UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

FORM 6-K

 


 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of February 2020

 

Commission File Number: 001-37361

 


 

Sina Corporation

(Registrant’s Name)

 


 

SINA Plaza, No. 8 Courtyard 10

the West Xibeiwang E. Road

Haidian District, Beijing 100193

People’s Republic of China

(Address of Principal Executive Offices)

 


 

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

 

Form 20-F x      Form 40-F o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

 

 

 


 

EXHIBIT INDEX

 

99.1 - Press Release

 

 

2


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

 

 

SINA CORPORATION

 

 

 

 

 

 

Date: February 27, 2020

By:

/s/ Bonnie Yi Zhang

 

 

Bonnie Yi Zhang

 

 

Chief Financial Officer

 

3


Exhibit 99.1

 

SINA Reports Fourth Quarter and Fiscal Year 2019 Unaudited Financial Results

 

BEIJING, China—February 26, 2020—SINA Corporation (the “Company” or “SINA”) (NASDAQ: SINA), a leading online media company serving China and the global Chinese communities, today announced its unaudited financial results for the fourth quarter and the fiscal year ended December 31, 2019.

 

Fourth Quarter 2019 Highlights

 

·          Net revenues increased 4% year-over-year to $593.3 million. Non-GAAP net revenues increased 4% year-over-year to $590.7 million, representing an increase of 5% on a constant currency basis [1].

·          Advertising revenues decreased 5% year-over-year to $460.9 million.

·          Non-advertising revenues increased 49% year-over-year to $132.5 million. Non-GAAP non-advertising revenues increased 51% year-over-year to $129.8 million.

·          Net loss attributable to SINA was $175.4 million, or $2.53 for diluted net loss per share attributable to SINA’s ordinary shareholders. Non-GAAP net income attributable to SINA was $82.7 million, or $1.17 for non-GAAP diluted net income per share attributable to SINA’s ordinary shareholders.

 

Fiscal Year 2019 Highlights

 

·          Net revenues increased 3% year-over-year to $2.16 billion. Non-GAAP net revenues increased 3% year-over-year to $2.15 billion, representing an increase of 7% on a constant currency basis [2].

·          Advertising revenues decreased 3% year-over-year to $1.74 billion.

·          Non-advertising revenues increased 31% year-over-year to $419.3 million. Non-GAAP non-advertising revenues increased 32% year-over-year to $408.9 million.

·          Net loss attributable to SINA was $70.5 million, or $1.03 for diluted net loss per share attributable to SINA’s ordinary shareholders. Non-GAAP net income attributable to SINA was $232.6 million, or $3.26 for non-GAAP diluted net income per share attributable to SINA’s ordinary shareholders.

 


[1] On a constant currency (non-GAAP) basis, we assume that the exchange rate in the fourth quarter of 2019 had been the same as it was in the fourth quarter of 2018, or RMB6.94=US$1.00.

[2] On a constant currency (non-GAAP) basis, we assume that the exchange rate for fiscal year 2019 had been the same as it was for fiscal year 2018, or RMB6.62=US$1.00.

 


 

Fourth Quarter 2019 Financial Results

 

For the fourth quarter of 2019, SINA reported net revenues of $593.3 million, an increase of 4% compared to $573.0 million for the same period last year. Non-GAAP net revenues for the fourth quarter of 2019 were $590.7 million, an increase of 4% compared to $570.4 million for the same period last year.

 

Advertising revenues for the fourth quarter of 2019 were $460.9 million, a decrease of 5% compared to $484.3 million for the same period last year, primarily due to decreases in Weibo and portal advertising revenues as well as negative currency translation impact.

 

Non-advertising revenues for the fourth quarter of 2019 were $132.5 million, an increase of 49% compared to $88.7 million for the same period last year. Non-GAAP non-advertising revenues for the fourth quarter of 2019 were $129.8 million, an increase of 51% compared to $86.1 million for the same period last year. The year-over-year growth in non-advertising revenues was mainly attributable to increased revenues generated from SINA fin-tech businesses.

 

Gross margin for the fourth quarter of 2019 was 77%, compared to 79% for the same period last year. Advertising gross margin for the fourth quarter of 2019 was 81%, compared to 82% for the same period last year. Non-advertising gross margin for the fourth quarter of 2019 was 64%, up from 57% for the same period last year, benefiting from better gross margin profile of SINA fin-tech businesses.

 

Operating expenses for the fourth quarter of 2019 totaled $438.4 million, compared to $319.9 million for the same period last year, mainly attributable to a one-time litigation reserve of approximately $125.8 million recorded in relation to an arbitration ruling announced by Company on December 27, 2019, which is excluded under non-GAAP measures. Non-GAAP operating expenses for the fourth quarter of 2019 totaled $282.8 million, compared to $288.6 million for the same period last year.

 

Income from operations for the fourth quarter of 2019 was $18.7 million, compared to $130.1 million for the same period last year, mainly due to impact of the aforementioned one-time litigation reserve. Operating margin was 3%, compared to 23% for the same period last year. Non-GAAP income from operations for the fourth quarter of 2019 was $174.9 million, an increase of 10% compared to $159.6 million for the same period last year. Non-GAAP operating margin was 30%, compared to 28% for the same period last year.

 

Non-operating loss for the fourth quarter of 2019 was $208.4 million, compared to non-operating loss of $12.6 million for the same period last year. Non-operating loss for the fourth quarter of 2019 mainly included (i) a $177.8 million impairment on the Company’s investment in Yixia Tech Co., Ltd., which is excluded under non-GAAP measures; (ii) a $19.2 million net loss from fair value changes of investments, which is excluded under non-GAAP measures; (iii) a $10.4 million net earnings from equity method investments, which is reported one quarter in arrears; (iv) a $15.3 million net interest and other income.

 

Income tax expenses for the fourth quarter of 2019 were $6.6 million, compared to $14.3 million for the same period last year, largely attributable to increase in tax deduction based on preferential tax policy upon approval from relevant authorities.

 


 

Net loss attributable to SINA’s ordinary shareholders for the fourth quarter of 2019 was $175.4 million, compared to a net income attributable to SINA’s ordinary shareholders of $16.4 million for the same period last year. Diluted net loss per share attributable to SINA’s ordinary shareholders for the fourth quarter of 2019 was $2.53, compared to a diluted net income per share attributable to SINA’s ordinary shareholders of $0.22 for the same period last year. Non-GAAP net income attributable to SINA’s ordinary shareholders for the fourth quarter of 2019 was $82.7 million, compared to $57.7 million for the same period last year. Non-GAAP diluted net income per share attributable to SINA’s ordinary shareholders for the fourth quarter of 2019 was $1.17, compared to $0.80 for the same period last year.

 

As of December 31, 2019, SINA’s cash, cash equivalents and short-term investments totaled $2.9 billion, compared to $2.3 billion as of December 31, 2018, mainly due to net proceeds received from Weibo’s senior notes offering and offset by continued investment activities. For the fourth quarter of 2019, net cash provided by operating activities was $301.7 million, capital expenditures totaled $8.5 million, and depreciation and amortization expenses amounted to $11.0 million.

 

Fiscal Year 2019 Financial Results

 

For fiscal year 2019, SINA reported net revenues of $2.16 billion, an increase of 3% compared to $2.11 billion in 2018. Non-GAAP net revenues for 2019 were $2.15 billion, an increase of 3% compared to $2.10 billion in 2018.

 

Advertising revenues in 2019 were $1.74 billion, a decrease of 3% compared to $1.79 billion in 2018, primarily due to a decline in portal advertising revenues and negative currency translation impact.

 

Non-advertising revenues in 2019 were $419.3 million, an increase of 31% compared to $319.0 million in 2018. Non-GAAP non-advertising revenues in 2019 were $408.9 million, an increase of 32% compared to $308.6 million in 2018, benefiting from increased revenues generated from SINA fin-tech businesses and incremental revenues derived from Weibo’s live streaming business acquired in the fourth quarter of 2018.

 

Gross margin in 2019 was 77%, compared to 79% in 2018. Advertising gross margin in 2019 was 81%, flat year over year. Non-advertising gross margin in 2019 was 63%, compared to 65% in 2018.

 

Operating expenses in 2019 totaled $1.30 billion, compared to $1.19 billion in 2018. Non-GAAP operating expenses in 2019 totaled $1.06 billion, compared to $1.07 billion in 2018.

 

Income from operations in 2019 was $370.3 million, compared to $467.0 million in 2018, mainly due to impact of the aforementioned one-time litigation reserve. Operating margin was 17%, compared to 22% in 2018. Non-GAAP income from operations in 2019 was $611.9 million, compared to $581.5 million in 2018. Non-GAAP operating margin was 28%, flat year over year.

 


 

Non-operating loss in 2019 was $115.1 million, compared to a non-operating income of $88.5 million in 2018. Non-operating loss in 2019 mainly included (i) a $165.3 million net gain from fair value changes on investments, which is excluded under non-GAAP measures; (ii) a $342.0 million impairment on the Company’s certain investments, mainly including a $177.8 million impairment on the Company’s investment in Yixia Tech Co., Ltd., which is excluded under non-GAAP measures; and (iii) a $64.1 million net interest and other income.

 

Income tax expenses in 2019 were $146.5 million, compared to $129.1 million in 2018, largely attributable to the deferred tax charges recognized from the fair value changes of investments and offset by increase in tax deduction based on preferential tax policy upon approval from relevant authorities. Non-GAAP income tax expenses in 2019 were $97.4 million, compared to $91.0 million in 2018.

 

Net loss attributable to SINA’s ordinary shareholders in 2019 was $70.5 million, compared to a net income attributable to SINA’s ordinary shareholders of $125.6 million in 2018. Diluted net loss per share attributable to SINA’s ordinary shareholders in 2019 was $1.03, compared to a diluted net income per share attributable to SINA’s ordinary shareholders of $1.70 in 2018. Non-GAAP net income attributable to SINA’s ordinary shareholders in 2019 was $232.6 million, compared to $227.1 million in 2018. Non-GAAP diluted net income per share attributable to SINA’s ordinary shareholders in 2019 was $3.26, compared to $3.07 in 2018.

 

For the fiscal year of 2019, net cash provided by operating activities was $744.0 million, capital expenditures totaled $29.5 million, and depreciation and amortization expenses amounted to $44.6 million.

 


 

Non-GAAP Measures

 

This release contains the following non-GAAP financial measures: non-GAAP net revenues, non-GAAP advertising revenues, non-GAAP non-advertising revenues, non-GAAP advertising and non-advertising gross margin, non-GAAP operating expenses, non-GAAP income from operations, non-GAAP operating margin, non-GAAP net income attributable to SINA’s ordinary shareholders and non-GAAP diluted net income 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.

 

The Company’s non-GAAP financial measures exclude recognition of deferred revenues related to the license granted to Leju, stock-based compensation, amortization of intangible assets, goodwill and acquired intangibles impairment, litigation reserve for arbitration, adjustment for non-GAAP to GAAP reconciling items on the share of equity method investments (net of share of amortization of intangibles not on their books), gain (loss) on sale of investment, deemed disposal, fair value changes and impairment on investment, adjustment for non-GAAP to GAAP reconciling items for the income attributable to non-controlling interests, amortization of convertible debt and senior notes issuance cost, and income tax effects of above non-GAAP to GAAP reconciling items. 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, gain (loss) 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. Reconciliations of the Company’s non-GAAP measures to the nearest comparable GAAP measures are set forth in the section below titled “Unaudited Reconciliation of Non-GAAP to GAAP Results.”

 

Conference Call

 

SINA will host a conference call from 7:10 a.m. – 7:40 a.m. Eastern Time on February 26, 2020 (or 8:10 p.m. – 8:40 p.m. Beijing Time on February 26, 2020) 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.sina.com. The conference call can be accessed as follows:

 

US:

+1 845 675 0437

Hong Kong:

+852 3018 6771

Mainland China:

400 620 8038

International:

+65 6713 5090

Passcode for all regions:

6968115

 

A replay of the conference call will be available through morning Eastern Time March 5, 2020. The dial-in number is +61 2 8199 0299. The passcode for the replay is 6968115.

 


 

About SINA

 

SINA is a leading online media company serving China and the global Chinese communities. Its digital media network of SINA.com (portal), SINA mobile (mobile portal and mobile apps) and Weibo (social media) enables internet users to access professional media and user generated content in multi-media formats from personal computers and mobile devices and share their interests with friends and acquaintances.

 

SINA.com offers distinct and targeted professional content on each of its region-specific websites and a full range of complementary offerings. SINA mobile provides news information, professional and entertainment content customized for mobile users through mobile applications and mobile portal site SINA.cn.

 

Weibo is a leading social media platform for people to create, distribute and discover content. Based on an open platform architecture, Weibo provides unprecedented and simple way for people and organizations to publicly express themselves in real time, interact with others on a massive global platform and stay connected with the world.

 

Through these properties and other product lines, SINA offer an array of online media and social media services to its users to create a rich canvas for businesses and advertisers to effectively connect and engage with their targeted audiences.

 

Safe Harbor Statement

 

This press release contains forward-looking statements that relate to, among other things, SINA’s expected financial performance and SINA’s strategic and operational plans (as described, without limitation, in quotations from management in this press release). 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 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. SINA assumes no obligation to update the forward-looking statements in this press release and elsewhere. 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 failure to meet internal or external expectations of future performance given the rapidly evolving markets; condition of the global financial and credit market; the uncertain regulatory landscape in China; fluctuations in the Company’s quarterly operating results; the Company’s reliance on online advertising sales and value-added services for a majority of its revenues; failure to successfully develop, introduce, drive adoption of or monetize new features and products, including portal, Weibo and fin-tech products; failure to enter and develop the small and medium enterprise market by the Company or through cooperation with other parties, such as Alibaba; failure to successfully integrate acquired businesses; risks associated with the Company’s investments, including adverse impacts on our financial results from equity pick-up, fair value changes and impairment; and failure to compete successfully against new entrants and established industry competitors. Further information regarding these and other risks is included in SINA’s 2018 annual reports on Form 20-F and other filings with the Securities and Exchange Commission.

 

Contact:

Investor Relations

SINA Corporation

Phone: +86 10 5898 3336

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

 

Year ended

 

 

 

December 31,

 

September 30,

 

December 31,

 

 

 

2019

 

2018

 

2019

 

2019

 

2018

 

Net revenues:

 

 

 

 

 

 

 

 

 

 

 

Advertising

 

$

460,864

 

$

484,307

 

$

461,095

 

$

1,743,617

 

$

1,789,285

 

Non-advertising

 

132,450

 

88,707

 

100,353

 

419,338

 

319,042

 

 

 

593,314

 

573,014

 

561,448

 

2,162,955

 

2,108,327

 

Cost of revenues (1):

 

 

 

 

 

 

 

 

 

 

 

Advertising

 

88,121

 

85,048

 

80,297

 

338,386

 

341,153

 

Non-advertising

 

48,121

 

37,997

 

37,055

 

155,042

 

110,887

 

 

 

136,242

 

123,045

 

117,352

 

493,428

 

452,040

 

Gross profit

 

457,072

 

449,969

 

444,096

 

1,669,527

 

1,656,287

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing (1)

 

165,367

 

191,208

 

169,423

 

627,989

 

699,962

 

Product development (1)

 

95,638

 

85,383

 

91,150

 

372,818

 

345,942

 

General and administrative (1)

 

177,411

 

30,633

 

44,854

 

298,441

 

120,184

 

Goodwill and acquired intangibles impairment

 

 

12,691

 

 

 

23,245

 

 

 

438,416

 

319,915

 

305,427

 

1,299,248

 

1,189,333

 

Income from operations

 

18,656

 

130,054

 

138,669

 

370,279

 

466,954

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-operating income (loss):

 

 

 

 

 

 

 

 

 

 

 

Earning (loss) from equity method investments, net

 

10,353

 

(4,731

)

1,608

 

24

 

1,120

 

Gain (loss) on sale of investments, fair value changes and impairment on investments, net

 

(234,106

)

(22,960

)

(25,549

)

(179,164

)

17,981

 

Interest and other income, net

 

15,312

 

15,090

 

19,895

 

64,053

 

69,355

 

 

 

(208,441

)

(12,601

)

(4,046

)

(115,087

)

88,456

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(189,785

)

117,453

 

134,623

 

255,192

 

555,410

 

Income tax expenses

 

(6,580

)

(14,347

)

(27,930

)

(146,465

)

(129,084

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

(196,365

)

103,106

 

106,693

 

108,727

 

426,326

 

Less: Net income (loss) attributable to non-controlling interests

 

(20,919

)

86,729

 

86,296

 

179,269

 

300,764

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to SINA’s ordinary shareholders

 

$

(175,446

)

$

16,377

 

$

20,397

 

$

(70,542

)

$

125,562

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income (loss) per share

 

$

(2.53

)

$

0.24

 

$

0.29

 

$

(1.01

)

$

1.79

 

Diluted net income (loss) per share (2)

 

$

(2.53

)

$

0.22

 

$

0.28

 

$

(1.03

)

$

1.70

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing basic net income (loss) per share

 

69,449

 

69,235

 

69,936

 

69,640

 

70,296

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing diluted net income (loss) per share

 

69,449

 

69,666

 

70,019

 

69,640

 

72,375

 

 


(1) Stock-based compensation in each category:

 

 

 

 

 

 

 

 

 

Cost of revenues

 

$

3,255

 

$

922

 

$

3,448

 

$

11,859

 

$

10,128

 

Sales and marketing

 

6,422

 

3,174

 

6,426

 

24,499

 

21,942

 

Product development

 

10,267

 

4,403

 

10,655

 

38,991

 

30,830

 

General and administrative

 

12,002

 

8,834

 

12,342

 

46,522

 

32,169

 

 

(2) Net income (loss) attributable to SINA’s ordinary shareholders is adjusted for diluted shares issued by our subsidiary and equity method investments.

 

1


 

SINA CORPORATION

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. Dollars in thousands)

 

 

 

December 31,

 

December 31,

 

 

 

2019

 

2018

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

1,951,886

 

$

1,545,800

 

Short-term investments

 

951,953

 

799,534

 

Restricted cash

 

184,143

 

97,032

 

Accounts receivable, net

 

601,876

 

527,897

 

Financing receivables, net (1)

 

226,098

 

 

Prepaid expenses and other current assets

 

695,888

 

362,435

 

Subtotal

 

4,611,844

 

3,332,698

 

 

 

 

 

 

 

Property and equipment, net

 

253,179

 

262,846

 

Operating lease right-of-use assets, net (2)

 

24,872

 

 

Goodwill and intangible assets, net

 

307,300

 

319,575

 

Long-term investments

 

2,200,548

 

1,889,843

 

Other assets

 

71,085

 

81,127

 

Total assets

 

$

7,468,828

 

$

5,886,089

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

170,647

 

$

172,562

 

Amount due to customers

 

121,558

 

97,032

 

Accrued expenses and other current liabilities

 

886,713

 

540,807

 

Short-term bank loan

 

81,649

 

78,229

 

Deferred revenues

 

143,073

 

139,306

 

Short-term operating lease liabilities (2)

 

12,151

 

 

Short-term funding debts (1)

 

173,821

 

 

Income taxes payable

 

129,591

 

115,725

 

Subtotal

 

1,719,203

 

1,143,661

 

 

 

 

 

 

 

Convertible debt

 

888,266

 

884,123

 

Senior notes

 

793,985

 

 

Long-term funding debts (1)

 

22,260

 

 

Long-term deferred revenues

 

33,217

 

43,652

 

Long-term operating lease liabilities(2)

 

13,081

 

 

Other long-term liabilities

 

100,903

 

51,781

 

Total liabilities

 

3,570,915

 

2,123,217

 

 

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

SINA shareholders’ equity

 

2,638,481

 

2,717,791

 

Non-controlling interests

 

1,259,432

 

1,045,081

 

Total shareholders’ equity

 

3,897,913

 

3,762,872

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

7,468,828

 

$

5,886,089

 

 


(1) In 2019, the Company set up trusts, which were administered by third-party trust company to invest in consumer loans to the individual borrowers recommended by the Company. The trusts are considered as variable interest entities under ASC 810. Accordingly, the financing receivables due from the borrowers and the loan payables to the third party investors of the trust units are recorded on the Company’s consolidated balance sheet as financing receivables and funding debts, respectively.

 

(2) The Company adopted the new leasing guidance (ASU 2016-2) started from January 1, 2019, which requires that a lessee recognize the assets and liabilities that arise from operating leases. The Company recognized a right-of-use asset and a liability relating to lease payments (the Lease Liability) in the statements of financial position for lease contracts having terms beyond 12 months period.

 

2


 

SINA CORPORATION

UNAUDITED ADDITIONAL INFORMATION

(U.S. Dollars in thousands)

 

 

 

Three months ended

 

Year ended

 

 

 

December 31,

 

September 30,

 

December 31,

 

 

 

2019

 

2018

 

2019

 

2019

 

2018

 

 

 

 

 

 

 

 

 

 

 

 

 

Net revenues

 

 

 

 

 

 

 

 

 

 

 

Portal:

 

 

 

 

 

 

 

 

 

 

 

Advertising

 

$

56,466

 

$

67,377

 

$

50,105

 

$

216,440

 

$

290,215

 

Fintech *

 

77,759

 

27,300

 

50,365

 

206,780

 

111,412

 

Subtotal

 

134,225

 

94,677

 

100,470

 

423,220

 

401,627

 

 

 

 

 

 

 

 

 

 

 

 

 

Weibo:

 

 

 

 

 

 

 

 

 

 

 

Advertising and marketing

 

405,921

 

417,016

 

412,489

 

1,530,211

 

1,499,180

 

Weibo VAS

 

62,227

 

64,859

 

55,264

 

236,703

 

219,338

 

Subtotal

 

468,148

 

481,875

 

467,753

 

1,766,914

 

1,718,518

 

 

 

 

 

 

 

 

 

 

 

 

 

Elimination

 

(9,059

)

(3,538

)

(6,775

)

(27,179

)

(11,818

)

 

 

$

593,314

 

$

573,014

 

$

561,448

 

$

2,162,955

 

$

2,108,327

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues

 

 

 

 

 

 

 

 

 

 

 

Portal:

 

 

 

 

 

 

 

 

 

 

 

Advertising

 

$

20,404

 

$

29,180

 

$

22,996

 

$

90,071

 

$

117,600

 

Fintech *

 

32,808

 

14,377

 

26,161

 

98,676

 

68,500

 

Subtotal

 

53,212

 

43,557

 

49,157

 

188,747

 

186,100

 

 

 

 

 

 

 

 

 

 

 

 

 

Weibo

 

90,566

 

82,940

 

73,471

 

328,826

 

277,648

 

 

 

 

 

 

 

 

 

 

 

 

 

Elimination

 

(7,536

)

(3,452

)

(5,276

)

(24,145

)

(11,708

)

 

 

$

136,242

 

$

123,045

 

$

117,352

 

$

493,428

 

$

452,040

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

 

 

 

 

 

 

 

 

 

 

Portal

 

60

%

54

%

51

%

55

%

54

%

Weibo

 

81

%

83

%

84

%

81

%

84

%

 

 

77

%

79

%

79

%

77

%

79

%

 


*

Fintech includes SINA fin-tech and portal other businesses. For the fourth quarter of 2019, portal other revenue was $4.4 million, compared to $7.6 million for the same period last year. For the years ended December 31, 2019 and 2018, portal other revenue was $19.7 million and $37.2 million, respectively.

 

3


 

SINA CORPORATION

UNAUDITED RECONCILIATION OF NON-GAAP TO GAAP RESULTS

(U.S. Dollars in thousands, except per share data)

 

 

 

Three months ended

 

 

 

December 31, 2019

 

December 31, 2018

 

September 30, 2019

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

Non-GAAP

 

 

 

Actual

 

Adjustments

 

 

Results

 

Actual

 

Adjustments

 

 

Results

 

Actual

 

Adjustments

 

 

Results

 

Advertising revenues

 

$

460,864

 

 

 

 

$

460,864

 

$

484,307

 

 

 

 

$

484,307

 

$

461,095

 

 

 

 

$

461,095

 

Non-advertising revenues

 

132,450

 

(2,609

)

(a)

129,841

 

88,707

 

(2,609

)

(a)

86,098

 

100,353

 

(2,609

)

(a)

97,744

 

Net revenues

 

$

593,314

 

$

(2,609

)

 

$

590,705

 

$

573,014

 

$

(2,609

)

 

$

570,405

 

$

561,448

 

$

(2,609

)

 

$

558,839

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,609

)

(a)

 

 

 

 

(2,609

)

(a)

 

 

 

 

(2,609

)

(a)

 

 

 

 

 

 

3,255

 

(b)

 

 

 

 

922

 

(b)

 

 

 

 

3,448

 

(b)

 

 

Gross profit

 

$

457,072

 

$

646

 

 

$

457,718

 

$

449,969

 

$

(1,687

)

 

$

448,282

 

$

444,096

 

$

839

 

 

$

444,935

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(28,691

)

(b)

 

 

 

 

(16,411

)

(b)

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,075

)

(c)

 

 

 

 

(2,177

)

(c)

 

 

 

 

(29,423

)

(b)

 

 

 

 

 

 

(125,809

)

(e)

 

 

 

 

(12,691

)

(d)

 

 

 

 

(1,073

)

(c)

 

 

Operating expenses

 

$

438,416

 

$

(155,575

)

 

$

282,841

 

$

319,915

 

$

(31,279

)

 

$

288,636

 

$

305,427

 

$

(30,496

)

 

$

274,931

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,609

)

(a)

 

 

 

 

(2,609

)

(a)

 

 

 

 

 

 

 

 

 

 

 

 

 

31,946

 

(b)

 

 

 

 

17,333

 

(b)

 

 

 

 

(2,609

)

(a)

 

 

 

 

 

 

1,075

 

(c)

 

 

 

 

2,177

 

(c)

 

 

 

 

32,871

 

(b)

 

 

 

 

 

 

125,809

 

(e)

 

 

 

 

12,691

 

(d)

 

 

 

 

1,073

 

(c)

 

 

Income from operations

 

$

18,656

 

$

156,221

 

 

$

174,877

 

$

130,054

 

$

29,592

 

 

$

159,646

 

$

138,669

 

$

31,335

 

 

$

170,004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2,609

)

(a)

 

 

 

 

(2,609

)

(a)

 

 

 

 

 

 

 

 

 

 

 

 

 

31,946

 

(b)

 

 

 

 

17,333

 

(b)

 

 

 

 

(2,609

)

(a)

 

 

 

 

 

 

1,075

 

(c)

 

 

 

 

2,177

 

(c)

 

 

 

 

32,871

 

(b)

 

 

 

 

 

 

125,809

 

(e)

 

 

 

 

12,691

 

(d)

 

 

 

 

1,073

 

(c)

 

 

 

 

 

 

1,669

 

(f)

 

 

 

 

4,797

 

(f)

 

 

 

 

4,279

 

(f)

 

 

 

 

 

 

234,106

 

(g)

 

 

 

 

22,960

 

(g)

 

 

 

 

25,549

 

(g)

 

 

 

 

 

 

(129,158

)

(h)

 

 

 

 

(14,929

)

(h)

 

 

 

 

(12,047

)

(h)

 

 

 

 

 

 

1,371

 

(i)

 

 

 

 

1,035

 

(i)

 

 

 

 

1,360

 

(i)

 

 

 

 

 

 

(6,032

)

(j)

 

 

 

 

(2,138

)

(j)

 

 

 

 

(3,832

)

(j)

 

 

Net income (loss) attributable to SINA’s ordinary shareholders

 

$

(175,446

)

$

258,177

 

 

$

82,731

 

$

16,377

 

$

41,317

 

 

$

57,694

 

$

20,397

 

$

46,644

 

 

$

67,041

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income (loss) per share *

 

$

(2.53

)

 

 

 

$

1.17

 

$

0.22

 

 

 

 

$

0.80

 

$

0.28

 

 

 

 

$

0.94

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing diluted net income (loss) per share

 

69,449

 

94

 

(k)

69,543

 

69,666

 

960

 

(k)

70,626

 

70,019

 

 

 

70,019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin - advertising

 

81

%

1

%

 

82

%

82

%

1

%

 

83

%

83

%

 

 

83

%

Gross margin - non-advertising

 

64

%

-1

%

 

63

%

57

%

-1

%

 

56

%

63

%

-1

%

 

62

%

Operating margin

 

3

%

27

%

 

30

%

23

%

5

%

 

28

%

25

%

5

%

 

30

%

 

4


 

 

 

Year ended

 

 

 

December 31, 2019

 

December 31, 2018

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

Non-GAAP

 

 

 

Actual

 

Adjustments

 

 

Results

 

Actual

 

Adjustments

 

 

Results

 

Advertising revenues

 

$

1,743,617

 

 

 

 

$

1,743,617

 

$

1,789,285

 

 

 

 

$

1,789,285

 

Non-advertising revenues

 

419,338

 

(10,436

)

(a)

408,902

 

319,042

 

(10,436

)

(a)

308,606

 

Net revenues

 

$

2,162,955

 

$

(10,436

)

 

$

2,152,519

 

$

2,108,327

 

$

(10,436

)

 

$

2,097,891

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(10,436

)

(a)

 

 

 

 

(10,436

)

(a)

 

 

 

 

 

 

11,859

 

(b)

 

 

 

 

10,128

 

(b)

 

 

Gross profit

 

$

1,669,527

 

$

1,423

 

 

$

1,670,950

 

$

1,656,287

 

$

(308

)

 

$

1,655,979

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(110,012

)

(b)

 

 

 

 

(84,941

)

(b)

 

 

 

 

 

 

(4,379

)

(c)

 

 

 

 

(6,689

)

(c)

 

 

 

 

 

 

(125,809

)

(e)

 

 

 

 

(23,245

)

(d)

 

 

Operating expenses

 

$

1,299,248

 

$

(240,200

)

 

$

1,059,048

 

$

1,189,333

 

$

(114,875

)

 

$

1,074,458

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(10,436

)

(a)

 

 

 

 

(10,436

)

(a)

 

 

 

 

 

 

121,871

 

(b)

 

 

 

 

95,069

 

(b)

 

 

 

 

 

 

4,379

 

(c)

 

 

 

 

6,689

 

(c)

 

 

 

 

 

 

125,809

 

(e)

 

 

 

 

23,245

 

(d)

 

 

Income from operations

 

$

370,279

 

$

241,623

 

 

$

611,902

 

$

466,954

 

$

114,567

 

 

$

581,521

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(10,436

)

(a)

 

 

 

 

(10,436

)

(a)

 

 

 

 

 

 

121,871

 

(b)

 

 

 

 

95,069

 

(b)

 

 

 

 

 

 

4,379

 

(c)

 

 

 

 

6,689

 

(c)

 

 

 

 

 

 

125,809

 

(e)

 

 

 

 

23,245

 

(d)

 

 

 

 

 

 

16,374

 

(f)

 

 

 

 

(2,493

)

(f)

 

 

 

 

 

 

179,164

 

(g)

 

 

 

 

(17,981

)

(g)

 

 

 

 

 

 

(187,922

)

(h)

 

 

 

 

(34,806

)

(h)

 

 

 

 

 

 

4,803

 

(i)

 

 

 

 

4,140

 

(i)

 

 

 

 

 

 

49,108

 

(j)

 

 

 

 

38,109

 

(j)

 

 

Net income (loss) attributable to SINA’s ordinary shareholders

 

$

(70,542

)

$

303,150

 

 

$

232,608

 

$

125,562

 

$

101,536

 

 

$

227,098

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income (loss) per share *

 

$

(1.03

)

 

 

 

$

3.26

 

$

1.70

 

 

 

 

$

3.07

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in computing diluted net income (loss) per share

 

69,640

 

177

 

(k)

69,817

 

72,375

 

 

 

72,375

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin - advertising

 

81

%

 

 

81

%

81

%

 

 

81

%

Gross margin - non-advertising

 

63

%

-1

%

 

62

%

65

%

-1

%

 

64

%

Operating margin

 

17

%

11

%

 

28

%

22

%

6

%

 

28

%

 


(a)

To exclude the recognition of deferred revenue related to the license granted to Leju.

(b)

To exclude stock-based compensation.

(c)

To adjust amortization of intangible assets.

(d)

To exclude goodwill and acquired intangibles impairment.

(e)

To exclude the one-time litigation reserve for arbitration of NAI.

(f)

To exclude non-GAAP to GAAP reconciling items on the share of equity method investments, net of share of amortization of intangibles not on their books.

(g)

To exclude (gain) loss on sale of investments, (gain) loss on deemed disposal, fair value changes and impairment on investments, net.

(h)

To exclude non-GAAP to GAAP reconciling items for the income attributable to non-controlling interests.

(i)

To exclude the amortization of convertible debt and senior notes issuance cost.

(j)

To exclude the provision (benefit) for income tax related to item (c), (d) and (g). Other non-GAAP to GAAP reconciling items have no income tax effect.**

(k)

To adjust the number of shares for dilution resulted from convertible debt and unvested equity granted.

 

 

*

Net income (loss) attributable to SINA’s ordinary shareholders is adjusted for diluted shares issued by our subsidiary and equity method investments.

 

 

**

The Company considered the tax implication arising from the reconciliation items, and those items recorded in entities in tax free jurisdictions were without relevant tax implications. For impairment on investments, valuation allowances were made for those differences the Company does not expect they can be realized in the foreseeable future.

 

5


 

UNAUDITED RECONCILIATION OF SINA’S SHARE OF EQUITY INVESTMENTS’ NON-GAAP TO GAAP RESULTS*

 

 

 

Three months ended

 

 

 

December 31, 2019

 

December 31, 2018

 

September 30, 2019

 

 

 

Actual

 

Adjustments

 

Non-GAAP
Results

 

Actual

 

Adjustments

 

Non-GAAP
Results

 

Actual

 

Adjustments

 

Non-GAAP
Results

 

To exclude stock-based compensation

 

 

 

$

410

 

 

 

 

 

$

350

 

 

 

 

 

$

259

 

 

 

To exclude amortization of intangible assets resulting from business acquisitions

 

 

 

1,046

 

 

 

 

 

1,062

 

 

 

 

 

1,048

 

 

 

To exclude loss on disposal and impairment on investments, net

 

 

 

1,094

 

 

 

 

 

 

 

 

 

 

815

 

 

 

To exclude (gain) loss resulting from the fair value changes in investments, net

 

 

 

(205

)

 

 

 

 

4,062

 

 

 

 

 

2,837

 

 

 

To exclude tax impacts related to amortization of intangible assets

 

 

 

(245

)

 

 

 

 

(248

)

 

 

 

 

(245

)

 

 

Earning (loss) from equity method investments, net

 

$

9,922

 

$

2,100

 

$

12,022

 

$

(5,160

)

$

5,226

 

$

66

 

$

1,173

 

$

4,714

 

$

5,887

 

Share of amortization of equity investments’ intangibles not on their books

 

369

 

(369

)

 

367

 

(367

)

 

375

 

(375

)

 

Share of tax impacts related to amortization of equity investments’ intangibles not on their books

 

62

 

(62

)

 

62

 

(62

)

 

60

 

(60

)

 

 

 

$

10,353

 

$

1,669

 

$

12,022

 

$

(4,731

)

$

4,797

 

$

66

 

$

1,608

 

$

4,279

 

$

5,887

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year ended

 

 

 

 

 

 

 

 

 

December 31, 2019

 

December 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

 

Actual

 

Adjustments

 

Results

 

Actual

 

Adjustments

 

Results

 

 

 

 

 

 

 

To exclude stock-based compensation

 

 

 

$

1,134

 

 

 

 

 

$

2,441

 

 

 

 

 

 

 

 

 

To exclude amortization of intangible assets resulting from business acquisitions

 

 

 

4,204

 

 

 

 

 

4,379

 

 

 

 

 

 

 

 

 

To exclude loss on disposal and impairment on investments, net

 

 

 

8,712

 

 

 

 

 

2,989

 

 

 

 

 

 

 

 

 

To exclude (gain) loss resulting from the fair value changes in investments, net

 

 

 

5,022

 

 

 

 

 

(9,777

)

 

 

 

 

 

 

 

 

To exclude tax impacts related to amortization of intangible assets

 

 

 

(982

)

 

 

 

 

(942

)

 

 

 

 

 

 

 

 

Earning (loss) from equity method investments, net

 

$

(1,692

)

$

18,090

 

$

16,398

 

$

(463

)

$

(910

)

$

(1,373

)

 

 

 

 

 

 

Share of amortization of equity investments’ intangibles not on their books

 

1,467

 

(1,467

)

 

1,306

 

(1,306

)

 

 

 

 

 

 

 

Share of tax impacts related to amortization of equity investments’ intangibles not on their books

 

249

 

(249

)

 

277

 

(277

)

 

 

 

 

 

 

 

 

 

$

24

 

$

16,374

 

$

16,398

 

$

1,120

 

$

(2,493

)

$

(1,373

)

 

 

 

 

 

 

 


* Earning (loss) from equity method investments is recorded one quarter in arrears.

 

6