Weibo Reports Third Quarter 2021 Unaudited Financial Results

BEIJING, Nov. 11, 2021 /PRNewswire/ -- Weibo Corporation ("Weibo" or the "Company") (NASDAQ: WB), a leading social media in China, today announced its unaudited financial results for the third quarter ended September 30, 2021.

"We delivered another solid quarter, with sustained user growth and top line expansion," said Gaofei Wang, CEO of Weibo. "In September, both our MAUs and DAUs continued to grow from prior quarter, driven by a greater focus on Weibo's core positioning in social media, strong execution ability，effective channel investment strategies and the Olympic Game effect. We are committed to responding positively to the new regulatory requirements, and are confident that the new regulatory environment will benefit the internet sector, and empower Weibo's user growth and monetization in the long run." Mr. Wang concluded.

Third Quarter 2021 Highlights

• Net revenues were $607.4 million, an increase of 30% year-over-year or an increase of 23% year-over-year on a constant currency basis ^[1].
• Advertising and marketing revenues were $537.6 million, an increase of 29% year-over-year.
• Value-added service ("VAS") revenues were $69.8 million, an increase of 42% year-over-year.
• Income from operations was $213.0 million, an increase of 32% year-over-year, representing an operating margin of 35%.
• Net income attributable to Weibo was $181.7 million and diluted net income per share was $0.78.
• Non-GAAP income from operations was $248.7 million, an increase of 39% year-over-year, representing a non-GAAP operating margin of 41%.
• Non-GAAP net income attributable to Weibo was $209.6 million and non-GAAP diluted net income per share was $0.90.
• Monthly active users ("MAUs") were 573 million in September 2021, a net addition of 62 million users on a year-over-year basis. Mobile MAUs represented 94% of MAUs.
• Average daily active users ("DAUs") were 248 million in September 2021, a net addition of 23 million users on a year-over-year basis.

Third Quarter 2021 Financial Results

For the third quarter of 2021, Weibo's total net revenues were $607.4 million, an increase of 30% compared to $465.7 million for the same period last year.

Advertising and marketing revenues for the third quarter of 2021 were $537.6 million, an increase of 29% compared to $416.7 million for the same period last year. Advertising and marketing revenues excluding ad revenues from Alibaba were $516.8 million, an increase of 33% compared to $387.5 million for the same period last year, primarily attributable to solid advertising demand from key industries as well as strong sales execution.

VAS revenues for the third quarter of 2021 were $69.8 million, an increase of 42% year-over-year compared to $49.1 million for the same period last year, mainly attributable to the incremental revenues derived from the interactive entertainment company acquired in November 2020, while partially offset by decrease of revenue from live streaming business.

Costs and expenses for the third quarter of 2021 totaled $394.4 million, an increase of 29% compared to $304.8 million for the same period last year. The increase was primarily due to higher personnel-related cost and marketing expense.

Income from operations for the third quarter of 2021 was $213.0 million, an increase of 32% compared to $161.0 million for the same period last year. Operating margin was 35%, same as last year. Non-GAAP income from operations was $248.7 million, an increase of 39% compared to $179.4 million for the same period last year. Non-GAAP operating margin was 41%, compared to 39% last year.

Non-operating income for the third quarter of 2021 was $0.2 million, compared to a non-operating loss of $97.5 million for the same period last year. Non-operating income for the third quarter of 2021 mainly included (i) a $36.4 million net gain on fair value change of investments, which is excluded under non-GAAP measures; (ii) a $36.0 million impairment charge on equity investments, which is excluded under non-GAAP measures; and (iii) a $0.5 million net interest and other expense. 

Income tax expenses for the third quarter of 2021 were $31.4 million, compared to $30.0 million for the same period last year.

Net income attributable to Weibo for the third quarter of 2021 was $181.7 million, compared to $33.8 million for the same period last year. Diluted net income per share attributable to Weibo for the third quarter of 2021 was $0.78, compared to $0.15 for the same period last year. Non-GAAP net income attributable to Weibo for the third quarter of 2021 was $209.6 million, compared to $152.9 million for the same period last year. Non-GAAP diluted net income per share attributable to Weibo for the third quarter of 2021 was $0.90, compared to $0.66 for the same period last year.

As of September 30, 2021, Weibo's cash, cash equivalents and short-term investments totaled $2.71 billion. For the third quarter of 2021, cash provided by operating activities was $226.0 million, capital expenditures totaled $8.3 million, and depreciation and amortization expenses amounted to $14.1 million.

Business Outlook

For the fourth quarter of 2021, Weibo estimates its net revenues to increase by 15% to 20% year-over-year on a constant currency basis. This forecast reflects Weibo's current and preliminary view, which is subject to change.

Conference Call

Weibo's management team will host a conference call from 6:00 AM to 7:00 AM Eastern Time on November 11, 2021 (or 7:00 PM – 8:00 PM Beijing Time on November 11, 2021) to present an overview of the Company's financial performance and business operations.

Please register in advance of the conference call using the link provided below. Upon registering, you will be provided with dial-in numbers, passcode and unique registrant ID by email. To join the conference, please use the conference access information provided in the email received at the point of registering.

PRE-REGISTER LINK: https://apac.directeventreg.com/registration/event/7755478

Additionally, a live webcast of the call will be available through the Company's corporate website at https://ir.weibo.com.

A telephone replay will be available from 22:00 China Standard Time on November 11, 2021 to 20:59 China Standard Time on November 19, 2021. To access the recording, please use the following dial-in information listed below:

Non-GAAP Financial Measures

This release contains the following non-GAAP financial measures: non-GAAP income from operations, non-GAAP net income attributable to Weibo's shareholders, non-GAAP diluted net income per share attributable to Weibo's shareholders and adjusted EBITDA. 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 exclude stock-based compensation, amortization of intangible assets resulting from business acquisitions, non-cash compensation cost to non-controlling interest shareholders, net results of impairment on, gain/loss on sale of and fair value change of investments, non-GAAP to GAAP reconciling items on the share of equity method investments, non-GAAP to GAAP reconciling items for the income/loss attributable to non-controlling interests, provision for income tax primarily related to the amortization of intangible assets resulting from business acquisitions and fair value change of investments, and amortization of convertible debt and unsecured senior notes issuance cost. Adjusted EBITDA excludes interest income, net, income tax expenses (benefit), and depreciation expenses.

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 operating performance 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, gains (losses) 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. Accordingly, care should be exercised in understanding how the Company defines its non-GAAP financial measures. Reconciliations of the Company's non-GAAP financial measures to the nearest comparable GAAP measures are set forth in the section below titled "Unaudited Reconciliation of Non-GAAP to GAAP Results."

About Weibo

Weibo is a leading social media for people to create, share and discover content online. Weibo combines the means of public self-expression in real time with a powerful platform for social interaction, content aggregation and content distribution. Any user can create and post a feed and attach multi-media and long-form content. User relationships on Weibo may be asymmetric; any user can follow any other user and add comments to a feed while reposting. This simple, asymmetric and distributed nature of Weibo allows an original feed to become a live viral conversation stream.

Weibo enables its advertising and marketing customers to promote their brands, products and services to users. Weibo offers a wide range of advertising and marketing solutions to companies of all sizes. The Company generates a substantial majority of its revenues from the sale of advertising and marketing services, including the sale of social display advertisement and promoted marketing offerings. Designed with a "mobile first" philosophy, Weibo displays content in a simple information feed format and offers native advertisement that conform to the information feed on our platform. To support the mobile format, we have developed and continuously refining our social interest graph recommendation engine, which enables our customers to perform people marketing and target audiences based on user demographics, social relationships, interests and behaviors, to achieve greater relevance, engagement and marketing effectiveness.

Safe Harbor Statement

This press release contains forward-looking statements that relate to, among other things, Weibo's expected financial performance and strategic and operational plans (as described, without limitation, in the "Business Outlook" section and in quotations from management in this press release. Weibo may also make forward-looking statements in the Company's periodic reports to the U.S. Securities and Exchange Commission ("SEC"), 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. 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, Weibo's limited operating history in certain new businesses; failure to grow active user base and the level of user engagement; the uncertain regulatory landscape in China; fluctuations in the Company's quarterly operating results; the Company's reliance on advertising and marketing sales for a majority of its revenues; failure to successfully develop, introduce, drive adoption of or monetize new features and products; failure to compete effectively for advertising and marketing spending; failure to successfully integrate acquired businesses; risks associated with the Company's investments, including equity pick-up and impairment; failure to compete successfully against new entrants and established industry competitors; changes in the macro-economic environment, including the depreciation of the Renminbi; and adverse changes in economic and political policies of the PRC government and its impact on the Chinese economy. Further information regarding these and other risks is included in Weibo's annual report on Form 20-Fs and other filings with the SEC. All information provided in this press release is current as of the date hereof, and Weibo assumes no obligation to update such information, except as required under applicable law.

Contact:
Investor Relations
Weibo Corporation
Phone: +86 10 5898-3336
Email: ir@staff.weibo.com

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SOURCE Weibo Corporation