Shares of Weibo and Sina fell sharply on Thursday as earnings fell short of expectations: both exceeded 10percent.

category:Internet
 Shares of Weibo and Sina fell sharply on Thursday as earnings fell short of expectations: both exceeded 10percent.


Author: Fang Ling

On Thursday, May 23, before the U.S. stock market, Weibo released its first quarter results.

Net revenue in the first quarter was $399.2 million, slightly below market expectations of $399.6 million, up 14% year-on-year, a decline from 28% in the fourth quarter. Net profit attributable to Weibo was $1504 million, up 52% year-on-year.

Although the financial statements were generally in line with expectations, the second quarter revenue guidance disappointed the market. Weibo expects net revenue of $427 million to $437 million in the second quarter of 2019, far below market expectations of $481.8 million.

Against the backdrop of the general stock market decline on Thursday, microblogging had its deepest decline of 16.5%, with a final fall of 11.28%, to $45.39, the lowest since January 6, 2017 and a 35% decline since 2019. Weibo fell 10% before Thursday.

Sina shares fell 14.8%, 10.12%, to $42.54, the lowest since May 27, 2016, and continued to fall 1.4% after the session, with a cumulative decline of 20.1% since 2019. Sina fell 9% before Thursdays session.

The main financial indicators for the first quarter are as follows:

Wang Gaofei, CEO of Sina Weibo, said he was satisfied with Sina Weibos performance in the first quarter.

Through effective product upgrading and channel investment, Weibo has achieved steady traffic growth. In the first quarter, brand advertising revenue grew strongly, which benefited from Weibos comprehensive social marketing program and the continuous improvement of advertising marketing effect, bringing unique marketing value to brand advertisers.

In terms of active users, the number of monthly and daily users increased compared with the same period last year.

The number of active monthly users (MAUs) in March 2019 increased by about 54 million compared with the same period last year, reaching 465 million, of which 94% were mobile users. In March 2019, the average number of active users per day (DAUs) increased by 19 million net from the same period last year, reaching 203 million.

Revenue by category, advertising and marketing, as well as value-added services revenue, both declined in the same rate of growth as in the previous quarter.

Advertising and marketing revenue in the first quarter was $341.1 million, up 13% from $302.9 billion in the same period last year, far less than 25% in the fourth quarter of last year. Among them, advertising and marketing revenue from small and medium-sized enterprises and large customers amounted to 324.5 million US dollars, an increase of 17% over the same period last year.

Revenue from value-added services in the first quarter was $58 million, up 24% from $46.9 million in the same period last year, which was also significantly lower than 44% in the fourth quarter of last year. Weibo pointed out that the increase in revenue from value-added services was mainly due to revenue generated by the acquisition of Live services in the fourth quarter of last year.

In terms of cost, the total cost and expenditure in the first quarter was US$276.1 million, compared with US$240.5 million in the same period last year; under non-GAAP, the cost and expenditure were US$262.4 million and US$229.3 million in the same period last year.

According to Weibo, the growth is mainly related to revenue sharing generated by live broadcasting, as well as human-related costs and expenditure growth.

Shortly after the microblog earnings report was released, Sina also reported its first quarter performance.

In the first quarter, net revenue grew by 8% year-on-year. Among them, advertising revenue increased by 6% and non-advertising revenue increased by 18%. In addition, non-GAAP Sina ordinary shareholders should account for a net profit of $28.9 million, down year-on-year.

The main financial indicators are as follows

Revenue by business category, part of the growth in advertising revenue was dragged down by portal advertising, while the fourth quarter of the live business and financial technology business boosted non-advertising revenue.

Advertising revenue increased by 6% to $388 billion year on year, compared with $367.1 million in the same period last year. Sina said it benefited mainly from the growth of microblog advertising and marketing revenue, which was partly offset by the decline in portal advertising revenue.

Non-advertising revenue increased 18% to $87.1 million from a year earlier, compared with $73.7 million in the same period last year. This revenue is mainly due to the acquisition of live business by Weibo in the fourth quarter of last year and the increase of revenue from Sinas financial technology business.

The gross profit margin remained roughly stable. Gross margin was 76% in the first quarter and 75% in the same period last year. Among them, the gross interest rate of advertising business is 78%, 77% in the same period last year; the gross interest rate of non-advertising business is 64%, 65% in the same period last year. In terms of cash holdings, Sinas total cash, cash equivalents and short-term investments as at 31 March 2019 were $2.1 billion and $2.3 billion as at 31 December 2018. Sina said the decrease was mainly related to the companys sustained investment activities. * This article is from Wall Street (Wechat ID: Wallstreetcn). Source: Editor-in-Charge of Wall Street: Wang Fengzhi_NT2541

The gross profit margin remained roughly stable. Gross margin was 76% in the first quarter and 75% in the same period last year. Among them, the gross interest rate of advertising business is 78%, 77% in the same period last year; the gross interest rate of non-advertising business is 64%, 65% in the same period last year.

In terms of cash holdings, Sinas total cash, cash equivalents and short-term investments as at 31 March 2019 were $2.1 billion and $2.3 billion as at 31 December 2018. Sina said the decrease was mainly related to the companys sustained investment activities.

* This article is from Wall Street (Wechat ID: Wallstreetcn).