DouYu International Holdings Limited Reports First Quarter 2022 Unaudited Financial Results

WUHAN,China,May 18,2022 -- DouYu International Holdings Limited ("DouYu" or the "Company") (Nasdaq: DOYU),a leading game-centric live streaming platform inChinaand a pioneer in the eSports value chain,today announced its unaudited financial results for the first quarter ended March 31,2022.

First Quarter 2022 Financial and Operational Highlights

Total net revenues in the first quarter of 2022 were RMB1,795.6 million (US$283.3 million),compared with RMB2,152.7 million in the same period of 2021.

Gross profit in the first quarter of 2022 was RMB243.8 million (US$38.5 million),compared with RMB260.2 million in the same period of 2021.

Net loss in the first quarter of 2022 was RMB86.9 million (US$13.7 million),compared with RMB101.8 million in the same period of 2021.

Adjusted net loss[1] in the first quarter of 2022 was RMB52.5 million (US$8.3 million),compared with RMB70.7 million in the same period of 2021.

Average mobile MAUs[2] in the first quarter of 2022 were 55.1 million,compared with 59.1 million in the same period of 2021.

Quarterly average paying user[3] count in the first quarter of 2022 was 6.4 million,compared with 7.0 million in the same period of 2021.

Mr. Shaojie Chen,Chief Executive Officer of DouYu,commented,"During the first quarter of 2022,we continued executing on our strategic upgrade to develop our game-centric comprehensive content platform. In conjunction with our adoption of a selective copyright procurement strategy,we increased our investment in self-produced content and tournaments and enhanced our collaboration with game developers and distributors to deliver a stable operational performance through our high-quality game contents and refined operations. Our average mobile MAUs were 55.1 million in the first quarter. Going forward,we will continue to explore new business initiatives by leveraging our competitive advantage in livestreaming,videos,graphics,and interactive communities,while maintaining our leading position in the traditional livestreaming industry."

Mr. Hao Cao,Vice President of DouYu,"In the first quarter of 2022,our total revenues were RMB1.8 billion and our gross profit was RMB243.8 million,representing a gross margin of 13.6%. During the same quarter,we continued to make adjustments to our livestreaming operations and optimized our cost structure while constantly offering our premium content and refining our operations. We focused on operating efficiency improvement through ROI enhancement and cost controls and achieved encouraging results. Our gross margin improved year over year and net loss decreased to 86.9 million,while adjusted net loss narrowed to RMB52.5 million. Looking ahead,we will continue to improve our operational efficiency and remain focused on exploring new growth drivers and enhancing monetization capabilities to generate sustainable growth and higher shareholder value."

First Quarter 2022 Financial Results

Total net revenues in the first quarter of 2022 decreased by 16.6% to RMB1,795.6 million (US$283.3million),152.7 million in the same period of 2021.

Livestreaming revenuesin the first quarter of 2022 decreased by 13.6% to RMB1,727.2million (US$272.5million) from RMB1,998.6 million in the same period of 2021. The decrease was due to the implementation of prudent operating strategies in anticipation of a tightening regulatory environment. Such strategies primarily include the Company's adjustments to certain interactive features and the related operations in order to promote the long-term development of its platform.

Advertising and other revenuesin the first quarter of 2022 were RMB68.4million (US$10.8 million),compared with RMB154.1 million in the same period of 2021. The decrease was primarily due to the continued exploration of new commercialization models by using a portion of advertising traffic that could have been directly monetized,as well as the challenging macro environment.

Cost of revenuesin the first quarter of 2022 was RMB1,551.8million (US$244.8 million),a decrease of 18.0% compared with RMB1,892.5 million in the same period of 2021.

Revenue sharing fees and content costsin the first quarter of 2022 decreased by 19.2% to RMB1,340.6million (US$211.5 million) from RMB1,659.6million in the same period of 2021. The decrease was primarily due to the decreased revenue sharing fees which is in line with the Company's decreased livestreaming revenues,as well as a significant decrease in copyright costs.

Bandwidth costsin the first quarter of 2022 decreased by 11.8% to RMB151.9 million (US$24.0 million) from RMB172.1 million in the same period of 2021. The decrease was mainly due to less peak bandwidth usage for fewer purchased eSport tournaments,as well as lower per unit bandwidth costs as a result of improved procurement efficiency.

Gross profitin the first quarter of 2022 was RMB243.8 million (US$38.5million),compared with RMB260.2 million in the same period of 2021. Gross margin in the first quarter of 2022 improved to 13.6% from 12.1% in the same period of 2021. The increase in gross margin was primarily due to the significant decrease in copyright costs as a percentage of total net revenues.

Sales and marketing expensesin the first quarter of 2022 decreased 11.2% to RMB186.4 million (US$29.4 million) from RMB209.9 million in the same period of 2021. The decrease was mainly attributable to the decreased personnel-related expenses and branding expenses.

Research and development expensesin the first quarter of 2022 increased 4.5% to RMB116.3 million (US$18.3million) from RMB111.3 million in the same period of 2021. The increase was primarily attributable to continued investment in technical personnel as the Company continues to invest in product upgrades to support its game-centric content strategy.

General and administrative expensesin the first quarter of 2022 increased 2.3% to RMB90.1 million (US$14.2 million) from RMB88.1 million in the same period of 2021.

Other operating income,net in the first quarter of 2022was RMB47.8 million (US$7.5 million),compared with other operating income of RMB23.9 million in the same period of 2021.

Loss from operationsin the first quarter of 2022 was RMB101.2 million (US$16.0 million),compared with RMB125.1 million in the same period of 2021.

Adjusted loss from operations in the first quarter of 2022,which adds back share-based compensation expenses,was RMB68.0 million (US$10.7 million),compared with RMB91.8 million in the same period of 2021.

Income tax expenses in the first quarter of 2022 and 2021 were nildue to the Company's cumulative net losses and the resulting tax loss carry forward.

Net lossin the first quarter of 2022 was RMB86.9 million (US$13.7 million),compared with RMB101.8million in the same period of 2021.

Adjusted net lossin the first quarter of 2022,which excludes share-based compensation expenses,share of loss in equity method investments,and impairment loss of investments,was RMB52.5 million (US$8.3 million),compared with RMB70.7 million in the same period of 2021.

Basic and diluted net loss per ADS[4]in the first quarter of 2022 were RMB0.27 (US$0.04) and RMB0.27 (US$0.04),respectively. Adjusted basic and diluted net loss per ADS in the first quarter of 2022 were RMB0.16 (US$0.03) and RMB0.16 (US$0.03),respectively.

Cash and cash equivalents,restricted cash and bank deposits

As of March 31,2022,the Company had cash and cash equivalents,restricted cash,short-term and long-term bank deposits of RMB6,315 million (US$996.2 million),compared with RMB6,643 million as of December 31,2021.

Share Repurchase Program

On August 30,2021,the Company announced that its board of directors had authorized a share repurchase program under which the Company may repurchase up to US$100 million of its ordinary shares in the form of ADSs during a period of up to 12 months commencing on August 30,2021. The Company expects to utilize existing funds to make repurchases under this program. As of March 31,the Company had repurchased an aggregate of US$33.9 million (RMB215 million) worth of its ADSs under this program.

Recent Developments

Regulatory Update

On May 7,the competent authorities of the PRC issued the Opinion on Live Streaming Virtual Gifting and Enhancing the Protection of Minors (the "Opinion"). The Opinion stipulates that,for the main purpose of protecting minors,internet platforms shall,among other requirements and restrictions,(i) prohibit minors from engaging in virtual gifting,(ii) cancel all ranking functions that rank livestreamers solely by the volume of virtual gifts that they receive or rank users by the volume of virtual gifts that they send,within one month starting from the publication of the Opinion,and (iii) impose restrictions on certain interaction functions between 8:00 p.m. and 10:00 p.m. every day.

The Company is committed to fully complying with the Opinion and other applicable laws and regulations. Although the interpretation and implementation of the Opinion remain uncertain,the Company is carefully considering the provisions of the Opinion and assessing their implications for the Company's business. While the Company has been proactively monitoring the regulatory trends,and has strategically adjusted its operational strategies in response to the evolving regulatory landscape,the Company expects the Opinion,and the compliance measures to be taken,will have negative impacts on the live streaming service of the industry players,including that of the Company,which may in turn adversely affect the Company's business operations and financial condition. The Company will proactively seek guidance from and cooperate with the regulatory authorities in connection with its efforts to comply with the Opinion and the related implementation rules. There is no assurance that the compliance measures that the Company plans to take will be effective,or the implementation of the Opinion will not have a material adverse impact on the Company's business operations and financial condition in the following quarters.

Conference Call Information

The Company will hold a conference call on May 18,at 7:00am Eastern Time (or 7:00pmBeijing Time on the same day) to discuss the financial results. Listenersmay access the call by dialing the following numbers:

International:

1-412-317-6061

United States Toll Free:

1-888-317-6003

Mainland China Toll Free:

4001-206115

Hong Kong Toll Free:

800-963976

Singapore Toll Free:

800-120-5863

Conference ID:

7654821

The replay will be accessible through May 25,by dialing the following numbers:

International:

1-412-317-0088

United States Toll Free:

1-877-344-7529

Conference ID:

2324012

A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.douyu.com/.

[1] "Adjusted net loss" is calculated as net loss before share-based compensation expenses,and share of loss in equity method investments,and impairment loss on investments. For more information,please refer to "Use of Non-GAAP Financial Measures" and "Reconciliations of GAAP and Non-GAAP Results" at the end of this press release.

[2]Refers to the number of mobile devices that launched the Company's mobile apps in a given period. Average mobile MAUs for a given period is calculated by dividing (i) the sum of active mobile users for each month of such period,by (ii) the number of months in such period.

[3]"Quarterly average paying users" refers to the average paying users for each quarter during a given period of time calculated by dividing (i) the sum of paying users for each quarter of such period,by (ii) the number of quarters in such period. "Paying user" refers to a registered user that has purchased virtual gifts on the Company's platform at least once during the relevant period.

[4]Every ten ADSs represent one ordinary share.

About DouYu International Holdings Limited

Headquartered in Wuhan,DouYu International Holdings Limited (Nasdaq: DOYU) is a leading game-centric live streaming platform in China and a pioneer in the eSports value chain. DouYu operates its platform on both PC and mobile apps to bring users access to immersive and interactive games and entertainment livestreaming,a wide array of video and graphic contents,as well as opportunities to participate in community events and discussions. By nurturing a sustainable technology-based talent development system and relentlessly producing high-quality content,DouYu consistently delivers premium content through integration of livestreaming,video,and virtual communities with a primary focus on games,especially on eSports. This enables DouYu to continuously expand its user base and enhance its user experience. For more information,please see http://ir.douyu.com/.

Use of Non-GAAP Financial Measures

Adjusted operating income (loss) is calculated as operating income (loss) adjusted for share-based compensation expenses. Adjusted net income (loss) is calculated as net income (loss) adjusted for share-based compensation expenses,share of income (loss) in equity method investments,and impairment loss on investments. Adjusted net income (loss) attributable to DouYu is calculated as net income (loss) attributable to DouYu adjusted for share-based compensation expenses,and impairment loss of investments. Adjusted basic and diluted net income per ordinary share is non-GAAP net income attributable to ordinary shareholders divided by weighted average number of ordinary shares used in the calculation of non-GAAP basic and diluted net income per ordinary share. The Company adjusted the impact of (i) share-based compensation expenses,(ii) share of income (loss) in equity method investments,(iii) impairment loss of investments to understand and evaluate the Company's core operating performance. The non-GAAP financial measures are presented to enhance investors' overall understanding of the Company's financial performance and should not be considered a substitute for,or superior to,the financial information prepared and presented in accordance with U.S. GAAP. Investors are encouraged to review the reconciliation of the historical non-GAAP financial measures to its most directly comparable GAAP financial measures. As non-GAAP financial measures have material limitations as analytical metrics and may not be calculated in the same manner by all companies,they may not be comparable to other similarly titled measures used by other companies. In light of the foregoing limitations,you should not consider non-GAAP financial measures as a substitute for,such metrics in accordance with U.S. GAAP.

For more information on these non-GAAP financial measures,please see the table captioned "Reconciliations of Non-GAAP Results" near the end of this release.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted,all translations from RMB to U.S. dollars are made at a rate of RMB6.3393 to US$1.00,the noon buying rate in effect on March 31,in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB amounts could have been,or could be,converted,realized or settled in U.S. dollars at that rate on March 31,or at any other rate.

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts,including statements about the Company's beliefs and expectations,are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties,and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement,including but not limited to the following: the Company's results of operations and financial condition; the Company's business strategies; general market conditions,in particular the game live streaming market; the ability of the Company to retain and grow active and paying users; changes in general economic and business conditions in China; the impact of the COVID-19 to the Company's business operations and the economy in China and globally; any adverse changes in laws,regulations,rules,policies or guidelines applicable to the Company; and assumptions underlying or related to any of the foregoing. In some cases,forward-looking statements can be identified by words or phrases such as "may," "will," "expect," "anticipate," "target," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. Further information regarding these and other risks,uncertainties or factors is included in the Company's filings with the Securities Exchange Commission. All information provided in this press release is as of the date of this press release,and the Company does not undertake any duty to update such information,except as required under applicable law.

Investor Relations Contact

Lingling Kong

DouYu International Holdings Limited

Email: ir@douyu.tv

Phone: +1 (646) 224-6934

Robin Yang

ICR,LLC.

Email: DouYu.IR@icrinc.com

Phone: +1 (646) 224-6934

Media Relations Contact

Lingling Kong

DouYu International Holdings Limited

Email: pr_douyu@douyu.tv

Phone: +1 (646) 308-1475

Edmond Lococo

ICR,LLC.

Email: DouYu.PR@icrinc.com

Phone: +1 (646) 308-1475

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(All amounts in thousands,except share,ADS,per share and per ADS data)

As of December 31

As of March 31

2021

2022

2022

ASSETS

RMB

RMB

US$ (1)

Current assets:

Cash and cash equivalents

4,456,406

3,548,413

559,748

Restricted cash

10,703

6,057

955

Short-term bank deposits

2,076,355

2,660,532

419,689

Accounts receivable,net

191,389

153,378

24,195

Prepayments

80,717

60,091

9,479

Amounts due from related parties

37,159

35,116

5,539

Other current assets

376,367

380,464

60,017

Total current assets

7,229,096

6,844,051

1,079,622

Property and equipment,net

25,111

22,047

3,478

Intangible assets,net

161,540

155,326

24,502

Long-term bank deposits

100,000

100,000

15,775

Investments

491,425

530,245

83,644

Goodwill

12,637

12,582

1,985

Right-of-use assets,net

72,309

64,288

10,141

Other non-current assets

64,785

48,731

7,687

Total non-current assets

927,807

933,219

147,212

TOTAL ASSETS

8,156,903

7,777,270

1,226,834

LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES

Current liabilities:

Accounts payable

824,128

766,821

120,963

Advances from customers

7,476

8,388

1,323

Deferred revenue

235,134

231,410

36,504

Accrued expenses and other current liabilities

458,328

343,058

54,116

Amounts due to related parties

293,508

303,522

47,879

Lease liabilities due within one year

30,417

31,523

4,973

Total current liabilities

1,848,991

1,684,722

265,758

Lease liabilities

31,278

25,368

4,002

Deferred revenue

18,045

14,973

2,362

Total non-current liabilities

49,323

40,341

6,364

TOTAL LIABILITIES

1,898,314

1,725,063

272,122

(1)Translations ofRMB amounts into U.S. dollars at a specified rate are solely for the convenience of the reader.Unless

otherwise noted,all translations fromRMBto U.S. dollars are made at a rate of RMB6.3393 to US$1.00,the noon

buying rate in effect on March 31,in theH.10 statistical release of the Federal Reserve Board.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)

(All amounts in thousands,per share and per ADS data)

As of December 31

As of March 31

2021

2022

2022

RMB

RMB

US$ (1)

SHAREHOLDERS' EQUITY

Ordinary shares

23

23

4

Treasury shares

(802,250)

(911,217)

(143,741)

Additional paid-in capital

10,618,538

10,646,289

1,679,411

Accumulated deficit

(3,445,102)

(3,531,957)

(557,153)

Accumulated other comprehensive loss

(112,621)

(156,391)

(24,670)

Total DouYu Shareholders' Equity

6,258,588

6,046,747

953,851

Noncontrolling interests

1

5,460

861

Total Shareholders' Equity

6,589

6,052,207

954,712

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

8,834

(1)Translations of certainRMBamounts into U.S. dollars at a specified rate are solely for the convenience of the reader.

Unless otherwise noted,all translations fromRMB to U.S. dollars are made at a rate of RMB6.3393 to US$1.00,the noon

buying rate in effect on March31,in the H.10 statistical release of the Federal Reserve Board.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

(All amounts in thousands,per share and per ADS data)

Three Months Ended

March 31,

December 31,

March 31,

2021

2021

2022

2022

RMB

RMB

RMB

US$(1)

Net revenues

2,152,687

2,327,917

1,795,646

283,256

Cost of revenues

(1,892,499)

(2,083,223)

(1,551,872)

(244,802)

Gross profit

260,188

244,694

243,774

38,454

Operating income (expense) (2)

Sales and marketing expenses

(209,877)

(229,214)

(186,358)

(29,397)

General and administrative expenses

(88,074)

(98,756)

(90,100)

(14,213)

Research and development expenses

(111,264)

(132,574)

(116,308)

(18,347)

Other operating income,net

23,924

13,909

47,801

7,540

Total operating expenses

(385,291)

(446,635)

(344,965)

(54,417)

Loss from operations

(125,103)

(201,941)

(101,191)

(15,963)

Other income (expenses),net

127

(1,237)

(1,149)

(181)

Interest income,net

20,930

17,889

16,632

2,624

Loss before income taxes and share of income (loss)

in equity method investments

(104,046)

(185,289)

(85,708)

(13,520)

Income tax expenses

-

-

-

-

Share of income (loss) in equity method investments

2,213

(7,937)

(1,146)

(181)

Net loss

(101,833)

(193,226)

(86,854)

(13,701)

Less: Net (loss) income attributable to noncontrolling

interest

(39,814)

56,499

-

-

Net loss attributable to ordinary shareholders of the

Company

(62,019)

(249,725)

(86,854)

(13,701)

Net loss per ordinary share

Basic

(1.92)

(7.65)

(2.71)

(0.43)

Diluted

(1.92)

(7.65)

(2.71)

(0.43)

Net loss per ADS(3)

Basic

(0.19)

(0.77)

(0.27)

(0.04)

Diluted

(0.19)

(0.77)

(0.27)

(0.04)

Weighted average number of ordinary shares used in calculating net loss per ordinary share

Basic

32,349,764

32,636,774

32,065,147

32,147

Diluted

32,147

Weighted average number of ADS used in calculating net loss per ADS(3)

Basic

323,497,638

326,367,743

320,651,471

320,471

Diluted

323,471

(1) Translations of certainRMBamounts into U.S. dollars at a specified rate are solely for the convenience of the reader.

Unless otherwise noted,in theH.10 statistical release of the Federal Reserve Board.

(2) Share-based compensation expenses were allocated in cost of revenues and operating expenses as follows:

Three Months Ended

March 31,

2021

2021

2022

2022

RMB

RMB

RMB

US$(1)

Research and development expenses

5,468

5,444

5,435

857

Sales and marketing expenses

1,217

1,214

1,212

191

General and administrative expenses

26,632

26,604

26,563

4,190

(3) Every tenADSsrepresent one ordinary share.

RECONCILIATIONSOF GAAP ANDNON-GAAPRESULTS

(All amounts in thousands,

2021

2021

2022

2022

RMB

RMB

RMB

US$(1)

Loss from operations

(125,963)

Add:

Share-based compensation expenses

33,317

33,262

33,210

5,238

Adjusted operating loss

(91,786)

(168,679)

(67,981)

(10,725)

Net loss

(101,701)

Add:

Share-based compensation expenses

33,238

Share of (income) loss in equity method investments

(2,213)

7,937

1,146

181

Impairment losses of investments

-

1,297

-

-

Adjusted net loss

(70,729)

(150,730)

(52,498)

(8,282)

Net loss attributable to DouYu

(62,019)

(249,725)

(86,238

Share of (loss) income in equity method investments

(2,146

181

Impairment losses and fair value adjustments on

investments

-

1,297

-

-

Adjusted net loss attributable to DouYu

(30,915)

(207,229)

(52,282)

Adjusted net loss per ordinary share

Basic

(0.96)

(6.35)

(1.64)

(0.26)

Diluted

(0.96)

(6.35)

(1.64)

(0.26)

Adjusted net loss per ADS(2)

Basic

(0.10)

(0.63)

(0.16)

(0.03)

Diluted

(0.10)

(0.63)

(0.16)

(0.03)

Weighted average number of ordinary shares used in calculating adjusted net loss per ordinary share

Basic

32,147

Weighted average number of ordinary shares used in calculating adjusted net loss per ADS(2)

Basic

323,471

(1)Translations of certainRMBamounts into U.S. dollars at a specified rate are solely for the convenience of the reader.

Unless otherwise noted,in theH.10 statistical release of the Federal Reserve Board.

(2) The net tax impact to thenon-GAAPadjustments is zero

(3)Every tenADSsrepresent one ordinary share.

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