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Weibo Reports First Quarter 2016 Financial Results

BEIJING, May 11, 2016 /PRNewswire/ -- Weibo Corporation ("Weibo" or the "Company") WB, -0.43% a leading social media in China, today announced its unaudited financial results for the first quarter ended March 31, 2016.

First Quarter 2016 Highlights

  • Net revenues increased 24% year over year to $119.3 million, exceeding the Company's guidance between $111 million and $116 million.
  • Advertising and marketing revenue increased 25% year over year to $99.2 million.
  • Weibo Value-Added Services ("VAS") revenue increased 17% year over year to $20.0 million.
  • Net income attributable to Weibo was $7.1 million, or diluted net income per share was $0.03, compared to a net loss of $3.1 million, or diluted net loss per share of $0.01 for the same period last year.
  • Non-GAAP net income attributable to Weibo increased 491% year over year to $16.4 million, and non-GAAP diluted net income per share increased 483% year over year to $0.07.
  • Adjusted EBITDA increased 182% year over year to $19.0 million, or 16% of net revenues.
  • Monthly active users ("MAUs") in March 2016 grew 32% year over year to 261 million, 85% of which were mobile users. Average daily active users ("DAUs") in March 2016 grew 35% year over year to 120 million.

"Weibo had a strong first quarter with key accounts and SME advertising and marketing revenue together growing 97% year over year and total advertisers reaching 832,000, up 114% year over year. As we enter 2016, Weibo is well positioned from the growing adoption of fans marketing in China and the shift of ad budget to mobile and social platforms." said Gaofei Wang, Weibo's CEO. "In March, Weibo's mobile DAUs grew 45% year over year and reached 91% of total DAUs, highlighting Weibo's traffic momentum arising from high mobile usage and penetration beyond tier 1 cities."

First Quarter 2016 Financial Results

For the first quarter of 2016, Weibo reported net revenues of $119.3 million, compared to $96.3 million for the same period last year. Advertising and marketing revenue totaled $99.2 million, compared to $79.2 million for the same period last year. Advertising and marketing revenue from key accounts and Small & Medium-sized Enterprises (SME) was $88.1 million, compared to $44.7 million for the same period last year. Revenue from Alibaba was $11.1 million, compared to $34.5 million for the same period last year, which was derived from a strategic collaboration agreement that expired in January 2016. Weibo VAS revenue totaled $20.0 million, compared to $17.1 million for the same period last year.

Costs and expenses for the first quarter of 2016 totaled $112.1 million, compared to $100.8 million for the same period last year. Non-GAAP costs and expenses were $103.4 million, compared to $94.9 million for the same period last year. The increase in non-GAAP costs and expenses was primarily due to an increase in bandwidth costs resulting from strong video consumption and overall growth in traffic, increase in revenue share and value added taxes associated with higher revenues, and higher personnel-related costs.

Income from operations for the first quarter of 2016 was $7.2 million, compared to a loss of $4.5 million for the same period last year. Non-GAAP income from operations was $15.9 million, compared to $1.4 million for the same period last year.

Non-operating income for the first quarter of 2016 was $0.6 million, compared to a non-operating income of $1.5 million for the same period last year.

Net income attributable to Weibo for the first quarter of 2016 was $7.1 million, or diluted net income per share of $0.03, compared to a net loss of $3.1 million for the same period last year, or diluted net loss per share of $0.01. Non-GAAP net income attributable to Weibo for the first quarter of 2016 was $16.4 million, or diluted net income per share of $0.07, compared to $2.8 million for the same period last year, or diluted net income per share of $0.01.

As of March 31, 2016, Weibo's cash, cash equivalents and short-term investments totaled $373.4 million. For the first quarter of 2016, cash provided by operating activities was $40.0 million, capital expenditures totaled $4.1 million, and depreciation and amortization expenses amounted to $3.5 million.

Business Outlook

For the second quarter of 2016, Weibo estimates that its net revenues to be between $138 million and $143 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 and 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 and gain on the sale of investments and impairment on investments, net. In addition, adjusted EBITDA excludes depreciation expenses, interest income, net and income tax expenses. 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 Non-GAAP to GAAP Results."

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