Financial Performance - For Q3 2024, Weibo reported net revenue of $464.5 million, a 5% increase year-over-year from $442.2 million[10]. - Advertising and marketing revenue reached $398.6 million, up 2% from $389.3 million in the same quarter last year[10]. - Value-added services revenue grew by 25% year-over-year to $65.9 million, driven by upgrades in membership services[10]. - Operating profit for Q3 2024 was $141.3 million, maintaining an operating margin of 30%[4]. - Net profit attributable to Weibo shareholders was $130.6 million, with diluted earnings per share of $0.50, compared to $77.5 million and $0.32 in the same quarter last year[5]. - Non-GAAP operating profit was $164.5 million, with a non-GAAP operating margin of 35%[5]. - The company experienced a non-operating profit of $23.6 million in Q3 2024, compared to a non-operating loss of $28.4 million in the same period last year[11]. - Total costs and expenses for Q3 2024 were $323.2 million, a 5% increase from $308.2 million in the previous year[10]. - Total net revenue for the three months ended September 30, 2023, was $442.151 million, a slight increase from $437.873 million in the previous quarter[22]. - Advertising and marketing revenue for the same period was $389.301 million, compared to $375.277 million in the previous quarter, reflecting a growth of approximately 3%[22]. - Net profit attributable to Weibo shareholders for the three months ended September 30, 2023, was $77.489 million, down from $111.931 million in the previous quarter, indicating a decrease of about 31%[22]. - Operating profit for the three months ended September 30, 2023, was $133.986 million, compared to $135.385 million in the previous quarter, showing a marginal decline[22]. - The total cost and expenses for the three months ended September 30, 2023, amounted to $308.165 million, an increase from $302.488 million in the previous quarter[22]. - The company reported a decrease in value-added services revenue to $52.850 million for the three months ended September 30, 2023, down from $62.596 million in the previous quarter[22]. User Engagement - Monthly active users reached 587 million in September 2024, while daily active users averaged 257 million[6][7]. - The company anticipates continued focus on enhancing its advertising and marketing solutions to improve user engagement and revenue generation[20]. - Weibo is actively working on refining its social interest graph recommendation engine to better target audiences based on demographics and interests[18]. - The company faces risks related to user engagement and competition in the advertising market, which may impact future financial performance[20]. Cash and Investments - Total cash, cash equivalents, and short-term investments amounted to $2.2 billion as of September 30, 2024[12]. - Cash and cash equivalents decreased from $2,584,635 thousand at the end of 2023 to $1,203,977 thousand by September 30, 2024[26]. - Total assets decreased from $7,280,358 thousand at the end of 2023 to $6,625,116 thousand by September 30, 2024[29]. - The total liabilities decreased from $3,762,742 thousand at the end of 2023 to $2,947,175 thousand by September 30, 2024[29]. - Long-term investments increased from $1,320,386 thousand at the end of 2023 to $1,445,467 thousand by September 30, 2024[26]. - The company’s total equity attributable to Weibo shareholders increased from $3,398,735 thousand at the end of 2023 to $3,583,469 thousand by September 30, 2024[29]. Future Outlook - The company expects future revenue growth driven by increased advertising and value-added services[38]. - The revenue from value-added services is projected to reach $185,007 thousand for the nine months ending September 30, 2024, indicating a positive growth trend[38]. - The company is focusing on expanding its advertising client base beyond Alibaba to enhance revenue streams[38]. - New product and technology developments are expected to support market expansion and improve service offerings in the upcoming quarters[38].

Group 1 - Analysts project Weibo Corporation (WB) will announce quarterly earnings of $0.46 per share, a decline of 19.3% year over year [1] - Revenues are expected to reach $435.42 million, declining 1.5% from the same quarter last year [1] - There has been no revision in the consensus EPS estimate over the last 30 days, indicating analysts' reconsideration of their initial forecasts [1] Group 2 - The estimate for 'Net revenues- Value-added service' is projected at $57.82 million, reflecting a year-over-year change of -3.9% [4] - 'Net revenues- Advertising and marketing' are expected to be $377.60 million, indicating a change of -4% from the prior-year quarter [4] Group 3 - The average prediction for 'Average daily active users (DAUs)' is 257.95 million, down from 260 million in the same quarter last year [5] - 'Monthly active users (MAUs)' are expected to be 593.90 million, compared to 605 million a year ago [5] - Weibo shares have returned -11.8% over the past month, contrasting with the Zacks S&P 500 composite's +3.1% change [5]

Company Overview - Weibo Corporation (WB) shares increased by 7.1% to close at $10.80, with notable trading volume compared to typical sessions [1] - The stock has gained 34.8% over the past four weeks, driven by increased user engagement and partnerships enhancing advertising revenue and content ecosystem [1] Earnings Expectations - The upcoming quarterly earnings are expected to be $0.46 per share, reflecting a year-over-year decline of 19.3% [1] - Revenue is projected at $435.42 million, which is a decrease of 1.5% from the same quarter last year [1] Market Sentiment - The consensus EPS estimate for Weibo has remained unchanged over the last 30 days, indicating a lack of upward trend in earnings estimate revisions [2] - The stock currently holds a Zacks Rank of 3 (Hold), suggesting a neutral outlook [2] Industry Context - Weibo is part of the Zacks Internet - Content industry, which includes other companies like Airbnb, Inc. (ABNB) [2] - Airbnb's consensus EPS estimate has decreased by 2.1% over the past month, with a year-over-year change of -7.1% [2]

Core Viewpoint - Weibo Corporation's stock is considered extremely undervalued, with a market capitalization decline of 95% from over USD 30 billion in 2018 to approximately USD 1.8 billion today [1]. Company Summary - The significant drop in Weibo's market cap indicates a potential investment opportunity, as the company's book value has not been detailed but is implied to be more favorable compared to its current market valuation [1]. Analyst Background - The analysis is provided by a full-time investor with 15 years of experience in Asian and Global markets, previously serving as Head of Financial Markets at Fitch Solutions [1].

Investment Rating - The report does not explicitly state an investment rating for the company Core Insights - The company, Handback Group, is leveraging social media for insurance sales, which has become its primary customer acquisition channel [2][13] - The insurance intermediary industry is facing significant challenges due to tightening regulations and a trend towards "disintermediation" by traditional insurance companies [4][26] - The company's revenue model relies heavily on commissions from insurance sales, with a notable decline in commission rates impacting profitability [19][22] Summary by Sections Company Overview - Handback Group was established in 2015 and has raised significant funding from various institutional investors, with the founder holding a 29.68% stake [2][3] - The company collaborates with over 100 insurance companies, covering more than 65% of the life insurance market in China [3] Business Model - The company operates primarily through online distribution of insurance products, earning commissions based on a percentage of the premiums [3][4] - The revenue from insurance trading services constitutes over 99% of the company's total revenue, with the main platforms being Xiaoyusan, Kachabao, and Niubao 100 [5][6] Market Position - As of 2023, the company ranked eighth in the life insurance intermediary market with a market share of 2.9%, amidst a competitive landscape with 2,592 intermediaries [4][5] - The total premium for the life insurance intermediary market in China was approximately 237 billion yuan in 2023 [4] Customer Acquisition - The company has a weak direct customer acquisition capability, relying significantly on third-party distribution channels, particularly self-media influencers [11][13] - As of May 2024, the total number of insured individuals reached 1.465 million, with 51% coming from the Niubao 100 platform [11] Financial Performance - The company's revenue in 2023 was 1.63 billion yuan, recovering from a significant drop in 2022 due to regulatory changes affecting commission rates [23][28] - The gross profit margin improved to 37.0% in early 2024, indicating a trend towards better cost management [28][33] Regulatory Environment - The tightening of regulations, including the "Report and Action Integration" policy, poses risks to the company's business model, particularly its reliance on self-media for insurance sales [26][27] - The average first-year commission rates for the company's insurance products have significantly decreased, impacting revenue generation [21][22] Future Outlook - The company plans to use IPO proceeds primarily to expand its workforce, indicating a focus on scaling operations despite regulatory challenges [38] - The sustainability of the self-media insurance sales model remains uncertain due to ongoing regulatory scrutiny [27][38]

Financial Data and Key Metrics Changes - Weibo's total revenues for Q2 2024 reached $437.9 million, a decrease of 1% year-over-year, but an increase of 1% on a constant currency basis [27][28] - Advertising revenues were $375.3 million, reflecting a decrease of 3% year-over-year or 1% on a constant currency basis [28] - Non-GAAP operating income was $157.6 million, representing a non-GAAP operating margin of 36%, a modest increase year-over-year [27][32] - Net income attributable to Weibo was $126.3 million, with a net margin of 29%, remaining flat year-over-year [32] Business Line Data and Key Metrics Changes - VAS (Value-Added Services) revenues increased to $62.6 million, a growth of 15% year-over-year or 18% on a constant currency basis, primarily driven by membership services [31] - Mobile ad revenues accounted for approximately 94% of total ad revenue, amounting to $352.3 million [28] Market Data and Key Metrics Changes - MAU (Monthly Active Users) reached 583 million, while average DAUs (Daily Active Users) were 256 million, indicating improved user engagement [6][27] - The entertainment sector showed good momentum, driven by popular TV programs, while the FMCG sector faced challenges [29] Company Strategy and Development Direction - The company is focusing on user acquisition and engagement, particularly targeting high-quality users [6][27] - Weibo aims to enhance its monetization competitiveness by leveraging hot trends and IPs, and driving vertical content ecosystems [19][26] - The strategy includes strengthening partnerships with industries such as automotive and digital products to improve content marketing and ad revenue [16][18] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the macroeconomic environment and its impact on advertising demand for the second half of 2024, particularly in first-tier cities [36][37] - There is a noted stability in ad spending from advertisers, despite challenges in certain sectors like cosmetics and beauty [36][39] - The company anticipates a boost in user engagement and ad placements during the Summer Olympics, but expects a slowdown post-event [31] Other Important Information - The company has developed a large language model (LLM) to enhance content production and user interaction, which has received government approval [44][45] - The AI technology is expected to improve content recommendation and user experience on the platform [49] Q&A Session Summary Question: Overall macro outlook and advertising outlook for the second half of the year - Management noted that ad revenue in Q2 was flat year-over-year, with some sectors like cosmetics experiencing a decline, while others showed growth [36] - There are uncertainties regarding macroeconomic developments, particularly in consumption, which may impact ad spending [37][38] Question: Developments in AIGC and its impact on content production - Management highlighted the approval of their LLM and its application in enhancing user interaction and content understanding [44][45] - The AI is expected to improve content recommendations and user experience, with significant user engagement already observed [49]

Core Insights - Weibo Corporation reported revenue of $437.87 million for the quarter ended June 2024, a decrease of 0.5% year-over-year, with EPS at $0.48 compared to $0.53 in the same quarter last year [1] - The revenue exceeded the Zacks Consensus Estimate of $435.11 million by 0.64%, while the EPS surpassed the consensus estimate of $0.45 by 6.67% [1] User Metrics - Average daily active users (DAUs) were reported at 256 million, slightly below the average estimate of 259.31 million [3] - Monthly active users (MAUs) stood at 583 million, also below the estimated 597.03 million [4] Revenue Breakdown - Net revenues from value-added services reached $62.60 million, exceeding the average estimate of $56.50 million, reflecting a year-over-year increase of 14.7% [5] - Net revenues from advertising and marketing were $375.28 million, falling short of the average estimate of $378.61 million, with a year-over-year decline of 2.7% [6] Stock Performance - Weibo shares have returned 2.5% over the past month, outperforming the Zacks S&P 500 composite's 2.2% change [6] - The stock currently holds a Zacks Rank 5 (Strong Sell), indicating potential underperformance relative to the broader market in the near term [6]

Financial Performance - Net revenues for Q2 2024 were $437.9 million, a decrease of 1% year-over-year, but an increase of 1% on a constant currency basis[3]. - Advertising and marketing revenues were $375.3 million, a decrease of 3% year-over-year, while excluding Alibaba, revenues were $342.9 million, a decrease of 4%[5]. - Value-added services (VAS) revenues increased by 15% year-over-year to $62.6 million, driven primarily by growth in membership services[5]. - Net revenues for the six months ended June 30, 2024, were $714,228 thousand, a decrease of 3.5% compared to $740,974 thousand for the same period in 2023[19]. - Net income attributable to Weibo's shareholders for the six months ended June 30, 2024, was $161,369 thousand, down from $181,879 thousand in the same period of 2023, representing a decline of 11.3%[19]. - Net revenues for the second quarter of 2023 reached $440.24 million, a 11.3% increase from $395.50 million in the previous quarter[27]. User Engagement - Monthly active users (MAUs) reached 583 million, and average daily active users (DAUs) were 256 million in June 2024[3]. - The company emphasized improved user engagement and operating efficiency, focusing on high-quality user acquisition and a vertical content strategy[2]. Income and Margins - Income from operations was $135.4 million, with an operating margin of 31%, up from 28% in the previous year[6]. - Non-GAAP income from operations was $157.6 million, representing a non-GAAP operating margin of 36%, compared to 35% last year[6]. - Net income attributable to Weibo's shareholders was $111.9 million, an increase from $81.4 million in the same period last year[8]. - Basic net income per share attributable to Weibo's shareholders for the six months ended June 30, 2024, was $0.68, compared to $0.77 for the same period in 2023, a decrease of 11.7%[19]. Cash and Investments - Cash, cash equivalents, and short-term investments totaled $2.8 billion as of June 30, 2024[9]. - Cash and cash equivalents as of June 30, 2024, were $1,922,371 thousand, down from $2,584,635 thousand as of December 31, 2023, a decline of 25.7%[21]. - The company’s investment-related loss for the six months ended June 30, 2024, was $(4,725) thousand, compared to a loss of $(25,190) thousand for the same period in 2023, indicating an improvement[19]. - Investment related gain for the second quarter of 2023 was $25.19 million, significantly higher than $4.97 million in the previous quarter[24]. Costs and Expenses - Total costs and expenses for the six months ended June 30, 2024, were $598,248 thousand, compared to $634,075 thousand for the same period in 2023, reflecting a decrease of 5.7%[19]. - Stock-based compensation for the second quarter of 2023 was $26.07 million, compared to $21.01 million in the previous quarter[24]. Assets and Liabilities - Total assets as of June 30, 2024, were $7,102,285 thousand, a decrease from $7,280,358 thousand as of December 31, 2023, representing a decline of 2.4%[21]. - Total liabilities as of June 30, 2024, were $3,688,718 thousand, down from $3,762,742 thousand as of December 31, 2023, a decrease of 2.0%[22]. - The company reported a decrease in accounts receivable, net, to $371,291 thousand as of June 30, 2024, from $440,768 thousand as of December 31, 2023, a decline of 15.7%[21]. - The company’s total shareholders' equity increased to $3,375,350 thousand as of June 30, 2024, from $3,448,888 thousand as of December 31, 2023, a decrease of 2.1%[22]. Previous Quarter Comparisons - Non-GAAP diluted net income per share attributable to Weibo's shareholders was $0.53 for the second quarter of 2023, up from $0.41 in the previous quarter[24]. - Adjusted EBITDA for the second quarter of 2023 was $163.88 million, an increase from $133.03 million in the previous quarter[24]. - Non-GAAP operating margin improved to 35% in the second quarter of 2023, compared to 32% in the previous quarter[24]. - Advertising revenue from non-Ali advertisers was $358.89 million for the second quarter of 2023, compared to $316.40 million in the previous quarter, reflecting a 13.4% increase[27]. - Value-added services revenue increased to $54.57 million in the second quarter of 2023, up from $56.55 million in the previous quarter[27].

Financial Performance - Net revenue for Q2 2024 was $437.9 million, a decrease of 1% year-over-year, or an increase of 1% when adjusted for fixed exchange rates[4]. - Advertising and marketing revenue for Q2 2024 was $375.3 million, down 3% year-over-year, or down 1% when adjusted for fixed exchange rates[4]. - Value-added services revenue increased by 15% year-over-year to $62.6 million, primarily driven by growth in membership services[5]. - Operating profit for Q2 2024 was $135.4 million, with an operating margin of 31%, compared to 28% in the same period last year[5]. - Non-GAAP net profit attributable to Weibo shareholders was $126.3 million, with a diluted EPS of $0.48[5]. - The company reported a decrease in total costs and expenses by 5% year-over-year to $302.5 million[5]. - Non-operating profit for Q2 2024 was $11.4 million, compared to a non-operating loss of $13.8 million in the same period last year[5]. - Net income attributable to Weibo shareholders was $81.387 million for the quarter ended June 30, 2023, compared to $49.438 million for the quarter ended March 31, 2024, representing an increase of 64.5%[11]. - Basic net income per share attributable to Weibo shareholders was $0.35 for the quarter ended June 30, 2023, compared to $0.21 for the quarter ended March 31, 2024, indicating a growth of 66.7%[12]. - Operating profit for the quarter ended June 30, 2023, was $123.453 million, compared to $99.737 million for the quarter ended March 31, 2024, showing an increase of 23.8%[11]. - The company reported a total net revenue of $440.240 million for the quarter ended June 30, 2023, compared to $395.497 million for the quarter ended March 31, 2024, marking a growth of 11.3%[11]. - Revenue from advertising and marketing for the six months ended June 30, 2024, was $714,228, compared to $740,974 for the same period in 2023, a decrease of about 3.6%[18]. - The adjusted EBITDA for the six months ended June 30, 2024, was $293,393, compared to $297,625 for the same period in 2023, indicating a slight decrease of 1.1%[16]. - The company reported a net profit of $199,842,000 for the six months ended June 30, 2024, compared to $195,170,000 for the same period last year, reflecting an increase of approximately 1.4%[21]. - Total costs and expenses amounted to $620,997,000, down from $634,075,000 year-over-year, indicating a decrease of about 2.1%[21]. - The company achieved a gross profit of $247,144,000 before income tax expenses, up from $235,947,000, marking an increase of around 4.6%[21]. - The adjusted net profit attributable to shareholders was $210,647,000, compared to $181,879,000, reflecting a growth of about 15.8%[21]. - The company reported a total of $271,650,000 in profit before income tax expenses, an increase from $222,968,000, representing a growth of approximately 21.8%[21]. User Engagement - Monthly active users reached 583 million in June 2024, while daily active users averaged 256 million[4]. - The company emphasized enhancing user engagement and operational efficiency as key strategies for future growth[3]. - The company is continuously improving its social interest graph recommendation engine to enhance marketing effectiveness and user engagement[9]. - Weibo's revenue primarily comes from advertising and marketing services, which are crucial for its financial performance[9]. Assets and Liabilities - Cash, cash equivalents, and short-term investments totaled $2.8 billion as of June 30, 2024[6]. - As of June 30, 2024, total assets decreased to $7,102,285 from $7,280,358 as of December 31, 2023, representing a decline of approximately 2.4%[13][14]. - The company's cash and cash equivalents decreased to $1,922,371 as of June 30, 2024, down from $2,584,635 as of December 31, 2023, a reduction of about 25.7%[13]. - Total liabilities decreased to $3,688,718 as of June 30, 2024, from $3,762,742 as of December 31, 2023, a decline of approximately 2%[14]. - Long-term investments decreased slightly to $1,281,402 as of June 30, 2024, from $1,320,386 as of December 31, 2023, a reduction of about 2.9%[13][14]. Compliance and Accounting - The company’s total assets and liabilities were evaluated under both US GAAP and IFRS, with no significant discrepancies found in the financial reporting[20]. - The company is committed to maintaining compliance with both US GAAP and IFRS standards, ensuring transparency and accuracy in financial reporting[19]. - As of December 31, 2023, total assets reported under US GAAP amounted to $7,280,358, while under IFRS, it was $7,322,919, reflecting a difference of $42,561[22]. - The net goodwill and intangible assets were reported at $300,565 under US GAAP, adjusted to $289,461 under IFRS after accounting for redeemable non-controlling interests[22]. - Long-term investments were valued at $1,320,386 under US GAAP, increasing to $1,376,307 under IFRS after fair value adjustments[22]. - Total liabilities under US GAAP were $3,762,742, while under IFRS, they amounted to $3,892,810, indicating a difference of $130,068[22]. - The total equity attributable to shareholders was $3,398,735 under US GAAP, adjusted to $3,338,694 under IFRS after accounting for convertible bonds and other adjustments[22]. - The company reported a total of $666,833 in accrued expenses and other current liabilities under US GAAP, which adjusted to $666,497 under IFRS[22]. - The convertible preferred stock was valued at $317,625 under US GAAP, with an adjustment to $356,545 under IFRS due to fair value measurement[22]. - The company’s total liabilities and equity under US GAAP were $7,280,358, while under IFRS, it was $7,322,919, showing a difference of $42,561[22]. - The company’s non-controlling interests were reported at $50,153 under US GAAP, adjusted to $91,415 under IFRS after accounting for fair value changes[22]. - The adjustments between US GAAP and IFRS reflect differences in accounting policies, particularly in the treatment of convertible bonds, leases, and equity incentives[23][24][25][26][27]. Acquisition and Financial Liabilities - The company entered into a series of share purchase agreements to acquire a majority stake in Shanghai Mask Information Technology Co., Ltd. on October 31, 2020[28]. - The redeemable non-controlling interests were recognized at fair value on the acquisition date, including the redemption rights as part of the purchase price[28]. - The overall increase in redeemable non-controlling interests was recorded up to the redemption value from the acquisition date[28]. - The fair value of the redeemable non-controlling interests is treated as permanent equity, excluding the redemption rights[28]. - The fair value of the redemption rights is recognized separately as a financial liability on the balance sheet[28]. - The initial recognition of the financial liability reduces the parent company's equity[28]. - Subsequent changes in the carrying amount of the financial liability are recognized as financial expenses in the income statement[28]. - The company has an obligation to purchase the remaining equity interests held by the founder and CEO of Mask Technology at fair value[28]. - The application of acquisition accounting results in lower goodwill due to the separate recognition of the financial liability[28]. - The redeemable non-controlling interests are classified as financial liabilities due to the conditional events not fully controlled by the company[28].

In its upcoming report, Weibo Corporation (WB) is predicted by Wall Street analysts to post quarterly earnings of $0.45 per share, reflecting a decline of 15.1% compared to the same period last year. Revenues are forecasted to be $435.11 million, representing a year-over-year decrease of 1.2%.The current level reflects a downward revision of 1.4% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their init ...