JOYY Inc. (NASDAQ: YY) saw its stock price plummet 10.41% in pre-market trading on Thursday following the release of its fourth quarter and full year 2024 financial results. The sharp decline came as investors focused on a massive goodwill impairment charge and declining user metrics, overshadowing an adjusted earnings beat.

For the fourth quarter of 2024, JOYY reported revenue of $549.4 million, slightly missing the consensus estimate of $549.5 million. However, the company's bottom line was severely impacted by a $454.9 million non-cash goodwill impairment charge, resulting in a net loss of $304.1 million for the quarter. Excluding this impairment and other one-time items, JOYY's adjusted net income was $96.1 million, surpassing the expected $73.4 million.

Investors appear to be particularly concerned about shrinking user engagement across JOYY's platforms. The company reported that its global average mobile monthly active users (MAUs) decreased to 263.1 million in Q4 2024, down from 274.9 million in the same period of 2023. This decline was evident across key products like Bigo Live, Likee, and Hago, signaling potential challenges in user retention and growth.

Despite the negative market reaction, JOYY did report some positive metrics. The company's gross profit for Q4 was $203.8 million, with a gross margin of 37.1%. Management also highlighted growth in non-livestreaming revenues and improvements in operational efficiency. However, these positives were overshadowed by the large impairment charge and user metric declines, leading to the significant pre-market selloff.

Looking ahead, JOYY provided revenue guidance for the first quarter of 2025, projecting net revenues to be between $482 million and $490 million. This forecast reflects the company's current view on market conditions and potential macroeconomic uncertainties. As investors digest the mixed results and future outlook, JOYY's stock may continue to face pressure in the near term.