Weibo Reports Third Quarter 2015 Results

BEIJING, Nov. 18, 2015 (GLOBE NEWSWIRE) -- Weibo Corporation ("Weibo" or the "Company") (NASDAQ:WB), a leading social media in China, today announced its unaudited financial results for the quarter ended September 30, 2015.

Third Quarter 2015 Highlights

• Net revenues increased 48% year over year to $124.7 million, exceeding the Company's guidance between $120 million and $123 million.
• Advertising and marketing revenue increased 62% year over year.
• Weibo Value Added Services ("Weibo VAS") revenue increased 1% year over year, despite a 72% year-over-year decline in revenue from data licensing, a deemphasized business.
• Net income attributable to Weibo's ordinary shareholders was $14.5 million, or diluted net income per share of $0.07, compared to a net loss of $6.7 million for the same period last year, or diluted net loss per share of $0.03.
• Non-GAAP net income attributable to Weibo's ordinary shareholders was $22.1 million, or non-GAAP diluted net income per share of $0.10, compared to a non-GAAP net loss of $1.5 million for the same period last year, or non-GAAP diluted net loss per share of $0.01.
• Non-GAAP adjusted EBITDA was $26.5 million, compared to a non-GAAP adjusted EBITDA of $1.9 million for the same period last year.
• Monthly active users ("MAUs") reached 222 million in September 2015, up 33% year over year. Mobile MAUs represented 85% of total MAUs in September 2015. Daily active users ("DAUs") reached 100 million on average for September 2015, up 30% year over year.

"We continue to see strong momentum in Weibo's advertising and marketing business, with non-Alibaba ad revenues growing 100% year over year in RMB and ad customers in the quarter reaching close to half a million," said Gaofei Wang, Weibo's CEO. "On the user side, strong consumption of video, photo and key opinion leader content are contributing to the robust growth of Weibo traffic. For example, daily video views on Weibo in September 2015 grew 9.7 times from the same period last year."

Third Quarter 2015 Financial Results

For the third quarter of 2015, Weibo reported net revenues of $124.7 million, compared to $84.1 million for the same period last year. Advertising and marketing revenue for the third quarter of 2015 totaled $105.9 million, compared to $65.4 million for the same period last year. Weibo VAS revenue for the third quarter of 2015 totaled $18.9 million, compared to $18.8 million for the same period last year.

Costs and expenses for the third quarter of 2015 totaled $110.8 million, compared to $92.0 million for the same period last year. Non-GAAP costs and expenses for the third quarter of 2015 was $103.2 million, compared to $88.1 million for the same period last year. The increase in non-GAAP costs and expenses was primarily due to an increase in infrastructure costs resulting from traffic growth and strong multi-media consumption, higher game and other revenue share and value added taxes associated with higher revenues, and an increase in personnel-related costs.

Income from operations for the third quarter of 2015 was $13.9 million, compared to a loss from operations of $7.8 million for the same period last year. Non-GAAP income from operations for the third quarter of 2015 was $21.5 million, compared to a non-GAAP loss from operations of $3.9 million for the same period last year.

Non-operating income for the third quarter of 2015 was $1.4 million, compared to a non-operating loss of $0.3 million for the same period last year.

Net income attributable to Weibo's ordinary shareholders for the third quarter of 2015 was $14.5 million, or net income per share of $0.07, compared to a net loss of $6.7 million for the same period last year, or net loss per share of $0.03. Non-GAAP net income attributable to Weibo's ordinary shareholders for the third quarter of 2015 was $22.1 million, or diluted net income per share of $0.10, compared to a non-GAAP net loss of $1.5 million for the same period last year, or net loss per share of $0.01.

As of September 30, 2015, Weibo's cash, cash equivalents and short-term investments totaled $353.3 million. For the three months ending September 30, 2015, cash, cash equivalents and short-term investments increased $16.2 million. For the third quarter of 2015, cash provided by operating activities was $71.0 million, capital expenditures totaled $0.6 million, and depreciation and amortization expenses amounted to $5.1 million.

Recent Development

On November 5, 2015, the Company held its annual general meeting of shareholders, where the shareholders re-elected Mr. Charles Chao and Mr. Yichen Zhang as directors of the Company.

Business Outlook

For the fourth quarter of 2015, Weibo estimates that its net revenues to be between $146 million and $149 million. This forecast reflects Weibo's current and preliminary view, which is subject to change.

Non-GAAP Measures

This release contains the following non-GAAP financial measures: non-GAAP costs and expenses, non-GAAP income (loss) from operations, non-GAAP net income (loss), non-GAAP diluted net income (loss) per share attributable to Weibo's ordinary shareholders and non-GAAP adjusted EBITDA. These non-GAAP financial measures should be considered in addition to, not as a substitute for, measures of the Company's financial performance prepared in accordance with U.S. GAAP.

The Company's non-GAAP financial measures exclude stock-based compensation, amortization of intangible assets net of tax, change in fair value of investor option liability, gain (loss) on the sale of investments and impairment on investments, and dividend income from investments. In addition, non-GAAP adjusted EBITDA excludes depreciation expenses, interest income (expenses) and income tax expenses (benefits). The Company's management uses these non-GAAP financial measures in their financial and operating decision-making, because management believes these measures reflect the Company's ongoing operating performance in a manner that allows more meaningful period-to-period comparisons. The Company believes that these non-GAAP financial measures provide useful information to investors and others in the following ways: (i) in comparing the Company's current financial results with the Company's past financial results in a consistent manner, and (ii) in understanding and evaluating the Company's current operating performance and future prospects in the same manner as management does, if they so choose. The Company also believes that the non-GAAP financial measures provide useful information to both management and investors by excluding certain expenses, gains (losses) and other items (i) that are not expected to result in future cash payments or (ii) that are non-recurring in nature or may not be indicative of the Company's core operating results and business outlook.

Use of non-GAAP financial measures has limitations. The Company's non-GAAP financial measures do not include all income and expense items that affect the Company's operations. They may not be comparable to non-GAAP financial measures used by other companies. Accordingly, care should be exercised in understanding how the Company defines its non-GAAP financial measures. Reconciliations of the Company's non-GAAP measures to the nearest comparable GAAP measures are set forth in the section below titled "Unaudited Reconciliation of GAAP and Non-GAAP Measures."

The unaudited condensed consolidated statements of operations and balance sheets have been prepared assuming that the Weibo funds acquired from SINA on June 30, 2015 had been in existence throughout the periods. Impact of such funds to each period was not significant.

Conference Call

Weibo will host a conference call at 8 PM – 9 PM Eastern Time on November 18, 2015 (or 9 AM – 10 AM Beijing Time on November 19, 2015) to present an overview of the Company's financial performance and business operations. A live webcast of the call will be available through the Company's corporate website at http://ir.weibo.com. The conference call can be accessed as follows:

US Toll Free: +1 (888) 346-8982

Hong Kong Toll Free: +852 800-905-945

China Toll Free: +86 400-120-1203

International: +1 (412) 902-4272

Passcode for all regions: Weibo

A replay of the conference call will be available through midnight Eastern Time, November 25, 2015. The dial-in number is +1 (412) 317-0088. The passcode for the replay is 10076332.

About Weibo Corporation

Weibo is a leading social media for people to create, share and discover Chinese-language content. Weibo combines the means of public self-expression in real time with a powerful platform for social interaction, as well as content aggregation and distribution. Any user can create and post a feed of up to 140 Chinese characters and attach multi-media or long-form content. User relationships on Weibo may be asymmetric; any user can follow any other user and add comments to a feed while reposting. This simple, asymmetric and distributed nature of Weibo allows an original feed to become a live viral conversation stream.

Weibo enables its advertising and marketing customers to promote their brands, products and services to users. Weibo offers a wide variety of advertising and marketing solutions to its customers, ranging from large brand advertisers to Alibaba/e-commerce merchants to small and medium sized enterprises to individuals. The Company generates a substantial majority of revenues from the sale of advertising and marketing services, including the sale of social display ads, promoted feeds and event-based ad solutions. Weibo has developed and is continuously refining its social interest graph recommendation engine, which enables its customers to perform people marketing and target audiences based on user demographics, social relationships, interests and behaviors, to achieve greater relevance, engagement and marketing effectiveness on Weibo.

Safe Harbor Statement

This press release contains forward-looking statements that relate to, among other things, Weibo's expected financial performance and strategic and operational plans (as described, without limitation, in the "Business Outlook" section and in quotations from management in this press release. Weibo may also make forward-looking statements in the Company's periodic reports to the U.S. Securities and Exchange Commission ("SEC"), in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. These forward-looking statements can be identified by terminology, such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "confidence," "estimates" and similar statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, Weibo's limited operating history in certain new businesses; failure to grow active user base and the level of user engagement; the uncertain regulatory landscape in China; fluctuations in the Company's quarterly operating results; the Company's reliance on advertising sales for a majority of its revenues; failure to successfully develop, introduce, drive adoption of or monetize new features and products; failure to compete effectively for advertising and marketing spending; failure to develop the small and medium enterprise market by the Company or through cooperation with other parties, including Alibaba; failure to successfully integrate acquired businesses; risks associated with the Company's investments, including equity pick-up and impairment; failure to compete successfully against new entrants and established industry competitors; and adverse changes in economic and political policies of the PRC government and its impact on the Chinese economy. Further information regarding these and other risks is included in Weibo's annual report on Form 20-F for the fiscal year ended December 31, 2014 filed with the SEC on April 28, 2015 and other filings with the SEC. All information provided in this press release is current as of the date hereof, and Weibo assumes no obligation to update such information, except as required under applicable law.