. The completion of the transaction is subject to customary closing conditions and the Group expects a gain will be recognized from the transaction. The Group is in the process of the valuation related to the consideration and evaluating the accounting treatment of this acquisition. (c) In September 2018, the Company entered into a loan agreement with a commercial bank, under which the Company obtained credit facility amounting to HK$700 million. The interest rate of the loan was HIBOR plus 0.67% per annum. As of the date of the issuance of the financial statements, the Company has borrowed a short-term loan amounting to HK$320 million from the bank. Term deposit of RMB300 million was pledged as collateral for the loan borrowed. (d) On February 28, 2019, the Company entered into a facility agreement with Goldman Sachs Lending Partners LLC (“the Lender”). Subject to the terms of this agreement, the Lender agreed to make available to the Company a US$ term loan facility in an aggregate amount of up to US$100,250. In March 2019, the Company has borrowed a loan amounting to US$100,250 under this facility agreement. The interest rate of the loan is LIBOR plus a margin per annum. The margin ranges from 1.25% to 3.65% subject to the actual term of the loan. The loan was repaid on April 16, 2019. (e) Huya completed a follow-on public offering of ADSs on April 12, 2019. As a result of these transactions, Huya issued and sold an aggregate of 13,600,000 ADSs and the Company, as selling shareholder, sold an aggregate of 4,800,000 Huya’s ADSs it held at a price of US$24.00 per ADS. The underwriters’ options granted by Huya and the Company to purchase additional ADSs have not been exercised yet until April 26, 2019. The net proceeds received by Huya, after deducting underwriter commissions and estimated offering expenses, amounted to approximately US$313.8 million. The net proceeds received by the Company, after deducting underwriter commissions, amounted to approximately US$111.2 million. |
Restricted net assets
Restricted net assets | 12 Months Ended |
Dec. 31, 2018 | |
Other Restricted Assets [Abstract] | |
Restricted net assets | 32. Restricted net assets Relevant PRC laws and regulations permit payments of dividends by the Group’s subsidiaries and VIEs incorporated in the PRC only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. In addition, the Company’s subsidiaries and VIEs in the PRC are required to annually appropriate 10% of their net after-tax income to the statutory general reserve fund prior to payment of any dividends, unless such reserve funds have reached 50% of their respective registered capital. As a result of these and other restrictions under PRC laws and regulations, the Group’s subsidiaries and VIEs incorporated in the PRC are restricted in their ability to transfer a portion of their net assets to the Company either in the form of dividends, loans or advances, which restricted portion as calculated under U.S. GAAP amounted to approximately RMB3,559,861 and RMB5,057,086 as of December 31, 2017 and 2018, respectively. There are no differences between U.S. GAAP and PRC accounting standards in connection with the reported net assets of the legally owned subsidiaries in the PRC and the VIEs. Even though the Company currently does not require any such dividends, loans or advances from the PRC entities for working capital and other funding purposes, the Company may in the future require additional cash resources from them due to changes in business conditions, to fund future acquisitions and development, or merely to declare and pay dividends or distributions to our shareholders. Except for the above, there is no other restriction on use of proceeds generated by the Group’s subsidiaries and VIEs to satisfy any obligations of the Company. The Company performed a test on the restricted net assets of subsidiaries and VIEs in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08 (e) (3), “General Notes to Financial Statements” and concluded that the restricted net assets exceeded 25% of the consolidated net assets of the Company as of December 31, 2018 and the condensed financial information of the Company are required to be presented (Note 34). |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting | 33. Segment Reporting There are three segments in the Group, including YY Live, Huya and 100 Education, for the year ended December 31, 2016. The Company has disposed of a great majority of its online education business before the end of 2016 and disposed of the remaining portion of its online education business in the beginning of 2017, 100 Education Technology ceased to be an operating segment starting from the first quarter of 2017. The Company remained two segments, YY Live and Huya. In addition, the Company revamped its internal organization and one sub-business stream previously presented and reviewed under YY Live was changed to be presented and reviewed under Huya from the first quarter of 2017. Segment information of comparative periods has been restated accordingly. Starting from the three months ended December 31, 2017, the Company reviews the financial performance of the operating segments up to the net income of each segment. Segment information for comparative periods has been revised to be presented on the same basis as the year ended December 31, 2017. As the Group’s long-lived assets and revenue are substantially located in and derived from the PRC, no geographical segments are presented. The Group currently does not allocate assets to all of its segments, as its CODM does not use such information to allocate resources or evaluate the performance of the operating segments. The following table presents summary information by segment: For the year ended December 31, 2018: YY Live Huya Elimination Total RMB RMB RMB RMB Net revenues Live streaming 10,434,822 4,442,845 - 14,877,667 Others 667,350 220,595 (2,055 ) 885,890 Total net revenues 11,102,172 4,663,440 (2,055 ) 15,763,557 Cost of revenues (1) (6,083,487 ) (3,933,647 ) - (10,017,134 ) Gross profit 5,018,685 729,793 (2,055 ) 5,746,423 Operating expenses (1) Research and development expenses (926,900 ) (265,152 ) - (1,192,052 ) Sales and marketing expenses (962,164 ) (189,207 ) 2,055 (1,149,316 ) General and administrative expenses (595,515 ) (287,710 ) - (883,225 ) Total operating expenses (2,484,579 ) (742,069 ) 2,055 (3,224,593 ) Other income 78,922 38,938 - 117,860 Operating income 2,613,028 26,662 - 2,639,690 Interest expense (8,616 ) - - (8,616 ) Interest income and investment income 329,003 156,549 - 485,552 Foreign currency exchange (losses) gains, net (565 ) 51 - (514 ) Gain on deemed disposal and disposal of investments 16,178 - - 16,178 Gain on fair value changes of investment 1,487,405 - 201,999 1,689,404 Fair value loss on derivative liabilities - (2,285,223 ) - (2,285,223 ) Other non-operating expenses (2,000 ) - - (2,000 ) Income before income tax expenses 4,434,433 (2,101,961 ) 201,999 2,534,471 Income tax (expenses) benefits (501,683 ) 50,943 (26,967 ) (477,707 ) Income before share of loss in equity method investments, net of income taxes 3,932,750 (2,051,018 ) 175,032 2,056,764 Share of income in equity method investments, net of income taxes 120,636 113,329 (175,032 ) 58,933 Net income 4,053,386 (1,937,689 ) - 2,115,697 (1) Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 63,867 10,472 74,339 Research and development expenses 194,530 30,643 225,173 Sales and marketing expenses 3,891 1,832 5,723 General and administrative expenses 159,042 183,748 342,790 The following table presents summary information by segment: For the year ended December 31, 2017: YY Live Huya Total RMB RMB RMB Net revenues Live streaming 8,601,418 2,069,536 10,670,954 Others 808,558 115,280 923,838 Total net revenues 9,409,976 2,184,816 11,594,792 Cost of revenues (1) (5,096,538 ) (1,929,864 ) (7,026,402 ) Gross profit 4,313,438 254,952 4,568,390 Operating expenses (1) Research and development expenses (611,726 ) (170,160 ) (781,886 ) Sales and marketing expenses (603,989 ) (87,292 ) (691,281 ) General and administrative expenses (442,646 ) (101,995 ) (544,641 ) Goodwill impairment (2,527 ) - (2,527 ) Total operating expenses (1,660,888 ) (359,447 ) (2,020,335 ) Gain on deconsolidation and disposal of subsidiaries 37,989 - 37,989 Other income 103,558 9,629 113,187 Operating income (loss) 2,794,097 (94,866 ) 2,699,231 Interest expense (32,122 ) - (32,122 ) Interest income and investment income 166,335 14,049 180,384 Foreign currency exchange losses, net (2,176 ) - (2,176 ) Gain on deemed disposal and disposal of investments 45,861 - 45,861 Income (loss) before income tax expenses 2,971,995 (80,817 ) 2,891,178 Income tax expenses (415,811 ) - (415,811 ) Income (loss) before share of income (loss) in equity method investments, net of income taxes 2,556,184 (80,817 ) 2,475,367 Share of income (loss) in equity method investments, net of income taxes 33,175 (151 ) 33,024 N et income (loss) 2,589,359 (80,968 ) 2,508,391 (1) Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 39,882 2,877 42,759 Research and development expenses 113,174 9,174 122,348 Sales and marketing expenses 3,626 791 4,417 General and administrative expenses 60,871 27,266 88,137 For the year ended December 31, 2016: YY Live Huya 100 Education Total RMB RMB RMB RMB Net revenues Live streaming 6,235,249 791,978 - 7,027,227 Others 1,011,170 4,926 160,727 1,176,823 Total net revenues 7,246,419 796,904 160,727 8,204,050 Cost of revenues (1) (3,900,814 ) (1,094,644 ) (107,972 ) (5,103,430 ) Gross profit (loss) 3,345,605 (297,740 ) 52,755 3,100,620 Operating expenses (1) Research and development expenses (456,375 ) (188,334 ) (30,521 ) (675,230 ) Sales and marketing expenses (259,040 ) (68,746 ) (59,482 ) (387,268 ) General and administrative expenses (375,958 ) (71,325 ) (35,154 ) (482,437 ) Goodwill impairment (3,861 ) - (13,804 ) (17,665 ) Total operating expenses (1,095,234 ) (328,405 ) (138,961 ) (1,562,600 ) Gain on deconsolidation and disposal of subsidiaries 103,960 - - 103,960 Other income 129,504 - - 129,504 Operating income (loss) 2,483,835 (626,145 ) (86,206 ) 1,771,484 Interest expense (81,085 ) - - (81,085 ) Interest income and investment income 66,631 518 44 67,193 Foreign currency exchange gains, net 1,158 - - 1,158 Gain on deemed disposal and disposal of investments 25,061 - - 25,061 Income (loss) before income tax expenses 2,495,600 (625,627 ) (86,162 ) 1,783,811 Income tax (expenses) benefits (294,529 ) - 14,015 (280,514 ) Income (loss) before share of income (loss) in equity method investments, net of income taxes 2,201,071 (625,627 ) (72,147 ) 1,503,297 Share of income (loss) in equity method investments, net of income taxes 8,390 - (111 ) 8,279 Net income (loss) 2,209,461 (625,627 ) (72,258 ) 1,511,576 (1) Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya 100 Education Total RMB RMB RMB RMB Cost of revenues 9,893 5,677 324 15,894 Research and development expenses 53,085 19,538 6,193 78,816 Sales and marketing expenses 2,781 326 - 3,107 General and administrative expenses 19,523 26,557 13,389 59,469 |
Additional information - conden
Additional information - condensed financial statements | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Additional information - condensed financial statements | 34. Additional information – condensed financial statements The condensed financial statements of YY Inc. have been prepared in accordance with SEC Regulation S-X Rule 5-04 and Rule 12-04. The Company records its investments in subsidiaries and VIEs under the equity method of accounting. Such investments to subsidiaries and VIEs are presented on the balance sheet as “Interests in subsidiaries and VIEs” and the profit of the subsidiaries and VIEs is presented as “Share of profit of subsidiaries and VIEs” in the statement of comprehensive income. The footnote disclosures contain supplemental information relating to the operations of the Company and, as such, these financial statements should be read in conjunction with the notes to the consolidated financial statements of the Company. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. As of December 31, 2017 and 2018, there were no material contingencies, significant provisions for long-term obligations, or guarantees of the Company, except for those, if any, which have been separately disclosed in the consolidated financial statements. (a) Condensed balance sheets of YY Inc. as of December 31, 2017 and 2018 As of December 31, 2017 2018 2018 RMB RMB US$ (Note 2(e)) Assets Current assets Amounts due from a subsidiary 2,671,590 2,592,009 376,992 Non-current assets Interests in subsidiaries and VIEs 8,535,113 15,935,185 2,317,677 Total assets 11,206,703 18,527,194 2,694,669 Liabilities and shareholders’ equity Current liabilities Interests payable 777 39 6 Convertible bonds - 6,863 998 Short-term loans 588,235 - - Total current liabilities 589,012 6,902 1,004 Non-current liabilities Convertible bonds 6,536 - - Total liabilities 595,548 6,902 1,004 Shareholders’ equity Class A common shares (US$0.00001 par value; 10,000,000,000 shares authorized, 945,245,908 shares issued and outstanding as of December 31, 2017 and 981,740,848 shares issued and outstanding as of December 31, 2018) 57 59 9 Class B common shares (US$0.00001 par value; 1,000,000,000 shares authorized, 317,982,976 shares issued and outstanding as of December 31, 2017 and 288,182,976 shares issued and outstanding as of December 31, 2018) 23 21 3 Additional paid-in capital 5,339,844 11,168,866 1,624,444 Retained earnings 5,280,828 7,015,194 1,020,318 Accumulated other comprehensive (loss) income (9,597 ) 336,152 48,891 Total shareholders’ equity 10,611,155 18,520,292 2,693,665 Total liabilities and shareholders’ equity 11,206,703 18,527,194 2,694,669 (b) Condensed statements of comprehensive income of YY Inc. for the years ended December 31, 2016, 2017 and 2018 For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ (Note2(e)) Share of profit of subsidiaries and VIEs 1,605,003 2,545,045 2,211,452 321,642 Interest expense (81,085 ) (32,122 ) (2,445 ) (357 ) Net income attributable to controlling interest of the Company 1,523,918 2,512,923 2,209,007 321,285 Other comprehensive income (loss) : Unrealized gain (loss) of available-for-sale securities 134,768 (41,150 ) - - Foreign currency translation adjustments, net of nil tax (5,317 ) (61,513 ) 434,080 63,134 Total comprehensive income 1,653,369 2,410,260 2,643,087 384,419 (c) Condensed statements of cash flows of YY Inc. for the years ended December 31, 2016, 2017 and 2018 For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ (Note2(e)) Cash flows from operating activities - - - - Cash flows from investing activities Repayment of loans from a subsidiary - 2,132,512 195,091 28,375 Loans to a subsidiary - (2,950,607 ) - - Net cash (used in) provided by investing activities - (818,095 ) 195,091 28,375 Cash flows from financing activities Proceeds from bank borrowings - 621,118 - - Proceeds from issuance of common shares, net of issuance cost - 2,950,607 (4,473 ) (651 ) Partial disposal of subsidiary’s interests to non-controlling interest shareholders - - 378,548 55,058 Repayment of bank borrowings - - (569,166 ) (82,782 ) Repayment of convertible bonds - (2,753,630 ) - - Net cash provided by (used in) financing activities - 818,095 (195,091 ) (28,375 ) Net increase in cash and cash equivalents - - - - Cash and cash equivalents at the beginning of the year - - - - Cash and cash equivalents at the end of the year - - - - |
Principal accounting policies (
Principal accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of presentation | (a) Basis of presentation The consolidated financial statements of the Group have been prepared in accordance with the U.S. GAAP to reflect the financial position, results of operations and cash flows of the Group. Significant accounting policies followed by the Group in the preparation of the consolidated financial statements are summarized below. |
Consolidation | (b) Consolidation The Group’s consolidated financial statements include the financial statements of the Company, its subsidiaries and VIEs for which the Company or its subsidiary is the primary beneficiary. All transactions and balances among the Company, its subsidiaries and VIEs have been eliminated upon consolidation. A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting powers; or has the power to appoint or remove the majority of the members of the board of directors; or to cast a majority of votes at the meeting of directors; or has the power to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders. A VIE is an entity in which the Company, or its subsidiary, through contractual agreements, bears the risks of, and enjoys the rewards normally associated with ownership of the entity, and therefore the Company or its subsidiary is the primary beneficiary of the entity. In determining whether the Company or its subsidiaries are the primary beneficiary, the Company considered whether it has the power to direct activities that are significant to the VIEs economic performance, and also the Company’s obligation to absorb losses of the VIEs that could potentially be significant to the VIEs or the right to receive benefits from the VIEs that could potentially be significant to the VIEs. Beijing Huanju Shidai, Bilin Changxiang, Huya Technology, 100 Edu Technology and ultimately the Company hold all the variable interests of the VIEs and have been determined to be the primary beneficiary of the VIEs. The Company deconsolidates its subsidiaries in accordance with ASC 810 as of the date the Company ceased to have a controlling financial interest in the subsidiaries. The Company accounts for the deconsolidation of its subsidiaries by recognizing a gain or loss in net income/loss attributable to the Company in accordance with ASC 810. This gain or loss is measured at the date the subsidiaries are deconsolidated as the difference between (a) the aggregate of the fair value of any consideration received, the fair value of any retained non-controlling interest in the subsidiaries being deconsolidated, and the carrying amount of any non-controlling interest in the subsidiaries being deconsolidated, including any accumulated other comprehensive income/loss attributable to the non-controlling interest, and (b) the carrying amount of the assets and liabilities of the subsidiaries being deconsolidated. |
Use of estimates | (c) Use of estimates The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, mezzanine equity and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period in the consolidated financial statements and accompanying notes. Actual results could differ materially from such estimates. The Company believes that the assessment of whether the Group acts as a principal or an agent in different revenue streams, classification of perpetual items versus consumable items under item-based model, the determination of estimated selling prices of multiple elements revenue contracts, income taxes, allowances for doubtful accounts, determination of share-based compensation expenses, impairment assessment of goodwill, long-lived assets and intangible assets, tax considerations for earnings retained in the Group’s VIEs, assessment on the probability of performance condition affiliated in equity-classified award under ASC 718 that affect vesting, determination of the fair value of derivative liabilities arising from Huya’s Preferred Shares prior to Huya’s IPO, subsequent adjustment due to significant observable price change for the equity investments without readily determinable fair values and not accounted for by the equity method, represent critical accounting policies that reflect more significant judgments and estimates used in the preparation of its consolidated financial statements. Management bases the estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from these estimates. |
Foreign currency translation | (d) Foreign currency translation The Group uses Renminbi (“RMB”) as its reporting currency. The functional currency of the Company and its subsidiaries incorporated in the Cayman Islands, British Virgin Islands, Hong Kong and Singapore is United States dollar (“US$”), while the functional currency of the other entities and VIEs in the Group is RMB, which is their respective local currency. In the consolidated financial statements, the financial information of the Company and its subsidiaries, which use US$ as their functional currency, have been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, expenses, gains, and losses are translated using the average exchange rate for the period. Translation adjustments arising from these are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income or loss in the statement of comprehensive income. Foreign currency transactions denominated in currencies other than functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are remeasured at the applicable rates of exchange in effect at that date. Foreign exchange gains and losses resulting from the settlement of such transactions and from remeasurement at year-end are recognized in foreign currency exchange gains/losses, net in the consolidated statement of comprehensive income. |
Convenience translation | (e) Convenience translation Translations of amounts from RMB into US$ for the convenience of the reader were calculated at the noon buying rate of US$1.00 = RMB 6.8755 on December 31, 2018 as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted into US$ at such rate. |
Cash and cash equivalents | (f) Cash and cash equivalents Cash includes currency on hand and deposits held by financial institutions that can be added to or withdrawn without limitation. Cash equivalents represent short-term and highly liquid investments placed with banks, which have both of the following characteristics: i) Readily convertible to known amounts of cash throughout the maturity period; ii) So near their maturity that they present insignificant risk of changes in value because of changes in interest rates. The Group considers all highly liquid investments with original maturities of three months or less as cash equivalents. In November 2016, the FASB issued new guidance related to the classification of restricted cash in the statement of cash flows. The new standard requires that a statement of cash flows explain any change during the year in total cash, cash equivalents, and restricted cash. The new standard is effective for fiscal years beginning after December 15, 2017, and should be applied retrospectively. The Company adopted the new standard during the beginning of 2018 and applied the standard retrospectively for all periods presented. Cash, cash equivalents and restricted cash presented on the consolidated statements of cash flows included cash and cash equivalents and restricted short-term deposits in the consolidated balance sheets. As of Decmber 31, 2017, cash, cash equivalents and restricted cash presented in the consolidated statement of cash flows is 3,617,432, including cash and cash equivalents of RMB2,617,432 and restricted short-term deposits of RMB1,000,000 in the consolidated balance sheet, respectively. As of Decmber 31, 2018, cash, cash equivalents and restricted cash presented in the consolidated statement of cash flows is 6,004,231, including cash and cash equivalents of RMB6,004,231 and restricted short-term deposits of nil in the consolidated balance sheet, respectively. |
Short-term deposits | (g) Short-term deposits Short-term deposits represent time deposits placed with banks with original maturities between three months and one year. Interest earned is recorded as interest income in the consolidated statements of comprehensive income during the periods presented. |
Long-term deposits | (h) Long-term deposits Long-term deposits represent time deposits placed with banks with original maturities more than one year. Interest earned is recorded as interest income in the consolidated statements of comprehensive income during the periods presented. |
Short-term investments | (i) Short-term investments For investments in financial instruments with a variable interest rate indexed to the performance of underlying assets, the Group elected the fair value method at the date of initial recognition and carried these investments subsequently at fair value. Changes in fair values are reflected in the consolidated statements of comprehensive income. |
Accounts receivable | (j) Accounts receivable Accounts receivable are presented net of allowance for doubtful accounts. The Group uses specific identification in providing for bad debts when facts and circumstances indicate that collection is doubtful and a loss is probable and estimable. If the financial conditions of its customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowance may be required. The Group maintains an allowance for doubtful accounts which reflects its best estimate of amounts that potentially will not be collected. The Group determines the allowance for doubtful accounts on an individual basis taking into consideration various factors including but not limited to historical collection experience and credit-worthiness of the debtors as well as the age of the individual receivables balance. Additionally, Group makes specific bad debt provisions based on any specific knowledge Group has acquired that might indicate that an account is uncollectible. The facts and circumstances of each account may require Group to use substantial judgment in assessing its collectability. |
Financing receivables | (k) Financing receivables Financing receivables represent receivables derived from finance business, including micro-credit personal loans and corporate loans. Financing receivables are recorded at amortized cost, reduced by a valuation allowance estimated as of the balance sheet date. The amortized cost is equal to the unpaid principal amount, accrued interest receivables and net deferred origination costs. The origination costs are the direct costs attributable to originating the financing charged by third-party companies. The cash flows related to the principal of finance business are included in the investing activities category in the consolidated statement of cash flows. Micro-credit personal loans The Group provides micro loans to qualified individual borrowers. The micro loan periods granted to the borrowers generally range from one month to twelve months. Corporate loans The Group provides loans to corporate borrowers mainly through sales-and-leaseback model. Under the sales-and-leaseback arrangement, the Group, who is also the lender, purchases machinery and equipment from lessees, who are also the borrowers, and leases the purchased equipment back to the lessees for a number of years. In a sales-and-leaseback arrangement, the transaction is in substance a collateral financing. Allowance for financing receivables The Group assesses the allowance for financing receivables either on an individual or collective basis. The Group estimates and evaluates the allowance amounts and whether such amounts are adequate to cover potential losses, and periodic reviews are performed to ensure such amounts continue to reflect the best estimate of the losses inherent in the outstanding portfolio of debts. The estimate is based on a pooled basis due to the composition of homogeneous financing with similar size and general credit risk characteristics for similar finance businesses. The Group considers the credit worthiness of the individuals and the companies receiving financing, aging of the outstanding financing receivables, value of the collateral assets and other specific circumstances related to the financing when determining the allowance for financing receivables. Financing receivables are placed on non-accrual status upon reaching 90 days past due or when reasonable doubt exists in timely collection of the financing receivables. When a financing receivable is placed on non-accrual status, the Group stops accruing financing income. Financing receivable is returned to accrual status if the related individual or company has performed in accordance with the contractual terms for a reasonable period of time and, in the Group’s judgment, will continue to make period principal and financing income payments as scheduled. |
Investment | (l) Investments ASU 2016-01 (“ASU 2016-01”), Recognition and Measurement of Financial Assets and Financial Liabilities amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The main provisions require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value through earnings, unless they qualify for a measurement alternative. The new guidance requires modified retrospective application to all outstanding instruments beginning January 1, 2018, with a cumulative effect adjustment recorded to opening accumulated deficit as of the beginning of the first period in which the guidance becomes effective. However, changes to the accounting for equity securities without a readily determinable fair value would be applied prospectively. The Group adopted the new financial instruments accounting standard from January 1, 2018. Following the adoption of this guidance, accumulated fair value gain, amounting to RMB87.8 million, was reclassified from accumulated other comprehensive loss to retained earnings as of January 1, 2018. Equity Investments with Readily Determinable Fair Values Equity investments with readily determinable fair values are measured and recorded at fair value using the market approach based on the quoted prices in active markets at the reporting date. The Group classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. Equity Investments without Readily Determinable Fair Values After the adoption of this new accounting standard, the Group elected to record equity investments without readily determinable fair values and not accounted for under the equity method at cost, less impairment, adjusted for subsequent observable price changes on a nonrecurring basis, and report changes in the carrying value of the equity investments in current earnings. Changes in the carrying value of the equity investments are required to be made whenever there are observable price changes in orderly transactions for the identical or similar investment of the same issuer. The implementation guidance notes that an entity should make a “reasonable effort” to identify price changes that are known or that can reasonably be known. Equity Investments Accounted for Using the Equity Method The Group accounts for its equity investment over which it has significant influence but does not own a majority equity interest or otherwise control using the equity method. The Group adjusts the carrying amount of the investment and recognizes investment income or loss for share of the earnings or loss of the investee after the date of investment. The Group assesses its equity investment for other-than-temporary impairment by considering factors including, but not limited to, current economic and market conditions, operating performance of the entities, including current earnings trends and undiscounted cash flows, and other entity-specific information. The fair value determination, particularly for investment in privately held entities, requires judgment to determine appropriate estimates and assumptions. Changes in these estimates and assumptions could affect the calculation of the fair value of the investment and determination of whether any identified impairment is other-than-temporary. |
Property and equipment | (m) Property and equipment Property and equipment are stated at historical cost less accumulated depreciation and impairment loss, if any. Depreciation is calculated using the straight-line method over their estimated useful lives. Residual rate is determined based on the economic value of the property and equipment at the end of the estimated useful lives as a percentage of the original cost. Estimated useful lives Residual rate Buildings 40 years 0 % Servers, computers and equipment 3 years 0%-5 % Leasehold improvements Shorter of lease term or 5 years 0 % Decoration of buildings 10 years 0 % Motor vehicles 4 years 5 % Furniture, fixture and office equipment 5 years 0%-5 % Expenditures for maintenance and repairs are expensed as incurred. The gain or loss on the disposal of property and equipment is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the consolidated statements of comprehensive income. All direct and indirect costs that are related to the construction of property and equipment and incurred before the assets are ready for their intended use are capitalized as construction in progress. Construction in progress is transferred to specific property and equipment items and depreciation of these assets commences when they are ready for their intended use. |
Business combinations | (n) Business combinations Business combinations are recorded using the purchase method of accounting, and the cost of an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued as well as the contingent considerations and all contractual contingencies as of the acquisition date. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total of consideration of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the subsidiary acquired over (ii) the fair value of the identifiable net assets of the subsidiary acquired is recorded as goodwill. If the consideration of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of comprehensive income. |
Intangible assets | (o) Intangible assets Intangible assets mainly consist of operating rights, software, domain names, technology and license. Identifiable intangible assets are carried at acquisition cost less accumulated amortization and impairment loss, if any. Finite-lived intangible assets are tested for impairment if impairment indicators arise. Amortization of finite-lived intangible assets is computed using the straight-line method over their estimated useful lives, which are as follows: Estimated useful lives Operating rights Shorter of the economic life or contract terms Software 3 -5 years Domain names 15 years Technology 5 years License 15 years |
Land use right | (p) Land use rights Land use rights are carried at cost less accumulated amortization. Amortization of the land use rights is made on straight-line basis over 40 years from the date when the Group first obtained the land use rights certificate from the local authorities. |
Impairment of long-lived assets | (q) Impairment of long-lived assets For long-lived assets other than investments and goodwill whose impairment policy is discussed elsewhere in the financial statements, the Group evaluates for impairment whenever events or changes (triggering events) indicate that the carrying amount of an asset may no longer be recoverable. The Group assesses the recoverability of the long-lived assets by comparing the carrying value of the long-lived assets to the estimated undiscounted future cash flows expected to receive from use of the assets and their eventual disposition. Such assets are considered to be impaired if the sum of the expected undiscounted cash flows is less than the carrying amount of the assets. The impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Group tests impairment of long-lived assets at the reporting unit level when impairment indicator appeared and recognizes impairment in the event that the carrying value exceeds the fair value of each reporting unit. The impairment charges of intangible assets recorded in general and administrative expenses for the years ended December 31, 2016, 2017 and 2018 were amounting to RMB3,828, nil and nil, respectively. |
Goodwill | (r) Goodwill Goodwill represents the excess of the purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of an acquired business. |
Annual test for impairment of goodwill | (s) Annual test for impairment of goodwill Goodwill assessment for impairment is performed on at least an annual basis on October 1 or whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. The Group performs a two-step goodwill impairment test. The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill is not considered impaired and the second step will not be required. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of the affected reporting unit’s goodwill to the carrying value of that goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. This allocation process is only performed for purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or liabilities. An impairment loss is recognized for any excess in the carrying value of goodwill over the implied fair value of goodwill. The judgment in estimating the fair value of reporting units includes estimating future cash flows, determining appropriate discount rates and making other assumptions. Changes in these estimates and assumptions could materially affect the determination of the fair value of each reporting unit. |
Convertible bonds | (t) Convertible bonds The Group determines the appropriate accounting treatment of its convertible bonds in accordance with the terms in relation to the conversion feature, call and put options, and beneficial conversion feature. After considering the impact of such features, the Group may account for such instrument as a liability in its entirety, or separate the instrument into debt and equity components following the respective guidance described under ASC 815 Derivatives and Hedging and ASC 470 Debt. The debt discount, if any, together with related issuance cost are subsequently amortized as interest expense, using the effective interest method, from the issuance date to the earliest conversion date. Interest expenses are recognized in the statement of comprehensive income in the period in which they are incurred. |
Mezzanine equity and non-controlling interest | (u) Mezzanine equity and non-controlling interests Mezzanine equity For the Company’s majority-owned subsidiaries and consolidated VIEs, a non-controlling interest is recognized to reflect the portion of their equity which is not attributable, directly or indirectly, to the Company. When the non-controlling interest is contingently redeemable upon the occurrence of a conditional event, which is not solely within the control of the Company, the non-controlling interest is classified as mezzanine equity. In accordance with ASC subtopic 480-10, the Group calculated, on an accumulative basis from the acquisition date, (i) the amount of accretion that would increase the balance of non-controlling interests to their estimated redemption value over the period from the date of acquisition to the earliest redemption date of the non-controlling interests and (ii) the amount of net (loss) profit attributable to non-controlling shareholders of certain subsidiaries based on their ownership percentage. The carrying value of the non-controlling interests as mezzanine equity was adjusted by an accumulative amount equal to the higher of (i) and (ii). Each type of increase in carrying amount shall be recorded as charges against retained earnings or, in the absence of retained earnings, by charges against additional paid-in capital. Non-controlling interests Non-controlling interests are recognized to reflect the portion of the equity of majority-owned subsidiaries and VIEs which is not attributable, directly or indirectly, to the controlling shareholder. |
Revenue recognition | Revenue recognition and significant judgments For the year ended December 31, 2018, revenue presentation has been changed to live streaming and others to better reflect the way the Group generates revenues. The revenue presentation for the years ended December 31, 2016 and 2017 are also retrospectively changed to be consistent with the year ended December 31, 2018. Revenues from live streaming are mainly generated from YY Live platform and Huya platform. Other revenues are mainly generated from online games, membership, online education, advertising and finance business. Disaggregated revenues are disclosed in Note 33 “Segment Reporting”. On January 1, 2018, the Group adopted ASC 606, “Revenue from Contracts with Customers” using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Group’s historic accounting under Topic 605. Based on the Group’s assessment, the adoption of ASC 606 did not result in any adjustment on the Group’s consolidated financial statements, and there were no material differences between the Group’s adoption of ASC 606 and its historic accounting under ASC 605. Revenues are recognized when control of the promised virtual items or services is transferred to the Group’s customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those virtual items or services. The Group has a recharge system for users to purchase the Group’s virtual currency. Users can recharge via various online payment platforms provided by third parties. Virtual currency is non-refundable and without expiry. As the virtual currency is often consumed soon after it is purchased based on history of turnover, the Group considers the impact of the breakage amount for virtual currency coupons is insignificant. Unconsumed virtual currency is recorded as deferred revenue. Virtual currencies used to purchase virtual items are recognized as revenue according to the prescribed revenue recognition policies of virtual items addressed below unless otherwise stated. (i) Live streaming Live streaming mainly consists of YY Live platform and Huya platform. It generates revenue from sales of virtual items in the platforms. Users can access the platforms and view the live streaming content showed by the performers. The Group shares a portion of the sales proceeds of virtual items (“revenue sharing fee”) with performers and talent agencies in accordance with their revenue sharing arrangements. Those performers who do not have revenue sharing arrangements with the Group are not entitled to any revenue sharing fee. The Group evaluates and determines that it is the principal and views users to be its customers. The Group reports live streaming revenues on a gross basis. Accordingly, the amounts billed to users are recorded as revenues and revenue sharing fee paid to performers and talent agencies are recorded as cost of revenues. Where the Group is the principal, it controls the virtual items before they are transferred to users. Its control is evidenced by the Group’s sole ability to monetize the virtual items before they are transferred to users, and is further supported by the Group being primarily responsible to users and having a level of discretion in establishing pricing. The Group designs, creates and offers various virtual items for sales to users with pre-determined selling price. Sales proceeds are recorded as deferred revenue and recognized as revenue based on the consumption of the virtual items. Virtual items are categorized as consumable and time-based items. Consumable items are consumed upon purchase and use while time-based items could be used for a fixed period of time. Users can purchase and present consumable items to performers to show support for their favorite performers, or purchase time-based virtual items for one or multiple months for a monthly fee, which provide users with recognized status, such as priority speaking rights or special symbols over a period of time. Accordingly, live streaming revenue is recognized immediately when the consumable virtual item is used, or in the case of time-based virtual items, revenue is recognized ratably over the fixed period on a straight-line basis. The Group does not have further obligations to the user after the virtual items are consumed immediately or after the stated period of time for time-based items. The Group may also enter into contracts that can include various combinations of virtual items, which are generally capable of being distinct and accounted for as separate performance obligations, such as noble member program. Judgments are required as follow: 1) determining whether those virtual items are considered distinct performance obligations that should be accounted for separately versus together, 2) determining the standalone selling price for each distinct performance obligation, and 3) allocating of the arrangement consideration to the separate accounting of each distinct performance obligation based on their relative standalone selling prices. In instances where standalone selling price is not directly observable as the Group does not sell the virtual item separately, the Group determines the standalone selling price based on pricing strategies, market factors and strategic objectives. The Group recognizes revenue for each of the distinct performance obligations identified in accordance with the applicable revenue recognition method relevant for that obligation. As the Group’s live streaming virtual items are generally sold without right of return and the Group does not provide any other credit and incentive to its users, therefore accounting of variable consideration when estimating the amount of revenue to recognize is not applicable to the Group’s live streaming business. (ii) Others Other revenues mainly generated from online games, membership, online education, advertising and finance business. (1) Online games revenues The Group generates revenues from offering virtual items in online games developed by third parties or the Group itself to game players. Historically, the majority of online games revenues for the three years ended December 31, 2016, 2017 and 2018 were derived from third parties developed games. Users play games through the Group’s platform free of charge and are charged for purchases of virtual items, including consumable and perpetual items, which can be utilized in the online games to enhance their game-playing experience. Consumable items represent virtual items that can be consumed by a specific user within a specified period of time. Perpetual items represent virtual items that are accessible to the users’ account over the life of the online games. Pursuant to contracts signed between the Group and the respective game developers, game developers own the games’ copyrights and other intellectual property, and take primary responsibilities of game development and game operation, including designing, developing and updating of the games related to game content, pricing of virtual items, providing ongoing updates of new contents and bug fixing. The Group’s responsibilities under the agreements with the game developers to offer certain standard promotions that include providing access to the platform, announcing the new games to users on the platform, and occasional advertising on the Group’s platforms. Therefore, revenues derived from third party developed games are recorded on a net basis, net of the amount paid to game developers. Given that third party developed games are managed and administered by the third party game developers, the Group does not have access to the data on the consumption details such as when the game token is spent on the virtual items or the types of virtual items (consumable or perpetual items) purchased by each individual game player. However, the Group maintains historical data on timing of the conversion of its virtual currency into game specific tokens and the amount of purchases of game tokens. The Group believes that its responsibility to the game developers correspond to the game developers’ services to the users. The Group has adopted a policy to recognize revenues relating to game tokens for third party developed games over the estimated user relationship period with the Group on a game-by-game basis, which is approximately one to six months for the periods presented. Future usage patterns may differ from historical usage patterns and therefore the estimated user relationship period with the Group may change in the future. The estimated user relationship period is based on data collected from those users who have acquired game tokens. To estimate the user relationship period, the Group maintains a system that captures the following information for each user: (a) the frequency that users log into each game via the Group’s platform, and (b) the amount and the timing of when the users convert or charge his or her game tokens. The Group estimates the user relationship period for a particular game to be the date a player purchases or converts from virtual currency to a game token through the date the Group estimates the user plays the game for the last time. This computation is performed on a user by user basis. Then, the results for all analyzed users are averaged to determine an estimated end user relationship period for each game. Revenues from in-game payments of each month are recognized over the user relationship period estimated for that game. The consideration of user relationship period with each online game is based on the Group’s best estimate that takes into account all known and relevant information at the time of assessment. The Group assesses the estimated user relationship period for each game on a quarterly basis. Any adjustments arising from changes in the user relationship period as a result of new information will be accounted as a change in accounting estimate in accordance with ASC 250 Accounting Changes and Error Corrections. (2) Membership The Group operates a membership subscription program where subscription members can have enhanced user privileges when using YY Client and live streaming channels. The membership fee is collected up-front from subscribers. The receipt of the revenue is initially recorded as deferred revenue and revenue is recognized ratably over the period of the subscription when services are rendered. Unrecognized portion beyond 12 months from balance sheet date is classified as long-term deferred revenue. (3) Online education revenues Educational programs and services consist of vocational training, language training courses and K-12 afterschool education courses. The course fee is generally paid in advance and is initially recorded as deferred revenue. Revenue for regular courses is recognized proportionately as the classes are attended, and is reported net of scholarships and course fee refunds. Students are entitled to one trial class of the purchased course and course fee is fully refundable if a student decides not to take the remaining course after the trial class. No refund will be provided to a student who withdraws from a course after the trial period, and revenue is recognized for the amount collected. Course fee refunds were insignificant over the period presented. In addition to regular courses, Group also provides a package of several regular courses to students, which has individual fair value in the market. Pursuant to the applicable accounting guidance, Group has accounted for these course packages as a multiple-element arrangement because each individual course qualifies as a single unit of accounting, and allocated the course fee from the course package to each individual course in the package based on its stand alone selling price. Group recognizes revenue equal to the fair value allocated to individual courses proportionately as the classes are attended. Students are granted a right to retake the courses at a substantial discount in the circumstances where the students fail to achieve certain score targets for some specific courses. The discount arrangement has a stand-alone value and qualifies as a separate unit of accounting under U.S. GAAP. Therefore, Group has accounted for those courses as a multiple-element arrangement and allocated a portion of the initial course fee to the substantial discount based on a breakage rate. The breakage rate is determined based on our historical data. The amount allocated to the substantial discount is deferred and recognized as revenue upon the expiration of the retaking right, which is generally six months after the end of the initial course term. Group also sells pre-paid cards primarily to distributors. Pre-paid card sales represent prepaid service fees received from students for online courses. The prepaid service fee is recorded as deferred revenue upon receiving the upfront cash payment. Revenue is recognized on a gross basis based on the selling price of the distributors to the students and is recognized over the period the online course is available to the students, which generally is from the enrolment date to the completion of the relevant professional examination date. (4) Advertising revenues The Group primarily generate advertising revenues from sales of various forms of advertising and provision of promotion campaigns on the live streaming platforms by way of advertisement display or integrated promotion activities in shows and programs on the live streaming platforms. Advertisements on the Group’s platforms are generally charged on the basis of duration, and advertising contracts are signed to establish the fixed price and the advertising services to be provided. Where collectability is reasonably assured, advertising revenues from advertising contracts are recognized ratably over the contract period of display. The Group enters into advertising contracts directly with advertisers or third-party advertising agencies that represent advertisers. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 1 to 3 months. Both third-party advertising agencies and direct advertisers are generally billed at the end of the display period and payments are due usually within 3 months. In instances where the timing of revenue recognition differs from the timing of billing, the Group has determined the advertising contracts generally do not include a significant financing component. The primary purpose of the credits terms is to provide customers with simplified and predictable ways of purchasing the Group’s advertising services, not to receive financing from its customers or to provide customers with financing. Certain customers may receive sales incentives in the forms of discounts and rebates to advertisers or advertising agencies based on purchase volume, which are accounted for as variable consideration. The Group estimates these amounts based on the expected amount to be provided to customers considering the contracted rebate rates and estimated sales volume based on historical experience, and reduce revenues recognized. The Group believes that there will not be significant changes to the estimates of variable consideration. (5) Financing revenues The Group generates revenues from micro-credit personal loans provided to individual borrowers and corporate loans to corporate customers. The Group recognizes financing income related to those services over the life of the underlying financing using the effective interest method on unpaid principal amounts after net of loan origination cost. The Group does not accrue financing revenues when a financing receivables is placed on non-accrual status. Financing revenues will be recognized when cash is received on a cash basis cost recovery method by applying first to reduce principal and then to interests thereafter. Contract balances The Group collects accounts receivable from various online payment platforms, distribution platforms and advertising customers. The allowance for doubtful accounts reflects the Group’s best estimate of probable losses inherent in the accounts receivable balance. The Group determines the allowance based on known troubled accounts, historical experience, and other currently available evidence. The activity in the allowance for doubtful accounts for the periods presented is disclosed and detailed in Note 9 . The opening balance of accounts receivable was RMB169,571 as of January 1, 2017. As of December 31, 2017 and 2018, accounts receivable were RMB153,944 and RMB198,428, Contract liabilities primarily consists of deferred revenue for unconsumed virtual items and unamortized revenue from virtual items in the Group’s platforms, where there is still an obligation to be provided by the Group, which will be recognized as revenue when all of the revenue recognition criteria are met. The opening balance of deferred revenue related to live streaming business as of January 1, 2017 was RMB320,547. As of December 31, 2017 and 2018, deferred revenue related to live streaming business were RMB682,613 and RMB922,774 respectively. During the years ended December 31, 2017 and 2018, the Group recognized revenue of live streaming business amounted to RMB308,545 and RMB637,346, respectively, that was included in the corresponding contract liability balance at the beginning of the periods. The opening balance of deferred revenue related to other revenue as of January 1, 2017 was RMB135,595. As of December 31, 2017 and 2018, deferred revenue related to other revenue were RMB133,149 and RMB120,552, respectively. During the years ended December 31, 2017 and 2018, the Group recognized revenue of other revenue amounted to RMB122,138 and RMB120,698, respectively, that was included in the corresponding contract liability balance at the beginning of the periods. . During the years ended December 31, 2016, 2017 and 2018, the Group does not have any arrangement where the performance obligations have already been satisfied in the past year, but the corresponding revenue is recognized in a later year. As of December 31, 2018, the aggregate amount of the transaction price allocated to the remaining performance obligation is RMB1,043,326, the Group expects to recognize RMB951,616 performance obligation as revenue in 2019, the remaining performance obligation is expected to be recognized as revenue in 2020 and after years. However, the amount and timing of revenue recognition is largely driven by customer usage, which can extend beyond the original contractual term. |
Advances from customers and deferred revenue | (w) Advances from customers and deferred revenue Advances from customers primarily consist of prepayments from users in the form of the Group’s virtual currency that are not yet consumed or converted into game tokens, and upon the consumption or conversion, are recognized as revenue according to the prescribed revenue recognition policies described above. Deferred revenue primarily consists of the unamortized game tokens, prepaid subscriptions under the membership program and unamortized revenue from virtual items in various channels in the Group’s platforms, where there is still an implied obligation to be provided by the Group, which will be recognized as revenue when all of the revenue recognition criteria are met. |
Cost of revenues | (x) Cost of revenues Amounts recorded as cost of revenue relate to direct expenses incurred in order to generate revenue. Such costs are recorded as incurred. Cost of revenues primarily consists of (i) revenue sharing fees and content costs, including payments to various channel owners and performers, and content providers, (ii) bandwidth costs, (iii) salary and welfare, (iv) depreciation and amortization expense for servers, other equipment and intangibles directly related to operating the platform, (v) payment handling cost, (vi) share-based compensation, (vii) other taxes and surcharges, and (viii) other costs. The Group was subject to cultural development fee at a tax rate of 3% on service income from provision of advertising services in the PRC. The Group was also subject to surcharges of VAT, which are calculated based on 12% of the VAT paid for the years ended December 31, 2016, 2017 and 2018. The Group reported other taxes and surcharges, and cultural development fees in cost of revenues. Based on the Group’s corporate structure and the contractual arrangements among the Group’s PRC subsidiaries, the Group’s VIEs and their shareholders, the Group is effectively subject to 6% 17% VAT and related surcharges on revenues generated by the Group’s subsidiaries based on the Group’s contractual arrangements entered into with the Group’s VIEs. |
Research and development expenses | (y) Research and development expenses Research and development expenses primarily consist of (i) salary and welfare for research and development personnel, (ii) share-based compensation for research and development personnel, (iii) depreciation of office premise and servers utilized by research and development personnel, and (iv) rental expenses. Costs incurred during the research stage are expensed as incurred. Costs incurred in the development stage, prior to the establishment of technological feasibility, which is when a working model is available, are expensed when incurred. The Group recognizes internal use software development costs in accordance with guidance on intangible assets and internal use software. This requires capitalization of qualifying costs incurred during the software’s application development stage and to expense costs as they are incurred during the preliminary project and post implementation/operation stages. The Group has not capitalized any costs related to internal use software during the years ended December 31, 2016, 2017 and 2018, respectively. |
Sales and marketing expenses | (z) Sales and marketing expenses Sales and marketing expenses primarily consist of (i) advertising and market promotion expenses, and (ii) salary and welfare for sales and marketing personnel. The advertising and market promotion expenses amounted to approximately RMB298,681, RMB621,771 and RMB1,065,866 during the years ended December 31, 2016, 2017 and 2018, respectively. |
General and administrative expenses | (aa) General and administrative expenses General and administrative expenses primarily consist of (i) share-based compensation for management and administrative personnel, (ii) salary and welfare for general and administrative personnel, and (iii) professional service fees. |
Employee social security and welfare benefits | (bb) Employee social security and welfare benefits Employees of the Group in the PRC are entitled to staff welfare benefits including pension, work-related injury benefits, maternity insurance, medical insurance, unemployment benefit and housing fund plans through a PRC government-mandated multi-employer defined contribution plan. The Group is required to accrue for these benefits based on certain percentages of the employees’ salaries, up to a maximum amount specified by the local government. The Group is required to make contributions to the plans out of the amounts accrued. The PRC government is responsible for the medical benefits and the pension liability to be paid to these employees and the Group’s obligations are limited to the amounts contributed and no legal obligation beyond the contributions made. Employee social security and welfare benefits included as expenses in the accompanying statements of comprehensive income amounted to RMB206,704, RMB214,848 and RMB286,139 for the years ended December 31, 2016, 2017 and 2018, respectively. |
Share based compensation | (cc) Share-based compensation The Group grants stock-based award, such as, but not limited to, share options, restricted shares, restricted share units of the Company, share option, restricted share units and ordinary shares of the Company’s subsidiaries to eligible employees, officers, directors, and non-employee consultants. Awards granted to employees, officers, and directors are initially accounted for as equity-classified awards. The related share-based compensation expenses are measured at the grant date fair value of the award and are recognized using the graded vesting method, net of estimated forfeiture rates, over the requisite service period, which is generally the vesting period. Forfeitures are estimated at the time of grant based on historical forfeiture rates and will be revised in the subsequent periods if actual forfeitures differ from those estimates. The Group also granted share options, restricted shares and restricted share units to non-employees, which are also initially accounted for as equity-classified awards. Awards granted to non-employees are initially measured at fair value on the grant date and periodically remeasured thereafter until the earlier of the performance commitment date or the date the service is completed and recognized over the period the service is provided. Awards are remeasured at each reporting date using the fair value as at each period end until the measurement date, generally when the services are completed and share-based awards are vested. Changes in fair value between the interim reporting dates are recorded in consistent with the method used in recognizing the original compensation costs. For an award with a performance and/or service condition that affects vesting, the performance and/or service condition is not considered in determining the award’s fair value on the grant date. Performance and service conditions should be considered when the Group is estimating the quantity of awards that will vest. Compensation cost will reflect the number of awards that are expected to vest and will be adjusted to reflect those awards that do ultimately vest. The Group recognizes compensation cost for awards with performance conditions if and when the Group concludes that it is probable that the performance condition will be achieved, net of an estimate of pre-vesting forfeitures over the requisite service period. The Group reassesses the probability of vesting at each reporting period for awards with performance conditions and adjusts compensation cost based on its probability assessment, unless on certain situations, the Group may not be able to determine that it is probable that a performance condition will be satisfied until the event occurs. ASU 2017-09, Compensation—Stock Compensation (Topic 718), Scope of Modification Accounting, provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. An entity should account for the effects of a modification unless all the followings are met: - The fair value (or calculated value or intrinsic value, if such an alternative measurement method is used) of the modified award is the same as the fair value (or calculated value or intrinsic value, if such an alternative measurement method is used) of the original award immediately before the original award is modified. If the modification does not affect any of the inputs to the valuation technique that the entity uses to value the award, the entity is not required to estimate the value immediately before and after the modification. - The vesting conditions of the modified award are the same as the vesting conditions of the original award immediately before the original award is modified. - The classification of the modified award as an equity instrument or a liability instrument is the same as the classification immediately before the original award is modified. The current disclosure requirements in Topic 718 apply regardless of whether an entity is required to apply modification accounting under the amendments in this ASU 2017-09. The Group adopted these amendments to Subtopic 718-10 and there was no impact on the consolidated financial statements for the year ended December 31, 2018. The Group’s share-based awards mainly include share-based awards of YY as well as share-based awards of Huya, details of which are disclosed in Note 26. Fair value determination of these share-based awards is summarized as below: (1) Restricted share units In determining the fair value of restricted share units granted, the fair value of the underlying shares of YY on the grant dates is applied. The grant date fair value of restricted share units is based on stock price of YY in the NASDAQ Global Market. The fair value of restricted share units of Huya is determined with reference to stock price of Huya in NYSE. (2) Share options In determining the fair value of share options granted, a binomial option-pricing model is applied. The determination of the fair value is affected by the stock price of YY in the NASDAQ Global Market, as well as assumptions regarding a number of complex and subjective variables, including risk-free interest rates, exercise multiples, expected forfeiture rates, the expected share price volatility rates, and expected dividends. The Group uses the similar meth in determining the fair value of share options granted by Huya. (3) Huya’s ordinary shares Prior to the IPO, in determining the fair value of the ordinary shares of Huya granted, a combination of discounted cash flow method (“DCF”) under income approach and guideline companies method (“GCM”) under market approach is applied, with a discount for lack of marketability, given that the shares underlying the awards were not publicly traded at the time of grant. DCF method of the income approach involves applying appropriate weighted average cost of capital, or WACC, to discount the future cash flows forecast, based on the Group’s best estimates as of the valuation date, to present value. The WACC was determined based on a consideration of the factors including risk-free rate, comparative industry risk, equity risk premium, company size and non-systematic risk factors. GCM was also adopted under the market approach to arrive at an equity valuation for Huya. GCM employs trading multiples method of selected public comparable companies including trailing and leading Enterprise Value/Revenue multiples. Based on the Huya’s current stage of development and the conceptual strength of the income approach, 50% weight was assigned to each of the income approach and the market approach for the valuation date. Upon the completion of Huya’s initial public offering, the fair value of Huya’s ordinary shares is determined with reference to stock price of Huya in NYSE |
Other income | (dd) Other income Other income primarily consists of government grants which represent cash subsidies received from the PRC government by the Group entities. Government grants are originally recorded as deferred revenue when received upfront. After all of the conditions specified in the grants have been met, the grants are recognized as operating income. |
Leases | (ee) Leases Each lease is classified at the inception date as either a finance lease or an operating lease. For the lessee, a lease is a finance lease if any of the following conditions exist: a) ownership of the leased property is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the leased property’s estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the leaser at the inception date. A finance lease is accounted for as if there was an acquisition of an asset and an incurrence of an obligation at the inception of the lease. All other leases are accounted for as operating leases. Payments made under operating lease are charged to the consolidated statement of comprehensive income on a straight-line basis over the term of underlying lease. The Group has no finance lease for any of the years presented. For the sales-and-leaseback transactions where the Group is the buyer-lessor, the transaction is accounted for as a finance lease, details of which are disclosed in Note 2(k). |
Income taxes | (ff) Income taxes Current income taxes are provided on the basis of net income for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred income taxes are accounted for using an asset and liability method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The tax base of an asset or liability is the amount attributed to that asset or liability for tax purpose. The effect on deferred taxes of a change in tax rates is recognized in statement of comprehensive income in the period of change. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more likely than not that some portion of, or all of the deferred tax assets will not be realized. Uncertain tax positions The guidance on accounting for uncertainties in income taxes prescribes a more likely than not threshold for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Guidance was also provided on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, accounting for income taxes in interim periods, and income tax disclosures. Significant judgment is required in evaluating the Group’s uncertain tax positions and determining its provision for income taxes. The Group recognizes interests and penalties, if any, under accrued expenses and other current liabilities on its balance sheet and under other expenses in its statements of comprehensive income. The Group did not recognize any significant interest and penalties associated with uncertain tax positions for the years ended December 31, 2016, 2017 and 2018. As of December 31, 2017 and 2018, the Group did not have any significant unrecognized uncertain tax positions. Adoption of ASU 2016-16 In October 2016, the FASB issued ASU 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory (Topic 740). This standard will require entities to recognize the income tax consequences of intra-entity transfers of assets other than inventory at the time of transfer. This standard requires a modified retrospective approach to adoption. The Group adopted ASU 2016-16 from January 1, 2018 using a modified retrospective transition method. There was no material impact to the Company’s consolidated financial statements. |
Statutory reserves | (gg) Statutory reserves The Group’s subsidiaries and VIEs established in the PRC are required to make appropriations to certain non-distributable reserve funds. In accordance with the laws applicable to China’s Foreign Investment Enterprises, the Group’s subsidiaries registered as wholly owned foreign enterprises have to make appropriations from its after-tax profit (as determined under the Accounting Standards for Business Enterprises as promulgated by the Ministry of Finance of the People’s Republic of China (“PRC GAAP”) to reserve funds including general reserve fund, and staff bonus and welfare fund. The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with PRC GAAP. Appropriation is not required if the reserve fund has reached 50% of the registered capital of the company. Appropriation to the staff bonus and welfare fund is at the company’s discretion. In addition, in accordance with the Company Laws of the PRC, the VIEs of the Company registered as PRC domestic companies must make appropriations from its after-tax profit as determined under the PRC GAAP to non-distributable reserve funds including a statutory surplus fund and a discretionary surplus fund. The appropriation to the statutory surplus fund must be at least 10% of the after-tax profits as determined under the PRC GAAP. Appropriation is not required if the surplus fund has reached 50% of the registered capital of the company. Appropriation to the discretionary surplus fund is made at the discretion of the company. The use of the general reserve fund, statutory surplus fund and discretionary surplus fund are restricted to the offsetting of losses or increasing capital of the respective company. The staff bonus and welfare fund is a liability in nature and is restricted to fund payments of special bonus to staff and for the collective welfare of employees. All these reserves are not allowed to be transferred to the Company in terms of cash dividends, loans or advances, nor can they be distributed except under liquidation. During the years ended December 31, 2016, 2017 and 2018, appropriations to general reserve fund and statutory surplus fund amounted to RMB2,350, RMB3,861, and RMB39,007 respectively. |
Related parties | (hh) Related parties Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence, such as a family member or relative, shareholder, or a related corporation. |
Dividends | (ii) Dividends Dividends are recognized when declared. No dividends on common shares were declared for the years ended December 31, 2016, 2017 and 2018, respectively. The Group does not have any present plan to pay any dividends on common shares in the foreseeable future. The Group currently intends to retain the available funds and any future earnings to operate and expand its business. |
Income per share | (jj) Income per share Basic income per share is computed on the basis of the weighted-average number of common shares outstanding during the period under measurement. Diluted income per share is based on the weighted-average number of common shares outstanding and potential common shares. Potential common shares result from the assumed exercise of outstanding share options, restricted shares and restricted share units or other potentially dilutive equity instruments, when they are dilutive under the treasury stock method or the if-converted method. |
Comprehensive income | (kk) Comprehensive income Comprehensive income is defined as the change in equity of the Company during a period arising from transactions and other events and circumstances excluding transactions resulting from investments by shareholders and distributions to shareholders. Comprehensive income is reported in the consolidated statements of comprehensive income. As of December 31, 2017, accumulated other comprehensive income/loss of the Group includes the unrealized gain of available-for-sale securities and the foreign currency translation adjustments. As of December 31, 2018, accumulated other comprehensive income/loss of the Group is the foreign currency translation adjustments. |
Segment reporting | (ll) Segment reporting Operating segments are defined as components of an enterprise engaging in businesses activities for which separate financial information is available that is regularly evaluated by the Group’s chief operating decision makers (“CODM”) in deciding how to allocate resources and assess performance. The Group’s chief operating decision maker has been identified as the Chief Executive Officer, who reviews segment results when making decisions about allocating resources and assessing performance of the Group. |
Recently issued accounting pronouncements | (mm) Recently issued accounting pronouncements In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2016-02 (Topic 842) “Leases”. Topic 842 supersedes the lease requirements in Accounting Standards Codification (ASC) Topic 840, “Leases”. Under Topic 842, lessees are required to recognize assets and liabilities on the balance sheet for most leases and provide enhanced disclosures. Leases will continue to be classified as either finance or operating. The Company will adopt the new standard using the optional transition method (from ASU 2018-11, Leases Targeted Improvements) for fiscal years and interim periods within 2019. As permitted under the transition guidance, the Company will carry forward the assessment of whether the existing contracts contain or are leases, classification of the leases and remaining lease terms. Based on the portfolio of leases as of December 31, 2018, lease assets of approximately RMB 145 million and liabilities of approximately RMB141 million will be recognized on the Group’s balance sheet upon adoption, primarily relating to the rental of buildings. In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13: Financial Instruments-Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early application will be permitted for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is in the process of evaluating the impact of the standard on its consolidated financial statements. In January 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-04: Simplifying the Test for Goodwill Impairment. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The guidance should be adopted on a prospective basis for the annual or any interim goodwill impairment tests beginning after December 15, 2019. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company is in the process of evaluating the impact of the standard on its consolidated financial statements. In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting: The amendments in this Update expand the scope of Topic 718 to include share based payment transactions for acquiring goods and services from nonemployees. An entity should apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606. The amendments in this Update are effective for public business entities for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. The Company does not expect ASU 2018-07 to have a material impact to the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this standard will remove, modify and add certain disclosures under ASC Topic 820, Fair Value Measurement, with the objective of improving disclosure effectiveness. ASU 2018-13 will be effective for the Group’s fiscal year beginning January 1, 2020, with early adoption permitted. The transition requirements are dependent upon each amendment within this update and will be applied either prospectively or retrospectively. The Company does not expect ASU 2018-13 to have a material impact to the Company’s consolidated financial statements. |
Organization and principal ac_2
Organization and principal activities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of details of the subsidiaries, VIEs and VIE's subsidiaries | Name Place of incorporation Date of incorporation or acquisition % of direct or indirect economic ownership Principal activities Principal subsidiaries Duowan Entertainment Corporation (“Duowan BVI”) British Virgin Islands (“BVI”) November 6, 2007 100 % Investment holding Huanju Shidai Technology (Beijing) Co., Ltd. (“Beijing Huanju Shidai” or “Duowan Entertainment”) PRC March 19, 2008 100 % Investment holding Guangzhou Huanju Shidai Information Technology Co., Ltd. (“Guangzhou Huanju Shidai”) PRC December 2, 2010 100 % Software development Engage Capital Partners I, L.P. (“Engage L.P.”) Cayman Islands March 23, 2015 93.5 % Investment HUYA Inc. (“Huya”) Cayman Islands March 30, 2017 44.0 % Investment holding Guangzhou Huya Technology Co., Ltd. (“Huya Technology”) PRC June 16, 2017 44.0 % Software development Hago Singapore Pte. Ltd. (“Hago Singapore”) Singapore May 7, 2018 100 % Internet value added services Principal VIEs Guangzhou Huaduo Network Technology Co., Ltd. (“Guangzhou Huaduo”) PRC April 11, 2005 100 % Holder of internet content provider licenses and internet value added services Zhuhai Huanju Interactive Entertainment Technology Co., Ltd. (“Zhuhai Huanju Interactive”) PRC May 4, 2015 100 % Software development Shanghai Yilian Equity Investment Partnership (LP) (“Shanghai Yilian”) PRC June 23, 2015 93.5 % Investment Guangzhou Huanju Microfinance Co., Ltd. (“Guangzhou Microfinance”) PRC January 11, 2016 100 % Financing services Guangzhou Huya Information Technology Co., Ltd. (“Guangzhou Huya”) PRC August 10, 2016 44.0 % Holder of internet content provider licenses and internet value added services Guangzhou Yilianyixing Investment Partnership (LP) (“Guangzhou Yilianyixing”) PRC June 28, 2017 99 % Investment |
Principal accounting policies_2
Principal accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of property and equipment estimated useful lives and residual rate | Property and equipment are stated at historical cost less accumulated depreciation and impairment loss, if any. Depreciation is calculated using the straight-line method over their estimated useful lives. Residual rate is determined based on the economic value of the property and equipment at the end of the estimated useful lives as a percentage of the original cost. Estimated useful lives Residual rate Buildings 40 years 0 % Servers, computers and equipment 3 years 0%-5 % Leasehold improvements Shorter of lease term or 5 years 0 % Decoration of buildings 10 years 0 % Motor vehicles 4 years 5 % Furniture, fixture and office equipment 5 years 0%-5 % |
Schedule of amortization of finite-lived intangible assets is computed using the straight-line method over the following estimated useful lives | Amortization of finite-lived intangible assets is computed using the straight-line method over their estimated useful lives, which are as follows: Estimated useful lives Operating rights Shorter of the economic life or contract terms Software 3 -5 years Domain names 15 years Technology 5 years License 15 years |
Certain risks and concentrati_2
Certain risks and concentration (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Schedule of consolidated financial information of the Group's VIEs and VIE's subsidiaries excluding the inter company items with the Group's subsidiaries included in the accompanying consolidated financial statements | December 31, 2017 2018 RMB RMB Assets Current assets Cash and cash equivalents 1,343,731 4,665,938 Short-term deposits 3,400,000 2,100,000 Restricted short-term deposits 1,000,000 - Short-term investments 124,550 979,052 Accounts receivable, net 149,958 192,932 Inventory 315 - Amounts due from related parties 9,309 172,258 Financing receivables, net - 725,336 Prepayments and other current assets 190,456 663,437 Total current assets 6,218,319 9,498,953 Non-current assets Long-term deposits - 1,000,000 Deferred tax assets 113,017 70,834 Investments 582,775 862,272 Property and equipment, net 359,912 655,402 Intangible assets, net 15,504 57,050 Land use rights, net 1,832,739 1,784,639 Amounts due from related parties 20,000 - Other non-current assets 133,812 143,240 Total non-current assets 3,057,759 4,573,437 Total assets 9,276,078 14,072,390 Liabilities Current liabilities Accounts payable 67,817 112,167 Deferred revenue 757,244 950,816 Advances from customers 80,406 101,690 Income taxes payable 142,204 162,118 Accrued liabilities and other current liabilities 1,404,877 2,207,138 Amounts due to related parties 30,502 28,336 Total current liabilities 2,483,050 3,562,265 Non-current liabilities Deferred revenue 52,185 86,977 Deferred tax liabilities 8,404 - Total non-current liabilities 60,589 86,977 Total liabilities 2,543,639 3,649,242 For the year ended December 31, 2016 2017 2018 RMB RMB RMB Net revenues 8,164,100 11,577,104 15,740,097 Net income 1,874,435 2,766,279 3,475,109 For the year ended December 31, 2016 2017 2018 RMB RMB RMB Net cash provided by operating activities 2,538,836 3,974,085 4,672,879 Net cash used in investing activities (1,313,002 ) (3,571,668 ) (1,212,622 ) Net cash provided by financing activities 8,508 66,875 - 1,234,342 469,292 3,460,257 |
Cash and cash equivalents (Tabl
Cash and cash equivalents (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of cash and cash equivalents balance | December 31, 2017 December 31, 2018 Amount RMB equivalent Amount RMB equivalent RMB 1,627,044 1,627,044 4,707,868 4,707,868 US$ 151,529 990,388 188,869 1,296,284 Others - - N/A 79 Total 2,617,432 6,004,231 |
Short-term and Long-term depo_2
Short-term and Long-term deposits (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deposit Assets Disclosure [Abstract] | |
Schedule of Deposit Assets | December 31, 2017 December 31, 2018 Amount RMB equivalent Amount RMB equivalent Short-term deposits RMB 3,400,000 3,400,000 2,100,000 2,100,000 US$ 397,816 2,600,104 761,573 5,226,996 Total 6,000,104 7,326,996 Long-term deposits RMB - - 1,000,000 1,000,000 |
Accounts receivable, net (Table
Accounts receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Financing receivables,net [Abstract] | |
Schedule of accounts receivable, net | December 31, 2017 2018 RMB RMB Accounts receivable, gross 161,300 206,772 Less: allowance for doubtful receivables (7,356 ) (8,344 ) Accounts receivable, net 153,944 198,428 |
Summary of allowance for doubtful accounts | The following table summarizes the details of the allowance for doubtful accounts: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Balance at the beginning of the year (58,791 ) (55,220 ) (7,356 ) Reversals (additions) charged to general and administrative expenses, net 3,571 (3,049 ) (1,198 ) Write-off during the year - 50,913 210 Balance at the end of the year (55,220 ) (7,356 ) (8,344 ) |
Financing receivables, net (Tab
Financing receivables, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Financing receivables,net [Abstract] | |
Schedule of Financing Receivables | Financing receivables consist of the following: December 31, 2018 RMB Financing receivables, gross Micro-credit personal loans 734,108 Corporate loans 274,857 Total 1,008,965 Less: allowance for financing receivables (15,829 ) Financing receivables, net 993,136 Current portion 768,343 Non-current portion 224,793 |
Past Due Financing Receivables | The following table presents the aging of financing receivables as of December 31, 2018. 1-90 days past due 91-180 days past due 181-360 days past due Total past due Current Total financing receivables Micro-credit personal loans 13,074 6,590 1,411 21,075 713,033 734,108 Corporate loans - - - - 274,857 274,857 13,074 6,590 1,411 21,075 987,890 1,008,965 |
Allowance for Credit Losses on Financing Receivables | Movement of allowance for financing receivables is as follows: For the year ended December 31, 2018 RMB Balance at the beginning of the year - Charge for the year (15,829 ) Balance at the end of the year (15,829 ) |
Prepayments and other current_2
Prepayments and other current assets (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of prepayments and other current assets | December 31, 2017 2018 RMB RMB Interests receivable 78,274 218,553 Prepayments and deposits to vendors and content providers 81,319 183,293 Loans to third parties - 180,964 Receivables from payment platforms - 112,061 Amounts receivables from issuance of a subsidiary’s preferred shares - 102,951 Value added taxes to be deducted - 69,563 Receivables from disposal of subsidiaries and investments 7,986 59,255 Rental and other deposits 14,214 22,457 Employee advances 16,697 11,536 Others 23,449 58,386 Total 221,939 1,019,019 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Investments [Abstract] | |
Schedule of investments | December 31, 2017 2018 RMB RMB Equity investments accounted for using the equity method (i) 309,241 378,378 Equity investments with readily determinable fair values (ii) 138,251 238,915 Equity investments without readily determinable fair values (iii) 703,566 3,974,231 Available-for-sale debt securities 1,961 - Total 1,153,019 4,591,524 (i) In 2017 and 2018, the Group acquired minority stake of a number of privately-held entities with total consideration of RMB21,740 and RMB14,277, respectively. Investments have been accounted for under the equity method where the Group has significant influence on these investments and the investments are considered as in-substance ordinary shares. (ii) In 2018, the Group made an investment in a third party investment fund with total consideration of RMB204,499. The Group does not have the ability to exercise significant influence over the investment. Therefore, it has been precluded from applying the equity method of accounting. In 2018, fair value loss of RMB113,677 (iii) Equity securities without readily determinable fair values and over which the Company has neither significant influence nor control through investments in common stock or in-substance common stock. In 2017 and 2018, the Group acquired minority preffered shares or ordinary shares of a number of privately-held entities with total consideration of RMB301,848 and RMB2,118,648, |
Property and equipment, net (Ta
Property and equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property and equipment, net [Abstract] | |
Schedule of property and equipment | Property and equipment consists of the following: December 31, 2017 2018 RMB RMB Gross carrying amount Buildings 731,640 857,020 Servers, computers and equipment 588,589 679,735 Construction in progress 44,103 211,657 Decoration of buildings 100,711 103,305 Motor vehicles 27,330 38,407 Furniture, fixture and office equipment 24,102 26,439 Leasehold improvements 18,651 22,913 Total 1,535,126 1,939,476 Less: accumulated depreciation (518,128 ) (643,157 ) Property and equipment, net 1,016,998 1,296,319 |
Land use rights, net (Tables)
Land use rights, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Schedule Of Land Use Right | Land use rights consist of the following: December 31, 2018 RMB Gross carrying amount 1,924,563 Less: accumulated amortization (139,924 ) Land use rights, net 1,784,639 |
Use Rights [Member] | |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The estimated amortization expenses for each of the following five years are as follows: Amortization expense of land use rights RMB 2019 48,096 2020 48,096 2021 48,096 2022 48,096 2023 48,096 |
Intangible assets, net (Tables)
Intangible assets, net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Summary of Group's intangible assets | The following table summarizes the Group’s intangible assets: December 31, 2017 2018 RMB RMB Gross carrying amount Operating rights 47,020 67,080 Software 34,413 39,535 License - 32,000 Domain names 25,774 26,819 Technology 17,676 18,094 Total of gross carrying amount 124,883 183,528 Less: accumulated amortization Operating rights (40,320 ) (48,451 ) Software (19,448 ) (28,406 ) License - (1,422 ) Domain names (9,687 ) (11,213 ) Technology (10,695 ) (11,856 ) Total accumulated amortization (80,150 ) (101,348 ) Less: accumulated impairment (7,252 ) (7,495 ) Intangible assets, net 37,481 74,685 |
Schedule of weighted average amortization periods of intangible assets | The weighted average amortization periods of intangible assets as of December 31, 2017 and 2018 are as below: December 31, 2017 2018 Domain names 15 years 15 years License Not applicable 15 years Software 4 years 4 years Operating rights 1 year 2 year Technology 5 years Not applicable |
Other Intangible Assets [Member] | |
Schedule of estimated amortization expenses | The estimated amortization expenses for each of the following five years are as follows: Amortization expense of intangible assets RMB 2019 22,710 2020 13,010 2021 4,563 2022 4,060 2023 3,978 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The changes in the carrying amount of goodwill for the years ended December 31, 2017 and 2018 are as follows: YY Live RMB Balance as of December 31, 2016 14,300 Impairment charges (i) (2,527 ) Foreign currency translation adjustments (57 ) Balance as of December 31, 2017 11,716 Foreign currency translation adjustments 47 Balance as of December 31, 2018 11,763 (i) The Group performs its annual goodwill impairment test of each reporting unit as of October 1, or more frequently, if certain events or circumstances warrant. Events or changes in circumstances which might indicate potential impairment in goodwill include the entity-specific factors, including, but not limited to, stock price volatility, market capitalization relative to net book value, and projected revenue, market growth and operating results. |
Deferred revenue (Tables)
Deferred revenue (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Deferred Revenue Disclosure [Abstract] | |
Classification of Deferred Revenue | December 31, 2017 2018 RMB RMB Deferred revenue, current Live streaming 637,346 842,040 Others 120,698 109,576 Total current deferred revenue 758,044 951,616 Deferred revenue, non-current Live streaming 45,267 80,734 Others 12,451 10,976 Total non-current deferred revenue 57,718 91,710 |
Accrued liabilities and other_2
Accrued liabilities and other current liabilities (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities and other current liabilities | December 31, 2017 2018 RMB RMB Revenue sharing fees 839,745 1,318,561 Salaries and welfare 220,539 329,169 Marketing and promotion expenses 109,901 213,216 Bandwidth costs 102,064 131,252 Value added taxes and other taxes payable 23,204 109,040 Deposits from third parties 27,440 82,771 Payables to merchants 15,442 75,471 Other payable to content providers 20,849 30,313 Others 106,779 124,578 Total 1,465,963 2,414,371 |
Short-term loans (Tables)
Short-term loans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Convertible bonds [Abstract] | |
Schedule of Short-term Debt | December 31, 2017 2018 RMB RMB Short-term loans 588,235 - |
Convertible bonds (Tables)
Convertible bonds (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Convertible bonds [Abstract] | |
Schedule of convertible bonds | December 31, 2017 2018 RMB RMB Convertible bonds, current 2019 Convertible Senior Notes - 6,863 Convertible bonds, non-current 2019 Convertible Senior Notes 6,536 - |
Cost of revenues (Tables)
Cost of revenues (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Cost of Revenue [Abstract] | |
Schedule of Cost of revenues | For the year ended December 31, 2016 2017 2018 RMB RMB RMB Revenue sharing fees and content costs 3,790,624 5,727,081 8,272,696 Bandwidth costs 651,652 695,839 967,436 Salary and welfare 232,497 237,063 323,623 Depreciation and amortization 173,048 128,639 117,293 Payment handling costs 67,474 72,953 104,772 Share-based compensation 15,894 42,759 74,339 Other taxes and surcharges 44,659 48,360 48,724 Other costs 127,582 73,708 108,251 Total 5,103,430 7,026,402 10,017,134 |
Other income (Tables)
Other income (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Component of Operating Income [Abstract] | |
Schedule of other income | For the year ended December 31, 2016 2017 2018 RMB RMB RMB Government grants 128,550 88,873 88,488 Others 954 24,314 29,372 Total 129,504 113,187 117,860 |
Income tax (Tables)
Income tax (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of the current and deferred portions of income tax expense included in the consolidated statements of Comprehensive Income | The current and deferred portions of income tax expense included in the consolidated statements of comprehensive income are as follows: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Income (loss) before income tax expenses PRC entities 1,914,432 2,919,350 3,494,192 Non-PRC entities (a) (130,621 ) (28,172 ) (959,721 ) Total 1,783,811 2,891,178 2,534,471 Current income tax expenses PRC entities (288,282 ) (402,012 ) (379,130 ) Non-PRC entities - (9,880 ) (48,931 ) Total (288,282 ) (411,892 ) (428,061 ) Deferred income tax benefit (expenses) PRC entities 7,768 (3,919 ) (25,081 ) Non-PRC entities - - (24,565 ) Total 7,768 (3,919 ) (49,646 ) Income tax expenses PRC entities (280,514 ) (405,931 ) (404,211 ) Non-PRC entities - (9,880 ) (73,496 ) Total (280,514 ) (415,811 ) (477,707 ) (a) The loss before tax incurred by non-PRC entities for the year ended December 31, 2018 was mainly due to the fair value loss on derivative liabilities amouting to RMB2,285,223. This fair value loss was incurred by Huya whose applicable tax rate is zero, therefore the tax impact related to this fair value loss was included in “effect of different tax rates available to different jurisdictions” in the reconciliation table below. |
Schedule of the reconciliation of total tax expense computed by applying the respective statutory income tax rate to pre-tax income | The reconciliation of total tax expense computed by applying the respective statutory income tax rate to pre-tax income is as follows: For the year ended December 31, 2016 2017 2018 PRC Statutory income tax rate (25.0 )% (25.0 )% (25.0 )% Effect of tax holiday and preferential tax benefit 11.6 % 13.2 % 16.5 % Effect of different tax rates available to different jurisdictions (1.7 )% (0.3 )% (10.1 )% Permanent differences (i) (1.1 )% (1.8 )% (3.5 )% Change in valuation allowance (1.5 )% (2.3 )% (1.6 )% Effect of Super Deduction available to the Group 2.0 % 1.8 % 4.9 % Effective income tax rate (15.7 )% (14.4 )% (18.8 )% Per ADS effect of tax holiday (RMB) 3.52 4.71 5.35 Per share effect of tax holiday (RMB) 0.18 0.24 0.27 (i) Permanent differences mainly arise from expenses not deductible for tax purposes including primarily share-based compensation costs and expenses incurred by subsidiaries and VIEs. |
Schedule of the tax effects of temporary differences that give rise to the deferred tax asset balances | The tax effects of temporary differences that give rise to the deferred tax asset balances as of December 31, 2017 and 2018 are as follows: December 31, 2017 2018 RMB RMB Deferred tax assets: Tax loss carried forward 74,951 148,899 Allowance for doubtful receivable, accrued expense and 62,177 84,249 Deferred revenue 97,858 36,007 Impairment of investment 12,783 17,180 Others 753 753 Valuation allowance (i) (135,505 ) (175,793 ) Amounts offset by deferred tax liabilities - (40,461 ) Total deferred tax assets, net 113,017 70,834 Deferred tax liabilities: Related to the fair value changes of investments 3,627 61,658 Related to acquired intangible assets 2,406 1,531 Others 4,777 4,777 Amounts offset by deferred tax assets - (40,461 ) Total deferred tax liabilities, net 10,810 27,505 (i) Valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group considered factors including future taxable income exclusive of reversing temporary differences and tax loss carry forwards. Valuation allowance was provided for net operating loss carry forward because it was more likely than not that such deferred tax assets would not be realized based on the Group’s estimate of its future taxable income. If events occur in the future that allow the Group to realize more of its deferred income tax than the presently recorded amounts, an adjustment to the valuation allowances will result in a decrease in tax expense when those events occur. |
Summary of Valuation Allowance | Movement of valuation allowance For the year ended December 31, 2016 2017 2018 RMB RMB RMB Balance at beginning of the year (53,316 ) (80,712 ) (135,505 ) Additions (45,491 ) (78,978 ) (113,597 ) Reversals 18,095 24,185 73,309 Balance at end of the year (80,712 ) (135,505 ) (175,793 ) |
Share-based compensation (Table
Share-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Share-based compensation [Line Items] | |
Summary of the restricted share units activity | Number of restricted shares Weighted average grant-date fair value (US$) Outstanding, December 31, 2015 36,283,602 2.3535 Granted 1,530,008 1.8618 Forfeited (4,628,202 ) 2.7386 Vested (12,229,688 ) 2.0151 Outstanding, December 31, 2016 20,955,720 2.4320 Granted 22,090,030 5.3001 Forfeited (4,007,728 ) 2.5561 Vested (8,163,878 ) 2.3227 Outstanding, December 31, 2017 30,874,144 4.4969 Granted 11,977,794 4.7052 Forfeited (5,115,304 ) 4.6843 Vested (12,507,000 ) 3.6776 Outstanding, December 31, 2018 25,229,634 4.9639 Expected to vest at December 31, 2018 23,742,895 4.9552 |
Schedule Of Restricted Stock Units | The following table summarizes the activity of restricted share units for the year ended December 31, 2018: Number of restricted share units Weighted average grant-date fair value (US$) Outstanding, January 1, 2016, December 31, 2016 and 2017 - - Granted 4,193,685 9.0242 Forfeited (76,500 ) 7.1600 Vested (10,000 ) 19.5900 Outstanding, December 31, 2018 4,107,185 9.0331 Expected to vest at December 31, 2018 3,795,535 8.9944 |
Pre-2009 Scheme Options [Member] | |
Share-based compensation [Line Items] | |
Share-based Compensation, Stock Options, Activity | Movements in the number of share options granted and their related weighted average exercise prices are as follows: Number of options Weighted average exercise price (US$) Weighted average remaining contractual life (years) Aggregate intrinsic value (US$) Outstanding, January 1, 2018 - - - Granted 10,934,300 4.7025 5.29 Outstanding, December 31, 2018 10,934,300 4.7025 5.29 - Expected to vest at December 31, 2018 10,934,300 4.7025 5.29 - Exercisable at December 31, 2018 - - - - |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The Company has used binomial option-pricing model to determine the fair value of the share options as of the grant dates. Key assumptions are set as below: Weighted average fair value per option granted US$ 2.6425 Weighted average exercise price US$ 4.7025 Weighted average Risk-free interest rate (1) 2.77 % Expected term (in year) (2) 5-6 Expected volatility (3) 57 % Dividend yield (4) - (1) The risk-free interest rate of periods within the contractual life of the share option is based on US Treasury Bonds of similar tenor at the valuation dates. (2) The expected term is the contract life of the option. (3) Expected volatility is estimated based on the average of historical volatilities of the Company at the valuation dates. (4) The Company has no history or expectation of paying dividend on its ordinary shares. The expected dividend yield was estimated based on the Company’s expected dividend policy over the expected term of the option. |
2017 Share Incentive Plan | |
Share-based compensation [Line Items] | |
Share-based Compensation, Stock Options, Activity | Number of options Weighted average exercise price (US$) Weighted average remaining contractual life (years) Aggregate intrinsic value (US$) As at January 1, 2016 and December 31, 2016 - - - - Granted 11,737,705 2.5500 Forfeited (18,000 ) 2.5500 As at December 31, 2017 11,719,705 2.5500 9.75 2,227 Granted 6,138,353 2.4672 Forfeited (75,000 ) 2.5500 Cancelled (262,503 ) 2.5500 As at December 31, 2018 17,520,555 2.5210 8.82 227,049 Expected to vest at December 31, 2018 13,982,830 2.5338 8.87 181,024 Exercisable as of December 31, 2018 2,736,927 2.4572 8.63 35,642 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | 2017 2018 Weighted average fair value per option granted US$ 1.3798 US$ 5.2130 Weighted average exercise price US$ 2.55 US$ 2.47 Risk-free interest rate (1) 2.25 % 2.83 % Expected term (in year) (2) 10 10 Expected volatility (3) 55 % 55 % Dividend yield (4) - - (1) The risk-free interest rate of periods within the contractual life of the share option is based on the China Government Bond yield as at the valuation dates. (2) The expected term is the contract life of the option. (3) Expected volatility is estimated based on the average of historical volatilities of the comparable companies in the same industry as at the valuation dates. (4) Huya has no history or expectation of paying dividend on its ordinary shares. The expected dividend yield was estimated based on Huya’s expected dividend policy over the expected term of the option. |
Basic and diluted net income _2
Basic and diluted net income per share (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of calculation of basic and diluted net income per share | Basic and diluted net income per share for the years ended December 31, 2016, 2017 and 2018 are calculated as follows: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Numerator: Net income attrib utable to common shareholders of the Compa ny 1,523,918 2,493,235 1,641,958 Interest expenses of convertible notes 81,085 20,820 149 Numerator for diluted income per share 1,605,003 2,514,055 1,642,107 Denominator: Denominator for basic calculation—weighted average number of Class A and Class B common shares outstanding 1,127,343,312 1,186,460,144 1,280,847,795 Dilutive effect of share options 684,455 376,918 94,254 Dilutive effect of restricted share units 15,816,362 11,598,378 12,966,689 Dilutive effect of convertible bonds 72,267,200 18,202,301 180,668 Denominator for diluted calculation 1,216,111,329 1,216,637,741 1,294,089,406 Basic net income per Class A and Class B common share 1.35 2.10 1.28 Diluted net income per Class A and Class B common share 1.32 2.07 1.27 Basic net income per ADS* 27.04 42.03 25.64 Diluted net income per ADS* 26.40 41.33 25.38 * Each ADS represents 20 |
Related party transactions (Tab
Related party transactions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Schedule of related parties and their relationships with the Group | The table below sets forth the major related parties and their relationships with the Group: Major related parties Relationship with the Group Guangzhou Sunhongs Corp., Ltd. (“Guangzhou Sunhongs”) (Formerly known as Guangzhou Shanghang Information Technology Co., Ltd.) Significant influence exercised by a principal shareholder of the Company Kingsoft Corporation Limited (“Kingsoft Group”) Significant influence exercised by a principal shareholder of the Company Bigo Inc. (“Bigo”) Investment with significant influence Shanghai Ansha Network Technology Co., Ltd.(“Shanghai Ansha”) Investment with significant influence Guangzhou Chenjun Equity Investment Limited Partnership(“Guangzhou Chenjun”) Investment with significant influence Guangzhou Kuyou Information Technology Co., Ltd.(“Guangzhou Kuyou”) Investment with significant influence Beijing Huanqiu Xingxue Technology Development Co., Ltd.(“Xingxue”) Investment with significant influence Yunke Online Investment with significant influence |
Schedule of significant related party transactions | During the years ended December 31, 2016, 2017 and 2018, significant related party transactions are as follows: For the year ended December 31, 2016 2017 2018 RMB RMB RMB Loan to related parties 44,500 24,962 188,000 Bandwidth service provided by Guangzhou Sunhongs 96,224 92,068 103,439 Online games revenue shared from related parties 100,078 87,414 31,366 Repayment of loans from related parties - 35,462 20,000 Bandwidth service provided by Kingsoft Group - 711 11,314 Payments on behalf of related parties, net of repayments 10,699 (23,116 ) (2,543 ) Partial disposal of investments to Guangzhou Chenjun 33,750 35,160 - Partial disposal of a subsidiary to Guangzhou Chenjun 24,394 - - Others 13,573 14,276 11,833 |
Schedule of the amounts due from/to related parties | As of December 31, 2017 and 2018, the amounts due from/to related parties are as follows: December 31, 2017 2018 RMB RMB Amounts due from related parties, current Due from Bigo (1) 9,831 191,800 Others 1,359 1,759 Total 11,190 193,559 Amounts due from related parties, non-current Due from Yunke Online 20,000 - Amounts due to related parties Due to Guangzhou Sunhongs 8,432 11,062 Due to Guangzhou Kuyou 7,583 4,144 Due to Shanghai Ansha 6,178 5,364 Due to Kingsoft Group - 5,239 Others 8,309 2,527 Total 30,502 28,336 (1) The amounts due from Bigo mainly consisted of unsecured loans provided to Bigo.The maturities of the loans were all within one year. |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of liabilities measured at fair value on recurring basis | The following table summarizes the Company’s assets that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy as of December 31, 2017 and December 31, 2018: As of December 31, 2017 Level 1 Level 2 Level 3 Total Assets Short-term investments 29,570 94,980 - 124,550 Equity investment with readily determinable fair values 138,251 - - 138,251 Available-for-sale debt securities - - 1,961 1,961 167,821 94,980 1,961 264,762 As of December 31, 2018 Level 1 Level 2 Level 3 Total Assets Short-term investments (i) 78,605 900,448 - 979,053 Equity investment with readily determinable fair values (ii) 238,915 - - 238,915 317,520 900,448 - 1,217,968 Liabilities Derivative liabilities (iii) - - - - (i) Short-term investments represented the investments issued by commercial banks or other financial institutions with a variable interest rate indexed to the performance of underlying assets within one year. For the instruments whose fair value is provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. For the instruments whose fair value is estimated based on quoted prices of similar products provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements. (ii) Equity investments with readily determinable fair values are valued using the market approach based on the quoted prices in active markets at the reporting date. The Group classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. (iii) The Company has determined that conversion feature embedded in the Huya’s Series B-2 Preferred Shares is required to be bifurcated and accounted for as a derivative liability which would be measured at fair value (Note 24). Upon the completion of Huya’s IPO, the derivative liabilities were derecognized and the balance was transferred to additional paid-in capital accordingly. |
Schedule of changes in level 3 instruments | The following table presents the changes in Level 3 liabilities for the year ended December 31, 2018. Conversion feature embedded in Series A Preferred Shares Conversion feature embedded in Series B-2 Preferred Shares Total RMB RMB RMB Balance as of January 1, 2018 - - - Initial recognition upon the extinguishment of Huya’s Series A Preferred Shares and the issuance of Huya’s Series B-2 Preferred Shares as of March 8, 2018 572,237 320,097 892,334 Fair value loss on derivative liabilities 628,298 1,656,925 2,285,223 Foreign exchange 4,573 6,697 11,270 Derecognition of derivative liabilities upon the completion of Huya’s IPO (1,205,108 ) (1,983,719 ) (3,188,827 ) Balance as of December 31, 2018 - - - |
Schedule of Certain Significant Estimates | Such approach involves certain significant estimates which are as follows: Valuation Date March 8, 2018 May 10, 2018 Volatility 50 % 50 % Risk-free rate (3 months) 1.66 % 1.58 % Risk-free rate (4 years) 2.52 % 2.46 % Dividend yield 0 % 0 % |
Commitments and contingencies (
Commitments and contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum payments under non-cancellable operating leases | As of December 31, 2018, future minimum payments under non-cancellable operating leases consist of the following: Office rental RMB 2019 84,689 2020 53,609 2021 35,871 2022 and after 47,726 221,895 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting [Abstract] | |
Summary information by segment | The following table presents summary information by segment: For the year ended December 31, 2018: YY Live Huya Elimination Total RMB RMB RMB RMB Net revenues Live streaming 10,434,822 4,442,845 - 14,877,667 Others 667,350 220,595 (2,055 ) 885,890 Total net revenues 11,102,172 4,663,440 (2,055 ) 15,763,557 Cost of revenues (1) (6,083,487 ) (3,933,647 ) - (10,017,134 ) Gross profit 5,018,685 729,793 (2,055 ) 5,746,423 Operating expenses (1) Research and development expenses (926,900 ) (265,152 ) - (1,192,052 ) Sales and marketing expenses (962,164 ) (189,207 ) 2,055 (1,149,316 ) General and administrative expenses (595,515 ) (287,710 ) - (883,225 ) Total operating expenses (2,484,579 ) (742,069 ) 2,055 (3,224,593 ) Other income 78,922 38,938 - 117,860 Operating income 2,613,028 26,662 - 2,639,690 Interest expense (8,616 ) - - (8,616 ) Interest income and investment income 329,003 156,549 - 485,552 Foreign currency exchange (losses) gains, net (565 ) 51 - (514 ) Gain on deemed disposal and disposal of investments 16,178 - - 16,178 Gain on fair value changes of investment 1,487,405 - 201,999 1,689,404 Fair value loss on derivative liabilities - (2,285,223 ) - (2,285,223 ) Other non-operating expenses (2,000 ) - - (2,000 ) Income before income tax expenses 4,434,433 (2,101,961 ) 201,999 2,534,471 Income tax (expenses) benefits (501,683 ) 50,943 (26,967 ) (477,707 ) Income before share of loss in equity method investments, net of income taxes 3,932,750 (2,051,018 ) 175,032 2,056,764 Share of income in equity method investments, net of income taxes 120,636 113,329 (175,032 ) 58,933 Net income 4,053,386 (1,937,689 ) - 2,115,697 (1) Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 63,867 10,472 74,339 Research and development expenses 194,530 30,643 225,173 Sales and marketing expenses 3,891 1,832 5,723 General and administrative expenses 159,042 183,748 342,790 The following table presents summary information by segment: For the year ended December 31, 2017: YY Live Huya Total RMB RMB RMB Net revenues Live streaming 8,601,418 2,069,536 10,670,954 Others 808,558 115,280 923,838 Total net revenues 9,409,976 2,184,816 11,594,792 Cost of revenues (1) (5,096,538 ) (1,929,864 ) (7,026,402 ) Gross profit 4,313,438 254,952 4,568,390 Operating expenses (1) Research and development expenses (611,726 ) (170,160 ) (781,886 ) Sales and marketing expenses (603,989 ) (87,292 ) (691,281 ) General and administrative expenses (442,646 ) (101,995 ) (544,641 ) Goodwill impairment (2,527 ) - (2,527 ) Total operating expenses (1,660,888 ) (359,447 ) (2,020,335 ) Gain on deconsolidation and disposal of subsidiaries 37,989 - 37,989 Other income 103,558 9,629 113,187 Operating income (loss) 2,794,097 (94,866 ) 2,699,231 Interest expense (32,122 ) - (32,122 ) Interest income and investment income 166,335 14,049 180,384 Foreign currency exchange losses, net (2,176 ) - (2,176 ) Gain on deemed disposal and disposal of investments 45,861 - 45,861 Income (loss) before income tax expenses 2,971,995 (80,817 ) 2,891,178 Income tax expenses (415,811 ) - (415,811 ) Income (loss) before share of income (loss) in equity method investments, net of income taxes 2,556,184 (80,817 ) 2,475,367 Share of income (loss) in equity method investments, net of income taxes 33,175 (151 ) 33,024 N et income (loss) 2,589,359 (80,968 ) 2,508,391 (1) Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 39,882 2,877 42,759 Research and development expenses 113,174 9,174 122,348 Sales and marketing expenses 3,626 791 4,417 General and administrative expenses 60,871 27,266 88,137 For the year ended December 31, 2016: YY Live Huya 100 Education Total RMB RMB RMB RMB Net revenues Live streaming 6,235,249 791,978 - 7,027,227 Others 1,011,170 4,926 160,727 1,176,823 Total net revenues 7,246,419 796,904 160,727 8,204,050 Cost of revenues (1) (3,900,814 ) (1,094,644 ) (107,972 ) (5,103,430 ) Gross profit (loss) 3,345,605 (297,740 ) 52,755 3,100,620 Operating expenses (1) Research and development expenses (456,375 ) (188,334 ) (30,521 ) (675,230 ) Sales and marketing expenses (259,040 ) (68,746 ) (59,482 ) (387,268 ) General and administrative expenses (375,958 ) (71,325 ) (35,154 ) (482,437 ) Goodwill impairment (3,861 ) - (13,804 ) (17,665 ) Total operating expenses (1,095,234 ) (328,405 ) (138,961 ) (1,562,600 ) Gain on deconsolidation and disposal of subsidiaries 103,960 - - 103,960 Other income 129,504 - - 129,504 Operating income (loss) 2,483,835 (626,145 ) (86,206 ) 1,771,484 Interest expense (81,085 ) - - (81,085 ) Interest income and investment income 66,631 518 44 67,193 Foreign currency exchange gains, net 1,158 - - 1,158 Gain on deemed disposal and disposal of investments 25,061 - - 25,061 Income (loss) before income tax expenses 2,495,600 (625,627 ) (86,162 ) 1,783,811 Income tax (expenses) benefits (294,529 ) - 14,015 (280,514 ) Income (loss) before share of income (loss) in equity method investments, net of income taxes 2,201,071 (625,627 ) (72,147 ) 1,503,297 Share of income (loss) in equity method investments, net of income taxes 8,390 - (111 ) 8,279 Net income (loss) 2,209,461 (625,627 ) (72,258 ) 1,511,576 (1) Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya 100 Education Total RMB RMB RMB RMB Cost of revenues 9,893 5,677 324 15,894 Research and development expenses 53,085 19,538 6,193 78,816 Sales and marketing expenses 2,781 326 - 3,107 General and administrative expenses 19,523 26,557 13,389 59,469 |
Additional information - cond_2
Additional information - condensed financial statements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed balance sheets | (a) Condensed balance sheets of YY Inc. as of December 31, 2017 and 2018 As of December 31, 2017 2018 2018 RMB RMB US$ (Note 2(e)) Assets Current assets Amounts due from a subsidiary 2,671,590 2,592,009 376,992 Non-current assets Interests in subsidiaries and VIEs 8,535,113 15,935,185 2,317,677 Total assets 11,206,703 18,527,194 2,694,669 Liabilities and shareholders’ equity Current liabilities Interests payable 777 39 6 Convertible bonds - 6,863 998 Short-term loans 588,235 - - Total current liabilities 589,012 6,902 1,004 Non-current liabilities Convertible bonds 6,536 - - Total liabilities 595,548 6,902 1,004 Shareholders’ equity Class A common shares (US$0.00001 par value; 10,000,000,000 shares authorized, 945,245,908 shares issued and outstanding as of December 31, 2017 and 981,740,848 shares issued and outstanding as of December 31, 2018) 57 59 9 Class B common shares (US$0.00001 par value; 1,000,000,000 shares authorized, 317,982,976 shares issued and outstanding as of December 31, 2017 and 288,182,976 shares issued and outstanding as of December 31, 2018) 23 21 3 Additional paid-in capital 5,339,844 11,168,866 1,624,444 Retained earnings 5,280,828 7,015,194 1,020,318 Accumulated other comprehensive (loss) income (9,597 ) 336,152 48,891 Total shareholders’ equity 10,611,155 18,520,292 2,693,665 Total liabilities and shareholders’ equity 11,206,703 18,527,194 2,694,669 |
Condensed statements of operations and comprehensive income | (b) Condensed statements of comprehensive income of YY Inc. for the years ended December 31, 2016, 2017 and 2018 For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ (Note2(e)) Share of profit of subsidiaries and VIEs 1,605,003 2,545,045 2,211,452 321,642 Interest expense (81,085 ) (32,122 ) (2,445 ) (357 ) Net income attributable to controlling interest of the Company 1,523,918 2,512,923 2,209,007 321,285 Other comprehensive income (loss) : Unrealized gain (loss) of available-for-sale securities 134,768 (41,150 ) - - Foreign currency translation adjustments, net of nil tax (5,317 ) (61,513 ) 434,080 63,134 Total comprehensive income 1,653,369 2,410,260 2,643,087 384,419 |
Condensed statements of cash flows | (c) Condensed statements of cash flows of YY Inc. for the years ended December 31, 2016, 2017 and 2018 For the year ended December 31, 2016 2017 2018 2018 RMB RMB RMB US$ (Note2(e)) Cash flows from operating activities - - - - Cash flows from investing activities Repayment of loans from a subsidiary - 2,132,512 195,091 28,375 Loans to a subsidiary - (2,950,607 ) - - Net cash (used in) provided by investing activities - (818,095 ) 195,091 28,375 Cash flows from financing activities Proceeds from bank borrowings - 621,118 - - Proceeds from issuance of common shares, net of issuance cost - 2,950,607 (4,473 ) (651 ) Partial disposal of subsidiary’s interests to non-controlling interest shareholders - - 378,548 55,058 Repayment of bank borrowings - - (569,166 ) (82,782 ) Repayment of convertible bonds - (2,753,630 ) - - Net cash provided by (used in) financing activities - 818,095 (195,091 ) (28,375 ) Net increase in cash and cash equivalents - - - - Cash and cash equivalents at the beginning of the year - - - - Cash and cash equivalents at the end of the year - - - - |
Organization and principal ac_3
Organization and principal activities (Narrative) (Details) ¥ in Thousands | 12 Months Ended |
Dec. 31, 2018CNY (¥) | |
Organization and principal activities [Line Items] | |
Registered capital and PRC statutory reserves of the VIEs and VIE's subsidiaries | ¥ 4,660,890 |
Guangzhou Huya | Exclusive Business Cooperation Agreement [Member] | |
Organization and principal activities [Line Items] | |
Period of prior written notice required to terminate the agreement | 30 days |
Guangzhou Huya | Power of Attorney [Member] | |
Organization and principal activities [Line Items] | |
Period of prior written notice required to terminate the agreement | 30 days |
Huanju Shidai Technology Beijing Company Limited [Member] | Guangzhou Huaduo [Member] | Exclusive Technology Support and Technology Services Agreement [Member] | |
Organization and principal activities [Line Items] | |
Period of prior written notice required to terminate the agreement | 30 days |
Huanju Shidai Technology Beijing Company Limited [Member] | Guangzhou Huaduo [Member] | Exclusive Business Cooperation Agreement [Member] | |
Organization and principal activities [Line Items] | |
Period of prior written notice required to terminate the agreement | 30 days |
Huanju Shidai Technology Beijing Company Limited [Member] | Guangzhou Huaduo [Member] | Exclusive Option Agreement [Member] | |
Organization and principal activities [Line Items] | |
Term of agreement | 10 years |
Organization and principal ac_4
Organization and principal activities (Schedule of Details of Subsidiaries, VIEs and VIE's Subsidiary) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Zhuhai Huanju Interactive Entertainment Technology [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 100.00% |
Shanghai Yilian Equity Investment Partnership LP [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 93.50% |
Guangzhou Huya Technology Co., Ltd. [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 44.00% |
HUYA Inc [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 44.00% |
Guangzhou Huya Information Technology Company Limited [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 44.00% |
Guangzhou Yilianyixing Investment Partnership LP [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 99.00% |
Guangzhou Huanju Microfinance Co., Ltd. [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 100.00% |
Guangzhou Huaduo [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 100.00% |
Duowan Entertainment Corporation [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 100.00% |
Huanju Shidai Technology Beijing Company Limited [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 100.00% |
Guangzhou Huanju Shidai [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 100.00% |
Engage Capital Partners I LP [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 93.50% |
Hago Singapore Pte. Ltd. [Member] | |
Subsidiaries, VIEs and VIE's subsidiary [Line Items] | |
% of direct or indirect economic ownership | 100.00% |
Principal accounting policies_3
Principal accounting policies (Convenience Translation - Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018USD ($) | Jan. 01, 2018CNY (¥) | Dec. 31, 2017USD ($) | Dec. 31, 2015CNY (¥) | |
Convenience translation | |||||||
Rate of translations of amounts from RMB into US$ | 6.8755 | 6.8755 | |||||
Cash and cash equivalents | |||||||
Cash and cash equivalents | ¥ 6,004,231 | ¥ 2,617,432 | $ 873,279 | ||||
Restricted short-term deposits | 0 | 1,000,000 | |||||
Cash, cash equivalents and restricted cash | 6,004,231 | 3,617,432 | ¥ 1,579,743 | $ 873,279 | $ 526,134 | ¥ 1,318,155 | |
Impairment of long-lived assets | |||||||
Impairment charges of intangible assets | ¥ 0 | ¥ 0 | ¥ 3,828 | ||||
Lessee, Finance Lease, Description |  For the lessee, a lease is a finance lease if any of the following conditions exist: a) ownership of the leased property is transferred to the lessee by the end of the lease term, b) there is a bargain purchase option, c) the lease term is at least 75% of the leased property’s estimated remaining economic life or d) the present value of the minimum lease payments at the beginning of the lease term is 90% or more of the fair value of the leased property to the leaser at the inception date.  | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Cumulative Effect of Change on Equity or Net Assets | ¥ 87,800 | ||||||
Contract Balance [Member] | |||||||
Impairment of long-lived assets | |||||||
Revenue, Remaining Performance Obligation, Amount | ¥ 1,043,326 | ||||||
Revenue Remaining Performance Obligation Expected to be Recognized | 951,616 | ||||||
Accounting Standards Update 2016-02 [Member] | |||||||
Impairment of long-lived assets | |||||||
Operating Lease, Right-of-Use Asset | 145,000 | ||||||
Operating Lease, Liability | ¥ 141,000 |
Principal accounting policies_4
Principal accounting policies (Schedule of Property and Equipment Estimated Useful Lives and Residual Rate) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Buildings [Member] | |
Property and equipment [Line Items] | |
Estimated useful lives | 40 years |
Residual rate (as a percent) | 0.00% |
Servers, computers and equipment [Member] | |
Property and equipment [Line Items] | |
Estimated useful lives | 3 years |
Servers, computers and equipment [Member] | Minimum [Member] | |
Property and equipment [Line Items] | |
Residual rate (as a percent) | 0.00% |
Servers, computers and equipment [Member] | Maximum [Member] | |
Property and equipment [Line Items] | |
Residual rate (as a percent) | 5.00% |
Leasehold improvements [Member] | |
Property and equipment [Line Items] | |
Residual rate (as a percent) | 0.00% |
Estimated useful lives | Shorter of lease term or 5 years |
Decoration of buildings [Member] | |
Property and equipment [Line Items] | |
Estimated useful lives | 10 years |
Residual rate (as a percent) | 0.00% |
Motor vehicles [Member] | |
Property and equipment [Line Items] | |
Estimated useful lives | 4 years |
Residual rate (as a percent) | 5.00% |
Furniture, fixture and office equipment [Member] | |
Property and equipment [Line Items] | |
Estimated useful lives | 5 years |
Furniture, fixture and office equipment [Member] | Minimum [Member] | |
Property and equipment [Line Items] | |
Residual rate (as a percent) | 0.00% |
Furniture, fixture and office equipment [Member] | Maximum [Member] | |
Property and equipment [Line Items] | |
Residual rate (as a percent) | 5.00% |
Principal accounting policies_5
Principal accounting policies (Schedule of Amortization of Finite-lived Intangible Assets is Computed Using Straight-line Method Over Following Estimated Useful Lives) (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Operating rights [Member] | |
Intangible assets, net [Line Items] | |
Estimated useful lives | Shorter of the economic life or contract terms |
Software [Member] | Minimum [Member] | |
Intangible assets, net [Line Items] | |
Estimated useful lives | 3 years |
Software [Member] | Maximum [Member] | |
Intangible assets, net [Line Items] | |
Estimated useful lives | 5 years |
Domain names [Member] | |
Intangible assets, net [Line Items] | |
Estimated useful lives | 15 years |
Technology [Member] | |
Intangible assets, net [Line Items] | |
Estimated useful lives | 5 years |
License [Member] | |
Intangible assets, net [Line Items] | |
Estimated useful lives | 15 years |
Principal accounting policies_6
Principal accounting policies (Revenue Recognition and Cost of Revenues - Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018USD ($) | Jan. 01, 2017CNY (¥) | |
Revenue recognition [Line Items] | |||||
Tax rate on service income from provision of advertising services in the PRC (as a percent) | 3.00% | ||||
Surcharges on business taxes and VAT (as a percent) | 12.00% | ||||
Accounts Receivable, Net, Current | ¥ 198,428 | ¥ 153,944 | $ 28,860 | ||
(Additions) reversals charged to general and administrative expenses, net | (1,198) | (3,049) | ¥ 3,571 | ||
Contract Balance [Member] | |||||
Revenue recognition [Line Items] | |||||
Accounts Receivable, Net, Current | 198,428 | 153,944 | ¥ 169,571 | ||
Others [Member] | Contract Balance [Member] | |||||
Revenue recognition [Line Items] | |||||
Deferred Revenue | 120,552 | 133,149 | 135,595 | ||
Deferred Revenue, Revenue Recognized | 120,698 | 122,138 | |||
Live streaming [Member] | Contract Balance [Member] | |||||
Revenue recognition [Line Items] | |||||
Deferred Revenue | 922,774 | 682,613 | ¥ 320,547 | ||
Deferred Revenue, Revenue Recognized | ¥ 637,346 | ¥ 308,545 | |||
Minimum [Member] | |||||
Revenue recognition [Line Items] | |||||
VAT (as a percent) | 6.00% | ||||
Maximum [Member] | |||||
Revenue recognition [Line Items] | |||||
VAT (as a percent) | 17.00% | ||||
Advertising revenues [Member] | Minimum [Member] | |||||
Revenue recognition [Line Items] | |||||
Advertising revenues contract term | 1 month | ||||
Advertising revenues [Member] | Maximum [Member] | |||||
Revenue recognition [Line Items] | |||||
Advertising revenues contract term | 3 months | ||||
Period over which payments are due | 3 months |
Principal accounting policies_7
Principal accounting policies (Sales and Marketing Expenses, Share based Compensation, Statutory Reserves, Dividends and Segment Reporting - Narrative) (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Statutory reserves [Line Item] | |||
Advertising and market promotion expenses | ¥ 1,065,866 | ¥ 621,771 | ¥ 298,681 |
Employee social security and welfare benefits | ¥ 286,139 | 214,848 | 206,704 |
Minimum percentage appropriation to statutory surplus fund required | 10.00% | ||
Surplus fund threshold for mandatory appropriation requirement (as a percent) | 50.00% | ||
Amount appropriated to statutory reserves | ¥ 0 | 0 | 0 |
Statutory reserves [Member] | |||
Statutory reserves [Line Item] | |||
Amount appropriated to statutory reserves | ¥ 39,007 | ¥ 3,861 | ¥ 2,350 |
Certain risks and concentrati_3
Certain risks and concentration (Narrative) (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Certain risks and concentration [Line Items] | |||
Maximum foreign ownership in internet information provider or other value-added telecommunication service provider's business allowed under PRC laws and regulations | 50.00% | ||
Minimum [Member] | |||
Certain risks and concentration [Line Items] | |||
Term of contractual agreements | 10 years | ||
Maximum [Member] | |||
Certain risks and concentration [Line Items] | |||
Term of contractual agreements | 30 years | ||
Guangzhou Huaduo [Member] | |||
Certain risks and concentration [Line Items] | |||
Equity interests ownership (as a percent) | 100.00% | ||
Guangzhou Huaduo [Member] | Guangzhou Huanju Shidai and Beijing Huanju Shidai [Member] | |||
Certain risks and concentration [Line Items] | |||
Service fees | ¥ 744,339 | ¥ 279,828 | ¥ 305,792 |
Beijing Tuda and Guangzhou Huaduo [Member] | Beijing Huanju Shidai [Member] | |||
Certain risks and concentration [Line Items] | |||
Maximum percentage of the income of VIEs which may be charged as service fees | 100.00% | ||
Maximum percentage of the profits payable by VIEs | 100.00% |
Certain risks and concentrati_4
Certain risks and concentration (Schedule of Consolidated Financial Information of Group's VIEs and VIE's Subsidiary Excluding Inter Company Items With Group's Subsidiaries Included in Accompanying Consolidated Financial Statements) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018USD ($) | |
Current assets | |||||
Cash and cash equivalents | ¥ 6,004,231 | ¥ 2,617,432 | $ 873,279 | ||
Restricted short-term deposits | 0 | 1,000,000 | 0 | ||
Short-term investments | 979,053 | 124,550 | 142,397 | ||
Accounts receivable, net | 198,428 | 153,944 | 28,860 | ||
Inventory | 0 | 315 | 0 | ||
Amounts due from related parties | 193,559 | 11,190 | 28,152 | ||
Financing receivables, net | 768,343 | ||||
Prepayments and other current assets | 1,019,019 | 221,939 | 148,210 | ||
Total current assets | 16,489,629 | 10,129,474 | 2,398,316 | ||
Non-current assets | |||||
Deferred tax assets | 70,834 | 113,017 | 10,302 | ||
Investments | 4,591,524 | 1,153,019 | 667,809 | ||
Property and equipment, net | 1,296,319 | 1,016,998 | 188,542 | ||
Intangible assets, net | 74,685 | 37,481 | 10,862 | ||
Amounts due from related parties | 0 | 20,000 | 0 | ||
Other non-current assets | 223,859 | 144,275 | 32,559 | ||
Total non-current assets | 9,278,416 | 4,329,245 | 1,349,489 | ||
Total assets | 25,768,045 | 14,458,719 | 3,747,805 | ||
Current liabilities | |||||
Accounts payable | 114,589 | 76,351 | 16,666 | ||
Deferred revenue | 951,616 | 758,044 | 138,407 | ||
Advances from customers | 101,690 | 80,406 | 14,790 | ||
Income taxes payable | 235,561 | 146,298 | 34,261 | ||
Accrued liabilities and other current liabilities | 2,414,371 | 1,465,963 | 351,156 | ||
Amounts due to related parties | 28,336 | 30,502 | 4,121 | ||
Total current liabilities | 3,853,026 | 3,145,799 | 560,399 | ||
Non-current liabilities | |||||
Deferred revenue | 91,710 | 57,718 | 13,339 | ||
Deferred tax liabilities | 27,505 | 10,810 | 4,000 | ||
Total non-current liabilities | 119,215 | 75,064 | 17,339 | ||
Total liabilities | 3,972,241 | 3,220,863 | $ 577,738 | ||
Net revenues | 15,763,557 | $ 2,292,714 | 11,594,792 | ¥ 8,204,050 | |
Net income | 1,641,958 | 238,812 | 2,493,235 | 1,523,918 | |
Net cash provided by operating activities | 4,464,814 | 649,379 | 3,718,452 | 2,421,135 | |
Net cash used in investing activities | (6,295,386) | $ (915,626) | (3,037,516) | (2,172,359) | |
Variable interest entity [Member] | |||||
Current assets | |||||
Cash and cash equivalents | 4,665,938 | 1,343,731 | |||
Short-term deposits | 2,100,000 | 3,400,000 | |||
Restricted short-term deposits | 0 | 1,000,000 | |||
Short-term investments | 979,052 | 124,550 | |||
Accounts receivable, net | 192,932 | 149,958 | |||
Inventory | 0 | 315 | |||
Amounts due from related parties | 172,258 | 9,309 | |||
Financing receivables, net | 725,336 | 0 | |||
Prepayments and other current assets | 663,437 | 190,456 | |||
Total current assets | 9,498,953 | 6,218,319 | |||
Non-current assets | |||||
Long-term deposits | 1,000,000 | 0 | |||
Deferred tax assets | 70,834 | 113,017 | |||
Investments | 862,272 | 582,775 | |||
Property and equipment, net | 655,402 | 359,912 | |||
Intangible assets, net | 57,050 | 15,504 | |||
Land use right, net | 1,784,639 | 1,832,739 | |||
Amounts due from related parties | 0 | 20,000 | |||
Other non-current assets | 143,240 | 133,812 | |||
Total non-current assets | 4,573,437 | 3,057,759 | |||
Total assets | 14,072,390 | 9,276,078 | |||
Current liabilities | |||||
Accounts payable | 112,167 | 67,817 | |||
Deferred revenue | 950,816 | 757,244 | |||
Advances from customers | 101,690 | 80,406 | |||
Income taxes payable | 162,118 | 142,204 | |||
Accrued liabilities and other current liabilities | 2,207,138 | 1,404,877 | |||
Amounts due to related parties | 28,336 | 30,502 | |||
Total current liabilities | 3,562,265 | 2,483,050 | |||
Non-current liabilities | |||||
Deferred revenue | 86,977 | 52,185 | |||
Deferred tax liabilities | 0 | 8,404 | |||
Total non-current liabilities | 86,977 | 60,589 | |||
Total liabilities | 3,649,242 | 2,543,639 | |||
Net revenues | 15,740,097 | 11,577,104 | 8,164,100 | ||
Net income | 3,475,109 | 2,766,279 | 1,874,435 | ||
Net cash provided by operating activities | 4,672,879 | 3,974,085 | 2,538,836 | ||
Net cash used in investing activities | (1,212,622) | (3,571,668) | (1,313,002) | ||
Net cash provided by financing activities | 0 | 66,875 | 8,508 | ||
Net (decrease) / increase in cash and cash equivalents | ¥ 3,460,257 | ¥ 469,292 | ¥ 1,234,342 |
Business combination and disp_2
Business combination and disposal of subsidiaries (Narrative) (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | 12 Months Ended | |
Jan. 31, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Beijing Yunke Online Technology Developments Co., Ltd. [Member] | |||
Business combination [Line Items] | |||
Gain (Loss) on Disposition of Stock in Subsidiary | ¥ 37,989 | ||
Disposal Of Equity Interest, Percentage Of Ownership Transferred | 46.00% | ||
Sale of Stock, Percentage of Ownership after Transaction | 34.00% | ||
Xingxue Technology Development Co., Ltd [Member] | |||
Business combination [Line Items] | |||
Equity Method Investment Disposal Percentage | 33.86% | ||
Assets and Liabilities for Disposal of Subsidiaries | ¥ 154,999 | ||
Proceeds from Sale of Equity Method Investments | ¥ 118,500 | ||
Equity Method Investment, Ownership Percentage | 31.14% | ||
Equity Method Investment, Realized Gain (Loss) on Disposal | ¥ 127,434 | ||
Deconsolidation, Revaluation of Retained Investment, Gain (Loss), Amount | 57,791 | ||
Fair value of consideration received, fair value the retained noncontrolling interest and carrying amount of noncontrolling interest | ¥ 282,433 | ||
Beifu [Member] | |||
Business combination [Line Items] | |||
Subsidiary Divestiture Interest Percentage | 60.00% | ||
Proceeds from Divestiture of Interest in Consolidated Subsidiaries | ¥ 3,500 | ||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 10.00% | ||
Gain (Loss) on Disposition of Stock in Subsidiary | ¥ (23,474) | ||
Fair Value Consideration Received | 13,236 | ||
Assets and Liabilities for Disposal of Subsidiaries | 36,710 | ||
Deconsolidation, Revaluation of Retained Investment, Gain (Loss), Amount | ¥ (3,088) |
Cash and cash equivalents (Deta
Cash and cash equivalents (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2017USD ($) |
Cash and cash equivalents [Line Items] | ||||
Cash and cash equivalents | ¥ 6,004,231 | $ 873,279 | ¥ 2,617,432 | |
Others [Member] | ||||
Cash and cash equivalents [Line Items] | ||||
Cash and cash equivalents | 79 | 0 | ||
RMB [Member] | ||||
Cash and cash equivalents [Line Items] | ||||
Cash and cash equivalents | 4,707,868 | 1,627,044 | ||
US$ [Member] | ||||
Cash and cash equivalents [Line Items] | ||||
Cash and cash equivalents | ¥ 1,296,284 | $ 188,869 | ¥ 990,388 | $ 151,529 |
Short-term and Long-term depo_3
Short-term and Long-term deposits (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2017USD ($) |
Shortterm and Longterm deposits [Line Items] | ||||
Short-term deposits | ¥ 7,326,996 | $ 1,065,667 | ¥ 6,000,104 | |
RMB [Member] | ||||
Shortterm and Longterm deposits [Line Items] | ||||
Short-term deposits | 2,100,000 | 3,400,000 | ||
Long-term deposits | 1,000,000 | 0 | ||
US$ [Member] | ||||
Shortterm and Longterm deposits [Line Items] | ||||
Short-term deposits | ¥ 5,226,996 | $ 761,573 | ¥ 2,600,104 | $ 397,816 |
Restricted short-term deposits
Restricted short-term deposits (Narrative) (Details) ¥ in Millions, $ in Millions | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2017USD ($) |
Restricted Cash And Investments [Line Items] | |||
Debt Instrument, Collateral Amount | ¥ | ¥ 1,000 | ||
Restricted Of Short Term Deposit | $ 0 | ||
Loans Payable [Member] | |||
Restricted Cash And Investments [Line Items] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 160 |
Short-term investments (Narrati
Short-term investments (Narrative) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Short-term Investments | ¥ 979,053 | $ 142,397 | ¥ 124,550 |
Accounts receivable, net (Detai
Accounts receivable, net (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | |
Accounts Receivable Net [Line Items] | ||||||
Accounts receivable, gross | ¥ 206,772 | ¥ 161,300 | ||||
Less: allowance for doubtful receivables | ¥ (7,356) | ¥ (7,356) | ¥ (58,791) | (8,344) | (7,356) | |
Accounts receivable, net | ¥ 198,428 | $ 28,860 | ¥ 153,944 | |||
Summary of allowance for doubtful accounts | ||||||
Balance at the beginning of the year | (7,356) | (55,220) | (58,791) | |||
(Additions) reversals charged to general and administrative expenses, net | (1,198) | (3,049) | 3,571 | |||
Write-off during the year | 210 | 50,913 | 0 | |||
Balance at the end of the year | ¥ (8,344) | ¥ (7,356) | ¥ (55,220) |
Financing receivables, net (Sch
Financing receivables, net (Schedule Of Accounts Financing Receivables) (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Financing receivables, gross | ¥ 1,008,965 | |
Less: allowance for financing receivables | (15,829) | ¥ 0 |
Financing receivables, net | 993,136 | |
Current portion | 768,343 | |
Non-current portion | 224,793 | |
Micro-credit personal loans | ||
Financing receivables, gross | 734,108 | |
Corporate loans | ||
Financing receivables, gross | 274,857 | |
Financing receivables, net | ¥ 199,000 |
Financing receivables, net (S_2
Financing receivables, net (Schedule of Aging of Financing Receivables) (Details 1) ¥ in Thousands | Dec. 31, 2018CNY (¥) |
Financing Receivables, Past Due | ¥ 21,075 |
Financing Receivables, Current | 987,890 |
Total financing receivables | 1,008,965 |
1-90 days past due | |
Financing Receivables, Past Due | 13,074 |
91-180 days past due | |
Financing Receivables, Past Due | 6,590 |
181-360 days past due | |
Financing Receivables, Past Due | 1,411 |
Micro Credit personal Loans [Member] | |
Financing Receivables, Past Due | 21,075 |
Financing Receivables, Current | 713,033 |
Total financing receivables | 734,108 |
Micro Credit personal Loans [Member] | 1-90 days past due | |
Financing Receivables, Past Due | 13,074 |
Micro Credit personal Loans [Member] | 91-180 days past due | |
Financing Receivables, Past Due | 6,590 |
Micro Credit personal Loans [Member] | 181-360 days past due | |
Financing Receivables, Past Due | 1,411 |
Corporate Loans [Member] | |
Financing Receivables, Past Due | 0 |
Financing Receivables, Current | 274,857 |
Total financing receivables | 274,857 |
Corporate Loans [Member] | 1-90 days past due | |
Financing Receivables, Past Due | 0 |
Corporate Loans [Member] | 91-180 days past due | |
Financing Receivables, Past Due | 0 |
Corporate Loans [Member] | 181-360 days past due | |
Financing Receivables, Past Due | ¥ 0 |
Financing receivables, net (All
Financing receivables, net (Allowance For Financing Receivables) (Details) ¥ in Thousands | 12 Months Ended |
Dec. 31, 2018CNY (¥) | |
Balance at the beginning of the year | ¥ 0 |
Charge for the year | (15,829) |
Balance at the end of the year | ¥ (15,829) |
Financing receivables, net - (N
Financing receivables, net - (Narrative) (Details) ¥ in Thousands | Dec. 31, 2018CNY (¥) |
Financing Receivables, Gross | ¥ 1,008,965 |
Total financing receivable due from this default lessee as of December 31, 2018 | 993,136 |
Micro Credit personal Loans [Member] | |
Financing Receivables, Gross | 734,108 |
Micro Credit personal Loans [Member] | Guaranteed by a Third Party Corporation [Member] | |
Financing Receivables, Gross | 371,031 |
Corporate Loans [Member] | |
Sale-and-leaseback arrangements under corporate loans , the principal amount due in January 2019 and the lessee unable to repay | 15,000 |
Financing Receivables, Gross | 274,857 |
Total financing receivable due from this default lessee as of December 31, 2018 | 199,000 |
Financing Receivables, Equal to Greater than 90 Days Past Due [Member] | |
Financing Receivables, Non-accrual Status | ¥ 8,001 |
Prepayments and other current_3
Prepayments and other current assets (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Prepayments and other current assets [Line Items] | |||
Interests receivable | ¥ 218,553 | ¥ 78,274 | |
Prepayments and deposits to vendors and content providers | 183,293 | 81,319 | |
Loans to third parties | 180,964 | 0 | |
Receivable from payment platforms | 112,061 | 0 | |
Value added taxes to be deducted | 69,563 | 0 | |
Amounts receivables from issuance of a subsidiary's preferred shares | 102,951 | 0 | |
Receivables from disposal of subsidiaries and investments | 59,255 | 7,986 | |
Rental and other deposits | 22,457 | 14,214 | |
Employee advances | 11,536 | 16,697 | |
Others | 58,386 | 23,449 | |
Total | ¥ 1,019,019 | $ 148,210 | ¥ 221,939 |
Investments (Schedule of Invest
Investments (Schedule of Investments) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | |
Investments [Line Items] | ||||
Equity investments accounted for using the equity method (i) | [1] | ¥ 378,378 | ¥ 309,241 | |
Equity investments with readily determinable fair values (ii) | [2] | 238,915 | 138,251 | |
Equity investments without readily determinable fair values (iii) | [3] | 3,974,231 | 703,566 | |
Available-for-sale debt securities | 0 | 1,961 | ||
Total | ¥ 4,591,524 | $ 667,809 | ¥ 1,153,019 | |
[1] | In 2017 and 2018, the Group acquired minority stake of a number of privately-held entities with total consideration of RMB 21,740 and RMB14,277, respectively. Investments have been accounted for under the equity method where the Group has significant influence on these investments and the investments are considered as in-substance ordinary shares. | |||
[2] | In 2018, the Group made an investment in a third party investment fund with total consideration of RMB204,499. The Group does not have the ability to exercise significant influence over the investment. Therefore, it has been precluded from applying the equity method of accounting. In 2018, fair value loss of RMB113,677 related to investments with readily determinable fair values was recognized in gain on fair value changes of investments, all of which was unrealized. | |||
[3] | Equity securities without readily determinable fair values and over which the Company has neither significant influence nor control through investments in common stock or in-substance common stock. In 2017 and 2018, the Group acquired minority preffered shares or ordinary shares of a number of privately-held entities with total consideration of RMB301,848 and RMB2,118,648, respectively. The ownship interests were less than 20% of the investees’ total equities. The Company has neither significant influence nor control in these investees. These equity investments are not considered as debt securities or equity securities that have readily determinable fair values. Accordingly the Company elected to account for these investments at cost less impairments, adjusted by observable price changes. In 2018, fair value gain of RMB1,803,081 due to the observable price change, was recognized in gain on fair value changes of investments (Note 29). Out of the fair value gain of RMB1,803,081, RMB356,545 was realized and RMB1,446,536 was unrealized. |
Investments (Narrative) (Detail
Investments (Narrative) (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Consideration to acquire minority stake | ¥ 2,118,648 | ¥ 301,848 | |
Impairment charge | 35,348 | 43,205 | ¥ 80,104 |
Sale Of Investments Consideration Received On Transaction | 780,071 | ||
Gain on disposals and deemd disposal of investments | 16,178 | ||
Equity Securities, FV-NI, Unrealized Loss | 113,677 | ||
Equity securities with readily determinable fair value cost | 204,499 | ||
Equity Securities, FV-NI, Realized Gain | 356,545 | ||
Equity Securities, FV-NI, Gain | 1,803,081 | 0 | |
Unrealized Gain (Loss) on Investments | ¥ 1,446,536 | ||
Investees [Member] | |||
Equity method investment, ownership percentage | 20.00% | ||
Equity Method Investments [Member] | |||
Equity Method Investments Original Cost | ¥ 14,277 | ¥ 21,740 |
Property and equipment, net (Sc
Property and equipment, net (Schedule of Property and Equipment) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Property and equipment, net [Line Items] | |||
Gross carrying amount | ¥ 1,939,476 | ¥ 1,535,126 | |
Less: accumulated depreciation | (643,157) | (518,128) | |
Property and equipment, net | 1,296,319 | $ 188,542 | 1,016,998 |
Buildings [Member] | |||
Property and equipment, net [Line Items] | |||
Gross carrying amount | 857,020 | 731,640 | |
Servers, computers and equipment [Member] | |||
Property and equipment, net [Line Items] | |||
Gross carrying amount | 679,735 | 588,589 | |
Leasehold improvements [Member] | |||
Property and equipment, net [Line Items] | |||
Gross carrying amount | 22,913 | 18,651 | |
Decoration of buildings [Member] | |||
Property and equipment, net [Line Items] | |||
Gross carrying amount | 103,305 | 100,711 | |
Furniture, fixture and office equipment [Member] | |||
Property and equipment, net [Line Items] | |||
Gross carrying amount | 26,439 | 24,102 | |
Motor vehicles [Member] | |||
Property and equipment, net [Line Items] | |||
Gross carrying amount | 38,407 | 27,330 | |
Construction in progress [Member] | |||
Property and equipment, net [Line Items] | |||
Gross carrying amount | ¥ 211,657 | ¥ 44,103 |
Property and equipment, net (Na
Property and equipment, net (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Depreciation expense | ¥ 150,991 | $ 21,961 | ¥ 176,715 | ¥ 173,625 |
Land use rights, net (Schedule
Land use rights, net (Schedule Of Land Use Right) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Gross carrying amount | ¥ 183,528 | ¥ 124,883 | |
Less: accumulated amortization | (101,348) | (80,150) | |
Land use right, net | 74,685 | $ 10,862 | ¥ 37,481 |
Land use right [Member] | |||
Gross carrying amount | 1,924,563 | ||
Less: accumulated amortization | (139,924) | ||
Land use right, net | ¥ 1,784,639 |
Land use rights, net (Schedul_2
Land use rights, net (Schedule of Finite-Lived Intangible Assets, Future Amortization Expense) (Details) - Use Rights [Member] ¥ in Thousands | Dec. 31, 2018CNY (¥) |
2019 | ¥ 48,096 |
2020 | 48,096 |
2021 | 48,096 |
2022 | 48,096 |
2023 | ¥ 48,096 |
Land use rights, net (Narrative
Land use rights, net (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Amortization of acquired intangible assets and land use right | ¥ 69,095 | $ 10,049 | ¥ 62,419 | ¥ 100,892 |
Use Rights [Member] | ||||
Amortization of acquired intangible assets and land use right | ¥ 48,100 | ¥ 47,909 | ¥ 43,915 |
Intangible assets, net (Summary
Intangible assets, net (Summary of Group's Intangible Assets) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Intangible assets, net [Line Items] | |||
Gross carrying amount | ¥ 183,528 | ¥ 124,883 | |
Less: accumulated amortization | (101,348) | (80,150) | |
Less: accumulated impairment | (7,495) | (7,252) | |
Intangible assets, net | 74,685 | $ 10,862 | 37,481 |
Operating rights [Member] | |||
Intangible assets, net [Line Items] | |||
Gross carrying amount | 67,080 | 47,020 | |
Less: accumulated amortization | (48,451) | (40,320) | |
Software [Member] | |||
Intangible assets, net [Line Items] | |||
Gross carrying amount | 39,535 | 34,413 | |
Less: accumulated amortization | (28,406) | (19,448) | |
Domain names [Member] | |||
Intangible assets, net [Line Items] | |||
Gross carrying amount | 26,819 | 25,774 | |
Less: accumulated amortization | (11,213) | (9,687) | |
Technology [Member] | |||
Intangible assets, net [Line Items] | |||
Gross carrying amount | 18,094 | 17,676 | |
Less: accumulated amortization | (11,856) | (10,695) | |
License [Member] | |||
Intangible assets, net [Line Items] | |||
Gross carrying amount | 32,000 | 0 | |
Less: accumulated amortization | ¥ (1,422) | ¥ 0 |
Intangible assets, net (Schedul
Intangible assets, net (Schedule of Estimated Amortization Expenses) (Details) - Intangible Assets [Member] ¥ in Thousands | Dec. 31, 2018CNY (¥) |
Amortization expense of intangible assets | |
2019 | ¥ 22,710 |
2020 | 13,010 |
2021 | 4,563 |
2022 | 4,060 |
2023 | ¥ 3,978 |
Intangible assets, net (Sched_2
Intangible assets, net (Schedule of Weighted Average Amortization Periods of Intangible Assets) (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Domain names [Member] | ||
Weighted average amortization periods of intangible assets | ||
Weighted average amortization period | 15 years | 15 years |
Technology [Member] | ||
Weighted average amortization periods of intangible assets | ||
Weighted average amortization period | 5 years | |
Software [Member] | ||
Weighted average amortization periods of intangible assets | ||
Weighted average amortization period | 4 years | 4 years |
Operating rights [Member] | ||
Weighted average amortization periods of intangible assets | ||
Weighted average amortization period | 2 years | 1 year |
License [Member] | ||
Weighted average amortization periods of intangible assets | ||
Weighted average amortization period | 15 years |
Intangible assets, net (Narrati
Intangible assets, net (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Amortization of acquired intangible assets and land use right | ¥ 69,095 | $ 10,049 | ¥ 62,419 | ¥ 100,892 |
Finite-Lived Intangible Assets [Member] | ||||
Amortization of acquired intangible assets and land use right | ¥ 20,995 | ¥ 14,510 | ¥ 56,977 |
Goodwill (Details)
Goodwill (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | ||||
Goodwill | |||||||
Balance at beginning of the year | ¥ 11,716 | ¥ 14,300 | |||||
Impairment charges | 0 | [1] | $ 0 | [1] | (2,527) | ¥ (17,665) | [1],[2] |
Foreign currency translation adjustment | 47 | (57) | |||||
Balance at end of the year | ¥ 11,763 | $ 1,711 | ¥ 11,716 | ¥ 14,300 | |||
[1] | Share-based compensation was allocated in cost of revenues and operating expenses as follows:RMB RMB RMB US$ Cost of revenues 15,894 42,759 74,339 10,812 Research and development expenses 78,816 122,348 225,173 32,750 Sales and marketing expenses 3,107 4,417 5,723 832 General and administrative expenses 59,469 88,137 342,790 49,857 | ||||||
[2] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya 100 Education Total RMB RMB RMB RMB Cost of revenues 9,893 5,677 324 15,894 Research and development expenses 53,085 19,538 6,193 78,816 Sales and marketing expenses 2,781 326 - 3,107 General and administrative expenses 19,523 26,557 13,389 59,469 |
Goodwill (Narrative) (Details)
Goodwill (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||
Dec. 31, 2018CNY (¥) | [1] | Dec. 31, 2018USD ($) | [1] | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | [1],[2] | |
Goodwill [Line Items] | |||||||
Goodwill impairment losses | ¥ 0 | $ 0 | ¥ 2,527 | ¥ 17,665 | |||
Guangzhou Zhuque Information Technology Co Ltd [Member] | |||||||
Goodwill [Line Items] | |||||||
Goodwill impairment losses | ¥ 2,527 | ||||||
[1] | Share-based compensation was allocated in cost of revenues and operating expenses as follows:RMB RMB RMB US$ Cost of revenues 15,894 42,759 74,339 10,812 Research and development expenses 78,816 122,348 225,173 32,750 Sales and marketing expenses 3,107 4,417 5,723 832 General and administrative expenses 59,469 88,137 342,790 49,857 | ||||||
[2] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya 100 Education Total RMB RMB RMB RMB Cost of revenues 9,893 5,677 324 15,894 Research and development expenses 53,085 19,538 6,193 78,816 Sales and marketing expenses 2,781 326 - 3,107 General and administrative expenses 19,523 26,557 13,389 59,469 |
Deferred revenue (Details)
Deferred revenue (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Deferred revenue [Line Items] | |||
Deferred revenue, current | ¥ 951,616 | $ 138,407 | ¥ 758,044 |
Deferred revenue, non-current | 91,710 | $ 13,339 | 57,718 |
Live streaming [Member] | |||
Deferred revenue [Line Items] | |||
Deferred revenue, current | 842,040 | 637,346 | |
Deferred revenue, non-current | 80,734 | 45,267 | |
Others [Member] | |||
Deferred revenue [Line Items] | |||
Deferred revenue, current | 109,576 | 120,698 | |
Deferred revenue, non-current | ¥ 10,976 | ¥ 12,451 |
Accrued liabilities and other_3
Accrued liabilities and other current liabilities (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Revenue sharing fees | ¥ 1,318,561 | ¥ 839,745 | |
Salaries and welfare | 329,169 | 220,539 | |
Marketing and promotion expenses | 213,216 | 109,901 | |
Bandwidth costs | 131,252 | 102,064 | |
Value added taxes and other taxes payable | 109,040 | 23,204 | |
Deposits from third parties | 82,771 | 27,440 | |
Payables to merchants | 75,471 | 15,442 | |
Other payable to content providers | 30,313 | 20,849 | |
Others | 124,578 | 106,779 | |
Total | ¥ 2,414,371 | $ 351,156 | ¥ 1,465,963 |
Short-term loans (Details)
Short-term loans (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Short-term Debt | ¥ 0 | $ 0 | ¥ 588,235 |
Short-term loans (Narrative) (D
Short-term loans (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2017USD ($) | |
Restricted Cash and Investments, Current | ¥ 0 | $ 0 | ¥ 1,000,000 | |
Loans Payable [Member] | ||||
Debt Instrument, Face Amount | 588,235 | $ 90,000 | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ | $ 160,000 | |||
Restricted Cash and Investments, Current | ¥ | ¥ 1,000,000 | |||
Debt Instrument, Maturity Date, Description | These loans were all with a maturity of less than one year | |||
Loans Payable [Member] | Minimum [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 2.00% | 2.00% | ||
Loans Payable [Member] | Maximum [Member] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 3.00% | 3.00% |
Convertible bonds (Details)
Convertible bonds (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Convertible bonds, non-current | |||
2019 Convertible Senior Notes | ¥ 0 | $ 0 | ¥ 6,536 |
Short-term Debt [Member] | |||
Convertible bonds, current | |||
2019 Convertible Senior Notes | 6,863 | $ 998 | 0 |
Long-term Debt [Member] | |||
Convertible bonds, non-current | |||
2019 Convertible Senior Notes | ¥ 0 | ¥ 6,536 |
Convertible bonds (Narrative) (
Convertible bonds (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Apr. 01, 2017USD ($) | Mar. 18, 2014USD ($) | |
Convertible bonds [Line Items] | ||||||||
Interest expense | ¥ 8,616 | $ 1,253 | ¥ 32,122 | ¥ 81,085 | ||||
Convertible bonds, current | 6,863 | 0 | $ 998 | $ 1,000 | ||||
Debt Instrument, Repurchased Face Amount | $ 399,000 | |||||||
Convertible bonds, non-current | 0 | 6,536 | 0 | |||||
Convertible bonds [Member] | ||||||||
Convertible bonds [Line Items] | ||||||||
Interest expense | ¥ | 149 | 20,820 | ||||||
Convertible bonds, current | ¥ 6,900 | $ 1,000 | ||||||
Convertible bonds, non-current | ¥ 6,500 | $ 1,000 | ||||||
2.25% Convertible Senior Notes due 2019 [Member] | ||||||||
Convertible bonds [Line Items] | ||||||||
Aggregate principle amount | $ 400,000 | |||||||
Interest rate (as a percent) | 2.25% | 2.25% | ||||||
Convertible bonds, current | ¥ 6,863 | $ 998 | ||||||
2.25% Convertible Senior Notes due 2019 [Member] | Contingent redemption option [Member] | ||||||||
Convertible bonds [Line Items] | ||||||||
Redemption period, start date | Apr. 1, 2019 | Apr. 1, 2019 |
Cost of revenues (Details)
Cost of revenues (Details) - Cost of revenues [Member] - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue sharing fees and content costs | ¥ 8,272,696 | ¥ 5,727,081 | ¥ 3,790,624 |
Bandwidth costs | 967,436 | 695,839 | 651,652 |
Salary and welfare | 323,623 | 237,063 | 232,497 |
Depreciation and amortization | 117,293 | 128,639 | 173,048 |
Payment handling costs | 104,772 | 72,953 | 67,474 |
Other taxes and surcharges | 48,724 | 48,360 | 44,659 |
Share-based compensation | 74,339 | 42,759 | 15,894 |
Other costs | 108,251 | 73,708 | 127,582 |
Total | ¥ 10,017,134 | ¥ 7,026,402 | ¥ 5,103,430 |
Other income (Details)
Other income (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Government grants | ¥ 88,488 | ¥ 88,873 | ¥ 128,550 | |
Others | 29,372 | 24,314 | 954 | |
Total | ¥ 117,860 | $ 17,142 | ¥ 113,187 | ¥ 129,504 |
Income tax (Schedule of Current
Income tax (Schedule of Current and Deferred Portions of Income Tax Expense Included in Consolidated Statements of Comprehensive Income) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | ||
Current and deferred portions of income tax expense | |||||
Income (loss) before income tax expenses | ¥ 2,534,471 | $ 368,623 | ¥ 2,891,178 | ¥ 1,783,811 | |
Current income tax expenses | (428,061) | (411,892) | (288,282) | ||
Deferred income tax benefit (expenses) | (49,646) | (7,221) | (3,919) | 7,768 | |
Income tax expenses | (477,707) | $ (69,480) | (415,811) | (280,514) | |
PRC Entities [Member] | |||||
Current and deferred portions of income tax expense | |||||
Income (loss) before income tax expenses | 3,494,192 | 2,919,350 | 1,914,432 | ||
Current income tax expenses | (379,130) | (402,012) | (288,282) | ||
Deferred income tax benefit (expenses) | (25,081) | (3,919) | 7,768 | ||
Income tax expenses | (404,211) | (405,931) | (280,514) | ||
Non PRC Entities [Member] | |||||
Current and deferred portions of income tax expense | |||||
Income (loss) before income tax expenses | [1] | (959,721) | (28,172) | (130,621) | |
Current income tax expenses | (48,931) | (9,880) | 0 | ||
Deferred income tax benefit (expenses) | (24,565) | 0 | 0 | ||
Income tax expenses | ¥ (73,496) | ¥ (9,880) | ¥ 0 | ||
[1] | The loss before tax incurred by non-PRC entities for the year ended December 31, 2018 was mainly due to the fair value loss on derivative liabilities amouting to RMB2,285,223. This fair value loss was incurred by Huya whose applicable tax rate is zero, therefore the tax impact related to this fair value loss was included in “effect of different tax rates available to different jurisdictions” in the reconciliation table below. |
Income tax (Schedule of Reconci
Income tax (Schedule of Reconciliation of Total Tax Expense Computed by Applying Respective Statutory Income Tax Rate to Pre-tax Income) (Details) - ¥ / shares | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
PRC Statutory income tax rate (as a percent) | (25.00%) | (25.00%) | (25.00%) | |
Effect of tax holiday and preferential tax rate benefit (as a percent) | 16.50% | 13.20% | 11.60% | |
Effect of different tax rates available to different jurisdictions (as a percent) | (10.10%) | (0.30%) | (1.70%) | |
Permanent differences (as a percent) | [1] | (3.50%) | (1.80%) | (1.10%) |
Change in valuation allowance (as a percent) | (1.60%) | (2.30%) | (1.50%) | |
Effect of Super Deduction available to the Group (as a percent) | 4.90% | 1.80% | 2.00% | |
Effective income tax rate (as a percent) | (18.80%) | (14.40%) | (15.70%) | |
Per share effect of tax holiday (RMB) | ¥ 0.27 | ¥ 0.24 | ¥ 0.18 | |
ADS [Member] | ||||
Per share effect of tax holiday (RMB) | ¥ 5.35 | ¥ 4.71 | ¥ 3.52 | |
[1] | Permanent differences mainly arise from expenses not deductible for tax purposes including primarily share-based compensation costs and expenses incurred by subsidiaries and VIEs. |
Income tax (Schedule of Tax Eff
Income tax (Schedule of Tax Effects of Temporary Differences that Give Rise to Deferred Tax Asset Balances) (Details) - CNY (¥) ¥ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Deferred tax assets: | ||||||
Tax loss carried forward | ¥ 148,899 | ¥ 74,951 | ||||
Allowance for doubtful receivable, accrued expense and others not currently deductible for tax purposes | 84,249 | 62,177 | ||||
Deferred revenue | 36,007 | 97,858 | ||||
Impairment of investment | 17,180 | 12,783 | ||||
Others | 753 | 753 | ||||
Valuation allowance | (175,793) | [1] | (135,505) | [1] | ¥ (80,712) | ¥ (53,316) |
Amounts offset by deferred tax liabilities | (40,461) | 0 | ||||
Total deferred tax assets, net | 70,834 | 113,017 | ||||
Deferred tax liabilities: | ||||||
Related to the fair value changes of investments | 61,658 | 3,627 | ||||
Related to acquired intangible assets | 1,531 | 2,406 | ||||
Others | 4,777 | 4,777 | ||||
Amounts offset by deferred tax assets | (40,461) | 0 | ||||
Total deferred tax liabilities, net | ¥ 27,505 | ¥ 10,810 | ||||
[1] | Valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group considered factors including future taxable income exclusive of reversing temporary differences and tax loss carry forwards. Valuation allowance was provided for net operating loss carry forward because it was more likely than not that such deferred tax assets would not be realized based on the Group’s estimate of its future taxable income. If events occur in the future that allow the Group to realize more of its deferred income tax than the presently recorded amounts, an adjustment to the valuation allowances will result in a decrease in tax expense when those events occur. |
Income tax (Schedule of Movemen
Income tax (Schedule of Movement of valuation allowance) (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Balance at beginning of the year | ¥ (135,505) | [1] | ¥ (80,712) | ¥ (53,316) | |
Additions | (113,597) | (78,978) | (45,491) | ||
Reversals | 73,309 | 24,185 | 18,095 | ||
Balance at end of the year | ¥ (175,793) | [1] | ¥ (135,505) | [1] | ¥ (80,712) |
[1] | Valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group considered factors including future taxable income exclusive of reversing temporary differences and tax loss carry forwards. Valuation allowance was provided for net operating loss carry forward because it was more likely than not that such deferred tax assets would not be realized based on the Group’s estimate of its future taxable income. If events occur in the future that allow the Group to realize more of its deferred income tax than the presently recorded amounts, an adjustment to the valuation allowances will result in a decrease in tax expense when those events occur. |
Income tax (Narrative) (Details
Income tax (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019 | Dec. 31, 2018CNY (¥) | Dec. 31, 2017USD ($) | Dec. 31, 2016 | Dec. 31, 2017CNY (¥) | |
Income tax [Line Items] | |||||
Income tax rate (as a percent) | 25.00% | 25.00% | 25.00% | ||
Effective Income Tax Rate Reconciliation, Deduction, Percent | 4.90% | 1.80% | 2.00% | ||
Derivative, Loss on Derivative | ¥ 2,285,223 | ||||
Maximum [Member] | Research and Development Expense [Member] | |||||
Income tax [Line Items] | |||||
Effective Income Tax Rate Reconciliation, Deduction, Percent | 75.00% | ||||
Minimum [Member] | Research and Development Expense [Member] | |||||
Income tax [Line Items] | |||||
Effective Income Tax Rate Reconciliation, Deduction, Percent | 50.00% | ||||
Hong Kong [Member] | |||||
Income tax [Line Items] | |||||
Income tax rate (as a percent) | 16.50% | ||||
Operating Loss Carryforwards | ¥ 113,645 | ||||
CHINA [Member] | |||||
Income tax [Line Items] | |||||
Income tax rate (as a percent) | 25.00% | ||||
PRC withholding tax rate (as a percent) | 10.00% | ||||
Aggregate undistributed earnings of subsidiaries available for distribution | ¥ 11,519,699 | ¥ 7,605,499 | |||
Operating Loss Carryforwards | ¥ 355,685 | ||||
Inland Revenue, Hong Kong [Member] | Maximum [Member] | |||||
Income tax [Line Items] | |||||
PRC withholding tax rate (as a percent) | 5.00% | ||||
Singapore Country [Member] | |||||
Income tax [Line Items] | |||||
Income tax rate (as a percent) | 17.00% | ||||
Operating Loss Carryforwards | ¥ 242,735 | ||||
Guangzhou Huaduo [Member] | CHINA [Member] | |||||
Income tax [Line Items] | |||||
Income tax rate (as a percent) | 15.00% | ||||
Guangzhou Huanju Shidai [Member] | |||||
Income tax [Line Items] | |||||
Dividends | $ | $ 15,000 | ||||
Payments Related To Withholding Tax For Dividends | $ | $ 1,500 | ||||
Guangzhou Huanju Shidai [Member] | CHINA [Member] | |||||
Income tax [Line Items] | |||||
Preferential tax rate (as a percent) | 10.00% | ||||
Guangzhou Huanju Shidai [Member] | CHINA [Member] | Key National Software Enterprises [Member] | |||||
Income tax [Line Items] | |||||
Preferential tax rate (as a percent) | 10.00% | ||||
Guangzhou Juhui Information Technology Co., Ltd. [Member] | |||||
Income tax [Line Items] | |||||
Preferential tax rate (as a percent) | 12.50% | 0.00% | |||
Guangzhou Juhui Information Technology Co., Ltd. [Member] | CHINA [Member] | |||||
Income tax [Line Items] | |||||
Income tax rate (as a percent) | 12.50% | 0.00% | |||
Other PRC Subsidiaries [Member] | |||||
Income tax [Line Items] | |||||
Income tax rate (as a percent) | 25.00% | ||||
Guangzhou Huya [Member] | |||||
Income tax [Line Items] | |||||
Preferential tax rate (as a percent) | 15.00% | ||||
Huya Technology [Member] | |||||
Income tax [Line Items] | |||||
Preferential tax rate (as a percent) | 0.00% | ||||
Huya Technology [Member] | Subsequent Event [Member] | |||||
Income tax [Line Items] | |||||
Preferential tax rate (as a percent) | 12.50% |
Mezzanine equity (Narrative) (D
Mezzanine equity (Narrative) (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands | Mar. 08, 2018CNY (¥)shares | Mar. 08, 2018USD ($)shares | Jul. 10, 2017CNY (¥)shares | Jul. 10, 2017USD ($)$ / sharesshares | May 11, 2018CNY (¥) | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) |
Redeemable NonControlling Interest Equity Stock Issued During Period Shares New Issues | shares | 22,058,823 | 22,058,823 | 500,000,000 | 500,000,000 | |||||
Redeemable NonControlling Interest Equity Stock Issued During Period Value New Issues | ¥ 509,730 | $ 75,000 | ¥ 345,420 | $ 50,000 | |||||
Temporary Equity, Accretion to Redemption Value | 5,758 | ¥ 19,842 | |||||||
Derivative Liability | 892,000 | ||||||||
Derivative, Gain (Loss) on Derivative, Net | (2,285,223) | $ (332,372) | ¥ 0 | ¥ 0 | |||||
Proceeds from Issuance Initial Public Offering | ¥ 795,073 | ||||||||
Other Preferred Stock Dividends and Adjustments | 489,284 | ||||||||
Convertible Preferred Stock, Nonredeemable or Redeemable, Issuer Option, Value | ¥ 4,009,874 | ||||||||
Huya Broad casting [Member] | |||||||||
Derivative, Gain (Loss) on Derivative, Net | ¥ (2,285,223) | ||||||||
Interest Ownership Percentage By Parent | 44.00% | ||||||||
Additional Paid in Capital | ¥ 4,804,947 | ||||||||
Series A Preferred Shares [Member] | |||||||||
Shares Issued, Price Per Share | $ / shares | $ 3.4 | ||||||||
Series B2 Preferred Shares [Member] | |||||||||
Redeemable NonControlling Interest Equity Stock Issued During Period Shares New Issues | shares | 64,488,235 | 64,488,235 | |||||||
Redeemable NonControlling Interest Equity Stock Issued During Period Value New Issues | ¥ 2,919,112 | $ 461,600 |
Common shares (Narrative) (Deta
Common shares (Narrative) (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Aug. 21, 2017USD ($)$ / sharesshares | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017CNY (¥)shares | Dec. 31, 2016CNY (¥)shares | Dec. 31, 2015shares | |
Common shares [Line Items] | ||||||
Aggregate consideration of common shares issued and sold to an independent institutional investor | ¥ (4,473) | $ (651) | ¥ 2,950,607 | ¥ 0 | ||
Class A common shares [Member] | ||||||
Common shares [Line Items] | ||||||
Aggregate consideration of common shares issued and sold to an independent institutional investor | $ | $ 442,200 | |||||
Issue price per share | $ / shares | $ 3.5 | |||||
Common shares, shares authorized | 10,000,000,000 | 10,000,000,000 | 10,000,000,000 | 10,000,000,000 | ||
Common shares, shares outstanding | 981,740,848 | 981,740,848 | 945,245,908 | |||
Class B common shares [Member] | ||||||
Common shares [Line Items] | ||||||
Common shares, shares authorized | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 | ||
Common shares, shares outstanding | 288,182,976 | 288,182,976 | 317,982,976 | |||
Restricted shares [Member] | Class A common shares [Member] | ||||||
Common shares [Line Items] | ||||||
Issuance of common share (in shares) | 6,694,940 | 6,694,940 | 21,305,880 | 11,887,180 | ||
Common shares [Member] | Class A common shares [Member] | ||||||
Common shares [Line Items] | ||||||
Issuance of common share (in shares) | 132,250,000 | 132,250,000 | ||||
Common shares, shares outstanding | 981,740,848 | 981,740,848 | 945,245,908 | 750,115,028 | 728,227,848 | |
Common shares [Member] | Class B common shares [Member] | ||||||
Common shares [Line Items] | ||||||
Conversion of Stock, Shares Converted | 29,800,000 | 29,800,000 | 41,575,000 | 10,000,000 | ||
Common shares, shares outstanding | 288,182,976 | 288,182,976 | 317,982,976 | 359,557,976 | 369,557,976 |
Share-based compensation (Share
Share-based compensation (Share Options - Narrative) (Details) ¥ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2009shares | Dec. 31, 2008shares | Dec. 31, 2018CNY (¥)shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2017CNY (¥)shares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016CNY (¥) | Dec. 31, 2016USD ($) | |
Share-based compensation [Line Items] | ||||||||
Share-based Compensation | ¥ 648,025 | $ 94,251 | ¥ 257,661 | ¥ 157,286 | ||||
General and Administrative Expense [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Non Employee Share Based Compensation Cost | 20,980 | $ 0 | $ 0 | |||||
Share-based Compensation | 342,790 | $ 49,857 | 88,137 | 59,469 | ||||
Huya Common Share [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Allocated Share-based Compensation Expense | ¥ | ¥ 5,227 | ¥ 28,226 | ||||||
Stock Transferred During Period Shares Issued For Services | 367,870 | 367,870 | 1,551,495 | 1,551,495 | ||||
Employees [Member] | Huya Member [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 4,183,685 | 4,183,685 | ||||||
Non-employee [Member] | Huya Member [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 10,000 | 10,000 | ||||||
Pre-2009 Scheme Options [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Number | 154,535 | 154,535 | ||||||
Huya 2017 Share Incentive Plan [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Allocated Share-based Compensation Expense | ¥ | ¥ 151,242 | ¥ 19,473 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Description | There are two types of vesting schedule for employees, which are: i) 50% of the restricted share units will be vested after 24 months of the grant date and the remaining 50% will be vested in two equal installments over the following 24 months, and ii) restricted share units will be vested in four equal installments over the following 48 months. | There are two types of vesting schedule for employees, which are: i) 50% of the restricted share units will be vested after 24 months of the grant date and the remaining 50% will be vested in two equal installments over the following 24 months, and ii) restricted share units will be vested in four equal installments over the following 48 months. | ||||||
Share Based Compensation Arrangement By Share Based Payment Award Award Vesting Period Two | 48 months | 48 months | ||||||
Share Based Compensation Arrangement By Share Based Payment Award Award Vesting Period Three | 24 months | 24 months | ||||||
Share-based Compensation Arrangement by Share-based Payment Award Accelerated Compensation Cost | ¥ | ¥ 1,869 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period | 262,503 | 262,503 | ||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | ¥ | ¥ 169,604 | |||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 1 month 20 days | 1 year 1 month 20 days | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | 10 years | ||||||
Huya 2017 Share Incentive Plan [Member] | Share-based Compensation Award, Tranche Two [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 50.00% | 50.00% | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 24 months | 24 months | ||||||
Huya 2017 Share Incentive Plan [Member] | Employees [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Awards granted (in shares) | 5,918,353 | 5,918,353 | 11,737,705 | 11,737,705 | ||||
Huya 2017 Share Incentive Plan [Member] | Non-employee [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Awards granted (in shares) | 220,000 | 220,000 | ||||||
Share Incentive Scheme [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Number | 10,934,300 | |||||||
Share options [Member] | Pre-2009 Scheme Options [Member] | Employees [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Awards granted (in shares) | 8,499,050 | 12,705,700 | ||||||
Share options [Member] | Pre-2009 Scheme Options [Member] | Non-employee [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Awards granted (in shares) | 3,832,290 | |||||||
Restricted Stock [Member] | Huya 2017 Share Incentive Plan [Member] | ||||||||
Share-based compensation [Line Items] | ||||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Share-based Awards Other than Options | ¥ | ¥ 166,010 | |||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 2 months 15 days | 1 year 2 months 15 days | ||||||
Share-based Compensation | ¥ | ¥ 69,620 | ¥ 0 | 0 | |||||
Restricted Stock Expense Of Non Employees | ¥ | ¥ 1,076 | ¥ 0 | ¥ 0 |
Share-based compensation (Restr
Share-based compensation (Restricted Share Units - Narrative) (Details) - CNY (¥) ¥ in Thousands | 1 Months Ended | 12 Months Ended | |||
Oct. 31, 2012 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Sep. 16, 2011 | |
Share-based compensation [Line Items] | |||||
Shares approved for grants to qualified persons | 43,000,000 | ||||
Annual increase on the first day of each fiscal year, beginning from 2013 in maximum aggregate number of shares which may be issued pursuant to all awards under the Plan | 20,000,000 | ||||
2011 Incentive Scheme [Member] | Restricted share units [Member] | |||||
Share-based compensation [Line Items] | |||||
Share-based compensation (benefit) | ¥ 372,281 | ¥ 211,189 | ¥ 143,350 | ||
Total unrecognized compensation expense | ¥ 442,094 | ||||
Weighted average period over which unrecognized compensation expense is expected to be recognized | 1 year 1 month 9 days | ||||
2011 Incentive Scheme [Member] | Restricted share units [Member] | Employees [Member] | |||||
Share-based compensation [Line Items] | |||||
Granted (in shares) | 11,977,794 | 22,090,030 | 1,530,008 | ||
2011 Incentive Scheme [Member] | Restricted share units [Member] | Non-employee [Member] | |||||
Share-based compensation [Line Items] | |||||
Granted (in shares) | 150,000 |
Share-based compensation (Summa
Share-based compensation (Summary of Restricted Share Units Activity) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
2011 Incentive Scheme [Member] | Parent [Member] | |||
Number of restricted shares | |||
Outstanding at the beginning of the period (in shares) | 30,874,144 | 20,955,720 | 36,283,602 |
Granted (in shares) | 11,977,794 | 22,090,030 | 1,530,008 |
Forfeited (in shares) | (5,115,304) | (4,007,728) | (4,628,202) |
Vested (in shares) | (12,507,000) | (8,163,878) | (12,229,688) |
Outstanding at the end of the period (in shares) | 25,229,634 | 30,874,144 | 20,955,720 |
Expected to vest at the end of the period (in shares) | 23,742,895 | ||
Weighted average grant-date fair value | |||
Outstanding at the beginning of the period (in dollars per share) | $ 4.4969 | $ 2.4320 | $ 2.3535 |
Granted (in dollars per share) | 4.7052 | 5.3001 | 1.8618 |
Forfeited (in dollars per share) | 4.6843 | 2.5561 | 2.7386 |
Vested (in dollars per share) | 3.6776 | 2.3227 | 2.0151 |
Outstanding at the end of the period (in dollars per share) | 4.9639 | $ 4.4969 | $ 2.4320 |
Expected to vest at the end of the period (in dollars per share) | $ 4.9552 | ||
Huya 2017 Share Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | |||
Number of restricted shares | |||
Outstanding at the beginning of the period (in shares) | 0 | ||
Granted (in shares) | 4,193,685 | ||
Forfeited (in shares) | (76,500) | ||
Vested (in shares) | (10,000) | ||
Outstanding at the end of the period (in shares) | 4,107,185 | 0 | |
Expected to vest at the end of the period (in shares) | 3,795,535 | ||
Weighted average grant-date fair value | |||
Outstanding at the beginning of the period (in dollars per share) | $ 0 | ||
Granted (in dollars per share) | 9.0242 | ||
Forfeited (in dollars per share) | 7.1600 | ||
Vested (in dollars per share) | 19.5900 | ||
Outstanding at the end of the period (in dollars per share) | 9.0331 | $ 0 | |
Expected to vest at the end of the period (in dollars per share) | $ 8.9944 |
Share-based compensation (Huya'
Share-based compensation (Huya's share-based awards - Narrative) (Details) - shares | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Huya 2017 Share Incentive Plan [Member] | Employees [Member] | ||
Share-based compensation [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 5,918,353 | 11,737,705 |
Huya 2017 Share Incentive Plan [Member] | Non Employee [Member] | ||
Share-based compensation [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 220,000 | |
Share based Compensation Arrangements By Share Based Payments Awards Options Grants in the Period Non Employees | 220,000 | |
Maximum [Member] | ||
Share-based compensation [Line Items] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 28,394,117 | 17,647,058 |
Share-based compensation (Numbe
Share-based compensation (Number of share options granted to Huya's employees) (Details) - Huya 2017 Share Incentive Plan [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Number of options | |||
Balance ,options | 11,719,705 | 0 | [1] |
Granted (in shares) | 6,138,353 | 11,737,705 | |
Forfeited (in shares) | (75,000) | (18,000) | |
Cancelled | (262,503) | ||
Balance ,options | 17,520,555 | 11,719,705 | |
Expected to vest (in shares) | 13,982,830 | ||
Exercisable as of December 31, 2018 | 2,736,927 | ||
Weighted average exercise price | |||
Balance | $ 2.5500 | $ 0 | |
Granted (in dollars per share) | 2.4672 | 2.5500 | |
Forfeited (in dollars per share) | 2.5500 | 2.5500 | |
Cancelled | 2.5500 | ||
Balance ,weighted average exercise price | 2.5210 | $ 2.5500 | |
Expected to vest (in dollars per share) | 2.5338 | ||
Exercisable as of December 31, 2018 | $ 2.4572 | ||
Weighted average remaining contractual life (years) | |||
Balance | 8 years 9 months 25 days | 9 years 9 months | |
Expected to vest | 8 years 10 months 13 days | ||
Exercisable | 8 years 7 months 17 days | ||
Aggregate intrinsic value [Abstract] | |||
Balance | $ 227,049 | $ 2,227 | |
Expected to vest | 181,024 | ||
Exerisable | $ 35,642 | ||
[1] | The risk-free interest rate of periods within the contractual life of the share option is based on US Treasury Bonds of similar tenor at the valuation dates. |
Share-based compensation (Huya
Share-based compensation (Huya has used binomial option-pricing) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Huya [Member] | |||
Weighted average fair value per option granted | $ 5.2130 | $ 1.3798 | |
Weighted average exercise price | $ 2.47 | $ 2.55 | |
Risk-free interest rate | [1] | 2.83% | 2.25% |
Expected term (in year) | [2] | 10 years | 10 years |
Expected volatility | [3] | 55.00% | 55.00% |
Dividend yield | [4] | 0.00% | 0.00% |
YY [Member] | |||
Weighted average fair value per option granted | $ 2.6425 | ||
Weighted average exercise price | $ 4.7025 | ||
Risk-free interest rate | [5] | 2.77% | |
Expected volatility | [6] | 57.00% | |
Dividend yield | [7] | 0.00% | |
YY [Member] | Maximum [Member] | |||
Expected term (in year) | [2] | 6 years | |
YY [Member] | Minimum [Member] | |||
Expected term (in year) | [2] | 5 years | |
[1] | The risk-free interest rate of periods within the contractual life of the share option is based on the China Government Bond yield as at the valuation dates. | ||
[2] | The expected term is the contract life of the option. | ||
[3] | Expected volatility is estimated based on the average of historical volatilities of the comparable companies in the same industry as at the valuation dates. | ||
[4] | Huya has no history or expectation of paying dividend on its ordinary shares. The expected dividend yield was estimated based on Huya’s expected dividend policy over the expected term of the option. | ||
[5] | The risk-free interest rate of periods within the contractual life of the share option is based on US Treasury Bonds of similar tenor at the valuation dates. | ||
[6] | Expected volatility is estimated based on the average of historical volatilities of the Company at the valuation dates. | ||
[7] | The Company has no history or expectation of paying dividend on its ordinary shares. The expected dividend yield was estimated based on the Company’s expected dividend policy over the expected term of the option. |
Share-based compensation (Sha_2
Share-based compensation (Share-based compensation-Share options-2011 Share Incentive Scheme) (Details) - 2011 Share Incentive Scheme [Member] $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($)$ / sharesshares | |
Balance ,options | 0 |
Granted ,options | 10,934,300 |
Balance ,options | 10,934,300 |
Expected to vest at December 31, 2018 ,options | 10,934,300 |
Exercisable at December 31, 2018 ,options | 0 |
Granted ,weighted average exercise price | $ / shares | $ 4.7025 |
Balance ,weighted average exercise price | $ / shares | 4.7025 |
Expected to vest at December 31, 2018 ,weighted average exercise price | $ / shares | 4.7025 |
Exercisable at December 31, 2018 ,weighted average exercise price | $ / shares | $ 0 |
Granted ,contractual life | 5 years 3 months 14 days |
Balance ,contractual life | 5 years 3 months 14 days |
Expected to vest at December 31, 2018 ,contractual life | 5 years 3 months 14 days |
Exercisable at December 31, 2018 ,contractual life | 0 years |
Balance, December 31, 2018 ,aggregate intrinsic value | $ | $ 0 |
Expected to vest at December 31, 2018 ,aggregate intrinsic value | $ | 0 |
Exercisable at December 31, 2018 ,aggregate intrinsic value | $ | $ 0 |
Share-based compensation (Sha_3
Share-based compensation (Share based awards granted to an employee of a subsidiary and Other share based compensation - Narrative) (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Other subsidiaries share-based awards [member] | |||
Allocated Share-based Compensation Expense | ¥ 7,916 | ¥ (1,227) | ¥ 13,936 |
Basic and diluted net income _3
Basic and diluted net income per share (Schedule of Calculation of Basic and Diluted Net Income Per Share) (Details) ¥ / shares in Units, ¥ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018CNY (¥)¥ / sharesshares | Dec. 31, 2018$ / shares | Dec. 31, 2017CNY (¥)¥ / sharesshares | Dec. 31, 2016CNY (¥)¥ / sharesshares | ||
Numerator: | |||||
Net income attributable to common shareholders of the Company | ¥ | ¥ 1,641,958 | ¥ 2,493,235 | ¥ 1,523,918 | ||
Interest expenses of convertible notes | ¥ | 149 | 20,820 | 81,085 | ||
Numerator for diluted income per share | ¥ | ¥ 1,642,107 | ¥ 2,514,055 | ¥ 1,605,003 | ||
Denominator: | |||||
Denominator for basic calculationweighted average number of Class A and Class B common shares outstanding | [1] | 1,280,847,795 | 1,186,460,144 | 1,127,343,312 | |
Dilutive effect of share options | 94,254 | 376,918 | 684,455 | ||
Dilutive effect of restricted share units | 12,966,689 | 11,598,378 | 15,816,362 | ||
Dilutive effect of convertible bonds | 180,668 | 18,202,301 | 72,267,200 | ||
Denominator for diluted calculation (in shares) | [1] | 1,294,089,406 | 1,216,637,741 | 1,216,111,329 | |
Basic net income per share (in CNY/dollars per share) | (per share) | [1] | ¥ 1.28 | $ 0.19 | ¥ 2.10 | ¥ 1.35 |
Diluted net income per share (in CNY/dollars per share) | (per share) | [1] | ¥ 1.27 | 0.18 | ¥ 2.07 | ¥ 1.32 |
American Depository Shares [Member] | |||||
Denominator: | |||||
Denominator for basic calculationweighted average number of Class A and Class B common shares outstanding | [1] | 64,042,390 | 59,323,007 | 56,367,166 | |
Denominator for diluted calculation (in shares) | [1] | 64,704,470 | 60,831,887 | 60,805,566 | |
Basic net income per share (in CNY/dollars per share) | (per share) | [1] | ¥ 25.64 | 3.73 | ¥ 42.03 | ¥ 27.04 |
Diluted net income per share (in CNY/dollars per share) | (per share) | [1] | ¥ 25.38 | $ 3.69 | ¥ 41.33 | ¥ 26.40 |
[1] | Each ADS represents 20 common shares. |
Related party transactions (Sch
Related party transactions (Schedule of Significant Related Party Transactions) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Related party transactions [Line Items] | ||||
Loan to related parties | ¥ 188,000 | ¥ 24,962 | ¥ 44,500 | |
Repayment of loans from related parties | 20,000 | 35,462 | 0 | |
Payment on behalf of related parties, net of repayments | (2,543) | $ (370) | (23,116) | 10,699 |
Online games revenue [Member] | ||||
Related party transactions [Line Items] | ||||
Revenue shared from related parties | 31,366 | 87,414 | 100,078 | |
Guangzhou Chenjun Equity Investment Limited Partnership [Member] | ||||
Related party transactions [Line Items] | ||||
Partial disposal of a subsidiary to Guangzhou Chenjun | 0 | 0 | 24,394 | |
Guangzhou Chenjun [Member] | ||||
Related party transactions [Line Items] | ||||
Partial disposal of an equity investment to Guangzhou Chenjun | 0 | 35,160 | 33,750 | |
Guangzhou Sunhongs [Member] | Bandwidth service [Member] | ||||
Related party transactions [Line Items] | ||||
Expense with related party | 103,439 | 92,068 | 96,224 | |
Other Related Party [Member] | ||||
Related party transactions [Line Items] | ||||
Other transaction with related parties | 11,833 | 14,276 | 13,573 | |
Kingsoft Group | Bandwidth service [Member] | ||||
Related party transactions [Line Items] | ||||
Expense with related party | ¥ 11,314 | ¥ 711 | ¥ 0 |
Related party transactions (S_2
Related party transactions (Schedule of Amounts Due from/to Related Parties) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | |
Related party transactions [Line Items] | ||||
Amounts due from related parties, current | ¥ 193,559 | $ 28,152 | ¥ 11,190 | |
Amounts due from related parties, non-current | 0 | 0 | 20,000 | |
Amounts due to related parties | 28,336 | $ 4,121 | 30,502 | |
Bigo [Member] | ||||
Related party transactions [Line Items] | ||||
Amounts due from related parties, current | [1] | 191,800 | 9,831 | |
Other Related Party [Member] | ||||
Related party transactions [Line Items] | ||||
Amounts due from related parties, current | 1,759 | 1,359 | ||
Amounts due to related parties | 2,527 | 8,309 | ||
Guangzhou Sunhongs [Member] | ||||
Related party transactions [Line Items] | ||||
Amounts due to related parties | 11,062 | 8,432 | ||
Guangzhou Kuyou [Member] | ||||
Related party transactions [Line Items] | ||||
Amounts due to related parties | 4,144 | 7,583 | ||
Yunke Online [Member] | ||||
Related party transactions [Line Items] | ||||
Amounts due from related parties, non-current | 0 | 20,000 | ||
Shanghai Ansha [Member] | ||||
Related party transactions [Line Items] | ||||
Amounts due to related parties | 5,364 | 6,178 | ||
Due to Kingsoft Group [Member] | ||||
Related party transactions [Line Items] | ||||
Amounts due to related parties | ¥ 5,239 | ¥ 0 | ||
[1] | The amounts due from Bigo mainly consisted of unsecured loans provided to Bigo.The maturities of the loans were all within one year. |
Fair value measurements (Summar
Fair value measurements (Summary of Liabilities Measured at Fair Value on Recurring Basis) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | ||
Assets | |||||
Short-term investments | ¥ 979,053 | $ 142,397 | ¥ 124,550 | ||
Recurring [Member] | |||||
Assets | |||||
Short-term investments | 979,053 | [1] | 124,550 | ||
Equity investment with readily determinable fair values | 238,915 | [2] | 138,251 | ||
Available-for-sale debt securities | 1,961 | ||||
Total | 1,217,968 | 264,762 | |||
Liabilities | |||||
Derivative liabilities | [3] | 0 | |||
Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||||
Assets | |||||
Short-term investments | 78,605 | [1] | 29,570 | ||
Equity investment with readily determinable fair values | 238,915 | [2] | 138,251 | ||
Available-for-sale debt securities | 0 | ||||
Total | 317,520 | 167,821 | |||
Liabilities | |||||
Derivative liabilities | [3] | 0 | |||
Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||||
Assets | |||||
Short-term investments | 900,448 | [1] | 94,980 | ||
Equity investment with readily determinable fair values | 0 | [2] | 0 | ||
Available-for-sale debt securities | 0 | ||||
Total | 900,448 | 94,980 | |||
Liabilities | |||||
Derivative liabilities | [3] | 0 | |||
Recurring [Member] | Level 3 [Member] | |||||
Assets | |||||
Short-term investments | 0 | [1] | 0 | ||
Equity investment with readily determinable fair values | 0 | [2] | 0 | ||
Available-for-sale debt securities | 1,961 | ||||
Total | 0 | ¥ 1,961 | |||
Liabilities | |||||
Derivative liabilities | [3] | ¥ 0 | |||
[1] | Short-term investments represented the investments issued by commercial banks or other financial institutions with a variable interest rate indexed to the performance of underlying assets within one year. For the instruments whose fair value is provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. For the instruments whose fair value is estimated based on quoted prices of similar products provided by banks at the end of each period, the Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements. | ||||
[2] | Equity investments with readily determinable fair values are valued using the market approach based on the quoted prices in active markets at the reporting date. The Group classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. | ||||
[3] | The Company has determined that conversion feature embedded in the Huya’s Series B-2 Preferred Shares is required to be bifurcated and accounted for as a derivative liability which would be measured at fair value (Note 24). Upon the completion of Huya’s IPO, the derivative liabilities were derecognized and the balance was transferred to additional paid-in capital accordingly. |
Fair value measurements (Schedu
Fair value measurements (Schedule of Changes in Level 3 Instruments) (Details) ¥ in Thousands | 12 Months Ended |
Dec. 31, 2018CNY (¥) | |
Liabilities measured at fair value [Line Items] | |
Fair value loss on derivative liabilities | ¥ 2,285,223 |
Level 3 [Member] | |
Liabilities measured at fair value [Line Items] | |
Balance as of January 1, 2018 | 0 |
Initial recognition upon the extinguishment of Huya's Series A Preferred Shares and the issuance of Huya's Series B-2 Preferred Shares as of March 8, 2018 | 892,334 |
Fair value loss on derivative liabilities | 2,285,223 |
Foreign exchange | 11,270 |
Derecognition of derivative liabilities upon the completion of Huya's IPO | (3,188,827) |
Balance as of December 31, 2018 | 0 |
Level 3 [Member] | Conversion Feature Embedded In Series A Preferred Shares [Member] | |
Liabilities measured at fair value [Line Items] | |
Balance as of January 1, 2018 | 0 |
Initial recognition upon the extinguishment of Huya's Series A Preferred Shares and the issuance of Huya's Series B-2 Preferred Shares as of March 8, 2018 | 572,237 |
Fair value loss on derivative liabilities | 628,298 |
Foreign exchange | 4,573 |
Derecognition of derivative liabilities upon the completion of Huya's IPO | (1,205,108) |
Balance as of December 31, 2018 | 0 |
Level 3 [Member] | Conversion Feature Embedded In Series B Preferred Shares [Member] | |
Liabilities measured at fair value [Line Items] | |
Balance as of January 1, 2018 | 0 |
Initial recognition upon the extinguishment of Huya's Series A Preferred Shares and the issuance of Huya's Series B-2 Preferred Shares as of March 8, 2018 | 320,097 |
Fair value loss on derivative liabilities | 1,656,925 |
Foreign exchange | 6,697 |
Derecognition of derivative liabilities upon the completion of Huya's IPO | (1,983,719) |
Balance as of December 31, 2018 | ¥ 0 |
Fair value measurements (Narrat
Fair value measurements (Narrative) (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | ||
Equity Securities, FV-NI, Gain | ¥ 1,803,081 | ¥ 0 |
Fair value measurements (Sche_2
Fair value measurements (Schedule of Certain Significant Estimates) (Details) - Huya's Pre-IPO Preferred Shares [Member] | May 10, 2018 | Mar. 08, 2018 |
Volatility | 50.00% | 50.00% |
Dividend yield | 0.00% | 0.00% |
Risk-free rate (3 months) [Member] | ||
Risk-free rate | 1.58% | 1.66% |
Risk-free rate (4 years) [Member] | ||
Risk-free rate | 2.46% | 2.52% |
Commitments and contingencies_2
Commitments and contingencies (Narrative) (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Litigation [Line Items] | |||
Total office rental expenses | ¥ 50,206 | ¥ 62,211 | ¥ 76,753 |
Outstanding capital commitments | 193,412 | 111,966 | |
Copyright infringement claim [Member] | |||
Litigation [Line Items] | |||
Loss Contingency, Damages Sought, Value | 20,000 | 20,000 | 100,000 |
Copyright infringement claim [Member] | NetEase [Member] | |||
Litigation [Line Items] | |||
Loss Contingency, Damages Sought, Value | ¥ 20,000 | ¥ 20,000 | ¥ 100,000 |
Commitments and contingencies_3
Commitments and contingencies (Schedule of Future Minimum Payments Under Non-cancellable Operating Leases) (Details) ¥ in Thousands | Dec. 31, 2018CNY (¥) |
Future minimum payments under non-cancellable operating leases | |
2019 | ¥ 84,689 |
2020 | 53,609 |
2021 | 35,871 |
2022 and after | 47,726 |
Total | ¥ 221,895 |
Subsequent events (Narrative) (
Subsequent events (Narrative) (Details) $ / shares in Units, ¥ in Thousands, $ in Thousands, $ in Millions | Apr. 12, 2019USD ($)$ / sharesshares | Apr. 16, 2019USD ($) | Mar. 31, 2019CNY (¥)shares | Sep. 30, 2018HKD ($) | Dec. 31, 2018CNY (¥) | Mar. 31, 2019USD ($) | Mar. 31, 2019HKD ($) | Feb. 28, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) |
Subsequent events [Line Items] | ||||||||||
Short-term Debt | ¥ 0 | $ 0 | ¥ 588,235 | |||||||
Cash and Cash Equivalents, at Carrying Value | ¥ 6,004,231 | $ 873,279 | ¥ 2,617,432 | |||||||
Commercial Bank [Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 700 | |||||||||
Debt Instrument, Description of Variable Rate Basis | HIBOR plus 0.67% | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 0.67% | |||||||||
Scenario, Forecast [Member] | Commercial Bank [Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Short-term Debt | $ 320 | |||||||||
Term Deposits Asset | ¥ | ¥ 300,000 | |||||||||
Scenario, Forecast [Member] | Goldman Sachs Loan[Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 100,250 | |||||||||
Debt Instrument, Description of Variable Rate Basis | LIBOR plus a margin per annum. The margin ranges from 1.25% to 3.65% subject to the actual term of the loan. | |||||||||
Short-term Debt | $ 0 | $ 100,250 | ||||||||
Repayments of Short-term Debt | $ 100,250 | |||||||||
Scenario, Forecast [Member] | BIGO Inc [Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Business Combination, Contingent Consideration, Liability, Current | 343,100 | |||||||||
Cash and Cash Equivalents, at Carrying Value | $ 343,100 | |||||||||
Scenario, Forecast [Member] | Common Class A [Member] | BIGO Inc [Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 313,888,496 | |||||||||
Scenario, Forecast [Member] | Common Class B [Member] | BIGO Inc [Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 38,326,579 | |||||||||
American depository securities [Member] | Scenario, Forecast [Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Sale of Stock, Number of Shares Issued in Transaction | shares | 4,800,000 | |||||||||
Sale of Stock, Consideration Received on Transaction | $ 111,200 | |||||||||
American depository securities [Member] | Scenario, Forecast [Member] | Guangzhou Huya Technology Co., Ltd. [Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Sale of Stock, Number of Shares Issued in Transaction | shares | 13,600,000 | |||||||||
Sale of Stock, Price Per Share | $ / shares | $ 24 | |||||||||
Sale of Stock, Consideration Received on Transaction | $ 313,800 | |||||||||
Minimum [Member] | Scenario, Forecast [Member] | Goldman Sachs Loan[Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||||||||
Maximum [Member] | Scenario, Forecast [Member] | Goldman Sachs Loan[Member] | ||||||||||
Subsequent events [Line Items] | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 3.65% |
Restricted net assets (Details)
Restricted net assets (Details) - CNY (¥) ¥ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Percentage of after-tax income required to be transferred to statutory general reserve fund | 10.00% | |
Reserve level threshold for mandatory appropriation requirement (as a percent) | 50.00% | |
Restricted net assets | ¥ 5,057,086 | ¥ 3,559,861 |
Segment Reporting (Details)
Segment Reporting (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||||||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | ||||||
Net revenues | |||||||||
Others | ¥ 885,890 | $ 128,847 | ¥ 923,838 | ¥ 1,176,823 | |||||
Total net revenues | 15,763,557 | 2,292,714 | 11,594,792 | 8,204,050 | |||||
Cost of revenues | [2] | (10,017,134) | [1] | (1,456,932) | (7,026,402) | [3] | (5,103,430) | [4] | |
Gross profit (loss) | 5,746,423 | 835,782 | 4,568,390 | 3,100,620 | |||||
Operating expenses | |||||||||
Research and development expenses | [2] | (1,192,052) | [1] | (173,377) | (781,886) | [3] | (675,230) | [4] | |
Sales and marketing expenses | [2] | (1,149,316) | [1] | (167,161) | (691,281) | [3] | (387,268) | [4] | |
General and administrative expenses | [2] | (883,225) | [1] | (128,460) | (544,641) | [3] | (482,437) | [4] | |
Goodwill impairment | 0 | [2] | 0 | [2] | (2,527) | (17,665) | [2],[4] | ||
Total operating expenses | (3,224,593) | (468,998) | (2,020,335) | (1,562,600) | |||||
Gain on deconsolidation and disposal of subsidiaries | 0 | 0 | 37,989 | 103,960 | |||||
Other income | 117,860 | 17,142 | 113,187 | 129,504 | |||||
Operating income (loss) | 2,639,690 | 383,926 | 2,699,231 | 1,771,484 | |||||
Interest expense | (8,616) | (1,253) | (32,122) | (81,085) | |||||
Interest income and investment income | 485,552 | 70,621 | 180,384 | 67,193 | |||||
Foreign currency exchange (losses) gains, net | (514) | (75) | (2,176) | 1,158 | |||||
Gain on deemed disposal and disposal of investments | 16,178 | 2,353 | 45,861 | 25,061 | |||||
Gain on fair value changes of investment | 1,689,404 | 245,714 | 0 | 0 | |||||
Fair value loss on derivative liabilities | (2,285,223) | (332,372) | 0 | 0 | |||||
Other non-operating expenses | (2,000) | (291) | 0 | 0 | |||||
Income before income tax expenses | 2,534,471 | 368,623 | 2,891,178 | 1,783,811 | |||||
Income tax (expenses) benefits | (477,707) | (69,480) | (415,811) | (280,514) | |||||
Income before share of loss in equity method investments, net of income taxes | 2,056,764 | 299,143 | 2,475,367 | 1,503,297 | |||||
Share of income in equity method investments, net of income taxes | 58,933 | 8,571 | 33,024 | 8,279 | |||||
Net income | 2,115,697 | 307,714 | 2,508,391 | 1,511,576 | |||||
Share-based compensation | 648,025 | 94,251 | 257,661 | 157,286 | |||||
Cost of revenues [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 74,339 | 10,812 | 42,759 | 15,894 | |||||
Research and development expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 225,173 | 32,750 | 122,348 | 78,816 | |||||
Sales and marketing expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 5,723 | 832 | 4,417 | 3,107 | |||||
General and administrative expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 342,790 | 49,857 | 88,137 | 59,469 | |||||
Live streaming [Member] | |||||||||
Net revenues | |||||||||
Total net revenues | 14,877,667 | $ 2,163,867 | 10,670,954 | 7,027,227 | |||||
Huya [Member] | |||||||||
Net revenues | |||||||||
Others | 220,595 | 115,280 | 4,926 | ||||||
Total net revenues | 4,663,440 | 2,184,816 | 796,904 | ||||||
Cost of revenues | (3,933,647) | [1] | (1,929,864) | [3] | (1,094,644) | [4] | |||
Gross profit (loss) | 729,793 | 254,952 | (297,740) | ||||||
Operating expenses | |||||||||
Research and development expenses | (265,152) | [1] | (170,160) | [3] | (188,334) | [4] | |||
Sales and marketing expenses | (189,207) | [1] | (87,292) | [3] | (68,746) | [4] | |||
General and administrative expenses | (287,710) | [1] | (101,995) | [3] | (71,325) | [4] | |||
Goodwill impairment | 0 | [3] | [4] | ||||||
Total operating expenses | (742,069) | (359,447) | (328,405) | ||||||
Gain on deconsolidation and disposal of subsidiaries | 0 | ||||||||
Other income | 38,938 | 9,629 | |||||||
Operating income (loss) | 26,662 | (94,866) | (626,145) | ||||||
Interest expense | 0 | 0 | 0 | ||||||
Interest income and investment income | 156,549 | 14,049 | 518 | ||||||
Foreign currency exchange (losses) gains, net | 51 | 0 | 0 | ||||||
Gain on deemed disposal and disposal of investments | 0 | 0 | 0 | ||||||
Gain on fair value changes of investment | 0 | ||||||||
Fair value loss on derivative liabilities | (2,285,223) | ||||||||
Other non-operating expenses | 0 | ||||||||
Income before income tax expenses | (2,101,961) | (80,817) | (625,627) | ||||||
Income tax (expenses) benefits | 50,943 | ||||||||
Income before share of loss in equity method investments, net of income taxes | (2,051,018) | (80,817) | (625,627) | ||||||
Share of income in equity method investments, net of income taxes | 113,329 | (151) | 0 | ||||||
Net income | (1,937,689) | (80,968) | (625,627) | ||||||
Huya [Member] | Cost of revenues [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 10,472 | 2,877 | 5,677 | ||||||
Huya [Member] | Research and development expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 30,643 | 9,174 | 19,538 | ||||||
Huya [Member] | Sales and marketing expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 1,832 | 791 | 326 | ||||||
Huya [Member] | General and administrative expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 183,748 | 27,266 | 26,557 | ||||||
Huya [Member] | Live streaming [Member] | |||||||||
Net revenues | |||||||||
Total net revenues | 4,442,845 | 2,069,536 | 791,978 | ||||||
100 Education [Member] | |||||||||
Net revenues | |||||||||
Total net revenues | 160,727 | ||||||||
Cost of revenues | [4] | (107,972) | |||||||
Gross profit (loss) | 52,755 | ||||||||
Operating expenses | |||||||||
Research and development expenses | [4] | (30,521) | |||||||
Sales and marketing expenses | [4] | (59,482) | |||||||
General and administrative expenses | [4] | (35,154) | |||||||
Goodwill impairment | [4] | (13,804) | |||||||
Total operating expenses | (138,961) | ||||||||
Gain on deconsolidation and disposal of subsidiaries | 0 | ||||||||
Other income | |||||||||
Operating income (loss) | (86,206) | ||||||||
Interest expense | 0 | ||||||||
Interest income and investment income | 44 | ||||||||
Foreign currency exchange (losses) gains, net | 0 | ||||||||
Gain on deemed disposal and disposal of investments | 0 | ||||||||
Income before income tax expenses | (86,162) | ||||||||
Income tax (expenses) benefits | 14,015 | ||||||||
Income before share of loss in equity method investments, net of income taxes | (72,147) | ||||||||
Share of income in equity method investments, net of income taxes | (111) | ||||||||
Net income | (72,258) | ||||||||
100 Education [Member] | Cost of revenues [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 324 | ||||||||
100 Education [Member] | Research and development expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 6,193 | ||||||||
100 Education [Member] | Sales and marketing expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | |||||||||
100 Education [Member] | General and administrative expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 13,389 | ||||||||
100 Education [Member] | Live streaming [Member] | |||||||||
Net revenues | |||||||||
Total net revenues | |||||||||
100 Education [Member] | Others | |||||||||
Net revenues | |||||||||
Others | 160,727 | ||||||||
YY Live [Member] | |||||||||
Net revenues | |||||||||
Others | 667,350 | 808,558 | 1,011,170 | ||||||
Total net revenues | 11,102,172 | 9,409,976 | 7,246,419 | ||||||
Cost of revenues | (6,083,487) | [1] | (5,096,538) | [3] | (3,900,814) | [4] | |||
Gross profit (loss) | 5,018,685 | 4,313,438 | 3,345,605 | ||||||
Operating expenses | |||||||||
Research and development expenses | (926,900) | [1] | (611,726) | [3] | (456,375) | [4] | |||
Sales and marketing expenses | (962,164) | [1] | (603,989) | [3] | (259,040) | [4] | |||
General and administrative expenses | (595,515) | [1] | (442,646) | [3] | (375,958) | [4] | |||
Goodwill impairment | (2,527) | [3] | (3,861) | [4] | |||||
Total operating expenses | (2,484,579) | (1,660,888) | (1,095,234) | ||||||
Gain on deconsolidation and disposal of subsidiaries | 37,989 | 103,960 | |||||||
Other income | 78,922 | 103,558 | 129,504 | ||||||
Operating income (loss) | 2,613,028 | 2,794,097 | 2,483,835 | ||||||
Interest expense | (8,616) | (32,122) | (81,085) | ||||||
Interest income and investment income | 329,003 | 166,335 | 66,631 | ||||||
Foreign currency exchange (losses) gains, net | (565) | (2,176) | 1,158 | ||||||
Gain on deemed disposal and disposal of investments | 16,178 | 45,861 | 25,061 | ||||||
Gain on fair value changes of investment | 1,487,405 | ||||||||
Fair value loss on derivative liabilities | 0 | ||||||||
Other non-operating expenses | (2,000) | ||||||||
Income before income tax expenses | 4,434,433 | 2,971,995 | 2,495,600 | ||||||
Income tax (expenses) benefits | (501,683) | (415,811) | (294,529) | ||||||
Income before share of loss in equity method investments, net of income taxes | 3,932,750 | 2,556,184 | 2,201,071 | ||||||
Share of income in equity method investments, net of income taxes | 120,636 | 33,175 | 8,390 | ||||||
Net income | 4,053,386 | 2,589,359 | 2,209,461 | ||||||
YY Live [Member] | Cost of revenues [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 63,867 | 39,882 | 9,893 | ||||||
YY Live [Member] | Research and development expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 194,530 | 113,174 | 53,085 | ||||||
YY Live [Member] | Sales and marketing expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 3,891 | 3,626 | 2,781 | ||||||
YY Live [Member] | General and administrative expenses [Member] | |||||||||
Operating expenses | |||||||||
Share-based compensation | 159,042 | 60,871 | 19,523 | ||||||
YY Live [Member] | Live streaming [Member] | |||||||||
Net revenues | |||||||||
Total net revenues | 10,434,822 | ¥ 8,601,418 | ¥ 6,235,249 | ||||||
Elimination [Member] | |||||||||
Net revenues | |||||||||
Others | (2,055) | ||||||||
Total net revenues | (2,055) | ||||||||
Cost of revenues | [1] | 0 | |||||||
Gross profit (loss) | (2,055) | ||||||||
Operating expenses | |||||||||
Research and development expenses | [1] | 0 | |||||||
Sales and marketing expenses | [1] | 2,055 | |||||||
General and administrative expenses | [1] | 0 | |||||||
Total operating expenses | 2,055 | ||||||||
Other income | 0 | ||||||||
Operating income (loss) | 0 | ||||||||
Interest expense | 0 | ||||||||
Interest income and investment income | 0 | ||||||||
Foreign currency exchange (losses) gains, net | 0 | ||||||||
Gain on deemed disposal and disposal of investments | 0 | ||||||||
Gain on fair value changes of investment | 201,999 | ||||||||
Fair value loss on derivative liabilities | 0 | ||||||||
Other non-operating expenses | 0 | ||||||||
Income before income tax expenses | 201,999 | ||||||||
Income tax (expenses) benefits | (26,967) | ||||||||
Income before share of loss in equity method investments, net of income taxes | 175,032 | ||||||||
Share of income in equity method investments, net of income taxes | (175,032) | ||||||||
Net income | 0 | ||||||||
Elimination [Member] | Live streaming [Member] | |||||||||
Net revenues | |||||||||
Total net revenues | ¥ 0 | ||||||||
[1] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 63,867 10,472 74,339 Research and development expenses 194,530 30,643 225,173 Sales and marketing expenses 3,891 1,832 5,723 General and administrative expenses 159,042 183,748 342,790 | ||||||||
[2] | Share-based compensation was allocated in cost of revenues and operating expenses as follows:RMB RMB RMB US$ Cost of revenues 15,894 42,759 74,339 10,812 Research and development expenses 78,816 122,348 225,173 32,750 Sales and marketing expenses 3,107 4,417 5,723 832 General and administrative expenses 59,469 88,137 342,790 49,857 | ||||||||
[3] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya Total RMB RMB RMB Cost of revenues 39,882 2,877 42,759 Research and development expenses 113,174 9,174 122,348 Sales and marketing expenses 3,626 791 4,417 General and administrative expenses 60,871 27,266 88,137 | ||||||||
[4] | Share-based compensation was allocated in cost of revenues and operating expenses as follows: YY Live Huya 100 Education Total RMB RMB RMB RMB Cost of revenues 9,893 5,677 324 15,894 Research and development expenses 53,085 19,538 6,193 78,816 Sales and marketing expenses 2,781 326 - 3,107 General and administrative expenses 19,523 26,557 13,389 59,469 |
Additional information - cond_3
Additional information - condensed financial statements of the Company (Condensed balance sheets) (Details) ¥ in Thousands, $ in Thousands | Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Apr. 01, 2017USD ($) | Dec. 31, 2016CNY (¥) | Dec. 31, 2015CNY (¥) |
Current assets | ||||||
Amounts due from a subsidiary | ¥ 193,559 | $ 28,152 | ¥ 11,190 | |||
Non-current assets | ||||||
Total assets | 25,768,045 | 3,747,805 | 14,458,719 | |||
Current liabilities | ||||||
Convertible bonds | 6,863 | 998 | 0 | $ 1,000 | ||
Short-term loans | 0 | 0 | 588,235 | |||
Total current liabilities | 3,853,026 | 560,399 | 3,145,799 | |||
Non-current liabilities | ||||||
Convertible bonds | 0 | 0 | 6,536 | |||
Total liabilities | 3,972,241 | 577,738 | 3,220,863 | |||
Shareholders' equity | ||||||
Additional paid-in capital | 11,168,866 | 1,624,444 | 5,339,844 | |||
Retained earnings | 6,913,469 | 1,005,522 | 5,218,110 | |||
Accumulated other comprehensive (loss) income | 336,152 | 48,891 | (9,597) | |||
Total shareholders' equity | 21,377,131 | 3,109,174 | 10,712,859 | ¥ 5,052,555 | ¥ 3,246,819 | |
Total liabilities, mezzanine equity and shareholders' equity | 25,768,045 | 3,747,805 | 14,458,719 | |||
Class A common shares [Member] | ||||||
Shareholders' equity | ||||||
Common shares | 59 | 9 | 57 | |||
Class B common shares [Member] | ||||||
Shareholders' equity | ||||||
Common shares | 21 | 3 | 23 | |||
Parent [Member] | ||||||
Current assets | ||||||
Amounts due from a subsidiary | 2,592,009 | 376,992 | 2,671,590 | |||
Non-current assets | ||||||
Interests in subsidiaries and VIEs | 15,935,185 | 2,317,677 | 8,535,113 | |||
Total assets | 18,527,194 | 2,694,669 | 11,206,703 | |||
Current liabilities | ||||||
Interests payable | 39 | 6 | 777 | |||
Convertible bonds | 6,863 | 998 | 0 | |||
Short-term loans | 0 | 0 | 588,235 | |||
Total current liabilities | 6,902 | 1,004 | 589,012 | |||
Non-current liabilities | ||||||
Convertible bonds | 0 | 0 | 6,536 | |||
Total liabilities | 6,902 | 1,004 | 595,548 | |||
Shareholders' equity | ||||||
Additional paid-in capital | 11,168,866 | 1,624,444 | 5,339,844 | |||
Retained earnings | 7,015,194 | 1,020,318 | 5,280,828 | |||
Accumulated other comprehensive (loss) income | 336,152 | 48,891 | (9,597) | |||
Total shareholders' equity | 18,520,292 | 2,693,665 | 10,611,155 | |||
Total liabilities, mezzanine equity and shareholders' equity | 18,527,194 | 2,694,669 | 11,206,703 | |||
Parent [Member] | Class A common shares [Member] | ||||||
Shareholders' equity | ||||||
Common shares | 59 | 9 | 57 | |||
Parent [Member] | Class B common shares [Member] | ||||||
Shareholders' equity | ||||||
Common shares | ¥ 21 | $ 3 | ¥ 23 |
Additional information - cond_4
Additional information - condensed financial statements of the Company (Condensed balance sheets) (Parenthetical) (Details) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Class A common shares [Member] | |||
Condensed balance sheets [Line Items] | |||
Common shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | |
Common shares, shares authorized | 10,000,000,000 | 10,000,000,000 | 10,000,000,000 |
Common shares, shares issued | 981,740,848 | 945,245,908 | |
Common shares, shares outstanding | 981,740,848 | 945,245,908 | |
Class B common shares [Member] | |||
Condensed balance sheets [Line Items] | |||
Common shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | |
Common shares, shares authorized | 1,000,000,000 | 1,000,000,000 | 1,000,000,000 |
Common shares, shares issued | 288,182,976 | 317,982,976 | |
Common shares, shares outstanding | 288,182,976 | 317,982,976 | |
Parent [Member] | Class A common shares [Member] | |||
Condensed balance sheets [Line Items] | |||
Common shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | |
Common shares, shares authorized | 10,000,000,000 | 10,000,000,000 | |
Common shares, shares issued | 981,740,848 | 945,245,908 | |
Common shares, shares outstanding | 981,740,848 | 945,245,908 | |
Parent [Member] | Class B common shares [Member] | |||
Condensed balance sheets [Line Items] | |||
Common shares, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | |
Common shares, shares authorized | 1,000,000,000 | 1,000,000,000 | |
Common shares, shares issued | 288,182,976 | 317,982,976 | |
Common shares, shares outstanding | 288,182,976 | 317,982,976 |
Additional information - cond_5
Additional information - condensed financial statements of the Company (Condensed statements of operations and comprehensive income) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Condensed statements of operations [Line Items] | ||||
Interest expense | ¥ (8,616) | $ (1,253) | ¥ (32,122) | ¥ (81,085) |
Net income | 2,115,697 | 307,714 | 2,508,391 | 1,511,576 |
Other comprehensive income (loss) : | ||||
Unrealized gain (loss) of available-for-sale securities | 0 | 0 | (41,150) | 134,768 |
Foreign currency translation adjustments, net of nil tax | 434,080 | 63,134 | (61,513) | (5,317) |
Total comprehensive income | 2,076,038 | 301,946 | 2,390,572 | 1,653,369 |
Parent [Member] | ||||
Condensed statements of operations [Line Items] | ||||
Share of profit of subsidiaries and VIEs | 2,211,452 | 321,642 | 2,545,045 | 1,605,003 |
Interest expense | (2,445) | (357) | (32,122) | (81,085) |
Net income | 2,209,007 | 321,285 | 2,512,923 | 1,523,918 |
Other comprehensive income (loss) : | ||||
Unrealized gain (loss) of available-for-sale securities | 0 | 0 | (41,150) | 134,768 |
Foreign currency translation adjustments, net of nil tax | 434,080 | 63,134 | (61,513) | (5,317) |
Total comprehensive income | ¥ 2,643,087 | $ 384,419 | ¥ 2,410,260 | ¥ 1,653,369 |
Additional information- condens
Additional information- condensed financial statements of the Company (Condensed statements of cash flows) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017CNY (¥) | Dec. 31, 2016CNY (¥) | |
Condensed statement of cash flows [Line Items] | ||||
Cash flows from operating activities | ¥ 4,464,814 | $ 649,379 | ¥ 3,718,452 | ¥ 2,421,135 |
Cash flows from investing activities | ||||
Net cash used in investing activities | (6,295,386) | (915,626) | (3,037,516) | (2,172,359) |
Cash flows from financing activities | ||||
Proceeds from bank borrowings | 691,612 | 100,591 | 621,118 | 0 |
Proceeds from issuance of common shares, net of issuance cost | (4,473) | (651) | 2,950,607 | 0 |
Partial disposal of subsidiary's interests to non-controlling interest shareholders | 378,548 | 55,058 | 0 | 0 |
Repayment of bank borrowings | (1,308,092) | (190,254) | 0 | 0 |
Repayment of convertible bonds | 0 | 0 | (2,753,630) | 0 |
Net cash provided by financing activities | 4,167,270 | 606,105 | 1,392,525 | 10,651 |
Cash and cash equivalents at the beginning of the year | 2,617,432 | |||
Cash and cash equivalents at the end of the year | 6,004,231 | 873,279 | 2,617,432 | |
Parent [Member] | ||||
Condensed statement of cash flows [Line Items] | ||||
Cash flows from operating activities | 0 | 0 | 0 | 0 |
Cash flows from investing activities | ||||
Repayment of loans from a subsidiary | 195,091 | 28,375 | 2,132,512 | 0 |
Loans to a subsidiary | 0 | 0 | (2,950,607) | 0 |
Net cash used in investing activities | 195,091 | 28,375 | (818,095) | 0 |
Cash flows from financing activities | ||||
Proceeds from bank borrowings | 0 | 0 | 621,118 | 0 |
Proceeds from issuance of common shares, net of issuance cost | (4,473) | (651) | 2,950,607 | 0 |
Partial disposal of subsidiary's interests to non-controlling interest shareholders | 378,548 | 55,058 | 0 | 0 |
Repayment of bank borrowings | (569,166) | (82,782) | 0 | 0 |
Repayment of convertible bonds | 0 | 0 | (2,753,630) | 0 |
Net cash provided by financing activities | (195,091) | (28,375) | 818,095 | 0 |
Net increase in cash and cash equivalents | 0 | 0 | 0 | 0 |
Cash and cash equivalents at the beginning of the year | 0 | 0 | 0 | 0 |
Cash and cash equivalents at the end of the year | ¥ 0 | $ 0 | ¥ 0 | ¥ 0 |