SINA Reports First Quarter 2019 Unaudited Financial Results

BEIJING, May 23, 2019 /PRNewswire/ -- 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 first quarter ended March 31, 2019.

First Quarter 2019 Highlights

• Both net revenues and non-GAAP net revenues increased 8% year-over-year to $475.1 million and $472.5 million.
• Advertising revenues increased 6% year-over-year to $388.0 million.
• Non-advertising revenues increased 18% year-over-year to $87.1 million. Non-GAAP non-advertising revenues increased 19% year-over-year to $84.5 million.
• Income from operations increased 19% year-over-year to $86.9 million. Non-GAAP income from operations increased 21% year-over-year to $114.2 million.
• Net income attributable to SINA was $33.1 million, or $0.46 for diluted net income per share attributable to SINA's ordinary shareholders. Non-GAAP net income attributable to SINA was $28.9 million, or $0.40 for non-GAAP diluted net income per share attributable to SINA's ordinary shareholders.

First Quarter 2019 Financial Results

For the first quarter of 2019, SINA reported net revenues of $475.1 million, an increase of 8% compared to $440.8 million for the same period last year. Non-GAAP net revenues for the first quarter of 2019 were $472.5 million, an increase of 8% compared to $438.1 million for the same period last year.

Advertising revenues for the first quarter of 2019 were $388.0 million, an increase of 6% compared to $367.1 million for the same period last year, primarily driven by an increase of $38.2 million, or 13% growth in Weibo advertising and marketing revenues and partially offset by a decrease of portal advertising revenues.

Non-advertising revenues for the first quarter of 2019 were $87.1 million, an increase of 18% compared to $73.7 million for the same period last year. Non-GAAP non-advertising revenues for the first quarter of 2019 were $84.5 million, an increase of 19% compared to $71.1 million for the same period last year. The year-over-year growth in non-advertising revenues was mainly attributable to the revenues derived from Weibo's live streaming business acquired in the fourth quarter of 2018 and increased revenues generated from SINA fin-tech businesses.

Gross margin for the first quarter of 2019 was 76%, compared to 75% for the same period last year. Advertising gross margin for the first quarter of 2019 was 78%, compared to 77% for the same period last year. Non-advertising gross margin for the first quarter of 2019 was 64%, compared to 65% for the same period last year.

Operating expenses for the first quarter of 2019 totaled $272.7 million, compared to $258.8 million for the same period last year. Non-GAAP operating expenses for the first quarter of 2019 totaled $245.3 million, compared to $237.3 million for the same period last year.

Income from operations for the first quarter of 2019 was $86.9 million, compared to $73.3 million for the same period last year. Operating margin was 18%, compared to 17% for the same period last year. Non-GAAP income from operations for the first quarter of 2019 was $114.2 million, compared to $94.6 million for the same period last year. Non-GAAP operating margin was 24%, compared to 22% for the same period last year.

Non-operating income for the first quarter of 2019 was $77.7 million, compared to $22.6 million for the same period last year. Non-operating income for the first quarter of 2019 included (i) an $80.8 million net gain on sale of investments, fair value changes and impairment on investments, which is excluded under non-GAAP measure; (ii) a $13.1 million net interest and other income; and (iii) a $16.3 million net loss from equity method investments, which is reported one quarter in arrears. Non-operating income for the first quarter of 2018 mainly included (i) a $17.1 million net interest and other income; and (ii) a $7.2 million net gain on sale of investments, fair value changes and impairment on investments, which is excluded under non-GAAP measure.    

Income tax expenses for the first quarter of 2019 were $65.2 million, compared to $18.8 million for the same period last year, largely attributable to the deferred tax charges recognized from the fair value changes of investments.

Net income attributable to SINA's ordinary shareholders for the first quarter of 2019 was $33.1 million, compared to $28.7 million for the same period last year. Diluted net income per share attributable to SINA's ordinary shareholders for the first quarter of 2019 was $0.46, compared to $0.38 for the same period last year. Non-GAAP net income attributable to SINA's ordinary shareholders for the first quarter of 2019 was $28.9 million, compared to $35.2 million for the same period last year. Non-GAAP diluted net income per share attributable to SINA's ordinary shareholders for the first quarter of 2019 was $0.40, compared to $0.47 for the same period last year.

As of March 31, 2019, SINA's cash, cash equivalents and short-term investments totaled $2.1 billion, compared to $2.3 billion as of December 31, 2018. The decrease of SINA's cash, cash equivalents and short-term investments mainly resulted from continued investment activities. For the first quarter of 2019, net cash provided by operating activities was $93.5 million, capital expenditures totaled $10.0 million, and depreciation and amortization expenses amounted to $11.1 million.

Non-GAAP Measures

This release contains the following non-GAAP financial measures: non-GAAP net 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 attributable to SINA's ordinary shareholders. 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, adjustment for non-GAAP to GAAP reconciling items on the share of equity method investments, gain (loss) on sale of investment, deemed disposal, fair value changes and impairment on investment, and income tax effects of above non-GAAP to GAAP reconciling items and adjustment for non-GAAP to GAAP reconciling items for the income attributable to non-controlling interests and amortization of convertible debt issuance cost. 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 8:10 a.m. – 8:40 a.m. Eastern Time on May 23, 2019 (or 8:10 p.m. – 8:40 p.m. Beijing Time on May 23, 2019) 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:

A replay of the conference call will be available through morning Eastern Time May 31, 2019. The dial-in number is +61 2 9003 4211. The passcode for the replay is 3264429.

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

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