Shares of Cheetah Mobile (NYSE:CMCM) were up 19.3% as of 12:45 p.m. EDT Monday after the China-based mobile internet company announced stronger-than-expected second-quarter 2018 results.
That's not to say its performance looked great at first glance. Quarterly revenue declined 8.2% year over year to 1.103 billion yuan ($166.8 million), while adjusted net income more than doubled year over year to 211.2 million yuan ($21.9 million), or $0.21 per diluted American depositary share (ADS). Analysts, on average, were only looking for earnings of $0.09 per share on revenue of $155.2 million.
Within Cheetah Mobile's top line, sales from utility products and related services fell 5.2%, and the mobile entertainment business endured a 10.2% decline. But Cheetah Mobile Chairman and CEO Sheng Fu noted that those results arrived above expectations.
"We are pleased that the initiatives we have implemented to resume growth for our company are starting to bear fruit," he added. "In the second half of 2018, we expect revenues to recover its sequential growth trends, primarily driven by growth in our mobile utility products business in the domestic market, growth in our mobile games business, and the normal seasonality effect."
Cheetah Mobile expects third-quarter revenue between 1.29 billion yuan ($194.9 million) and 1.35 billion yuan ($204 million), well above the $168 million most analysts were modeling for, and good for year-over-year growth of 10% to 15%. As such, with Cheetah Mobile stock trading down nearly 50% from its 52-week high leading into this report, it's no surprise to see it rebounding today.