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SINA Reports Third Quarter 2012 Financial Results
Third Quarter 2012 Highlights
- Net revenues increased 17% year over year to
$152.4 million . Non-GAAP net revenues increased 18% year over year to$147.7 million , reaching the high end of the Company's guidance between$145.0 million and $148.0 million . - Advertising revenues grew 19% year over year to
$120.6 million , within the Company's guidance between$120.0 million and $122.0 million . - Non-advertising revenues increased 9% year over year to
$31.8 million . Non-GAAP non-advertising revenues increased 10% year over year to$27.1 million , exceeding the Company's guidance between$25.0 million and $26.0 million . Non-GAAP non-advertising revenues other than MVAS grew 150% year over year to$8.0 million . - Net income attributable to
SINA was$9.9 million , or$0.14 diluted net income per share attributable toSINA . Non-GAAP net income attributable toSINA was$11.7 million , or$0.17 non-GAAP diluted net income per share attributable toSINA .
"The
Third Quarter 2012 Financial Results
For the third quarter of 2012,
Online advertising revenues for the third quarter of 2012 were
Gross margin for the third quarter of 2012 was 54%, down from 56% for the same period last year. Advertising gross margin for the third quarter of 2012 was 55%, compared to 59% for the same period last year. Non-GAAP advertising gross margin for the third quarter of 2012 was 56%, down from 60% for the same period last year, mainly due to increased content spending, particularly related to the Olympics, as well as production-related labor and infrastructure costs. MVAS gross margin for the third quarter of 2012 was 36%, compared to 32% for the same period last year, due to a change in product mix.
Operating expenses for the third quarter of 2012 totaled
Income from operations for the third quarter of 2012 was
Non-operating income from for the third quarter of 2012 was
Net income attributable to
As of
Business Outlook
Non-GAAP Measures
This release contains financial measures that are not prepared in accordance with generally accepted accounting principles in
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." These non-GAAP measures include non-GAAP net revenues, non-GAAP non-advertising revenues, non-GAAP gross profit, non-GAAP advertising gross margin, non-GAAP operating expenses, non-GAAP income/(loss) from operations, non-GAAP equity earnings/(loss) from equity investments, non-GAAP net income/(loss) attributable to
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 items, including stock-based compensation, amortization of intangible assets, recognition of deferred revenues and gain/loss resulting from the disposal, purchase or impairment of a business, investment or non-controlling interest in a subsidiary, 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 more 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 comparing the Company's current financial results with the Company's past financial results in a consistent manner, and 2) 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's management further believes 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 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 payments and is not an indicator used by management to measure the Company's core operating results and business outlook.
The Company's management believes excluding the amortization of intangible assets from its non-GAAP financial measures is useful for itself and investors, because it enables 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 and is not an indicator used by management to measure the Company's core operating results and business outlook.
The Company's management believes excluding the recognition of deferred revenues, mostly relating to the license agreements with CRIC from its non-GAAP financial measures is useful for itself and investors, because it enables a more meaningful comparison of the Company's revenue performance between reporting periods. In addition, such revenues will not result in cash settlement in the future and is not an indicator used by management to measure the Company's core operating results and business outlook.
The Company's management believes excluding stock-based compensation and amortization expense of intangible assets from its share of earning/(loss) from equity investments is useful for itself and investors, as these items are excluded to calculate the Company's non-GAAP measures.
The Company's management believes excluding gain/loss resulting from the disposal, purchase or impairment of a business, investment or non-controlling interest in a subsidiary from its non-GAAP financial measures is useful for itself and investors, because such gains/losses are not indicative of the Company's core operating results.
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
US: |
+1 646 254 3515 |
Hong Kong: |
+852 3051 2745 |
Passcode for all regions: |
66183734 |
A replay of the conference call will be available through
About
We are an online media company serving
SINA.com offers distinct and targeted professional content on each of its region specific websites and a range of complementary offerings. SINA.cn provides information and entertainment content from
Through these businesses and properties and other business lines, we offer an array of services including mobile value added services ("MVAS"), online video, music streaming, online games, photo sharing, blog, email, classified listings, fee-based services, e-commerce and enterprise services. We generate the majority of our revenues from online brand advertising, MVAS and fee-based services.
Safe Harbor Statement
This press release contains forward-looking statements that relate to, among other things,
Contact:
Investor Relations
Phone: 8610-82628888 x 3112
Email: ir@staff.sina.com.cn
SINA CORPORATION |
||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||
(U.S. Dollars in thousands, except per share data) |
||||||||||
Three months ended |
Nine months ended |
|||||||||
September 30, |
June 30, |
September 30, |
||||||||
2012 |
2011 |
2012 |
2012 |
2011 |
||||||
Net revenues: |
||||||||||
Advertising |
$120,590 |
$ 101,018 |
$103,130 |
$302,262 |
$265,150 |
|||||
Non-advertising |
31,788 |
29,268 |
28,475 |
87,941 |
84,310 |
|||||
152,378 |
130,286 |
131,605 |
390,203 |
349,460 |
||||||
Cost of revenues: |
||||||||||
Advertising (a) |
54,010 |
41,070 |
48,472 |
146,566 |
111,823 |
|||||
Non-advertising |
15,428 |
16,072 |
13,150 |
41,605 |
42,792 |
|||||
69,438 |
57,142 |
61,622 |
188,171 |
154,615 |
||||||
Gross profit |
82,940 |
73,144 |
69,983 |
202,032 |
194,845 |
|||||
Operating expenses: |
||||||||||
Sales and marketing (a) |
38,439 |
36,256 |
34,471 |
107,654 |
99,854 |
|||||
Product development (a) |
28,392 |
19,429 |
26,139 |
79,554 |
44,069 |
|||||
General and administrative (a) |
12,308 |
8,264 |
9,188 |
28,817 |
21,033 |
|||||
Goodwill impairment |
- |
68,891 |
- |
- |
68,891 |
|||||
Amortization of intangibles |
12 |
107 |
12 |
132 |
624 |
|||||
79,151 |
132,947 |
69,810 |
216,157 |
234,471 |
||||||
Income/(loss) from operations |
3,789 |
(59,803) |
173 |
(14,125) |
(39,626) |
|||||
Non-operating income: |
||||||||||
Interest and other income, net |
4,388 |
5,826 |
4,782 |
12,701 |
12,788 |
|||||
Earning/(loss) from equity investments, net |
883 |
176 |
(3,315) |
(6,353) |
1,241 |
|||||
Gain on sale of /(impairment) on investments,net |
3,004 |
(281,162) |
32,770 |
38,835 |
(281,548) |
|||||
8,275 |
(275,160) |
34,237 |
45,183 |
(267,519) |
||||||
Income/(loss) before income taxes |
12,064 |
(334,963) |
34,410 |
31,058 |
(307,145) |
|||||
Provision for income taxes |
(1,592) |
(1,366) |
(1,033) |
(1,351) |
(4,288) |
|||||
Net income/(loss) |
10,472 |
(336,329) |
33,377 |
29,707 |
(311,433) |
|||||
Less: Net income/(loss) attributable to noncontrolling interest |
594 |
9 |
132 |
324 |
(62) |
|||||
Net income/(loss) attributable to SINA |
$ 9,878 |
$(336,338) |
$33,245 |
$29,383 |
$(311,371) |
|||||
Basic net income/(loss) per share attributable to SINA |
$ 0.15 |
$ (5.10) |
$ 0.50 |
$ 0.44 |
$ (4.80) |
|||||
Diluted net income/(loss) per share attributable to SINA |
$ 0.14 |
$ (5.10) |
$ 0.49 |
$ 0.43 |
$ (4.80) |
|||||
Shares used in computing basic |
||||||||||
net income/(loss) per share attributable to SINA |
66,496 |
65,908 |
66,337 |
66,339 |
64,821 |
|||||
Shares used in computing diluted |
||||||||||
net income/(loss) per share attributable to SINA |
66,874 |
65,908 |
66,809 |
66,822 |
64,821 |
|||||
(a) Stock-based compensation in each category: |
||||||||||
Cost of revenues - advertising |
$ 865 |
$ 895 |
$ 751 |
$ 2,423 |
$ 2,281 |
|||||
Sales and marketing |
1,187 |
909 |
754 |
2,707 |
2,087 |
|||||
Product development |
1,011 |
982 |
868 |
2,946 |
1,950 |
|||||
General and administrative |
3,267 |
1,629 |
1,346 |
5,746 |
4,994 |
SINA CORPORATION |
|||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
(U.S. Dollars in thousands) |
|||||||
September 30, |
December 31, |
||||||
2012 |
2011 |
||||||
Assets |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ 227,101 |
$ 513,980 |
|||||
Short-term investments |
469,146 |
159,495 |
|||||
Accounts receivable, net |
144,959 |
112,469 |
|||||
Other current assets |
49,510 |
41,966 |
|||||
Total current assets |
890,716 |
827,910 |
|||||
Property and equipment, net |
72,391 |
74,511 |
|||||
Goodwill and intangible assets, net |
15,851 |
15,974 |
|||||
Investments |
463,130 |
463,938 |
|||||
Other assets |
27,370 |
9,114 |
|||||
Total assets |
$ 1,469,458 |
$ 1,391,447 |
|||||
Liabilities and Shareholders' Equity |
|||||||
Current liabilities: |
|||||||
Accounts payable |
$ 4,183 |
$ 8,854 |
|||||
Accrued liabilities |
203,828 |
174,972 |
|||||
Income taxes payable |
9,956 |
14,717 |
|||||
Convertible debt |
- |
2,200 |
|||||
Total current liabilities |
217,967 |
200,743 |
|||||
Long-term deferred revenue |
112,470 |
126,529 |
|||||
Other long-term liabilities |
1,815 |
1,826 |
|||||
Total liabilities |
332,252 |
329,098 |
|||||
Shareholders' equity |
|||||||
SINA shareholders' equity |
1,128,410 |
1,055,670 |
|||||
Noncontrolling interest |
8,796 |
6,679 |
|||||
Total shareholders' equity |
1,137,206 |
1,062,349 |
|||||
Total liabilities and shareholders' equity |
$ 1,469,458 |
$ 1,391,447 |
SINA CORPORATION |
||||||||||
UNAUDITED SEGMENT INFORMATION |
||||||||||
(U.S. Dollars in thousands) |
||||||||||
Three months ended |
Nine months ended |
|||||||||
September 30, |
June 30, |
September 30, |
||||||||
2012 |
2011 |
2012 |
2012 |
2011 |
||||||
Net revenues |
||||||||||
Advertising |
$ 120,590 |
$ 101,018 |
$ 103,130 |
$ 302,262 |
$ 265,150 |
|||||
Mobile related |
19,079 |
21,374 |
17,668 |
55,765 |
62,176 |
|||||
Others |
12,709 |
7,894 |
10,807 |
32,176 |
22,134 |
|||||
$ 152,378 |
$ 130,286 |
$ 131,605 |
$ 390,203 |
$ 349,460 |
||||||
Cost of revenues |
||||||||||
Advertising |
$ 54,010 |
$ 41,070 |
$ 48,472 |
$ 146,566 |
$ 111,823 |
|||||
Mobile related |
12,262 |
14,584 |
10,778 |
34,717 |
39,452 |
|||||
Others |
3,166 |
1,488 |
2,372 |
6,888 |
3,340 |
|||||
$ 69,438 |
$ 57,142 |
$ 61,622 |
$ 188,171 |
$ 154,615 |
TABLE
SINA CORPORATION |
||||||||||||||||||
UNAUDITED RECONCILIATION OF NON-GAAP TO GAAP RESULTS |
||||||||||||||||||
(U.S. Dollars in thousands, except per share data) |
||||||||||||||||||
Three months ended |
||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
June 30, 2012 |
||||||||||||||||
Non-GAAP |
Non-GAAP |
Non-GAAP |
||||||||||||||||
Actual |
Adjustments |
Results |
Actual |
Adjustments |
Results |
Actual |
Adjustments |
Results |
||||||||||
Advertising revenues |
$120,590 |
$120,590 |
$101,018 |
$101,018 |
$103,130 |
$103,130 |
||||||||||||
Non-advertising revenues |
31,788 |
(4,687) |
(c) |
27,101 |
29,268 |
(4,687) |
(c) |
24,581 |
28,475 |
(4,686) |
(c) |
23,789 |
||||||
Net revenues |
$152,378 |
$ (4,687) |
$147,691 |
$130,286 |
$ (4,687) |
$125,599 |
$131,605 |
$ (4,686) |
$126,919 |
|||||||||
865 |
(a) |
895 |
(a) |
751 |
(a) |
|||||||||||||
(4,687) |
(c) |
(4,687) |
(c) |
(4,686) |
(c) |
|||||||||||||
Gross profit |
$ 82,940 |
$ (3,822) |
$ 79,118 |
$ 73,144 |
$ (3,792) |
$ 69,352 |
$ 69,983 |
$ (3,935) |
$ 66,048 |
|||||||||
(3,520) |
(a) |
|||||||||||||||||
(5,465) |
(a) |
(107) |
(b) |
(2,968) |
(a) |
|||||||||||||
(12) |
(b) |
(68,891) |
(f) |
(12) |
(b) |
|||||||||||||
Operating expenses |
$ 79,151 |
$ (5,477) |
$ 73,674 |
$132,947 |
$ (72,518) |
$ 60,429 |
$ 69,810 |
$ (2,980) |
$ 66,830 |
|||||||||
4,415 |
(a) |
|||||||||||||||||
6,330 |
(a) |
107 |
(b) |
3,719 |
(a) |
|||||||||||||
12 |
(b) |
(4,687) |
(c) |
12 |
(b) |
|||||||||||||
(4,687) |
(c) |
68,891 |
(f) |
(4,686) |
(c) |
|||||||||||||
Income/(loss) from operations |
$ 3,789 |
$ 1,655 |
$ 5,444 |
$ (59,803) |
$ 68,726 |
$ 8,923 |
$ 173 |
$ (955) |
$ (782) |
|||||||||
4,415 |
(a) |
|||||||||||||||||
6,330 |
(a) |
107 |
(b) |
3,719 |
(a) |
|||||||||||||
12 |
(b) |
(4,687) |
(c) |
12 |
(b) |
|||||||||||||
(4,687) |
(c) |
3,909 |
(d) |
(4,686) |
(c) |
|||||||||||||
3,138 |
(d) |
281,162 |
(e) |
4,217 |
(d) |
|||||||||||||
(3,004) |
(e) |
68,891 |
(f) |
(32,770) |
(e) |
|||||||||||||
Net income/(loss) attributable to SINA |
$ 9,878 |
$ 1,789 |
$ 11,667 |
$(336,338) |
$ 353,797 |
$ 17,459 |
$ 33,245 |
$ (29,508) |
$ 3,737 |
|||||||||
Diluted net income/(loss) per share attributable to SINA |
$ 0.14 |
$ 0.17 |
$ (5.10) |
$ 0.26 |
$ 0.49 |
$ 0.05 |
||||||||||||
Shares used in computing diluted |
||||||||||||||||||
net income/(loss) per share attributable to SINA |
66,874 |
- |
66,874 |
65,908 |
1,005 |
(g) |
66,913 |
66,809 |
- |
66,809 |
||||||||
Gross margin - advertising |
55% |
1% |
56% |
59% |
1% |
60% |
53% |
1% |
54% |
|||||||||
Nine months ended |
||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
|||||||||||||||||
Non-GAAP |
Non-GAAP |
|||||||||||||||||
Actual |
Adjustments |
Results |
Actual |
Adjustments |
Results |
|||||||||||||
Advertising revenues |
$302,262 |
$302,262 |
$265,150 |
$265,150 |
||||||||||||||
Non-advertising revenues |
87,941 |
(14,059) |
(c) |
73,882 |
84,310 |
(14,059) |
(c) |
70,251 |
||||||||||
Net revenues |
390,203 |
$ (14,059) |
$376,144 |
$349,460 |
$ (14,059) |
$335,401 |
||||||||||||
2,423 |
(a) |
2,281 |
(a) |
|||||||||||||||
(14,059) |
(c) |
(14,059) |
(c) |
|||||||||||||||
Gross profit |
$202,032 |
$ (11,636) |
$190,396 |
$194,845 |
$ (11,778) |
$183,067 |
||||||||||||
(9,031) |
(a) |
|||||||||||||||||
(11,399) |
(a) |
(624) |
(b) |
|||||||||||||||
(132) |
(b) |
(68,891) |
(f) |
|||||||||||||||
Operating expenses |
216,157 |
$ (11,531) |
$204,626 |
$234,471 |
$ (78,546) |
$155,925 |
||||||||||||
11,312 |
(a) |
|||||||||||||||||
13,822 |
(a) |
624 |
(b) |
|||||||||||||||
132 |
(b) |
(14,059) |
(c) |
|||||||||||||||
(14,059) |
(c) |
68,891 |
(f) |
|||||||||||||||
Income/(loss) from operations |
$(14,125) |
$ (105) |
$(14,230) |
$ (39,626) |
$ 66,768 |
$ 27,142 |
||||||||||||
11,312 |
(a) |
|||||||||||||||||
13,822 |
(a) |
624 |
(b) |
|||||||||||||||
132 |
(b) |
(14,059) |
(c) |
|||||||||||||||
(14,059) |
(c) |
10,745 |
(d) |
|||||||||||||||
10,933 |
(d) |
281,548 |
(e) |
|||||||||||||||
(38,835) |
(e) |
68,891 |
(f) |
|||||||||||||||
Net income/(loss) attributable to SINA |
$ 29,383 |
$(28,007) |
$ 1,376 |
$(311,371) |
$ 359,061 |
$ 47,690 |
||||||||||||
Diluted net income/(loss) per share attributable to SINA |
$ 0.43 |
$ 0.01 |
$ (4.80) |
$ 0.71 |
||||||||||||||
Shares used in computing diluted |
||||||||||||||||||
net income/(loss) per share attributable to SINA |
66,822 |
- |
66,822 |
64,821 |
2,300 |
(g) |
67,121 |
|||||||||||
Gross margin - advertising |
52% |
0% |
* |
52% |
58% |
1% |
59% |
|||||||||||
(a) To adjust stock-based compensation related to employee incentives. |
||||||||||||||||||
(b) To adjust amortization of intangible assets. |
||||||||||||||||||
(c) To adjust the recognition of deferred revenue mostly related to the license agreements resulting from the CRIC Transaction. |
||||||||||||||||||
(d) To adjust share of equity investments' GAAP to Non-GAAP reconciling items, net of share of amortization of intangibles not on their books. |
||||||||||||||||||
(e) To adjust gain on sale of/(impairment) on equity investments |
||||||||||||||||||
(f) To adjust for impairment of MVAS goodwill |
||||||||||||||||||
(g) To adjust the number of shares used in computing diluted net loss per share from diluted net income per share. |
||||||||||||||||||
* Rounding |
UNAUDITED RECONCILIATION OF SINA'S SHARE OF EQUITY INVESTMENTS' GAAP TO NON-GAAP RESULTS* |
||||||||||||||||||
Three months ended |
||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
June 30, 2012 |
||||||||||||||||
Actual |
Adjustments |
Non-GAAP Results |
Actual |
Adjustments |
Non-GAAP Results |
Actual |
Adjustments |
Non-GAAP Results |
||||||||||
To adjust stock-based compensation |
$2,046 |
$1,605 |
$1,961 |
|||||||||||||||
To adjust amortization expenses of intangible |
||||||||||||||||||
assets resulting from business acquisitions |
749 |
1,568 |
1,663 |
|||||||||||||||
Earning/(loss) from equity investments, net |
$1,226 |
$2,795 |
$4,021 |
$ 912 |
$3,173 |
$4,085 |
$(2,722) |
$3,624 |
$ 902 |
|||||||||
Share of amortization of equity investments' |
||||||||||||||||||
intangibles not on their books |
$ (343) |
$ 343 |
$ - |
$ (736) |
$ 736 |
$ - |
$ (593) |
$ 593 |
$ - |
|||||||||
$ 883 |
$3,138 |
$4,021 |
$ 176 |
$3,909 |
$4,085 |
$(3,315) |
$4,217 |
$ 902 |
||||||||||
Nine months ended |
||||||||||||||||||
September 30, 2012 |
September 30, 2011 |
|||||||||||||||||
Actual |
Adjustments |
Non-GAAP Results |
Actual |
Adjustments |
Non-GAAP Results |
|||||||||||||
To adjust stock-based compensation |
$5,161 |
$3,914 |
||||||||||||||||
To adjust amortization expenses of intangible |
||||||||||||||||||
assets resulting from business acquisitions |
4,100 |
4,611 |
||||||||||||||||
Earning/(loss) from equity investments, net |
$(4,681) |
$9,261 |
$4,580 |
$3,461 |
$8,525 |
$11,986 |
||||||||||||
Share of amortization of equity investments' |
||||||||||||||||||
intangibles not on their books |
$(1,672) |
$1,672 |
$ - |
$(2,220) |
$2,220 |
$ - |
||||||||||||
$(6,353) |
$10,933 |
$4,580 |
$1,241 |
$10,745 |
$11,986 |
|||||||||||||
* Earning/(loss) from equity investments is recorded one quarter in arrears. |
SOURCE