China may be a hotbed of investor interest these days, but Chinese Internet media play Sina (NASDAQ:SINA), a Motley Fool Stock Advisor pick, has hit a few speed bumps recently. Yesterday's earnings report shows that the previous effects are still having an impact.

Sina reported that second-quarter net income was down 45% to $10 million, or $0.17 per diluted share. This included an impairment charge of $1.3 million due to the company's investment in Tidetime Sun. Net revenues declined 6% to $46 million. Investors also didn't take kindly to the fact that Sina forecast third-quarter profit below analysts' current expectations.

It's been no secret that Sina has faced some challenges in recent history. After all, last quarter the company disclosed some difficulties stemming from China's crackdown on mobile advertising linked to fortune-telling services. Sina's ongoing plans include a search engine, which was launched in June.

Although revenues decreased, advertising revenues grew 31% on a year-over-year basis (non-advertising revenues fell 24%). Sina management seems to think that the worst is over in terms of the mobile-messaging problems, stating that it anticipates an improvement in that area (described as upcoming "modest growth").

Meanwhile, Sina said in its conference call that its online game, Lineage II, saw some gamer defection. It linked that in part to the wildly popular online game World of Warcraft, which was recently launched in China by The9 (NASDAQ:NCTY).

Although Sina has had a difficult time of it, compared to other Internet plays like Shanda (NASDAQ:SNDA), Sohu (NASDAQ:SOHU), and NetEase (NASDAQ:NTES) (click here for coverage of NetEase's most recent quarter), it seems that investors may have a degree of forgiveness for the company.

It's no stretch to imagine the astronomical growth of the Chinese market. It has a population of 1.3 billion and only about 7.9% are Internet users so far. Right now, its 103 million Internet users put it second only to the United States. That's likely to translate into good things for many of the companies that offer Internet services.

It certainly doesn't seem like investors have reason to give up on Sina -- the Chinese market holds a whole lot of promise and there is room for many Internet players to do well there. On the other hand, at the moment Sina's current stock price doesn't seem like a bargain compared to its Chinese rivals, and things seem to be in a fair amount of limbo when it comes to Sina's Internet initiatives.

Shanda and NetEase are Motley Fool Rule Breakers picks. Talk about opportunities in China on our China Connection discussion board.

Alyce Lomax does not own shares of any of the companies mentioned.