Please ensure Javascript is enabled for purposes of website accessibility

SINA Shares Strong Growth on Weibo Ad Gains

By Steve Symington - Nov 28, 2018 at 3:40PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

However, the Chinese internet tech leader followed by reducing its full-year guidance.

SINA Corp. (SINA) announced strong third-quarter 2018 results on Wednesday morning, driven largely by the relative outperformance of advertising on its Weibo microblogging platform. At the same time, the company reduced its full-year outlook, as macroeconomic headwinds weighed on SINA's core business and smaller supplementary revenue streams.

With shares climbing as much as 8% early today before settling to close up around 2%, let's take a closer look at how SINA kicked off the second half.

SINA logo in both English and Chinese


SINA's results: The raw numbers


Q3 2018

Q3 2017

Year-Over-Year Growth

GAAP net revenue

$557.2 million

$433.1 million


GAAP net income attributable to SINA

$45.4 million

$49.3 million


GAAP net income per diluted share




DATA SOURCE: SINA CORPORATION. GAAP = generally accepted accounting principles.

What happened this quarter?

  • Adjusted for items like stock-based compensation, SINA's (non-GAAP) net income attributable to shareholders increased 20.8% to $0.93 per share.
  • Though we don't usually pay close attention to Wall Street's demands, both the top and bottom lines easily exceeded expectations for revenue of $551.4 million and adjusted earnings of $0.69 per share.
  • Advertising revenue grew 33% year over year to $483.8 million, driven primarily by a 48% increase in Weibo advertising and marketing sales. Sina portal ad revenue declined 15% (down 12% at constant currencies).
  • Non-advertising revenue declined 7.3% to $73.4 million, as growth from Weibo value-added service (VAS) revenues was more than offset by a combination of revenue-reporting changes, the negative impact of foreign currency exchange, and the "lackluster" performance of SINA's fintech businesses amid regulatory headwinds.
  • SINA generated cash from operations of $100.8 million.

What management had to say

"We are pleased with SINA's third quarter results," said SINA chairman and CEO Charles Chao in a press release. "Despite intensified competition and macro headwinds, we delivered healthy growth in both revenues and profitability driven by the continued momentum of Weibo business."

During the subsequent conference call, CFO Bonnie Yi Zhang credited Weibo's "robust growth to teams' efforts in product revamp, channel investment, and the content ecosystem cultivation, which further strengthened the social network effect, and broadened our strategic mode to serve public and social interactions among Chinese and the global Chinese communities."

Looking forward

Considering the uncertainties in today's macroeconomic and regulatory environment, SINA now expects full fiscal-year 2018 revenue arriving in the range of 14 billion yuan to 14.2 billion yuan. That's roughly $2.09 billion to $2.12 billion, down from SINA's prior guidance range of $2.12 billion to $2.27 billion.

To be fair, Wall Street had already anticipated some weakness; going into the report, consensus estimates predicted SINA's top line this year would arrive at roughly $2.15 billion, well below the midpoint of its old range. In the end, however solid the quarter was, this explains why the stock gave back some of its early gains while still managing to close in the green as investors digested the news.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

SINA Corporation Stock Quote
SINA Corporation

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.