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Yalla Eyes A Bigger Slice Of Middle Eastern Gaming Market

The Middle Eastern social media company reported its strongest revenue growth in two years as it prepares to launch two new self-developed games later this year

Key Takeaways:

Yalla's revenue grew 12.2% in the fourth quarter, while its profit rose nearly 10% on cost controls and better monetization of its users

The Middle Eastern social media company is currently testing two self-developed mid-core games, which could start contributing revenue in the second half of this year

Social media and gaming company Yalla Group Ltd. (YALA.US) on Monday reported its fastest revenue growth in more than two years, as it continued to better monetize its large user base in the Middle East and North Africa (MENA). It also held out the possibility that the growth could accelerate in the second half of this year with its rollout of two new self-developed games.

Yalla's latest quarterly report also detailed steps it is taking to incorporate AI into both its operations and apps, in a bid to keep improving its efficiency and user experience. Its careful spending has already given the company enviably high net margins that typically hover around 40%, though the figure dropped in the latest quarter as it ramped up its R&D spending on the two new mid-core games that could provide some new lift to its revenue.

The company has been actively exploring opportunities in the mid- and hardcore gaming spaces over the last two years, seeking to diversify beyond its traditional focus on casual gamers by targeting people who are willing to spend more heavily on the hobby.

As part of its bid to position itself as a major player in the regional gaming space, Yalla is also staging offline gaming events and tournaments throughout the region. It held six such events last year in cities including Abu Dhabi, Baghdad and Cairo, and ended with a December event in Riyadh, its second in the Saudi capital during the year.

While the ...