Weibo Corporation (NASDAQ:WB) Q1 2023 Earnings Conference Call May 25, 2023 7:00 AM ET Company Participants Sandra Zhang - Investor Relations Gaofei Wang - Chief Executive Officer Fei Cao - Chief Financial Officer Conference Call Participants Alicia Yap - Citigroup Thomas Chong - Jefferies Operator Good day and thank you for standing by. Welcome to the Weibo Reports First Quarter 2023 Financial Results. [Operator Instructions] Please be advised, today's conference is being recorded. I would now like to hand ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 20-F (Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ...

Exhibit 99.1 Reconciliation between U.S. GAAP and International Financial Reporting Standards The consolidated financial statements are prepared in accordance with U.S. GAAP, which differ in certain respects from International Financial Reporting Standards (“IFRS”). The effects of material differences between the consolidated financial statements of the Group prepared under U.S. GAAP and IFRS are as follows: Reconciliation of consolidated statements of comprehensive income data (in US$ thousands): For the Y ...

Financial Data and Key Metrics Changes - In Q4 2022, total revenue reached $448 million, a decrease of 27% year-over-year and 1% quarter-over-quarter [6][30] - Advertising and marketing revenues were $390.5 million, with mobile contributing 94% of total revenue [7][31] - Non-GAAP operating income was $152 million, representing a non-GAAP operating margin of 34% [7][30] - For full-year 2022, total revenue was $1.84 billion, a decrease of 19% year-over-year [7][30] - Non-GAAP net income attributable to Weibo was $540.1 million, with a net margin of 29% [30][38] Business Line Data and Key Metrics Changes - Advertising and marketing revenue for full-year 2022 was $1.6 billion, a decrease of 19% year-over-year [7][31] - Value-added service (VAS) revenues in Q4 were $57.5 million, a decrease of 12% year-over-year [35] - The number of video accounts and effective video views grew double-digit year-over-year, with effective use of video feed increasing over 50% year-over-year [14] Market Data and Key Metrics Changes - In December 2022, Weibo's MAUs reached 586 million, with a net addition of approximately 13 million users year-over-year [8][29] - Average DAUs reached 252 million, with a net addition of approximately 3 million users year-over-year [8][29] - The advertising revenue from the automobile industry showed year-over-year growth, benefiting from better recognition of new car launches [21][32] Company Strategy and Development Direction - The company plans to focus on user growth, operational efficiency, and strengthening core competitiveness in 2023 [19][28] - Emphasis on enhancing marketing capabilities for top KOLs and improving monetization strategies for content creators [17][28] - Continued investment in hot trends and entertainment verticals to drive user engagement and traffic growth [18][19] Management Comments on Operating Environment and Future Outlook - Management noted that the advertising market faced challenges due to macroeconomic conditions and COVID disruptions, but expressed optimism for recovery in 2023 [26][35] - The company anticipates a gradual recovery in advertising demand, particularly in the automobile and luxury sectors [27][35] - Management highlighted the importance of operational efficiency and cost control measures implemented in 2022 to stabilize earnings [36][52] Other Important Information - The company achieved a significant increase in ad revenue during the World Cup season, surpassing that of the Beijing Winter Olympics [21] - The annual GMV for the aesthetic medicine e-commerce business on Weibo doubled from the previous year, indicating potential for future growth in e-commerce [24] Q&A Session Summary Question: Can management share more detailed color around the monthly trend of ad revenue recovery and year-on-year growth trend? - Management indicated that Q4 faced negative impacts from political issues and COVID, affecting operations and customer budgets. They expect a clearer evaluation of recovery speed by late March or early April [41][44] Question: What are the plans for efficient improvement and cost control in 2023? - Management stated that they aim to reduce marketing-related expenses by 20% and continue restructuring to enhance operational efficiency [50][52] Question: What is the strategy for the VAS business in 2023, particularly regarding social e-commerce? - Management plans to leverage KOL live streaming and enhance traffic monetization through social e-commerce, aiming to increase market share and revenue from membership services [55][58]

Financial Data and Key Metrics Changes - Weibo's total revenues for Q3 2022 reached $453.6 million, a decrease of 25% year-over-year and an increase of 1% quarter-over-quarter [9][40] - Non-GAAP operating income was $162.1 million, representing a non-GAAP operating margin of 36%, up from 32% in the previous quarter [9][34] - Net income attributable to Weibo was approximately $519 million, with a net margin of 36% [40][48] Business Line Data and Key Metrics Changes - Advertising and marketing revenues were $383.4 million, a decrease of 27% year-over-year [41] - Mobile ad revenues accounted for approximately 95% of total ad revenues, amounting to $372 million [41] - The online gaming sector showed resilience, with a significant increase in traffic and interactions, particularly during eSports events [23][28] Market Data and Key Metrics Changes - The luxury and automobile sectors exhibited a solid recovery trend, with double-digit growth both year-over-year and sequentially [42] - The FMCG and e-commerce sectors continued to face challenges due to weak consumption sentiment and COVID-19 control measures [29][42] - Ad revenues from Alibaba decreased by 28%, aligning with the overall advertising business performance [45] Company Strategy and Development Direction - The company is focusing on improving operating efficiency and enhancing user engagement through product optimization and community investments [10][35] - Weibo aims to deepen cooperation with handset manufacturers to expand user scale and improve content distribution [14][35] - The strategy includes diversifying revenue streams beyond advertising, with a focus on e-commerce and membership systems [70][75] Management Comments on Operating Environment and Future Outlook - Management noted that the advertising market remains uncertain, but there are positive signals from certain industries, particularly during the Double 11 shopping festival [30][56] - The company anticipates a stable trend in e-commerce advertising and expects to capture advertising budgets related to the World Cup [32][56] - Management emphasized the importance of cost optimization and operational efficiency in navigating the uncertain macro environment [33][60] Other Important Information - Weibo's cash, cash equivalents, and short-term investments totaled $3 billion as of September 30, 2022 [49] - The company repurchased approximately 3.1 million ADS for a total cost of $157.7 million as part of its share repurchase program [50] Q&A Session Summary Question: Advertising outlook and sentiment in Q4 and 2023 - Management indicated that the recovery is closely tied to macroeconomic conditions, with expectations for a quarter-over-quarter improvement in Q4 [52][53] - The company anticipates a stable trend in e-commerce advertising during the Double 11 shopping festival [56][57] Question: Cost optimization strategies and margin outlook - Management confirmed ongoing cost optimization efforts, particularly in marketing and operational expenses, with expectations for a stable margin in Q4 [62][64] - The focus will remain on improving core competencies and operational efficiency [64][66] Question: Diversifying revenue streams beyond advertising - Management acknowledged the need to diversify monetization methods, with VAS currently accounting for about 13% of total revenue [70][75] - The company is investing in e-commerce and membership systems to enhance monetization opportunities [71][73]

Financial Data and Key Metrics Changes - Weibo's total revenues for Q2 2022 were $450.2 million, a decrease of 22% year-over-year or 19% on a constant currency basis [11] - Advertising revenues reached $385.6 million, down 23% year-over-year, with 95% of ad revenues coming from mobile [11][48] - Non-GAAP operating income was $145.3 million, representing a non-GAAP operating margin of 32%, up from 29% in the prior quarter [11][42] - Net income attributable to Weibo was $109.7 million, with a net margin of 24%, compared to 32% last year [57] Business Line Data and Key Metrics Changes - The gaming, food and beverage, and electronic vehicle sectors continued to trend upward despite tough market conditions [50] - Value-added service (VAS) revenues were $64.6 million, a decrease of 10%, mainly due to less revenue from membership and game-related services [55] Market Data and Key Metrics Changes - The advertising market faced significant headwinds due to COVID-related disruptions, particularly affecting e-commerce and cosmetics industries [28][49] - The automotive and luxury sectors showed signs of recovery, with advertisers gradually increasing their budgets [35][36] Company Strategy and Development Direction - The company is focusing on enhancing competitiveness, improving operating efficiency, and maintaining user engagement [12][27] - Weibo aims to strengthen its brand performance ad offerings and integrate them with content operations to capture higher ad value share [27][40] - Cost optimization initiatives have led to a 27% reduction in sales and marketing expenses year-over-year [42][56] Management's Comments on Operating Environment and Future Outlook - Management noted that while there are signs of economic recovery, the speed of recovery varies across industries [62] - The company remains confident in its long-term monetization opportunities, leveraging its unique value proposition and diversified content ecosystem [54] Other Important Information - Weibo's cash, cash equivalents, and short-term investments totaled $3 billion as of June 30, 2022 [58] - The company released its first ESG report in August, highlighting its commitment to sustainable development and social responsibility [59] Q&A Session Summary Question: Can you share more color on outlook for the ad spend in the second half? - Management indicated that two-thirds of revenue is related to consumption-related industries, which are expected to recover with stimulus policies [62] - There is a shift from offline to online advertising strategies, particularly in the automotive and luxury sectors [64][66] Question: What types of measures would be in place for second half regarding efficiency optimization and cost control? - Management highlighted a 27% reduction in marketing fees and improved user acquisition costs, focusing on core business scenarios [78][80] - The company aims to maintain high-quality growth and a steady gross margin while enhancing operational efficiency [88]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 20-F (Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ...

Financial Data and Key Metrics Changes - In Q4 2021, Weibo's total revenue reached $616.3 million, a 20% increase year-over-year. For the full year 2021, total revenues were $2.26 billion, up 34% year-over-year [6][7][28] - Advertising and marketing revenues in Q4 were $550.8 million, a 21% increase year-over-year, with mobile revenues accounting for 94% of total ad revenues [7][29] - Non-GAAP operating income for Q4 was $219.8 million, representing a non-GAAP operating margin of 36%. For the full year, non-GAAP operating income was $829.9 million, a 43% increase year-over-year, with a margin of 37% [7][28][37] - Net income attributable to Weibo for Q4 was $195.5 million, with a net margin of 32%. For the full year, net income was $718.5 million, maintaining a net margin of 32% [28][38] Business Line Data and Key Metrics Changes - The advertising and marketing segment saw a revenue increase of 33% year-over-year, reaching $1.98 billion for the full year 2021 [7][29] - Value-added service (VAS) revenue was $65.5 million in Q4, a 9% increase, and $276.3 million for the full year, a 36% increase [36][28] Market Data and Key Metrics Changes - Weibo's MAUs reached 573 million, and average DAUs were 249 million in December 2021, representing a 10% and 11% increase year-over-year, respectively [7][27] - The top three verticals contributing to revenue were FMCG, e-commerce, and 3C products, with luxury being the fastest-growing vertical [30][32] Company Strategy and Development Direction - The company aims to enhance its core competitiveness by focusing on social attributes and improving monetization efficiency through strategic partnerships in media, entertainment, gaming, and sports [16][19] - In 2022, Weibo plans to invest in key content verticals such as sports and online gaming to tap into a broader user community and improve engagement [27][49] Management's Comments on Operating Environment and Future Outlook - Management noted that despite macroeconomic and regulatory headwinds, the advertising business showed resilience, particularly in sectors like beauty, food and beverage, and automobiles [21][22] - The company expects softness in the overall advertising market in 2022 but believes the headwinds could be transient rather than structural [35] Other Important Information - Weibo successfully listed on the Hong Kong Stock Exchange on December 8, 2021, and will no longer provide financial guidance on net revenue growth [40] - The company generated $778.9 million in free cash flow in 2021, an increase of 10% year-over-year [39] Q&A Session Summary Question: Can management provide insights on advertiser sentiment in January or February? - Management indicated strong growth in advertisement placements in FMCG, 3C products, and luxury sectors, but noted negative growth in education and live streaming e-commerce due to regulatory headwinds [42][43] Question: Can management elaborate on the verticalization strategy for 2022, especially for sports and online gaming? - Management highlighted the importance of the sports vertical, especially with upcoming events like the Asia Games and World Cup, and emphasized investment in content to drive traffic and user engagement [45][49]

Financial Data and Key Metrics Changes - Weibo's net revenue for Q3 2021 was $607.4 million, representing a 30% year-over-year increase [33] - Operating income increased by 39% to $248.7 million, with an operating margin of 41% [33][37] - Net income attributable to Weibo was $209.6 million, a 37% increase, resulting in a net margin of 34% [33][38] - Diluted EPS rose to $0.90 from $0.66 in Q3 2020 [33] Business Line Data and Key Metrics Changes - Advertising and marketing revenues reached $537.6 million, up 29% year-over-year, with mobile ad revenue contributing approximately 92% [33][34] - Value-added service revenues increased by 42% to $69.8 million, primarily due to revenue from an interactive entertainment company acquired in November 2020 [37] Market Data and Key Metrics Changes - Monthly Active Users (MAUs) reached 573 million, with Daily Active Users (DAUs) at 248 million, marking an increase of 62 million and 23 million year-over-year, respectively [7][31] - 94% of Weibo's MAUs came from mobile in September 2021 [7] Company Strategy and Development Direction - Weibo is focusing on enhancing its competitive edge in social features and core functionalities to drive user engagement [13] - The company is investing in the gaming and eSports sectors, which have become significant content verticals, alongside traditional entertainment [19][62] - Weibo aims to adapt to regulatory changes by diversifying content offerings and enhancing compliance measures [27][28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by regulatory headwinds but expressed confidence in Weibo's ability to navigate these changes [29] - The company anticipates Q4 2021 revenue growth of 15% to 20% year-over-year on a constant currency basis [39] - Management emphasized the importance of maintaining strong relationships with government authorities to ensure compliance and operational stability [45] Other Important Information - Weibo's advertising revenue growth was supported by strong engagement during the Tokyo Olympics, with over 400 billion views and 170 million discussions related to Olympic topics [14] - The company is actively adjusting its advertising strategies in response to regulatory changes affecting various industries, particularly education and entertainment [22][23] Q&A Session Summary Question: Changes in Weibo's behavior post-implementation of the personal information protection law - Management noted that the law represents a megatrend affecting the industry, requiring adjustments in operations and compliance [41][43] Question: Advertising industry performance amidst macro and regulatory challenges - Management highlighted that Weibo maintained double-digit growth in ad revenue due to optimized ad sector structure and diversified coverage [42][47] Question: Impact of entertainment sector regulations on user engagement and monetization - Management stated that proactive measures taken prior to regulations helped minimize traffic impact, and they are focusing on diversifying content to mitigate risks [55][58] Question: Progress in eSports and gaming-related content - Management confirmed significant investments in the gaming sector, which is now one of the largest verticals for Weibo, and plans to continue expanding in this area [62][63] Question: Latest observations on advertising regulations and their impact - Management indicated that while regulations have affected the industry, Weibo's social media nature allows it to adapt and maintain ad revenue through alternative strategies [66][70]