Weibo Corporation (the "Company" or "Weibo") (Nasdaq:WB), a leading
social media platform for people to create, distribute and discover
Chinese-language content, today announced its unaudited financial
results for the first quarter ended March 31, 2014.
First Quarter 2014 Highlights
- Net revenues increased 161% year over year to $67.5
million.
- Advertising and marketing revenues grew 176% year over year to
$51.9 million.
- Weibo Value Added Services ("Weibo VAS") revenues increased
120% year over year to $15.7 million.
- Net loss increased 146% year over year to $47.4 million, or
$0.31 diluted net loss per share attributable to Weibo's ordinary
shareholders. Net loss in the first quarter of 2014 included a loss
of $40.2 million from the change in fair value of investor option
liability.
- Non-GAAP net loss decreased 74% year over year to $4.8 million,
or $0.03 non-GAAP diluted net loss per share attributable to
Weibo's ordinary shareholders.
- Monthly active users ("MAUs") were 143.8 million as of March
31, 2014, an increase of 34% year over year.
- Daily active users ("DAUs") were 66.6 million on average for
March 2014, an increase of 37% year over year.
"Weibo's IPO in five years from inception exemplifies the strong
technology and media know how of our team. We are delighted to
report robust traffic and revenue growth in the first quarter of
2014," stated Gaofei Wang, Weibo CEO. "During the first quarter, we
leveraged the chains of media events and fine-tuned our operations
and products to improve social information distribution and
discovery, resulting in Weibo's MAU growing 11% sequentially and
further solidifying Weibo as a leading social media in China. On
top of Weibo's traffic acceleration, Weibo's net revenues grew 161%
year over year. In May, we rolled out promoted feeds for brand
advertisers, further diversifying Weibo's revenue stream."
First Quarter 2014 Financial
Results
For the first quarter of 2014, Weibo reported net
revenues of $67.5 million, compared to $25.9 million for the same
period last year. Advertising and marketing revenues for the first
quarter of 2014 totaled $51.9 million, compared to $18.8 million
for the same period last year, with growth coming from social
display ads as well as promoted feeds and e-commerce related ads
from the strategic alliance with Alibaba. The latter two were
launched in the second quarter of 2013. Weibo VAS revenues for the
first quarter of 2014 was $15.7 million, compared to $7.1 million
for the same period last year, mainly due to growth in game-related
services, VIP membership as well as data licensing, which was
introduced in the fourth quarter of 2013.
Costs and expenses for the first quarter of 2014
was totaled $75.6 million, compared to $42.3 million for the same
period last year. Non-GAAP costs and expenses for the first quarter
of 2014 was $73.1 million, compared to $41.5 million for the same
period last year. The increase in non-GAAP costs and expenses was
due to an increase in VAT costs from higher revenues, as well as an
increase in bandwidth costs, marketing expenditures and
personnel-related costs.
Loss from operations for the first quarter of 2014
was $8.1 million, compared to a loss of $16.4 million for the same
period last year. Non-GAAP loss from operations for the first
quarter of 2014 was $5.6 million, compared to $15.6 million for the
same period last year.
Non-operating loss for the first quarter of 2014
was $39.9 million, compared to $2.6 million for the same period
last year. Non-operating loss for the first quarter of 2014
included a loss of $40.2 million from the change in fair value of
investor option liability in connection with Alibaba's investment
in Weibo.
Net loss for the first quarter of 2014 was $47.4
million, compared to a net loss of $19.2 million for the same
period last year. Diluted net loss per share for the first quarter
of 2014 was $0.31, compared to a diluted net loss of $0.13 per
share for the same period last year. Non-GAAP net loss for the
first quarter of 2014 was $4.8 million, compared to a non-GAAP net
loss of $18.4 million for the same period last year. Non-GAAP
diluted net loss per share for the first quarter of 2014 was $0.03,
compared to a non-GAAP diluted net loss of $0.13 per share for the
same period last year.
As of March 31, 2014, Weibo's cash, cash
equivalents and short-term investments totaled $466.2 million,
compared to $498.8 million as of December 31, 2013. For the first
quarter of 2014, cash used in operating activities was $18.2
million, capital expenditures totaled $2.8 million, and
depreciation and amortization expenses amounted to $5.3
million.
Initial Public Offering
In April 2014, Weibo completed its initial public
offering ("IPO") of a total of 19,320,000 American depositary
shares ("ADSs"), representing 19,320,000 Class A ordinary shares,
of which 6,000,000 ADSs were allotted to Ali WB Investment Holding
Ltd. ("Ali WB"), a wholly owned subsidiary of Alibaba, at $17.00
per ADS. Concurrently with the IPO, Ali WB acquired an additional
21,067,300 Class A ordinary shares of Weibo from SINA Corporation
and 2,923,478 Class A ordinary shares through a private placement
with Weibo at $14.45 per share, which represents a 15% discount to
the IPO price pursuant to the agreement entered into between SINA,
Weibo and Ali WB in connection with Ali WB's investment in Weibo.
Subsequent to the IPO, Weibo repurchased 2,923,478 ordinary shares
from SINA Corporation with the proceeds from the private placement.
All of Weibo's outstanding preferred shares initially issued in
April 2013 automatically converted into 30,046,154 Class A ordinary
shares immediately upon the completion of Weibo's offering.
Following these transactions, SINA remained the majority
shareholder of Weibo, holding approximately 58%, or 54% on a fully
diluted basis, of Weibo's total outstanding shares, and Ali WB
remained the second largest shareholder holding approximately 32%,
or 30% on a fully diluted basis, of Weibo's total outstanding
shares.
Business Outlook
For the second quarter of 2014, Weibo estimates
that its net revenues to be between $74 million and $76 million.
This forecast reflects Weibo's current and preliminary view, which
is subject to change.
Non-GAAP Measures
This release contains the following non-GAAP
financial measures: non-GAAP costs and expenses, non-GAAP income/
(loss) from operations, non-GAAP net income/ (loss) and non-GAAP
diluted net income/ (loss) per share. These non-GAAP financial
measures should be considered in addition to, not as a substitute
for, measures of the Company's financial performance prepared in
accordance with U.S. GAAP. The Company's non-GAAP financial
measures may be defined differently than similar terms used by
other companies. Accordingly, care should be exercised in
understanding how the Company defines its non-GAAP financial
measures. Reconciliations of the Company's non-GAAP measures to the
nearest GAAP measures are set forth in the section below titled
"Unaudited Reconciliation of Non-GAAP to GAAP Results."
The Company's non-GAAP financial measures exclude
stock-based compensation, amortization of intangible assets net of
tax, and change in fair value of investor option liability. The
Company's management uses these non-GAAP financial measures in
their financial and operating decision-making, because management
believes these measures reflect the Company's ongoing business
operations in a manner that allows more meaningful period-to-period
comparisons. The Company believes that these non-GAAP financial
measures provide useful information to investors and others in the
following ways: (i) in comparing the Company's current financial
results with the Company's past financial results in a consistent
manner, and (ii) in understanding and evaluating the Company's
current operating performance and future prospects in the same
manner as management does, if they so choose. The Company also
believes that the non-GAAP financial measures provide useful
information to both management and investors by excluding certain
expenses, gains/losses and other items (i) that are not expected to
result in future cash payments or (ii) that are non-recurring in
nature or may not be indicative of the Company's core operating
results and business outlook.
Use of non-GAAP financial measures has limitations.
The Company's non-GAAP financial measures do not include all income
and expense items that affect the Company's operations. They may
not be comparable to non-GAAP financial measures used by other
companies. Management compensates for these limitations by also
considering the Company's financial results prepared in accordance
with U.S. GAAP.
Conference Call
Weibo will host a conference call at
9:00p.m.–10:00p.m. Eastern Time on May 21, 2014 (or
9:00a.m.–10:00a.m. Beijing Time on May 22, 2014) to present an
overview of the Company's financial performance and business
operations. A live webcast of the call will be available through
the Company's corporate website at http://ir.weibo.com. The
conference call can be accessed as follows:
US Toll Free Dial in: +1 877 679 2987 |
International Dial in: +1 646 502 5131 |
Hong Kong: +852 3056 2688 |
China: 400 603 9021 |
Passcode for all regions: 838527 |
A replay of the conference call will be available through
midnight Eastern Time, June 4, 2014. The dial-in number is +1 866
345 5132. The passcode for the replay is 212641.
About Weibo
Weibo is a leading social media platform for people to create,
distribute and discover Chinese-language content. By providing an
unprecedented and simple way for Chinese people and organizations
to publicly express themselves in real time, interact with others
on a massive global platform and stay connected with the world,
Weibo has had a profound social impact in China. A microcosm of
Chinese society and a cultural phenomenon in China, Weibo allows
people to be heard publicly and exposed to the rich ideas, cultures
and experiences of the broader world. Media outlets use Weibo as a
source of news and a distribution channel for their headline news.
Government agencies and officials use Weibo as an official
communication channel for disseminating timely information and
gauging public opinion to improve public services. Individuals and
charities use Weibo to make the world a better place by launching
charitable projects, seeking donations and volunteers and
leveraging the celebrities and organizations on Weibo to amplify
their social influence.
Safe Harbor Statement
This press release contains forward-looking
statements that relate to, among other things, Weibo's expected
financial performance and Weibo's strategic and operational plans
(as described, without limitation, in the "Business Outlook"
section and in quotations from management in this press release).
Weibo may also make forward-looking statements in the Company's
periodic reports to the U.S. Securities and Exchange Commission, in
press releases and other written materials and in oral statements
made by its officers, directors or employees to third parties.
Statements that are not historical facts, including statements
about the Company's beliefs and expectations, are forward-looking
statements. These forward-looking statements can be identified by
terminology such as "will," "expects," "anticipates," "future,"
"intends," "plans," "believes," "confidence," "estimates" and
similar statements. Forward-looking statements involve inherent
risks and uncertainties. A number of important factors could cause
actual results to differ materially from those contained in any
forward-looking statement. Potential risks and uncertainties
include, but are not limited to Weibo's limited operating history
in a new and unproven market; failure to grow active user base and
user engagement; failure to compete effectively for user traffic or
user engagement; lack of experience operating as a stand-alone
public company; the uncertain regulatory landscape in China;
fluctuations in the Company's quarterly operating results; the
Company's reliance on advertising sales for a majority of its
revenues; failure to successfully develop, introduce, drive
adoption of or monetize new features and products; failure to enter
and develop the small and medium enterprise market by the Company
or through cooperation with other parties, such as Alibaba and
failure to compete successfully against new entrants and
established industry competitors. Further information regarding
these and other risks is included in filings with the Securities
and Exchange Commission. All information provided in this press
release is current as of the date of the press release, and Weibo
does not undertake any obligation to update such information,
except as required under applicable law.
|
|
WEIBO
CORPORATION |
UNAUDITED CONDENSED
COMBINED AND CONSOLIDATED STATEMENTS OF OPERATIONS |
(U.S. Dollars in
thousands, except per share data) |
|
|
|
|
|
|
|
|
|
Three months
ended |
|
March
31, |
December 31, |
|
2014 |
2013 |
2013 |
Net revenues: |
|
|
|
Advertising and
marketing |
$ 51,853 |
$ 18,763 |
$ 56,045 |
Weibo VAS |
15,657 |
7,121 |
15,379 |
Total net
revenues |
67,510 |
25,884 |
71,424 |
|
|
|
|
Costs and Expenses: |
|
|
|
Cost of revenues
(a) |
17,443 |
11,687 |
16,242 |
Sales and marketing
(a) |
23,849 |
8,451 |
22,860 |
Product development
(a) |
28,808 |
20,423 |
26,131 |
General and
administrative (a) |
5,472 |
1,738 |
4,998 |
Total costs and
expenses |
75,572 |
42,299 |
70,231 |
Income (loss) from
operations |
(8,062) |
(16,415) |
1,193 |
|
|
|
|
Non-operating income
(loss): |
|
|
|
Loss from equity method
investment |
- |
(654) |
- |
Change in fair value of
investor option liability |
(40,188) |
- |
19,535 |
Interest and other
income (expenses), net |
297 |
(1,933) |
361 |
|
(39,891) |
(2,587) |
19,896 |
|
|
|
|
Income (loss) before income tax
expenses |
(47,953) |
(19,002) |
21,089 |
Income tax benefits
(expenses) |
576 |
(239) |
471 |
Net income (loss) |
$ (47,377) |
$ (19,241) |
$ 21,560 |
|
|
|
|
Basic net income (loss) per share
attributable to Weibo's ordinary shareholders* |
$ (0.31) |
$ (0.13) |
$ 0.12 |
Diluted net income (loss) per share
attributable to Weibo's ordinary shareholders* |
$ (0.31) |
$ (0.13) |
$ 0.11 |
|
|
|
|
Shares used in computing basic net
income (loss) per share attributable to |
|
|
|
Weibo's ordinary
shareholders |
150,596 |
143,576 |
149,050 |
Shares used in computing diluted net
income (loss) per share attributable to |
|
|
|
Weibo's ordinary
shareholders |
150,596 |
143,576 |
166,162 |
|
|
|
|
|
|
|
|
(a) Stock-based compensation in each
category: |
|
|
|
Cost of
revenues |
$ 169 |
$ 51 |
$ 140 |
Sales and
marketing |
257 |
111 |
237 |
Product
development |
592 |
190 |
445 |
General and
administrative |
1,171 |
489 |
798 |
|
|
|
|
* Net income is adjusted to
reflect the impact of preferred shares issued when calculating the
basic and diluted earning per share. |
|
|
WEIBO
CORPORATION |
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS |
(U.S. Dollars in
thousands) |
|
|
|
|
|
|
|
March 31, |
December 31, |
|
2014 |
2013 |
Assets |
|
|
Current assets: |
|
|
Cash and cash
equivalents |
$ 206,201 |
$ 246,436 |
Short-term
investments |
260,011 |
252,342 |
Accounts receivable,
net |
60,071 |
47,304 |
Prepaid expenses and
other current assets |
7,647 |
5,693 |
Current assets
subtotal |
533,930 |
551,775 |
|
|
|
Property and equipment,
net |
34,547 |
35,702 |
Goodwill and intangible assets,
net |
10,308 |
10,588 |
Long-term investments |
13,538 |
5,500 |
Other assets |
479 |
3,369 |
Total assets |
$ 592,802 |
$ 606,934 |
|
|
|
Liabilities, Mezzanine Equity and
Shareholders' Deficit |
|
|
Liabilities: |
|
|
Current
liabilities: |
|
|
Accounts
payable |
$ 740 |
$ 824 |
Accrued
liabilities |
52,087 |
56,414 |
Deferred
revenues |
14,571 |
15,031 |
Amount due to
SINA |
263,323 |
267,722 |
Investor option
liability |
69,692 |
29,504 |
Current
liabilities subtotal |
400,413 |
369,495 |
|
|
|
Long-term
liabilities |
679 |
768 |
Total
liabilities |
401,092 |
370,263 |
|
|
|
Mezzanine equity - preferred
shares |
479,612 |
479,612 |
|
|
|
Shareholders' deficit: |
|
|
Weibo ordinary
shareholders' deficit |
(287,902) |
(242,941) |
Total shareholders'
deficit |
(287,902) |
(242,941) |
|
|
|
Total liabilities, mezzanine equity
and shareholders' deficit |
$ 592,802 |
$ 606,934 |
|
|
WEIBO
CORPORATION |
UNAUDITED
RECONCILIATION OF NON-GAAP TO GAAP RESULTS |
(U.S. Dollars in
thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended |
|
March 31,
2014 |
March 31,
2013 |
December 31,
2013 |
|
|
|
|
Non-GAAP |
|
|
|
Non- GAAP |
|
|
|
Non-GAAP |
|
Actual |
Adjustments |
|
Results |
Actual |
Adjustments |
|
Results |
Actual |
Adjustments |
|
Results |
|
|
|
|
|
|
|
|
|
|
|
|
|
Advertising and
marketing |
$ 51,853 |
|
|
$ 51,853 |
$ 18,763 |
|
|
$ 18,763 |
$ 56,045 |
|
|
$ 56,045 |
Weibo VAS |
15,657 |
|
|
15,657 |
7,121 |
|
|
7,121 |
15,379 |
|
|
15,379 |
Net
revenues |
$ 67,510 |
|
|
$ 67,510 |
$ 25,884 |
|
|
$ 25,884 |
$ 71,424 |
|
|
$ 71,424 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,189) |
(a) |
|
|
|
|
|
|
(1,620) |
(a) |
|
|
|
(280) |
(b) |
|
|
(841) |
(a) |
|
|
(229) |
(b) |
|
Total costs and
expenses |
$ 75,572 |
$ (2,469) |
|
$ 73,103 |
$ 42,299 |
$ (841) |
|
$ 41,458 |
$ 70,231 |
$ (1,849) |
|
$ 68,382 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,189 |
(a) |
|
|
|
|
|
|
1,620 |
(a) |
|
|
|
280 |
(b) |
|
|
841 |
(a) |
|
|
229 |
(b) |
|
Income (loss) from
operations |
$ (8,062) |
$ 2,469 |
|
$ (5,593) |
$ (16,415) |
$ 841 |
|
$ (15,574) |
$ 1,193 |
$ 1,849 |
|
$ 3,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,189 |
(a) |
|
|
|
|
|
|
1,620 |
(a) |
|
|
|
191 |
(b) |
|
|
|
|
|
|
229 |
(b) |
|
|
|
40,188 |
(c) |
|
|
841 |
(a) |
|
|
(19,535) |
(c) |
|
Net income (loss) |
$ (47,377) |
$ 42,568 |
|
$ (4,809) |
$ (19,241) |
$ 841 |
|
$ (18,400) |
$ 21,560 |
$ (17,686) |
|
$ 3,874 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income (loss) per share
attributable to Weibo's ordinary shareholders * |
$ (0.31) |
|
|
$ (0.03) |
$ (0.13) |
|
|
$ (0.13) |
$ 0.11 |
|
|
$ 0.02 |
Shares used in computing diluted net
income (loss) per share attributable to Weibo's ordinary
shareholders |
150,596 |
- |
|
150,596 |
143,576 |
- |
|
143,576 |
166,162 |
- |
|
166,162 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) To adjust
stock-based compensation. |
(b) To
adjust amortization of intangible assets and tax provision on
amortization of intangible assets. |
(c) To adjust the
change in fair value of investor option liability. |
* Net income is adjusted to
reflect the impact of preferred shares issued when calculating the
basic and diluted earnings per share. |
|
|
WEIBO
CORPORATION |
UNAUDITED ADDITIONAL
INFORMATION |
(U.S. Dollars in
thousands) |
|
|
|
|
|
Three months
ended |
|
March
31, |
December 31, |
|
2014 |
2013 |
2013 |
|
|
|
|
Net revenues |
|
|
|
Advertising and
marketing: |
|
|
|
Advertising and
marketing other than Alibaba |
$ 31,992 |
$ 18,763 |
$ 32,206 |
Alibaba
* |
19,861 |
- |
23,839 |
Subtotal |
51,853 |
18,763 |
56,045 |
|
|
|
|
Weibo VAS |
15,657 |
7,121 |
15,379 |
|
$ 67,510 |
$ 25,884 |
$ 71,424 |
|
|
|
|
*Revenue related to the strategic
alliance between Weibo and Alibaba formed on April 29, 2013. |
CONTACT: Investor Relations
Weibo Corporation
Phone: +8610-5898 3336
Email: ir@staff.weibo.com
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