SINA Corporation reported third-quarter 2019 non-GAAP earnings of 94 cents per share, beating the Zacks Consensus Estimate by 30.6%. The figure also increased 1.1% from the year-ago quarter.
Non-GAAP net revenues inched up 1% year on year to $558.8 million. At constant currency (cc), non-GAAP revenues increased 5% year over year. The Zacks Consensus Estimate for revenues was pegged at $563 million.
Quarter Details
Advertising revenues (82.1% of revenues) decreased 4.7% year over year to $461.1 million due to a decline in portal advertising revenues.
Non-advertising revenues (17.9% of total revenues) climbed 36.7% year over year (up 43% at cc) to $100.4 million. This upside was driven by robust performance in Weibo's live streaming business and higher revenues generated from the company’s fin-tech businesses.
Revenues from the Weibo business grew 1.7% year over year to $467.8 million, driven by solid user growth with monthly active users (MAU) reaching 497 million in September and the average daily active users (DAUs) reaching 216 million.
Weibo’s advertising & marketing revenues were up 0.8% year over year (up 5% at cc) to $412.5 million. Weibo’s VAS revenues jumped 8.6% to $55.3 million.
Revenues from the portal business edged down 0.8% year over year to $100.5 million. Portal advertising revenues plunged 32.8% year over year to $50.1 million due to lower ad spending by SME customers. Other revenues surged 88.5% to $50.4 million.
Operating Details
SINA reported a third-quarter non-GAAP gross profit of $444.9 million, up 0.9% year over year. Non-GAAP gross margin of 79.3% contracted 50 basis points (bps) on a year-over-year basis.
Non-GAAP advertising gross margin shrunk 100 bps to 83%. Non-GAAP non-advertising gross margin was 62%, down from year-ago quarter’s 70%.
Sales and marketing expenses were $169.4 million, down 8.7% year over year. Moreover, general and administrative expenses flared up 58.1% to $44.9 million. However, product development expenses were $91.2 million, reflecting a decrease of 0.4%.
Operating expenses (48.9% of revenues) on a non-GAAP basis came in at $274.9 million, down 0.5% year over year.
Non-GAAP operating income was $170 million, up 1.1% year over year. Non-GAAP operating margin was 30%, flat year over year.
Balance Sheet and Cash Flow
As of Sept 30, 2019, SINA's cash, cash equivalents and short-term investments were $2.9 billion compared the $2.15 billion reported in the previous quarter.
While net cash provided by operating activities was $220.2 million in the third quarter, capital expenditures totaled $6 million.
Zacks Rank & Other Key Picks
Currently, SINA carries a Zacks Rank #2 (Buy).
Other top-ranked stocks in the broader computer & technology sector include Alteryx , NetEase (NTES - Free Report) and Fortinet (FTNT - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Alteryx, NetEase and Fortinet is 39.9%, 31.9% and 14%, respectively.
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SINA Corporation reported third-quarter 2019 non-GAAP earnings of 94 cents per share, beating the Zacks Consensus Estimate by 30.6%. The figure also increased 1.1% from the year-ago quarter.
Non-GAAP net revenues inched up 1% year on year to $558.8 million. At constant currency (cc), non-GAAP revenues increased 5% year over year. The Zacks Consensus Estimate for revenues was pegged at $563 million.
Quarter Details
Advertising revenues (82.1% of revenues) decreased 4.7% year over year to $461.1 million due to a decline in portal advertising revenues.
Non-advertising revenues (17.9% of total revenues) climbed 36.7% year over year (up 43% at cc) to $100.4 million. This upside was driven by robust performance in Weibo's live streaming business and higher revenues generated from the company’s fin-tech businesses.
Revenues from the Weibo business grew 1.7% year over year to $467.8 million, driven by solid user growth with monthly active users (MAU) reaching 497 million in September and the average daily active users (DAUs) reaching 216 million.
Weibo’s advertising & marketing revenues were up 0.8% year over year (up 5% at cc) to $412.5 million. Weibo’s VAS revenues jumped 8.6% to $55.3 million.
Revenues from the portal business edged down 0.8% year over year to $100.5 million. Portal advertising revenues plunged 32.8% year over year to $50.1 million due to lower ad spending by SME customers. Other revenues surged 88.5% to $50.4 million.
Operating Details
SINA reported a third-quarter non-GAAP gross profit of $444.9 million, up 0.9% year over year. Non-GAAP gross margin of 79.3% contracted 50 basis points (bps) on a year-over-year basis.
Non-GAAP advertising gross margin shrunk 100 bps to 83%. Non-GAAP non-advertising gross margin was 62%, down from year-ago quarter’s 70%.
Sales and marketing expenses were $169.4 million, down 8.7% year over year. Moreover, general and administrative expenses flared up 58.1% to $44.9 million. However, product development expenses were $91.2 million, reflecting a decrease of 0.4%.
Operating expenses (48.9% of revenues) on a non-GAAP basis came in at $274.9 million, down 0.5% year over year.
Non-GAAP operating income was $170 million, up 1.1% year over year. Non-GAAP operating margin was 30%, flat year over year.
Balance Sheet and Cash Flow
As of Sept 30, 2019, SINA's cash, cash equivalents and short-term investments were $2.9 billion compared the $2.15 billion reported in the previous quarter.
While net cash provided by operating activities was $220.2 million in the third quarter, capital expenditures totaled $6 million.
Zacks Rank & Other Key Picks
Currently, SINA carries a Zacks Rank #2 (Buy).
Other top-ranked stocks in the broader computer & technology sector include Alteryx , NetEase (NTES - Free Report) and Fortinet (FTNT - Free Report) . All three stocks sport a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Alteryx, NetEase and Fortinet is 39.9%, 31.9% and 14%, respectively.
Free: Zacks’ Single Best Stock Set to Double
Today you are invited to download our just-released Special Report that reveals 5 stocks with the most potential to gain +100% or more in 2020. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
Download Free Report Now >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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