Weibo Reports First Quarter 2019 Unaudited Financial Results
BEIJING, May 23, 2019 /PRNewswire/ -- Weibo Corporation ("Weibo" or the "Company") (NASDAQ: WB), a leading social media in China, today announced its unaudited financial results for the first quarter ended March 31, 2019.
"We are pleased with Weibo's first quarter results," said Gaofei Wang, CEO of Weibo. "Weibo has delivered solid traffic growth through effective product upgrade and channel investment. We have also achieved strong advertising revenue growth for KA business, as we demonstrated unique value proposition for brand customers with the breadth of our social ad offerings and enhanced ad performance," said Mr. Wang.
First Quarter 2019 Highlights
First Quarter 2019 Financial Results
For the first quarter of 2019, Weibo's total net revenues were $399.2 million, an increase of 14% compared to $349.9 million for the same period last year.
Advertising and marketing revenues for the first quarter of 2019 were $341.1 million, an increase of 13% compared to $302.9 million for the same period last year. Advertising and marketing revenues from small & medium-sized enterprises ("SMEs") and key accounts ("KAs") were $324.5 million, representing an increase of 17% compared to $276.6 million same period last year.
VAS revenues for the first quarter of 2019 were $58.0 million, an increase of 24% year-over-year compared to $46.9 million for the same period last year, mainly attributable to the revenues derived from the live streaming business acquired in the fourth quarter of 2018.
Costs and expenses for the first quarter of 2019 totaled $276.1 million, compared to $240.5 million for the same period last year. The increase in costs and expenses was primarily due to the costs of revenue share incurred by the live streaming business and the increase in personnel related costs and expenses. Non-GAAP costs and expenses were $262.4 million, compared to $229.3 million for the same period last year.
Income from operations for the first quarter of 2019 was $123.1 million, compared to $109.4 million for the same period last year. Non-GAAP income from operations was $136.8 million, compared to $120.6 million for the same period last year.
Non-operating income for the first quarter of 2019 was $48.6 million, compared to $7.6 million for the same period last year, mainly resulted from a gain of $38.5 million from fair value change of investments for the first quarter of 2019.
Income tax expenses were $21.1 million, compared to $18.3 million for the same period last year.
Net income attributable to Weibo for the first quarter of 2019 was $150.4 million, compared to $99.1 million for the same period last year. Diluted net income per share attributable to Weibo for the first quarter of 2019 was $0.66, compared to $0.44 for the same period last year. Non-GAAP net income attributable to Weibo for the first quarter of 2019 was $128.5 million, compared to $112.6 million for the same period last year. Non-GAAP diluted net income per share attributable to Weibo for the first quarter of 2019 was $0.56, compared to $0.50 for the same period last year.
As of March 31, 2019, Weibo's cash, cash equivalents and short-term investments totaled $1.49 billion. For the first quarter of 2019, cash provided by operating activities was $80.8 million, capital expenditures totaled $7.7 million, and depreciation and amortization expenses amounted to $6.2 million.
For the second quarter of 2019, Weibo estimates its net revenues to be between $427 million and $437 million, or an increase of 7% year over year to 10% year over year on a constant currency basis. This forecast reflects the currency translation risks and assumes an average exchange rate of RMB 6.90 to US$1.00. This forecast also reflects Weibo's current and preliminary view, which is subject to change.
Weibo's management team will host a conference call from 7AM – 8AM Eastern Time on May 23, 2019 (or 7 PM – 8 PM Beijing Time on May 23, 2019) 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:
A replay of the conference call will be available from 22:00 China Standard Time on May 23, 2019 to 21:59 China Standard Time on May 31, 2019. The dial-in number is +61 2-8199-0299. The passcode for the replay is 5995595.
Non-GAAP Financial Measures
This release contains the following non-GAAP financial measures: non-GAAP costs and expenses, non-GAAP income from operations, non-GAAP net income attributable to Weibo, non-GAAP diluted net income per share attributable to Weibo and adjusted EBITDA. 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 exclude stock-based compensation, amortization of intangible assets, net results of impairment on, gain on sale of and fair value change of investments, non-GAAP to GAAP reconciling items on the share of equity method investments, non-GAAP to GAAP reconciling items for the income/loss attributable to non-controlling interests, provision for income tax related to the amortization of intangible assets (other non-GAAP to GAAP reconciling items have no tax effect), and amortization of convertible debt issuance cost. Adjusted EBITDA excludes interest income, net, income tax expenses, and depreciation expenses. 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 operating performance 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. Accordingly, care should be exercised in understanding how the Company defines its non-GAAP financial measures. Reconciliations of the Company's non-GAAP financial measures to the nearest comparable GAAP measures are set forth in the section below titled "Unaudited Reconciliation of Non-GAAP to GAAP Results."
Weibo is a leading social media for people to create, share and discover content online. Weibo combines the means of public self-expression in real time with a powerful platform for social interaction, content aggregation and content distribution. Any user can create and post a feed and attach multi-media and long-form content. User relationships on Weibo may be asymmetric; any user can follow any other user and add comments to a feed while reposting. This simple, asymmetric and distributed nature of Weibo allows an original feed to become a live viral conversation stream.
Weibo enables its advertising and marketing customers to promote their brands, products and services to users. Weibo offers a wide range of advertising and marketing solutions to companies of all sizes. The Company generates a substantial majority of its revenues from the sale of advertising and marketing services, including the sale of social display advertisement and promoted marketing offerings. Designed with a "mobile first" philosophy, Weibo displays content in a simple information feed format and offers native advertisement that conform to the information feed on our platform. To support the mobile format, we have developed and continuously refining our social interest graph recommendation engine, which enables our customers to perform people marketing and target audiences based on user demographics, social relationships, interests and behaviors, to achieve greater relevance, engagement and marketing effectiveness.
Safe Harbor Statement
This press release contains forward-looking statements that relate to, among other things, Weibo's expected financial performance and 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 ("SEC"), 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 certain new businesses; failure to grow active user base and the level of user engagement; the uncertain regulatory landscape in China; fluctuations in the Company's quarterly operating results; the Company's reliance on advertising and marketing sales for a majority of its revenues; failure to successfully develop, introduce, drive adoption of or monetize new features and products; failure to compete effectively for advertising and marketing spending; failure to successfully integrate acquired businesses; risks associated with the Company's investments, including equity pick-up and impairment; failure to compete successfully against new entrants and established industry competitors; changes in the macro-economic environment, including the depreciation of the Renminbi; and adverse changes in economic and political policies of the PRC government and its impact on the Chinese economy. Further information regarding these and other risks is included in Weibo's annual report on Form 20-Fs and other filings with the SEC. All information provided in this press release is current as of the date hereof, and Weibo assumes no obligation to update such information, except as required under applicable law.
SOURCE Weibo Corporation
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