The following discussion of our financial condition and results of operations is based upon and should be read in conjunction with our consolidated financial statements and their related notes included in this annual report. This report contains forward-looking statements. See “Forward-Looking Information.” In evaluating our business, you should carefully consider the information provided under the caption “Item 3. Key Information—D. Risk Factors” in this annual report. We caution you that our businesses and financial performance are subject to substantial risks and uncertainties. 104 Table of Contents In December 2023, we acquired a global mobile application service provider from Tencent Holdings Limited for an aggregate cash consideration of US$81 million (equivalent to RMB574.8 million). As this acquisition constituted a business combination under common control, we consolidated the financial results of this mobile application service provider on a retrospective basis since the first quarter of 2022 in accordance with ASC 805, Business Combinations. Accordingly, retrospective adjustments have been made to our consolidated financial information for the year ended December 31, 2022 presented in this annual report, reflecting the consolidation of this mobile application service provider. Given that this was a transaction that involved entities under common control of Tencent Holdings Limited, all assets and assumed liabilities transferred have been recognized at the historical cost of the parent. A.Operating Results We are a leading game-related entertainment and services provider. We deliver dynamic live streaming and video content and a rich array of services spanning games, e-sports, and other interactive entertainment genres to a large, highly engaged community of game enthusiasts. We have cultivated a robust entertainment ecosystem powered by AI and other advanced technologies, serving users and partners across the gaming universe, including game companies, e-sports tournament organizers, broadcasters and talent agencies. Leveraging this strong foundation, we have also expanded into innovative game-related services, such as game distribution, in-game item sales, advertising and more. We continue to extend our footprint in China and abroad, meeting the evolving needs of gamers, content creators, and industry partners worldwide. Our average MAUs in 2025 were 161.1 million. In prior periods, we reported mobile MAUs, which measured the sum of users who accessed our domestic Huya Live platform and related services through mobile devices (including smart TV and other smart devices) at least once during such relevant period. Beginning in the second quarter of 2025, we shifted to reporting MAUs, which measured the sum of users who accessed our domestic and overseas platforms and services (primarily the domestic Huya Live platform, our global mobile application service platform, our overseas game live streaming platform, and related services), inclusive of users across all devices (mobile, PC and web), to provide a more comprehensive view of user activity across our evolving ecosystem. Accordingly, our MAU for 2025 is not directly comparable to those of previous periods. In addition, restating prior-period figure on MAU basis is not practicable due to differences in data tracking. Our average quarterly paying users were 4.4 million in 2025, compared to 4.5 million in 2024, primarily due to the continued soft macroeconomic and industry environment affecting user spending sentiment for live streaming services. As our business continues to evolve, we have further expanded into game-related services and other new initiatives, which increasingly generate revenues and income through user engagement beyond our own platforms as well as from game industry partners directly. As a result, we believe that MAUs and paying users are becoming less representative of our overall business performance. Consequently, starting from 2026, we have decided to cease the regular disclosure of MAUs and paying users. Going forward, we believe our current and future strategic progress can be more meaningfully evaluated through our overall financial and operational performance. Our business and results of operations are affected by general factors that, among other things, influence the live streaming industry and the game industry in mainland China, including overall macroeconomic growth and users paying sentiment, growth and competitive landscape of the live streaming market and the game market, and governmental policies and initiatives affecting the live streaming industry and the game industry. Unfavorable changes in any of these general industry conditions could negatively affect demand for our services and materially and adversely affect our results of operations. While our business and results of operations are influenced by the general factors summarized above, we believe that our results of operations are more directly affected by company-specific factors, which include: ● our ability to retain and grow our user reach, as well as to maintain and enhance user engagement; ● our ability to attract and retain talented and popular broadcasters, and enhance our content offerings; ● our ability to establish and maintain relationships with business partners for game-related services and advertisers; ● our ability to enhance and diversify our monetization; and ● our ability to manage our cost and expense. 105 Table of Contents Results of Operations The following table sets forth a summary of our consolidated statements of comprehensive income (loss) for the years indicated, both in absolute amounts and as percentages of our total net revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ US$ ​ ​ ​ % ​ ​ (in thousands, except for percentages) Net revenues ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Live streaming 6,450,782 ​ 92.2 ​ 4,745,195 ​ 78.1 ​ 4,594,014 ​ 656,935 ​ 70.7 Game related services, advertising and others 543,546 ​ 7.8 ​ 1,333,920 ​ 21.9 ​ 1,908,386 ​ 272,896 ​ 29.3 Total net revenues 6,994,328 ​ 100.0 ​ 6,079,115 ​ 100.0 ​ 6,502,400 ​ 929,831 ​ 100.0 Cost of revenues(1) (6,179,125) ​ (88.3) ​ (5,269,661) ​ (86.7) ​ (5,630,267) ​ (805,117) ​ (86.6) Gross profit 815,203 ​ 11.7 ​ 809,454 ​ 13.3 ​ 872,133 ​ 124,714 ​ 13.4 Operating expenses ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development expenses(1) (578,610) ​ (8.3) ​ (512,637) ​ (8.4) ​ (496,677) ​ (71,024) ​ (7.6) Sales and marketing expenses(1) (440,605) ​ (6.3) ​ (274,049) ​ (4.5) ​ (266,567) ​ (38,119) ​ (4.1) General and administrative expenses(1) (320,838) ​ (4.6) ​ (254,840) ​ (4.2) ​ (308,875) ​ (44,169) ​ (4.8) Total operating expenses (1,340,053) ​ (19.2) ​ (1,041,526) ​ (17.1) ​ (1,072,119) ​ (153,312) ​ (16.5) Other income, net 81,258 ​ 1.2 ​ 42,496 ​ 0.7 ​ 37,481 ​ 5,360 ​ 0.6 Operating loss (443,592) ​ (6.3) ​ (189,576) ​ (3.1) ​ (162,505) ​ (23,238) ​ (2.5) Impairment loss of investments (225,800) ​ (3.2) ​ (232,466) ​ (3.8) ​ (120,156) ​ (17,182) ​ (1.8) Interest income 479,681 ​ 6.9 ​ 391,389 ​ 6.4 ​ 190,789 ​ 27,282 ​ 2.9 Disposal gain of investments — ​ — ​ — ​ — ​ 1,500 ​ 214 ​ 0.02 Foreign currency exchange losses, net ​ (1,593) ​ (0.0) ​ (3,802) ​ (0.1) ​ (6,718) ​ (961) ​ (0.1) Loss before income tax expenses (191,304) ​ (2.7) ​ (34,455) ​ (0.6) ​ (97,090) ​ (13,885) ​ (1.5) Income tax expenses (13,215) ​ (0.2) ​ (13,500) ​ (0.2) ​ (12,806) ​ (1,831) ​ (0.2) Loss before share of loss in equity method investments, net of income taxes (204,519) ​ (2.9) ​ (47,955) ​ (0.8) ​ (109,896) ​ (15,716) ​ (1.7) Share of loss in equity method investments, net of income taxes — ​ — ​ — ​ — ​ (2,695) ​ (385) ​ (0.04) Net loss (204,519) ​ (2.9) ​ (47,955) ​ (0.8) ​ (112,591) ​ (16,101) ​ (1.7) Notes: (1) Share-based compensation was allocated in cost of revenues and operating expenses as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ RMB ​ ​ ​ RMB ​ ​ ​ US$ ​ ​ (in thousands) Cost of revenues 16,137 15,566 12,091 1,729 Research and development expenses 40,679 27,269 22,772 3,256 Sales and marketing expenses 2,842 1,147 1,141 163 General and administrative expenses 18,607 20,538 37,588 5,375 ​ Net revenues Total net revenues decreased by 13.1% from RMB6,994.3 million in 2023 to RMB6,079.1 million in 2024, and increased by 7.0% to RMB6,502.4 million (US$929.8 million) in 2025. 106 Table of Contents Live streaming revenues. We generate revenues from our live streaming services primarily through sale of virtual items. Users can access content on our platform free of charge, but are charged for their purchases. The virtual items sold by us mainly include (i) consumable items, which can be gifted to the broadcasters or used in live streams to create special effects, (ii) time-based items, which provide paying users or receiving broadcasters with certain privileges and rights or special symbols over a period of time, and (iii) multiple virtual items sold in bundles. Revenues derived from consumable items are recognized immediately upon consumption, while revenues derived from time-based items are recognized over their usage period on a straight line basis. Based on our revenue-sharing arrangements with broadcasters, and in some cases, also their talent agencies, we share a percentage of the revenues generated from the sales of virtual items attributed to their live streams. Live streaming revenues decreased by 3.2% from RMB4,745.2 million in 2024 to RMB4,594.0 million (US$656.9 million) in 2025, primarily due to the continued impact of the macroeconomic and industry environment, partially offset by improved monetization efficiency, as reflected in higher average spending per paying user for live streaming services in the second half of 2025. Live streaming revenues decreased by 26.4% from RMB6,450.8 million in 2023 to RMB4,745.2 million in 2024, primarily attributable to the continued impact of the macroeconomic and industry environment and our proactive business adjustments in support of its strategic transformation and prudent operations. Game-related services, advertising and other revenues (formerly known as advertising and other revenues). We generate a portion of revenues from game-related services and sales of in-game items from certain mobile games that we developed and operated jointly with third-party distribution platforms. We also generate advertising revenues primarily from sales of various forms of advertising and promotion campaigns, including (i) display advertisements in various areas of our platform, (ii) native advertisements in cooperation with broadcasters, and (iii) game events advertising and campaigns. Advertisements on our platform are generally charged on the basis of duration or per specified action. We enter into advertising contracts directly with advertisers or advertising agencies. Game-related services, advertising and other revenues increased by 43.1% from RMB1,333.9 million in 2024 to RMB1,908.4 million (US$272.9 million) in 2025, primarily due to higher revenues from game-related services and advertising, which were mainly attributable to our deepened cooperation with game companies. Game-related services, advertising and other revenues increased by 145.4% from RMB543.5 million in 2023 to RMB1,333.9 million in 2024, primarily due to increased revenues from game distribution and advertising services and in-game item sales, which were mainly attributable to our deepened cooperation with game companies. Cost of revenues The following table sets forth the principal components of our cost of revenues by absolute amount and as a percentage of our total cost of revenues for the years presented. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ % ​ ​ ​ RMB ​ ​ ​ US$ ​ ​ ​ % ​ ​ (in thousands, except for percentages) Cost of revenues: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revenue sharing fees and content costs 5,378,413 ​ 87.0 ​ 4,619,735 ​ 87.7 ​ 4,872,318 ​ 696,732 ​ 86.5 Costs of in-game virtual items ​ 10,283 ​ 0.2 ​ 15,762 ​ 0.3 ​ 197,918 ​ 28,302 ​ 3.5 Bandwidth and server custody fees 360,660 ​ 5.8 ​ 237,441 ​ 4.5 ​ 179,189 ​ 25,624 ​ 3.2 Salaries and welfare 241,243 ​ 3.9 ​ 233,669 ​ 4.4 ​ 222,454 ​ 31,810 ​ 4.0 Payment handling costs 64,665 ​ 1.0 ​ 42,303 ​ 0.8 ​ 42,628 ​ 6,096 ​ 0.8 Share-based compensation 16,137 ​ 0.3 ​ 15,566 ​ 0.3 ​ 12,091 ​ 1,729 ​ 0.2 Others 107,724 ​ 1.8 ​ 105,185 ​ 2.0 ​ 103,669 ​ 14,824 ​ 1.8 Total cost of revenues 6,179,125 ​ 100.0 ​ 5,269,661 ​ 100.0 ​ 5,630,267 ​ 805,117 ​ 100.0 ​ Revenue sharing fees and content costs. Revenue sharing fees and content costs consist primarily of payments to broadcasters and talent agencies in accordance with our revenue-sharing arrangements, as well as content licensing and production costs. 107 Table of Contents Revenue sharing fees and content costs increased by 5.5% from RMB4,619.7 million in 2024 to RMB4,872.3 million (US$696.7 million) in 2025, primarily due to increased revenues. Revenue sharing fees and content costs as a percentage of our total net revenues decreased from 76.0% in 2024 to 74.9% in 2025. Revenue sharing fees and content costs decreased by 14.0% from RMB5,378.4 million in 2023 to RMB4,625.1 million in 2024, primarily due to decreased live streaming revenue sharing fees associated with the decline in live streaming revenues as well as lower costs related to licensed e-sports content, partially offset by increased game-related services, advertising and other revenue sharing fees. Revenue sharing fees and content costs as a percentage of our total net revenues decreased from 76.9% in 2023 to 76.0% in 2024. Costs of in-game virtual items. Costs of in-game virtual items consist primarily of costs incurred in purchasing in-game virtual items from game publishers. Costs of in-game virtual items increased by 53.3% from RMB10.3 million in 2023 to RMB15.8 million in 2024, and further by 1,155.7% to RMB197.9 million (US$28.3 million) in 2025, primarily due to the development of our in-game item sales business. Bandwidth and server custody fees. Bandwidth and server custody fees consist of fees and charges relating to bandwidth usage and server custody in our operations. Bandwidth and server custody fees decreased by 24.5% from RMB237.4 million in 2024 to RMB179.2 million (US$25.6 million) in 2025, primarily due to our continued technology and management enhancement efforts. Bandwidth and server custody fees decreased by 34.2% from RMB360.7 million in 2023 to RMB237.4 million in 2024, primarily due to continued technology and management enhancement efforts, as well as favorable pricing terms. Others. Salaries and welfare consist of salaries, bonuses and other benefits for our employees involved in the operations of our platform. Payment handling costs consist primarily of channel fees charged by payment channels such as WeChat Pay and Alipay. Other costs consist primarily of share-based compensation, as well as depreciation and amortization expense. Salaries and welfare decreased by 4.8% from RMB233.7 million in 2024 to RMB222.5 million (US$31.8 million) in 2025, primarily attributable to a decrease in headcount. Payment handling costs slightly increased by 0.8% from RMB42.3 million in 2024 to RMB42.6 million (US$6.1million) in 2025, primarily attributable to the increase in sales of in-game items. Share-based compensation decreased by 22.3% from RMB15.6 million in 2024 to RMB12.1 million (US$1.7 million) in 2025, primarily due to a decrease in awards granted in 2025. Other costs decreased by 1.4% from RMB105.2 million in 2024 to RMB103.7 million (US$14.8 million) in 2025. Salaries and welfare decreased by 3.1% from RMB241.2 million in 2023 to RMB233.7 million in 2024, primarily attributable to a decrease in headcount. Payment handling costs decreased by 34.6% from RMB64.7 million in 2023 to RMB42.3 million in 2024, primarily attributable to a decrease in sales of virtual items on our platform. Share-based compensation decreased by 3.5% from RMB16.1 million in 2023 to RMB15.6 million in 2024, primarily due to the decreased awards granted in 2024. Other costs decreased by 2.4% from RMB107.7 million in 2023 to RMB105.2 million in 2024. Gross profit and gross margin Our gross profit increased by 7.7% from RMB809.5 million in 2024 to RMB872.1 million (US$124.7 million) in 2025, primarily attributable to the fact that the increase in total net revenues outpaced the increase in revenue sharing fees and content costs, as well as a decrease in bandwidth and server custody fees. Our gross margin increased from 13.3% in 2024 to 13.4% in 2025. Our gross profit decreased by 0.7% from RMB815.2 million in 2023 to RMB809.5 million in 2024, primarily attributable to the decrease in live streaming revenues outpaced the decrease in bandwidth and server custody fees as well as revenue sharing fees and content costs. Our gross margin increased from 11.7% in 2023 to 13.3% in 2024. Operating expenses Operating expenses decreased by 22.3% from RMB1,340.1 million in 2023 to RMB1,041.5 million in 2024 and increased by 2.9% to RMB1,072.1 million (US$153.3 million) in 2025. Research and development expenses. Research and development expenses consist primarily of salaries, welfare and share-based compensation for research and development personnel. 108 Table of Contents Research and development expenses decreased by 3.1% from RMB512.6 million in 2024 to RMB496.7 million (US$71.0 million) in 2025, primarily attributable to decreased staff costs as a result of enhanced efficiency. Research and development expenses decreased by 11.4% from RMB578.6 million in 2023 to RMB512.6 million in 2024, primarily attributable to decreased personnel-related expenses and share-based compensation expenses. Sales and marketing expenses. Sales and marketing expenses consist primarily of advertising and market promotion expenses, salaries and welfare as well as shared-based compensation for sales and marketing personnel. Sales and marketing expenses decreased by 2.7% from RMB274.0 million in 2024 to RMB266.6 million (US$38.1 million) in 2025, primarily attributable to decreased channel promotion fees. Sales and marketing expenses decreased by 37.8% from RMB440.6 million in 2023 to RMB274.0 million in 2024, primarily attributable to primarily due to decreased marketing and promotion fees, as well as personnel-related expenses. General and administrative expenses. General and administrative expenses consist primarily of salaries and welfare for management and administrative personnel, credit loss provision, depreciation and amortization expenses and share-based compensation expense for management and administrative personnel. General and administrative expenses increased by 21.2% from RMB254.8 million in 2024 to RMB308.9 million (US$44.2 million) in 2025, primarily attributable to an RMB66.0 million (US$9.4 million) provision related to a receivable arising from a 2021 arrangement with a broadcaster, which was deemed to have a heightened risk of non-recoverability. General and administrative expenses decreased by 20.6% from RMB320.8 million in 2023 to RMB254.8 million in 2024, primarily attributable to decreased personnel-related expenses, professional service fees and provisions. Other income Our other income decreased by 11.8% from RMB42.5 million in 2024 to RMB37.5 million (US$5.4 million) in 2025, primarily attributable to lower government subsidies. Our other income decreased by 47.7% from RMB81.3 million in 2023 to RMB42.5 million in 2024, primarily attributable to lower government subsidies and realized damages received in the third quarter of 2023 from a favorable outcome in a broadcaster-related lawsuit. Operating loss Our operating loss was RMB162.5 million (US$23.2 million) in 2025, compared with RMB189.6 million in 2024. Our operating margin increased from a negative 3.1% in 2024 to a negative 2.5% in 2025. Our operating loss was RMB189.6 million in 2024, compared with RMB443.6 million in 2023. Our operating margin increased from a negative 6.3% in 2023 to a negative 3.1% in 2024. Interest income Interest income consists of interest earned on bank deposits and short-term wealth management products. Our interest income decreased from RMB391.4 million in 2024 to RMB190.8 million (US$27.3 million) in 2025, primarily due to a lower time deposit balance, which was mainly attributable to the special cash dividends paid in 2025. Our interest income decreased from RMB479.7 million in 2023 to RMB391.4 million in 2024, primarily attributable to a lower time deposit balance, which was mainly attributable to the special cash dividends paid in May 2024 and October 2024. 109 Table of Contents Impairment loss of investments We recorded impairment loss of investments of RMB120.2 million (US$17.2 million) in 2025, RMB232.5 million in 2024, and RMB225.8 million in 2023, primarily due to the recognition of impairment charges on our investments attributable to the weak financial performance of certain investees. Income tax expenses Our income tax expenses decreased from RMB13.5 million in 2024 to RMB12.8 million (US$1.8 million) in 2025, mainly due to decreased profitability of certain operating entities overseas. Our income tax expenses increased from RMB13.2 million in 2023 to RMB13.5 million in 2024, mainly due to increased profitability of certain operating entities overseas. For details on such income tax expenses, please see Note 19(b) to our audited consolidated financial statements included elsewhere in this annual report. Net loss attributable to HUYA Inc. We had a net loss attributable to HUYA Inc. of RMB112.6 million (US$16.1 million) in 2025, as compared to a net loss attributable to HUYA Inc. of RMB48.0 million in 2024. We had a net loss attributable to HUYA Inc. of RMB48.0 million in 2024, as compared to a net loss attributable to HUYA Inc. of RMB204.5 million in 2023. Taxation Cayman Islands According to Maples and Calder (Hong Kong) LLP, our legal counsel as to Cayman Islands law, the Cayman Islands currently levies no taxes on corporations based upon profits, income, gains or appreciation, there are no other taxes likely to be material to us levied by the government of the Cayman Islands, except for stamp duties, which may be applicable on instruments executed in, or brought within the jurisdiction of the Cayman Islands. Hong Kong Huya Limited, our subsidiary incorporated in Hong Kong, is subject to 16.5% income tax on their taxable income generated from operations in Hong Kong. The payments of dividends by these companies to their shareholders are not subject to any withholding tax in Hong Kong. In 2023, 2024 and 2025, the first HK$2 million of profits earned by our subsidiaries incorporated in Hong Kong was taxed at half of the current tax rate (i.e., 8.25%) while the remaining profits continued to be taxed at the existing 16.5% tax rate. Singapore HUYA PTE. LTD. and ELECYBER INTERNATIONAL PTE. LTD., our subsidiaries incorporated in Singapore, are subject to income tax at a rate of 17% on their assessable profits. Mainland China Generally, our subsidiaries in mainland China, the variable interest entity and its subsidiaries are subject to enterprise income tax on their taxable income in mainland China at a statutory rate of 25%. The enterprise income tax is calculated based on the entity’s global income as determined under tax laws of mainland China and accounting standards. Certified High and New Technology Enterprises are entitled to a preferential tax rate of 15% but are required to re-apply for the preferential tax treatment every three years. During the three-year period, a High and New Technology Enterprise must conduct a self-review of its qualification each year to ensure it meets the criteria of High and New Technology Enterprises. If a High and New Technology Enterprise fails to meet the criteria for any year, the enterprise cannot enjoy the 15% preferential tax rate that year and must instead be subject to the uniform 25% income tax rate. ​ 110 Table of Contents An entity registered in Hainan Free Trade Port and operating substantially that qualifies as an “Encouraged Industrial Enterprises” is entitled to a preferential income tax rate of 15% for five years since January 1, 2020. Entities must perform a self-assessment each year to ensure they meet the criteria for qualification, pursuant to the Circular about Preferential Corporate Income Tax Policy for Hainan Free Trade Port (SAT Public Notice [2020] No. 31). According to Hainan Provincial Tax Bureau Public Notice [2021] No. 1, enterprises set up in Hainan Free Trade Port without any branches outside shall have substantive operations in Hainan Free Trade Port, which means that such enterprises shall maintain actual business operation, human resources, finance management as well as assets solely in Hainan Free Trade Port in order to enjoy the preferential tax rate. If an Encouraged Industrial Enterprise fails to meet the qualification criteria for as the status of an “Encouraged Industrial Enterprise” or requirement of substantive operations in a given year, the enterprise would not be eligible to benefit from the 15% preferential tax rate for that year and therefore the regular 25% enterprise income tax rate would be applied instead. The enterprise income tax applicable to each of our significant subsidiaries in mainland China and the VIE are as follows: ● Huya Technology obtained the qualification as a High and New Technology Enterprise in 2025 and enjoyed a preferential tax rate of 15% for the years ended December 31, 2025. 2026 and 2027. ● Guangzhou Huya obtained the qualification as a High and New Technology Enterprise in 2024 and enjoyed a preferential tax rate of 15% for the years ended December 31, 2024, 2025 and 2026 as a qualified High and New Technology Enterprise. ● Hainan Huya Entertainment Information Technology Co., Ltd., as an enterprise in an encouraged industry registered in the Hainan Free Trade Port and engaging in substantive operations, is entitled to enjoy the preferential tax rate of 15% for eight years starting from 2020, pursuant to Cai Shui [2025] No. 2. Commerce & Finance Law Offices, our legal counsel as to the law of mainland China, has advised us that dividends paid by our subsidiaries in mainland China to our Hong Kong subsidiary will be subject to a withholding tax rate of 10%, unless the relevant Hong Kong entity satisfies all the requirements under the Arrangement between mainland China and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion with respect to Taxes on Income and Capital. If our Hong Kong subsidiary satisfies all the requirements under the tax arrangement and submits required application materials to the tax authority, the dividends paid to the Hong Kong subsidiary would be subject to withholding tax at the standard rate of 5%. Should the tax authority later decide that the preferential 5% tax rate is inapplicable based on subsequent reviews of the application, additional tax payable and late payment surcharges may be imposed. Commerce & Finance Law Offices, our legal counsel as to the law of mainland China, has advised us that if our holding company in the Cayman Islands or any of our subsidiaries outside of mainland China were deemed to be a “resident enterprise” under the Enterprise Income Tax Law, it would be subject to enterprise income tax on its worldwide income at a rate of 25%. See “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Under the enterprise income tax law of mainland China, we may be classified as a mainland China ‘resident enterprise,’ which could result in unfavorable tax consequences to us and our shareholders and have a material adverse effect on our results of operations and the value of your investment.” Impact of Foreign Currency Fluctuation See “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China—Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment” and “Item 11. Quantitative and Qualitative Disclosures About Market Risk—Foreign Exchange Risk.” Impact of Governmental Policies See “Item 3. Key Information—D. Risk Factors—Risks Related to Doing Business in Mainland China” and “Item 4. Information on the Company— B. Business Overview—Government Regulations.” 111 Table of Contents B.Liquidity and Capital Resources Our principal sources of liquidity have been cash generated from operating activities and financing activities. As of December 31, 2023, 2024 and 2025, we had RMB512.0 million, RMB1,188.9 million and RMB692.7 million (US$99.0 million), respectively, in cash and cash equivalents; RMB6,851.2 million, RMB4,075.0 million and RMB3,125.8 million (US$447.0 million), respectively, in short-term deposits. Our cash and cash equivalents consist primarily of demand deposits placed with banks. Our short-term deposits consist primarily of time deposits placed with banks with original maturities of more than three months but less than one year. We declared a special cash dividend on March 19, 2024 of US$0.66 per ordinary share, or US$0.66 per ADS, to holders of ordinary shares and holders of ADSs of record as of the close of business on May 10, 2024, and distributed such dividend in May 2024 in a total amount of approximately US$150 million. In addition, we declared a special cash dividend on August 13, 2024 of US$1.08 per ordinary share, or US$1.08 per ADS, to holders of ordinary shares and holders of ADSs of record as of the close of business on October 9, 2024, and distributed such dividend in October 2024 in a total amount of approximately US$250 million. In March 2025, our board approved the 2025-2027 Dividend Plan for the purpose of enhancing shareholder returns and optimizing our capital structure. The 2025-2027 Dividend Plan consists of the 2025 Cash Dividend, the 2026 Cash Dividend and the Expected 2027 Dividend. We distributed the 2025 Cash Dividend to the holders of our ordinary shares and holders of our ADSs in June 2025. The total amount of the 2025 Cash Dividend was approximately US$340 million, which was funded by surplus cash on our balance sheet. In addition, our board approved the 2026 Cash Dividend in March 2026, which will be paid to the holders of our ordinary shares and holders of our ADSs as of the close of business on June 17, 2026, in U.S. dollars, in an amount of US$0.135 per ordinary share or US$0.135 per ADS. The total amount of cash to be distributed for the 2026 Cash Dividend is expected to be approximately US$31 million, which will be funded by surplus cash on our balance sheet. The Expected 2027 Dividend consists of a cash dividend in the aggregate amount expected to be no less than US$30 million in 2027. With respect to the Expected 2027 Dividend, our board reserves full discretion relating to the determination to make such dividend distribution and the amount, timing, and other specifics of such distribution. The dividends to be paid under the 2025-2027 Dividend Plan to our ADS holders through the depositary bank will be subject to the terms of the deposit agreement. We believe that our current cash and cash equivalents and our anticipated cash flows from operations will be sufficient to meet our anticipated working capital requirements and capital expenditures for the 12 months following the date of this annual report. As of the date of this annual report, we are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our liquidity or capital resources or that would cause reported financial information to not necessarily be indicative of future financial condition. We may, however, decide to enhance our liquidity position or increase our cash reserve for future investments or operations through additional capital and finance funding. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict our operations. As of December 31, 2025, the majority of our cash, cash equivalents and short-term deposits were held by our wholly owned subsidiaries in offshore accounts. Although we consolidate the results of the variable interest entity and its subsidiaries, we only have access to the assets or earnings of the variable interest entity and its subsidiaries through our contractual arrangements with the variable interest entity and its shareholders. See “Item 4. Information on the Company—C. Organizational Structure—Contractual Arrangements with Guangzhou Huya.” For restrictions and limitations on liquidity and capital resources as a result of our corporate structure, see “—Holding Company Structure.” A majority of our future revenues are likely to continue to be in Renminbi. Under existing foreign exchange regulations of mainland China, Renminbi may be converted into foreign exchange for current account items, including profit distributions, interest payments and trade-related and service-related foreign exchange transactions. ​ 112 Table of Contents Our subsidiaries in mainland China may convert Renminbi amounts that they generate in its own business activities, including technical consulting and related service fees pursuant to its contracts with the variable interest entity, as well as dividends it receives from its own subsidiaries, into foreign exchange and pay them to its non-mainland China parent companies in the form of dividends. However, current mainland China regulations permit our subsidiaries in mainland China to pay dividends to us only out of its accumulated profits, if any, determined in accordance with accounting standards and regulations of mainland China. Our subsidiaries in mainland China are required to set aside at least 10% of its after-tax profits after making up previous years’ accumulated losses each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of its registered capital. These reserves are not distributable as cash dividends. Furthermore, capital account transactions, which include foreign direct investment and loans, must be approved by and/or registered with the State Administration of Foreign Exchange and its local branches. The total amount of loans we can make to our subsidiaries in mainland China cannot exceed statutory limits and must be registered with the local counterpart of the State Administration of Foreign Exchange. The statutory limit for the total amount of foreign debts of a foreign-invested company is the difference between the amount of total investment as approved by the Ministry of Commerce of China or its local counterpart and the amount of registered capital of such foreign-invested company. The following table sets forth a summary of our cash flows data for the years indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ 2025 ​ ​ ​ ​ RMB ​ ​ ​ RMB ​ ​ ​ RMB ​ ​ ​ US$ ​ ​ (in thousands) Summary Consolidated Cash Flows Data ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash (used in)/provided by operating activities ​ (32,081) ​ 94,283 ​ (176,152) ​ (25,191) Net cash provided by investing activities 53,206 ​ 3,678,535 ​ 2,185,278 ​ 312,492 Net cash used in financing activities (202,294) ​ (3,104,671) ​ (2,498,192) ​ (357,237) Net (decrease)/increase in cash and cash equivalents and restricted cash (181,169) ​ 668,147 ​ (489,066) ​ (69,936) Cash and cash equivalents and restricted cash at the beginning of the year 698,141 ​ 530,110 ​ 1,205,942 ​ 172,447 Effect of exchange rate changes on cash and cash equivalents and restricted cash 13,138 ​ 7,685 ​ (12,182) ​ (1,742) Cash and cash equivalents and restricted cash at the end of the year 530,110 ​ 1,205,942 ​ 704,694 ​ 100,769 ​ Operating Activities Net cash used in operating activities was RMB176.2 million (US$25.2 million) in 2025. In 2025, the difference between our net cash used in operating activities and our net loss attributable to HUYA Inc. of RMB112.6 million (US$ 16.1 million) was primarily attributable to certain non-cash expenses, including impairment loss of investments of RMB120.2 million (US$17.2 million) and share-based compensation of RMB73.6 million (US$10.5 million), and changes in certain working capital items, including a decrease of RMB314.6 million (US$45.0 million) in accrued liabilities and other current liabilities, an increase of RMB175.6 million (US$25.1 million) in accounts payable and an increase of RMB163.7 million (US$23.4 million) in accounts receivable. Net cash provided by operating activities was RMB94.3 million in 2024. In 2024, the difference between our net cash provided by operating activities and our net loss attributable to HUYA Inc. of RMB48.0 million was primarily attributable to certain non-cash expenses, including impairment loss of investments of RMB232.5 million and share-based compensation of RMB64.5 million, and changes in certain working capital items, including a decrease of RMB158.2 million in advances from customers and deferred revenue, a decrease of RMB124.0 million in accrued liabilities and other current liabilities and an increase of RMB59.0 million in amounts due from related parties. Net cash used in operating activities was RMB32.1 million in 2023. In 2023, the difference between our net cash used in operating activities and our net loss attributable to HUYA Inc. of RMB204.5 million was primarily attributable to certain non-cash expenses, including impairment loss of investments of RMB225.8 million and share-based compensation of RMB78.3 million, and changes in certain working capital items, including a decrease of RMB183.5 million in accrued liabilities and other current liabilities, an increase of RMB88.9 million in amounts due from related parties and a decrease of RMB60.1 million in advances from customers and deferred revenue. 113 Table of Contents Investing Activities Net cash provided by investing activities was RMB2,185.3 million (US$312.5 million) in 2025, which was primarily attributable to net maturities of short-term deposits of RMB2,340.3 million (US$334.7 million), and net maturities of long-term deposits of RMB50.0 million (US$7.2 million), partially offset by cash paid for property construction and equipment of RMB167.8 million (US$24.0 million), and cash paid for an equity method investment of RMB24.0 million (US$3.4 million). Net cash provided by investing activities was RMB3,678.5 million in 2024, which was primarily attributable to net maturities of short-term deposits of RMB3,837.4 million, and net maturities of long-term deposits of RMB80.0 million, partially offset by cash paid for property construction and equipment of RMB186.3 million, and cash paid for acquisition of subsidiaries of RMB28.8 million. Net cash provided by investing activities was RMB53.2 million in 2023, which was primarily attributable to net maturities of short-term deposits of RMB2,221.5 million, partially offset by net cash paid for long-term deposits of RMB1,426.7 million, cash paid for acquisition of subsidiaries of RMB546.1 million, cash paid for property construction and equipment of RMB123.2 million, and cash paid for investments of RMB68.3 million. Financing Activities Net cash used in financing activities was RMB2,498.2 million (US$357.2 million) in 2025, which was primarily attributable to the payment of special cash dividends. Net cash used in financing activities was RMB3,104.7 million in 2024, which was primarily attributable to the payment of special cash dividends. Net cash used in financing activities was RMB202.3 million in 2023, which was attributable to the repurchase of our ordinary shares. Material Cash Requirements Other than the ordinary cash requirements for our operations, our material cash requirements as of December 31, 2025 and any subsequent interim period primarily include our capital expenditures, operating lease obligations and other contractual obligations and commitments. Capital Expenditures We made capital expenditures of RMB131.3 million, RMB210.5 million and RMB188.8 million (US$27.0 million) in 2023, 2024 and 2025, respectively. In these periods, our capital expenditures were mainly used for payment of office building construction, purchasing of servers and other IT infrastructures, as well as for leasehold improvement. We will continue to make capital expenditures to support the growth of our business. Contractual Obligations and Commitments The following table sets forth our contractual obligations by specified categories as of December 31, 2025. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payment due by period ​ ​ ​ ​ ​ ​ ​ ​ Less than ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ More than ​ ​ ​ ​ Total ​ ​ ​ 1 year ​ ​ ​ 1 – 3 years ​ ​ ​ 4 – 5 years ​ ​ ​ 5 years ​ ​ (RMB in thousands) Operating Lease Obligations(1) ​ 46,435 ​ 27,135 ​ 10,885 ​ 8,415 ​ — Note: (1) Represents our non-cancellable operating leases and property management fees for offices expiring on different dates. Rental expenses under operating lease for 2023, 2024 and 2025 were RMB53.9 million, RMB54.6 million and RMB47.2 million (US$6.7 million), respectively. 114 Table of Contents In 2021, we signed a contract to purchase an exclusive license for broadcasting League of Legends matches from a subsidiary of Tencent for the period from 2021 to 2025 at an aggregate purchase price of RMB2,013 million. In January 2023, the license agreement was amended, pursuant to which we were granted a non-exclusive, instead of exclusive, license for broadcasting League of Legends matches from 2023 to 2025 and that the license fee payable was decreased to a total of RMB450 million for these three years. In September 2024, a second supplemental agreement to the license agreement was entered into, pursuant to which the aggregate license fee payable to the subsidiary of Tencent for the years 2024 through 2025 was further decreased to RMB230 million. The unpaid purchase price was RMB65 million as of December 31, 2025. As of December 31, 2025, our total capital commitments were RMB223.1 million, consisting of construction in progress and investment. We intend to fund our existing and future material cash requirements primarily with our existing cash balance and anticipated cash flows from operations. We will continue to make cash commitments, including capital expenditures, to support the growth of our business. Other than the obligations set forth above, we do not have any significant capital and other commitments, long-term obligations, or guarantees as of December 31, 2025. Off-Balance Sheet Arrangements We have not entered into any off-balance sheet financial guarantees or other off-balance sheet commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder’s equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us. Holding Company Structure HUYA Inc. is a holding company with no material operations of its own. We conduct our operations primarily through our subsidiaries in mainland China, the variable interest entity and its subsidiaries in mainland China. As a result, HUYA Inc.’s ability to pay dividends depends upon dividends paid by our subsidiaries in mainland China. If our existing subsidiaries in mainland China or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. In addition, our wholly foreign-owned subsidiaries in mainland China is permitted to pay dividends to us only out of its retained earnings, if any, as determined in accordance with accounting standards and regulations of mainland China. Under law of mainland China, each of our subsidiary and the variable interest entity and its subsidiaries in mainland China is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, our wholly foreign-owned subsidiaries in mainland China and the variable interest entity may allocate a portion of its after-tax profits based on accounting standards of mainland China to a discretionary surplus fund at its discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of mainland China is subject to examination by the banks designated by the State Administration of Foreign Exchange. Our subsidiaries in mainland China has not paid dividends and will not be able to pay dividends until it generates accumulated profits and meet the requirements for statutory reserve funds. The table below sets forth the respective revenues contribution and assets of HUYA Inc. and our wholly-owned subsidiaries and the variable interest entity and its subsidiaries as of the dates and for the years indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net revenues(1) ​ ​ ​ Total assets(1) ​ ​ ​ ​ For the year ended December 31, ​ ​ ​ As of December 31, ​ ​ ​ ​ 2023 ​ ​ ​ 2024 ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2025 HUYA Inc. and its wholly-owned subsidiaries 4.4 % 5.9 % 8.4 % 84.1 % 83.6 % Variable interest entity and its subsidiaries 95.6 % 94.1 % 91.6 % 15.9 % 16.4 % Total 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % Notes: (1) The percentages exclude the inter-company transactions and balances between HUYA Inc. and its wholly-owned subsidiaries and the variable interest entity and its subsidiaries. 115 Table of Contents C.Research and Development, Patents and Licenses, etc. Technology The success of our business is dependent on our strong technological capabilities that support us in delivering superior user experience, increasing operational efficiency and enabling innovations. Our technology platform has been designed for reliability, scalability and flexibility. ● AI and big data analytics. AI is used extensively in various aspects of our operations and is particularly useful for reviewing and screening contents through recognizing and analyzing patterns. The massive volume of data, such as viewing history, user interactions and purchase preference, enable us to further optimize our AI technology and enhance its accuracy. As the quantity and variety of content and user interactions continue to grow, AI capability has become increasingly important for us to control our operating costs and enhance our user experience by reducing the need for extensive manual review. Our big data analytics capability enables us to build a comprehensive interest profile for each user by assigning interest tags to them. Combined with our AI capability, these interest profiles allow us to personalize user interfaces and recommend content to our users. In addition, we are leveraging AI-generated content (AIGC) capabilities across our content production chain to improve content creation quality and efficiency as well as user engagement. We continue to integrate AI technologies throughout the entire cycle of live streaming content production, distribution, and consumption with the aim to improve broadcasters’ content creation efficiency, foster AI-powered digital IP innovation, and facilitate the design of more distinctive virtual streamers. ● Live streaming technologies. Our audio and video coding and streaming technologies enable low-latency and low-loss rates in delivering voice and video data on our platform, even with weak internet connection, which provides our users with superior viewing experience. Audio and video technologies have been our main focus since our inception. For instance, we offer stable 8-20M pixels Blu-ray quality and HDR (high-dynamic range) supported live streaming. ● Servers and other infrastructure. We have deployed hybrid cloud computing technology in our server system. We employ back-end architecture that enables smooth and expedient upgrades of our platform software infrastructure. Our advanced peer-to-peer streaming technologies help us manage bandwidth utilization more efficiently and constantly improving streaming video quality, which further enhanced scalability. In the years ended December 31, 2023, 2024 and 2025, our research and development expenditures were RMB578.6 million, RMB512.6 million and RMB496.7 million (US$71.0 million), representing 8.3%, 8.4% and 7.6% of our total net revenues for the same year, respectively. Our research and development expenses consist primarily of salaries, welfare and share-based compensation for research and development personnel. D.Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the period since January 1, 2026 that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions. E.Critical Accounting Estimates Revenue Under ASC 606, revenues is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. We identify our contracts with customers and all performance obligations within those contracts. We then determine the transaction price and allocates the transaction price to the performance obligations within our contracts with customers, recognizing revenue when, or as, we satisfy our performance obligations. We generate revenue primarily from sales of virtual items in our platforms. We may enter into contracts that can include various combinations of virtual items, which are generally being distinguished and accounted for as separate performance obligations. Some of the separate performance obligations cannot be purchased on a standalone basis. 116 Table of Contents Nature of estimate: We must make estimates and apply judgment in determining the performance obligations and the estimated stand alone selling prices for each identified performance obligation. Assumptions: The standalone selling price for each distinct performance obligation is estimated based on pricing strategies, market factors, individual user’s times of renewal based on historical data of users’ spending pattern and average times of renewal. The estimate of pricing strategies and individual user’s times of renewal are important to our assumptions in these factors. When one of our estimates of individual user’s times of renewal based on historical data of users’ spending pattern and average times of renewal decreased/increased by 5% while holding all other estimates constant, there would be no material impact to our consolidated results of operations. The nature of our key assumptions did not change significantly throughout the periods presented. See Note 2—“Principal accounting policies” to our audited consolidated financial statements included elsewhere in this annual report for more information regarding revenue recognition and significant judgments. Impairment of Goodwill Goodwill is not depreciated or amortized but is tested for impairment on an annual basis, and between annual tests when an event occurs, or circumstances change that could indicate that the asset might be impaired. Nature of estimate: Goodwill is subject to periodic assessments of impairment. We test goodwill for impairment in the fourth quarter of each year, or when an event occurs or circumstances change that indicate the asset may be impaired. We assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If a qualitative assessment identifies a possible impairment then a quantitative goodwill impairment test is performed. If the carrying value of the reporting unit is above fair value, an impairment charge is recorded for the amount by which the carrying amount exceeds the reporting unit’s fair value up to a maximum amount of the goodwill balance for the reporting unit. Assumptions and approach: Application of a goodwill impairment test requires significant management judgment, primarily on determining the fair value of the reporting unit. The judgment in estimating the fair value of the reporting units was based on the income approach. Under the income approach, the fair value of the acquiree is derived from the present value of long-term cash flows that the reporting unit is expected to generate. The estimated cash flow projections were based on management’s estimates which include significant judgments and assumptions relating to revenue growth rates, the gross profit ratio, and the discount rate. Changes in these estimates and assumptions could materially affect the determination of fair value for the reporting unit. As of December 31, 2025, we have performed a goodwill impairment analysis on the reporting unit relating to the recently acquired global mobile application service provider (the only reporting unit with a goodwill balance). When determining the fair value of this reporting unit, we used the income approach. The long-term cash flows are dependent on certain key assumptions including revenue growth rates, the gross profit ratio and the discount rate. These factors, particularly the revenue growth rate and the gross profit ratio, are subject to high degree of judgment and complexity. The carrying amount of goodwill allocated to the reporting unit was RMB453.5 million. Based on the quantitative assessment results, the fair value of this reporting unit exceeded its carrying amount by 1.2% as of December 31, 2025. If the revenue growth rate decreased by 3%, or the gross profit ratio decreased by 1% or the discount rate increased by 1% while holding all other assumptions constant, there would be significant impact to our consolidated results of operations. Because of the lack of operating history and expected rapid growth of the acquiree, we supplemented our income approach method with the use of a market-based method which considers EBITDA multiples based on market data of comparable companies engaged in similar operations and economic characteristics. Based on the results using both approaches, the fair value of the acquiree was determined to exceed its carrying value as of December 31, 2025. Therefore, we concluded that there was no impairment of goodwill as of December 31, 2025. Recently Issued Accounting Pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in “Principal accounting policies—(cc) Recently issued accounting pronouncements” of our audited consolidated financial statements included elsewhere in this annual report. 117 Table of Contents