SINA Reports Fourth Quarter and Fiscal Year 2006 Financial Results

News Release

View printer-friendly version
<< Back

SINA Reports Fourth Quarter and Fiscal Year 2006 Financial Results

SHANGHAI, China, Feb 07, 2007 /Xinhua-PRNewswire via COMTEX News Network/ -- SINA Corporation (Nasdaq: SINA), a leading online media company and mobile value-added service (MVAS) provider for China and for the global Chinese communities, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2006.
    Fourth Quarter 2006 Highlights

     - Net revenues increased 9% year-over-year and increased 1% quarter-over-
       quarter to $56.4 million, exceeding the Company's previous guidance
       between $53.0 million and $56.0 million.

     - Advertising revenues grew 43% year-over-year and 9% quarter-over-
       quarter to $35.7 million, exceeding the Company's previous guidance
       between $34.0 million and $35.0 million.

     - Non-advertising revenues decreased 23% year-over-year and decreased 12%
       quarter-over-quarter to $20.7 million, within the Company's previous
       guidance between $19.0 million and $21.0 million.

     - GAAP net income was $11.7 million or $0.20 diluted net income per
       share, compared to $13.8 million or $0.24 diluted net income per share
       in the same period last year.

     - Non-GAAP net income was $15.2 million or $0.26 non-GAAP diluted net
       income per share, compared to $12.4 million or $0.21 non-GAAP diluted
       net income per share in the same period last year.  Non-GAAP measures
       are disclosed below and reconciled to the corresponding GAAP measures
       in the section below titled "Reconciliation of Non-GAAP to GAAP
       Results."

    Fiscal 2006 Highlights

     - Net revenues increased 10% year-over-year to $212.9 million.

     - Advertising revenues grew 41% year-over-year to $120.1 million.

     - Non-advertising revenues decreased 15% year-over-year to $92.8 million.

     - GAAP net income was $39.9 million or $0.69 diluted net income per
       share, compared to $43.1 million or $0.75 diluted net income per share
       in fiscal 2005.

     - Non-GAAP net income was $51.6 million or $0.88 non-GAAP diluted net
       income per share, compared to $46.4 million or $0.79 non-GAAP diluted
       net income per share in fiscal 2005.

"This was another quarter of strong performance and further demonstrates SINA's position as the leading online advertising platform in China," said Charles Chao, CEO of SINA. "2006 represents a year of excellent execution for SINA. Our focus on the online media business has led to enhanced brand recognition, strong user and traffic growth, and an impressive 44% year-over- year increase in online advertising revenues in China. We begin 2007 with continuing momentum from our online advertising business, which makes up 63% of our total revenues as of this quarter."

Financial Results

For the fourth quarter of 2006, SINA reported net revenues of $56.4 million, compared to $52.0 million in the same period in fiscal 2005 and $56.1 million for the third quarter of 2006. Advertising revenues for the fourth quarter of 2006 totaled $35.7 million, representing a 43% increase from the same period last year and a 9% increase from last quarter. The growth in advertising came mainly from China, which recorded advertising revenues of $35.0 million for the fourth quarter of 2006, representing an increase of 45% from the same period last year and 10% sequentially. The growth in advertising revenues can be mostly attributed to the Beijing Auto Show, advertising seasonality and the momentum generated from the World Cup earlier in the year. Advertising revenues in the fourth quarter of 2006 represented 63% of total revenues, up from 48% in the same period last year.

Non-advertising revenues for the fourth quarter of 2006 totaled $20.7 million, a 23% decrease from the same period in 2005 and a 12% decrease over the previous quarter. The decrease in non-advertising revenues came mostly from the decline in MVAS revenues, which recorded $19.3 million for the fourth quarter of 2006, representing a decline of 22% from the same period in 2005 and a decline of 11% from last quarter. The decline in MVAS revenues was primarily due to the changes in operator policy announced in July 2006. SMS revenues contributed to most of the year-over-year decline in MVAS revenues, dropping 41% year-over-year to $10.8 million in the fourth quarter of 2006. This was partially offset by IVR revenues, which grew 158% year-over-year to $5.1 million, or 26% of total MVAS revenues, in the fourth quarter of 2006.

For fiscal 2006, SINA reported net revenues of $212.9 million, compared to $193.6 million in 2005. Advertising revenues for fiscal 2006 totaled $120.1 million, an increase of 41% from 2005. The growth in advertising came mostly from China, which generated $116.9 million in advertising revenues for fiscal 2006, representing a year-over-year growth of 44%. Non-advertising revenues for fiscal 2006 amounted to $92.8 million, a decrease of 15% from 2005. The decline in non-advertising revenues came mostly from MVAS, which generated $86.3 million in revenues for fiscal 2006, representing a 12% year-over-year decline.

Gross margin for the fourth quarter of 2006 was 62%, down from 66% in the same period last year and 64% in the last quarter. Gross margin for the fourth quarter of 2006 included a $1.1 million, or 2% of total revenues, write-off of prepaid license fees related to the iGame business, based on management's assessment of the game business during the quarter. Advertising gross margin for the fourth quarter of 2006 was 65%, compared to 69% in the same period last year and 65% in the previous quarter. Advertising gross margin in the fourth quarter of 2006 included stock-based compensation, which was equivalent to 1% of advertising revenues. Excluding this item, advertising gross margin in the fourth quarter of 2006 was 66%, compared to 69% in the same period last year. The decline in gross margin can be mainly attributed to the increase in web production and bandwidth costs. MVAS gross margin for the fourth quarter of 2006 was 61%, compared to 62% for the same period in 2005 and last quarter.

Gross margin for fiscal 2006 was 63%, down from 67% from fiscal 2005. Advertising gross margin for fiscal 2006 was 65%, compared to 67% for fiscal 2005. Advertising gross margin in fiscal 2006 includes $1.7 million in stock- based compensation or 1% of advertising revenues. MVAS gross margin for fiscal 2006 was 60%, compared to 66% in the prior year. The decrease in gross margin was primarily related to higher transmission and content costs.

Operating expenses for the fourth quarter of 2006 totaled $24.5 million, an increase of 5% from the same period last year. Operating expenses for the fourth quarter of 2006 include $1.8 million in stock-based compensation and $0.4 million in amortization expense of intangible assets, while the operating expenses for the fourth quarter of 2005 include $0.5 million in amortization expense of intangible assets. Excluding these items, operating expenses for the fourth quarter of 2006 were $22.4 million, a decline of 2% from the fourth quarter of 2005. The decline was mainly due to lower marketing expenses.

Operating expenses for fiscal 2006 were $98.5 million, an 11% increase from 2005. Operating expenses for fiscal 2006 include $7.7 million in stock- based compensation and $1.8 million in amortization expense of intangible assets, while operating expenses for fiscal 2005 include $3.2 million in amortization expense of intangible assets. Excluding these items, operating expenses for 2006 were $89.0 million, an increase of 4% from fiscal 2005. The year over year increase was mainly due to higher payroll-related expenses, such as management bonus and sales commissions, and higher bad debt expenses, partially offset by lower marketing expenses.

Net income for the fourth quarter of 2006 was $11.7 million or $0.20 diluted net income per share, compared to $13.8 million or $0.24 for the same period last year. Net income for the fourth quarter of 2006 includes $1.1 million write-off of prepaid license fees, while net income for the fourth quarter of 2005 includes a $2.6 million gain from the sale of an online auction joint venture, both of which were excluded in the non-GAAP results. Non-GAAP net income for the fourth quarter of 2006 was $15.2 million or $0.26 non-GAAP, compared to $12.4 million or $0.21 in the same period last year.

Net income for fiscal 2006 totaled $39.9 million or $0.69 diluted net income per share, compared to $43.1 million or $0.75 diluted net income per share in fiscal 2005. Non-GAAP net income for fiscal 2006 was $51.6 million or $0.88 non-GAAP diluted net income per share, compared to $46.4 million or $0.79 diluted net income per share for fiscal 2005.

As of December 31, 2006, SINA's cash, cash equivalents and investments in marketable securities totaled $362.8 million, compared to $300.7 million and $345.3 million as of December 31, 2005 and September 30, 2006, respectively. Cash flow from operating activities for the fourth quarter of 2006 was $14.9 million, compared to $14.4 million for the same period last year. For fiscal 2006, cash flow from operating activities was $63.1 million, compared to $58.3 million for fiscal 2005.

Business Outlook

The Company estimates that its total revenues for the first quarter of 2007 will be between $48.0 million and $50.0 million, with advertising revenues to be between $31.0 million and $32.0 million and non-advertising revenues to be between $17.0 million and $18.0 million.

Based on unvested shares as of the end of 2006 and excluding any new shares that may be granted, the Company estimates its stock-based compensation for the first quarter of 2007 to be between $2.2 million to $2.4 million and for fiscal 2007 to be between $8.2 million and $9.2 million.

Excluding the impact of any new accounting standards or tax regulations, such as FIN 48 Accounting for Uncertainty in Income Taxes, which became effective for the Company on January 1, 2007, the Company expects its applicable effective tax rate for 2007 to be approximately 10%.

Management Promotions and Changes

The Company announced today that Tong Chen, Senior Vice President and Chief Editor, who has been with the Company since 1997, has been promoted to Executive Vice President and Chief Editor, and Hong Du, Vice President, Sales & Marketing, who has been with the Company since 1999, has been promoted to Senior Vice President, Sales & Marketing.

Separately, Benjamin Tsiang, Executive Vice President in charge of SINA international operations, has decided to resign from the Company for personal reasons. Mr. Tsiang has agreed to serve as Senior Advisor to the Company.

Change of Filing Status

The Company announced that, effective immediately, it will satisfy its reporting obligations under Section 13(a) of the U.S. Securities Exchange Act of 1934 by filing reports with the Securities and Exchange Commission (SEC) on form available for use by Foreign Private Issuers ("FPI"). SINA currently meets the requirements of an FPI as defined under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. As a result of the change announced today, after the completion of filings related to fiscal 2006, which include a report on Form 10-K and proxy statement, the Company will no longer file its periodic reports with the SEC on Form 10-K and Form 10-Q or current reports on Form 8-K. Instead, the Company will file its future annual reports, beginning with the report for the fiscal year ending December 31, 2007, on Form 20-F, and current reports on Form 6-K, which forms are applicable to FPIs.

Non-GAAP Measures

This release contains non-GAAP financial measures. These non-GAAP financial measures, which are used as measures of the Company's performance, should be considered in addition to, not as a substitute for, measures of the Company's financial performance prepared in accordance with United States Generally Accepted Accounting Principles ("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 "Reconciliation of Non-GAAP to GAAP Results." These non-GAAP measures include non-GAAP gross profit, non- GAAP operating expenses, non-GAAP income from operations, non-GAAP net income, non-GAAP diluted net income per share and non-GAAP advertising gross margin.

The Company's management uses non-GAAP financial measures to gain an understanding of the Company's comparative operating performance (when comparing such results with previous periods or forecasts) and future prospects. The Company's non-GAAP financial measures exclude certain special items, including stock-based compensation charges, write off of prepaid license fees, amortization of intangible assets, amortization of convertible debt issuance cost, gain and loss on the sale of business and investments, and gain and loss on investments, from its internal financial statements for purposes of its internal budgets. Non-GAAP financial measures are used by the Company's management in their financial and operating decision-making, because management believes they reflect the Company's ongoing business in a manner that allows meaningful period-to-period comparisons. The Company's management believes that these non-GAAP financial measures provide useful information to investors and others in the following ways: 1) in understanding and evaluating the Company's current operating performance and future prospects in the same manner as management does, if they so choose, and 2) in comparing in a consistent manner the Company's current financial results with the Company's past financial results. The Company's management further believes the non- GAAP financial measures provide useful information to both management and investors by excluding certain expenses, gains and losses (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 its core operating results and business outlook.

The Company's management believes excluding stock-based compensation from its non-GAAP financial measures is useful for itself and investors as such expense will not result in future cash payment and is otherwise unrelated to the Company's core operating results. Non-GAAP financial measures that exclude stock-based compensation also enhance the comparability of results against prior periods.

The Company's management believes excluding the non-cash write off of prepaid license fees from its non-GAAP financial measures is useful for itself and investors as such expense does not impact cash earnings and is not indicative of the Company's core operating results and business outlook.

The Company's management believes excluding the non-cash amortization expense of intangible assets resulting from business acquisitions from its non-GAAP financial measures of operating expenses, income from operations and net income and excluding the non-cash amortization expense of intangible assets resulting from equity-method investments from its non-GAAP financial measure of net income are useful for itself and investors because they enable a more meaningful comparison of the Company's cash performance between reporting periods. In addition, such charges will not result in cash settlement in the future.

The Company's management believes excluding non-cash amortization expense of issuance cost relating to convertible bonds from its non-GAAP financial measure of net income is useful for itself and investors as such expense does not have any impact on cash earnings.

The Company's management believes excluding gains and losses on the sale of a business and investments from its non-GAAP financial measure of net income is useful for itself and investors because such gains and losses are not indicative of the Company's core operating results.

The Company's management believes excluding gains and losses on investment from its non-GAAP financial measure of net income is useful for itself and investors because the Company does not typically invest in common stock of other companies. Therefore, these charges are otherwise unrelated to the Company's ongoing business operations.

The non-GAAP financial measures have limitations. They do not include all items of income and expense that affect the Company's operations. Specifically, these non-GAAP financial measures are not prepared in accordance with GAAP, may not be comparable to non-GAAP financial measures used by other companies and, with respect to the non-GAAP financial measures that exclude certain items under GAAP, do not reflect any benefit that such items may confer to the Company. Management compensates for these limitations by also considering the Company's financial results as determined in accordance with GAAP.

Conference Call

SINA will host a conference call at 8:00 p.m. Eastern Time today to present an overview of the Company's financial performance and business operations for the fourth quarter and fiscal year ended December 31, 2006. The dial-in number for the call is 617-801-9702. The pass code is 61729864. A live Webcast of the call will be available from 8:00 p.m. - 9:00 p.m. ET on Wednesday, February 7, 2007 (9:00 a.m. - 10:00 a.m. Beijing Time on February 8, 2007). The call can be accessed through SINA's corporate web site at http://corp.sina.com. The call will be archived for 12 months on SINA's corporate web site at http://corp.sina.com. A replay of the conference call will be available through February 14, 2007 at midnight eastern time. The dial-in number is 617-801-6888. The pass code for the replay is 34193300.

About SINA

SINA Corporation (Nasdaq: SINA) is a leading online media company and value-added information service (VAS) provider for China and for global Chinese communities. With a branded network of localized web sites targeting Greater China and overseas Chinese, SINA provides services through five major business lines including SINA.com (online news and content), SINA Mobile (mobile value-added services), SINA Online (community-based services and games), SINA.net (search and enterprise services) and SINA E-Commerce (online shopping). Together these provide an array of services including region- focused online portals, mobile value-added services, search and directory, interest-based and community-building channels, free and premium email, online games, virtual ISP, classified listings, fee-based services, e-commerce and enterprise e-solutions.

Safe Harbor Statement

This announcement contains forward-looking statements that relate to, among other things, SINA's expected financial performance (as described without limitation in the "Business Outlook" section and in quotations from management in this press release) and SINA's strategic and operational plans. SINA may also make forward-looking statements in the Company's periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in its proxy statements, in its offering circulars and prospectuses, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. SINA assumes no obligation to update the forward-looking statements in this release and elsewhere. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking 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, SINA's limited operating history, the uncertain regulatory landscape in the People's Republic of China, the changes by mobile operators in China to their policies for MVAS, the Company's ability to develop and market other MVAS products, fluctuations in quarterly operating results, the Company's reliance on online advertising sales and MVAS for a majority of its revenues, the Company's reliance on mobile operators in China to provide MVAS, any failure to successfully develop and introduce new products and any failure to successfully integrate acquired businesses. Further information regarding these and other risks is included in SINA's Annual Report on Form 10-K for the year ended December 31, 2005 and its recent quarterly reports on Form 10-Q, as well as in its other filings with the Securities and Exchange Commission.



                                 SINA CORPORATION
            UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                (U.S. Dollar in thousands, except per share data)

                                   Three months ended      Twelve months ended
                                     Dec. 31,     Sept. 30,      Dec. 31,
                                  2006     2005     2006      2006     2005
    Net revenues:
        Advertising              $35,735  $25,010  $32,697  $120,067  $84,999
        Non-advertising           20,670   26,940   23,362    92,787  108,553
                                  56,405   51,950   56,059   212,854  193,552
    Cost of revenues:
        Advertising  (a)          12,581    7,782   11,333    42,529   27,627
        Non-advertising            9,076    9,976    8,715    36,881   35,480
                                  21,657   17,758   20,048    79,410   63,107
    Gross profit                  34,748   34,192   36,011   133,444  130,445

    Operating expenses:
        Sales and marketing (a)   12,460   13,753   12,210    49,972   51,690
        Product development (a)    4,888    4,230    5,082    19,573   15,268
        General and
         administrative (a)        6,756    4,835    7,832    27,172   18,820
        Amortization of
         intangibles                 415      475      468     1,820    3,159
                                  24,519   23,293   25,592    98,537   88,937
    Income from operations        10,229   10,899   10,419    34,907   41,508

    Non-operating income:
       Interest and other income   2,441    1,757    2,156     8,549    6,551
       Gain (loss) on sale of
        business and
        investments, net             373    2,649     (134)    2,033    4,136
       Gain (loss) on investment
        in Tidetime Sun, net         123     (435)    (270)     (147)  (3,175)
       Loss on equity
        investments                  -       (390)    (185)     (690)  (2,810)
       Amortization of
        convertible debt
        issuance cost               (171)    (171)    (172)     (685)    (685)
                                   2,766    3,410    1,395     9,060    4,017

    Income before income taxes    12,995   14,309   11,814    43,967   45,525
    Provision for income taxes    (1,273)    (550)  (1,095)   (4,051)  (2,410)

    Net income                   $11,722  $13,759  $10,719   $39,916  $43,115


    Basic net income per share     $0.22    $0.26    $0.20     $0.74    $0.82
    Diluted net income per share   $0.20    $0.24    $0.19     $0.69    $0.75

    Shares used in computing
     basic net income per share   54,103   53,208   53,690    53,696   52,485
    Shares used in computing
     diluted net income per
     share                        58,780   58,814   58,419    58,549   58,792

    Net income used for diluted
     net income per share
     calculation:
    Net income                   $11,722  $13,759  $10,719   $39,916  $43,115
    Amortization of convertible
     debt issuance cost              171      171      172       685      685
                                 $11,893  $13,930  $10,891   $40,601  $43,800


    (a) Stock-based compensation
     included under SFAS 123R
     was as follows:
       Cost of revenues -
        advertising                 $475     $-       $568    $1,743     $-
       Sales and marketing           366      -        531     1,511      -
       Product development           491      -        606     1,808      -
       General and
        administrative               897      -      1,001     4,412      -
                                  $2,229     $-     $2,706    $9,474     $-



                             SINA CORPORATION
                RECONCILIATION OF NON-GAAP TO GAAP RESULTS
             (U.S. Dollar in thousands, except per share data)

                                                  Three months ended
                                                  December 31, 2006
                                                                   Non-GAAP
                                           Actual   Adjustments     Results

                                                           475 (a)
                                                         1,113 (f)
    Gross profit                            $34,748     $1,588       $36,336

                                                        (1,754)(a)
                                                          (415)(b)
    Operating expenses                      $24,519    $(2,169)      $22,350

                                                         2,229 (a)
                                                         1,113 (f)
                                                           415 (b)
    Income from operations                  $10,229     $3,757       $13,986


                                                         2,229 (a)
                                                         1,113 (f)
                                                           415 (b)
                                                           171 (c)
                                                          (373)(d)
                                                          (123)(e)
    Net income                              $11,722     $3,432       $15,154


    Diluted net income per share              $0.20                    $0.26

    Shares used in computing diluted
     net income per share                    58,780                   58,780

    Net income used in computing diluted
     net income per share:
    Net income                              $11,722                  $15,154
    Amortization of convertible debt
     issuance costs                             171                      -
                                            $11,893                  $15,154

    Gross margin - advertising                  65%         1%           66%


                             SINA CORPORATION
                RECONCILIATION OF NON-GAAP TO GAAP RESULTS
             (U.S. Dollar in thousands, except per share data)


                                                  Three months ended
                                                  December 31, 2005
                                                                   Non-GAAP
                                           Actual   Adjustments     Results



    Gross profit                            $34,192       $-         $34,192


                                                          (475)(b)
    Operating expenses                      $23,293      $(475)      $22,818



                                                           475 (b)
    Income from operations                  $10,899       $475       $11,374



                                                           475 (b)
                                                           171 (c)
                                                        (2,649)(d)
                                                           435 (e)
                                                           176 (b)
    Net income                              $13,759    $(1,392)      $12,367


    Diluted net income per share              $0.24                    $0.21

    Shares used in computing diluted
     net income per share                    58,814                   58,814

    Net income used in computing diluted
     net income per share:
    Net income                              $13,759                  $12,367
    Amortization of convertible debt
     issuance costs                             171                      -
                                            $13,930                  $12,367

    Gross margin - advertising                  69%         0%           69%


                             SINA CORPORATION
                RECONCILIATION OF NON-GAAP TO GAAP RESULTS
             (U.S. Dollar in thousands, except per share data)


                                                  Three months ended
                                                  September 30, 2006
                                                                   Non-GAAP
                                           Actual   Adjustments     Results


                                                           568 (a)
    Gross profit                            $36,011       $568       $36,579

                                                        (2,138)(a)
                                                          (468)(b)
    Operating expenses                      $25,592    $(2,606)      $22,986


                                                         2,706 (a)
                                                           468 (b)
    Income from operations                  $10,419     $3,174       $13,593


                                                         2,706 (a)
                                                           468 (b)
                                                           172 (c)
                                                           134 (d)
                                                           270 (e)
                                                           145 (b)
    Net income                              $10,719     $3,895       $14,614


    Diluted net income per share              $0.19                    $0.25

    Shares used in computing diluted
     net income per share                    58,419                   58,419

    Net income used in computing diluted
     net income per share:
    Net income                              $10,719                  $14,614
    Amortization of convertible debt
     issuance costs                             172                      -
                                            $10,891                  $14,614

    Gross margin - advertising                  65%         2%           67%



                                                 Twelve months ended
                                                  December 31, 2006
                                                                  Non-GAAP
                                           Actual  Adjustments     Results

                                                          1,743 (a)
                                                          1,113 (f)

    Gross profit                            $133,444     $2,856     $136,300

                                                         (7,731)(a)
                                                         (1,820)(b)
    Operating expenses                       $98,537    $(9,551)     $88,986

                                                          9,474 (a)
                                                          1,113 (f)
                                                          1,820 (b)
    Income from operations                   $34,907    $12,407      $47,314

                                                          9,474 (a)
                                                          1,113 (f)
                                                          1,820 (b)
                                                            685 (c)
                                                         (2,033)(d)
                                                            147 (e)
                                                            499 (b)
    Net income                               $39,916    $11,705      $51,621


    Diluted net income per share               $0.69                   $0.88

    Shares used in computing diluted
     net income per share                     58,549                  58,549

    Net income used in computing diluted
     net income per share:
    Net income                               $39,916                 $51,621
    Amortization of convertible debt
     issuance costs                              685                     -
                                             $40,601                 $51,621

    Gross margin - advertising                   65%         1%          66%

    (a)  To adjust stock-based compensation charges
    (b)  To adjust  amortization of intangible assets
    (c)  To adjust amortization of convertible debt issuance cost
    (d)  To adjust (gain) loss on the sale of business and investments
    (e)  To adjust (gain) loss on investment in Tidetime Sun
    (f)  To adjust a write-off of game license


                                                 Twelve months ended
                                                  December 31, 2005
                                                                  Non-GAAP
                                           Actual  Adjustments     Results



    Gross profit                            $130,445       $-       $130,445


                                                         (3,159)(b)
    Operating expenses                       $88,937    $(3,159)     $85,778



                                                          3,159 (b)
    Income from operations                   $41,508     $3,159      $44,667



                                                          3,159 (b)
                                                            685 (c)
                                                         (4,136)(d)
                                                          3,175 (e)
                                                            367 (b)
    Net income                               $43,115     $3,250      $46,365


    Diluted net income per share               $0.75                   $0.79

    Shares used in computing diluted
     net income per share                     58,792                  58,792

    Net income used in computing diluted
     net income per share:
    Net income                               $43,115                 $46,365
    Amortization of convertible debt
     issuance costs                              685                     -
                                             $43,800                 $46,365

    Gross margin - advertising                   67%         0%          67%

    (a)  To adjust stock-based compensation charges
    (b)  To adjust  amortization of intangible assets
    (c)  To adjust amortization of convertible debt issuance cost
    (d)  To adjust (gain) loss on the sale of business and investments
    (e)  To adjust (gain) loss on investment in Tidetime Sun
    (f)  To adjust a write-off of game license



                                 SINA CORPORATION
                          UNAUDITED SEGMENT INFORMATION
                            (U.S. Dollar in thousands)

                                   Three months ended     Twelve months ended
                                    Dec. 31,     Sept. 30,      Dec. 31,
                                 2006     2005     2006      2006      2005

    Net revenues
        Advertising             $35,735  $25,010  $32,697  $120,067   $84,999
        Mobile related           19,304   24,803   21,811    86,257    98,070
        Others                    1,366    2,137    1,551     6,530    10,483
                                $56,405  $51,950  $56,059  $212,854  $193,552

    Cost of revenues
        Advertising             $12,581   $7,782  $11,333   $42,529   $27,627
        Mobile related            7,617    9,491    8,313    34,255    33,814
        Others                    1,459      485      402     2,626     1,666
                                $21,657  $17,758  $20,048   $79,410   $63,107



                                 SINA CORPORATION
                 UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
                            (U.S. Dollar in thousands)

                                             December 31,      December 31,
                                                 2006              2005
                                Assets
       Current assets:
           Cash, cash equivalents and
            investments in marketable
            securities                             $362,751          $300,689
           Accounts receivable, net                  45,031            33,940
           Other current assets                      10,330            12,380
                 Total current assets               418,112           347,009

       Property and equipment, net                   27,101            22,207
       Long-term investments                          1,170             3,977
       Goodwill and intangible assets, net           90,534            92,354
       Other assets                                   1,892             3,174
       Total assets                                $538,809          $468,721

                       Liabilities and Shareholders' Equity
       Current liabilities:
           Accounts payable                          $1,614            $1,582
           Accrued liabilities                       41,993            43,235
           Income taxes payable                       7,389             4,282
           Convertible debt                         100,000               -
                Total current liabilities           150,996            49,099

       Convertible debt                                 -             100,000
                Total liabilities                   150,996           149,099

       Shareholders' equity                         387,813           319,622

       Total liabilities and shareholders'
        equity                                     $538,809          $468,721

SOURCE SINA Corporation

Chen Fu of SINA Corporation, (86-21) 62895678 ext. 6089, or fuchen@staff.sina.com, or
Denise Roche of The Ruth Group, +1-646-536-7008, or droche@theruthgroup.com, for SINA
Corporation
http://corp.sina.com