On having a deep analysis of Chinese Internet Company, Sina Corp.’s December Q, microblog portal Weibo Corp. delivered another quarter of higher revenue and improved margins for it.
[Exclusive from MarketWatch: Sina projected 2016 revenue below Wall Street projections. Company projects adjusted revenue of US$ 850 million to US$ 950 million, in comparison to Reuter’s projection of US$ 985.9 million in revenue. The guidance assumes the yuan depreciates at an average rate of 8.5% to the U.S. dollar and excludes about US$ 10.4 million in deferred license revenue from online real-estate company E-House (China) Holdings Ltd.Over all, Sina reported a profit of US$14.6 million, i.e. 21 cents/share, in comparison toUS$59.8 million, i.e. 90 cents/share, a year earlier. Excluding stock-based compensation and other items, profit was 35 cents/share, in comparison to 24 cents a year earlier.Revenue rose with 21% atUS$256.2 million, driven by a 42% increase from Weibo. Meanwhile Reuters had projected a profit of 33 cents/share on US$241.7 million in revenue.Gross margin improved to 65.2% from 64.8% a year earlier. Advertising revenue rose 23% to US$223.2 million, with revenue from Weibo offsetting flat portal advertising revenue.
On the other hand, posted a fourfold increase in profit to US$ 19.1 million, i.e. 9 cents/share. Excluding stock-based compensation and other items, adjusted profit was 15 cents/share, in comparison to 4 cents/share a year earlier.Weibo’s revenue surged to $149 million from $105.2 million a year earlier, above the company’s projection and driven by a 47% increase in advertising and marketing revenue.]
UPDATE: Sina, being part of a consortium to take private E-House, holds a stake in ALIBABA Group Holding Ltd., which in turn holds a stake in Sina’s Weibo and has been driving advertising to the microblog.