Investment Rating - The report maintains a BUY rating for Weibo, with a target price (TP) of US$14.50, down from the previous TP of US$15.00, indicating a potential upside of 39.2% from the current price of US$10.42 [3][6]. Core Insights - Weibo's 4Q24 results showed net revenue of US$457 million, largely flat year-over-year (YoY) on a constant currency basis, and non-GAAP net income grew by 40% YoY to US$107 million, exceeding consensus estimates by 9% due to effective operational expense control [1][6]. - The overall advertiser sentiment for FY25 remains mixed, with certain sectors like 3C and e-commerce increasing ad budgets due to national subsidy programs, while others like cosmetics and personal care are cautious [1][6]. - The forecast for Weibo's total revenue in FY25 is a growth of 2% YoY on a constant currency basis, with a reduction in FY25-26E earnings forecast by 3-5% due to a soft revenue outlook and increased AI investments [1][6]. Financial Performance - FY24 net revenue was US$1.75 billion, up 1% YoY on a constant currency basis, while advertising revenue in 4Q24 declined by 3% YoY to US$386 million [1][6]. - VAS (Value-Added Services) revenue increased by 18% YoY to US$71 million in 4Q24, driven by membership and game-related revenue growth [6]. - Monthly Active Users (MAUs) declined by 1% YoY to 590 million in December 2024, but the Daily Active Users (DAU) to MAU ratio improved to 44.1% [6]. Revenue and Profitability Forecast - The revenue forecast for FY25 is US$1.77 billion, with adjusted net profit expected to be US$481 million, reflecting a slight decrease from previous estimates [2][7]. - The adjusted net profit margin is projected to be 27.2% for FY25, down from 27.3% in FY24, primarily due to increased investments in AI [6][12]. - The report anticipates a gross margin of 79.0% for FY25, consistent with previous years [7][12]. Shareholding and Market Data - Major shareholders include Sina with 37.3% and Alibaba with 28.9% [4]. - The market capitalization of Weibo is approximately US$2.45 billion, with an average trading volume of US$13.4 million over the past three months [3][4].

Investment Rating - The report maintains a "Buy" rating for the company, with a target price set at $14.5 based on an 8x P/E ratio for FY25E [1][19]. Core Insights - The company reported a net revenue of $457 million for Q4 2024, showing a year-over-year growth of approximately 0% in constant currency, aligning with Bloomberg consensus expectations. Non-GAAP net profit increased by 40% year-over-year to $107 million, exceeding expectations by 9% due to effective operational expense control [1][2]. - For FY25E, the overall sentiment among advertisers remains mixed, with certain verticals like 3C products and e-commerce increasing ad budgets supported by national subsidy programs, while others like cosmetics and gaming are cautious in ad spending. The company forecasts a 2% year-over-year revenue growth in constant currency for FY25E [1][3]. Revenue and Profitability Forecast - The company expects a slight revenue recovery in FY25E, projecting a total revenue of $1.77 billion, which represents a 2% year-over-year increase, primarily driven by growth in advertising revenue from 3C and e-commerce sectors [3][4]. - The adjusted net profit for FY25E is estimated at $481 million, with an adjusted EPS of $1.81. The report indicates a decrease in the non-GAAP operating profit margin to 31% for FY25E, down from 33% in FY24, mainly due to increased investments in artificial intelligence [4][14]. User Engagement Metrics - As of December 2024, the monthly active users (MAUs) decreased by 1% year-over-year to 590 million, while the daily active users (DAUs) to MAUs ratio improved to 44.1% from 43.0% in December 2023 [2][3]. Dividend Policy - The company announced an annual dividend policy, planning to pay $200 million in dividends for FY24, which equates to an approximate 8% dividend yield [3][4].

Weibo Corporation (NASDAQ:WB) Q4 2024 Results Conference Call March 13, 2025 7:00 AM ET Company Participants Sandra Zhang - Investor Relations Gaofei Wang - Chief Executive Officer Fei Cao - Chief Financial Officer Conference Call Participants Xueqing Zhang - CICC Felix Liu - UBS Daisy Chen - Haitong International Operator Good day, and thank you for standing by. Welcome to the Weibo reports fourth quarter and fiscal year 2024 financial results. [Operator Instructions] Please be advised that today's confere ...

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 reached USD 456.8 million, a decrease of 1% year-over-year, or relatively flat on a constant currency basis [10] - Total ad revenue for Q4 2024 was USD 385.9 million, a decrease of 4% year-over-year [11] - Value-added service revenues for Q4 2024 reached USD 71 million, an increase of 18% year-over-year [11] - For the full year 2024, total revenue was USD 1.75 billion, relatively flat year-over-year, or an increase of 1% on a constant currency basis [11] - Non-GAAP operating income for Q4 2024 was USD 136.2 million, representing a non-GAAP operating margin of 30% [11] - Full year 2024 non-GAAP operating income was USD 584.1 million, with a margin of 33% [12] Business Line Data and Key Metrics Changes - Advertising and marketing revenues for Q4 2024 were USD 385.9 million, a decrease of 4% year-over-year [52] - Mobile ad revenue contributed approximately 94% of total ad revenue in Q4 2024 [53] - Value-added service revenue for the full year 2024 increased by 13% to USD 256 million [53] Market Data and Key Metrics Changes - In Q4 2024, the automotive sector saw solid growth, driven by the increasing market penetration of new energy vehicles [23] - Ad revenue from the online game, cosmetics, personal care, and luxury industries showed a declining trend in Q4 2024 [24] - The government introduced stimulus policies in Q4 2024, positively impacting the digital product and e-commerce sectors [25] Company Strategy and Development Direction - The company plans to focus on user growth, content ecosystem enhancement, and operating efficiency in 2025 [29] - There is an emphasis on integrating social products and revamping the recommendation system to drive user engagement [30] - The company aims to strengthen its competitive edge in the content ecosystem and enhance operating efficiency as key goals for 2025 [27] Management's Comments on Operating Environment and Future Outlook - Management noted that while some industries fell short of expectations in 2024, effective cost management allowed for stable operating income [27] - The company expects to see a rebound in macroeconomic conditions and consumer spending as government policies take effect [26] - Management remains cautious about the gaming industry due to a lack of major game launches in 2024 [94] Other Important Information - The company announced an annual cash dividend of USD 0.82 per ordinary share for the fiscal year 2022, totaling approximately USD 200 million [68] - The Board's capital allocation strategy focuses on balancing long-term growth with shareholder returns [106] Q&A Session Summary Question: Future strategy of AI applications - Management highlighted ongoing integration of multiple AI models and the development of products based on large language models, with a focus on enhancing search capabilities and monetization [72][73][81] Question: 2025 outlook for advertisement - Management expects positive impacts from national subsidy policies on automotive and e-commerce sectors, while remaining cautious about discretionary industries like beauty and personal care [86][88][96] Question: Shareholder return policy - Management emphasized a balanced capital allocation strategy that supports long-term growth while delivering value to shareholders, including the potential for share buybacks [102][106]

Core Insights - Weibo Corp reported a fiscal fourth-quarter revenue decline of 1% year-on-year to $456.83 million, surpassing analyst consensus estimates of $437.87 million [1] - The company's adjusted EPS of 40 cents exceeded the analyst consensus estimate of 39 cents [1] - Advertising and marketing revenues decreased by 4% year-on-year to $385.9 million, primarily due to the underperformance of the online game sector [1] - Value-added service (VAS) revenues increased by 18% year-on-year to $71.0 million, driven by growth in membership services and game-related revenues [2] - Monthly active users (MAUs) were 590 million in December 2024, a slight decrease from 598 million year-on-year, while average daily active users (DAUs) increased to 260 million from 257 million year-on-year [2] - The adjusted operating margin declined by 100 basis points to 30%, with profits falling 6.7% year-on-year [2] - As of December 31, 2024, Weibo held $2.4 billion in cash and equivalents, generating $244.0 million in operating cash flow during the quarter [3] - The board of directors declared a cash dividend of $0.82 per ADS and an annual dividend payout of $200 million for fiscal 2024 [3] - WB stock is down 2.60% at $10.48 as of the last check [3]

Core Viewpoint - Weibo Corporation reported solid performance in the fourth quarter of 2024, focusing on high-quality user acquisition and engagement, optimizing its content ecosystem, and maintaining strong operating efficiency while announcing an annual dividend payout of US$200 million for fiscal year 2024 [2][22][23]. Fourth Quarter 2024 Highlights - Total net revenues for Q4 2024 were US$456.8 million, a decrease of 1% year-over-year [6][17]. - Advertising and marketing revenues were US$385.9 million, down 4% compared to the same period last year, primarily due to the underperformance in the online game sector [7][17]. - Value-added services (VAS) revenues increased by 18% year-over-year to US$71.0 million, driven by growth in membership services and game-related revenues [8][17]. - Operating margin for Q4 2024 was 26%, consistent with the previous year, while non-GAAP operating margin was 30%, down from 31% [9][17]. - Net income attributable to Weibo's shareholders was US$8.9 million, a significant decrease from US$83.2 million in the same quarter last year [12][17]. Fiscal Year 2024 Highlights - Total net revenues for fiscal year 2024 were US$1.75 billion, relatively flat compared to US$1.76 billion in 2023 [14][17]. - Advertising and marketing revenues for 2024 were US$1.50 billion, a decrease of 2% year-over-year [14][17]. - VAS revenues for 2024 increased by 13% to US$256.0 million [15][17]. - Income from operations for 2024 was US$494.3 million, with an operating margin of 28%, up from 27% in 2023 [16][17]. - Net income attributable to Weibo's shareholders for 2024 was US$300.8 million, down from US$342.6 million in 2023 [20][17]. Dividend Declaration - The board of directors adopted a cash dividend policy, declaring a cash dividend of US$0.82 per ordinary share for fiscal year 2024, amounting to approximately US$200 million [22][23]. Cash Flow and Financial Position - As of December 31, 2024, Weibo's cash, cash equivalents, and short-term investments totaled US$2.4 billion [13][17]. - Cash provided by operating activities for 2024 was US$639.9 million, compared to US$672.8 million in 2023 [21][17]. User Engagement Metrics - Monthly active users (MAUs) reached 590 million in December 2024, with average daily active users (DAUs) at 260 million [17].

Core Viewpoint - Weibo Corporation will announce its unaudited financial results for Q4 and fiscal year 2024 on March 13, 2025, before the U.S. market opens, followed by a conference call to discuss financial performance and business operations [1]. Company Overview - Weibo is a leading social media platform that allows users to create, share, and discover content online, combining real-time public self-expression with social interaction and content distribution [3]. - The platform enables users to create and post feeds with multimedia and long-form content, allowing for asymmetric user relationships where any user can follow others and engage with their content [3]. Advertising and Marketing Solutions - Weibo generates a substantial majority of its revenue from advertising and marketing services, including social display advertisements and promoted marketing offerings [4]. - The company employs a "mobile first" philosophy, displaying content in a simple information feed format and offering native advertisements that align with the platform's content [4]. - Weibo has developed a social interest graph recommendation engine to enhance marketing effectiveness by targeting audiences based on demographics, social relationships, interests, and behaviors [4].

Financial Data and Key Metrics Changes - Weibo's total revenue for Q3 2024 reached $464.5 million, up 5% year-over-year, with ad revenue at $398.6 million, up 2% year-over-year, and VAS revenue at $65.9 million, up 25% year-over-year [13][49][56] - Non-GAAP operating income was $164.5 million, representing a non-GAAP operating margin of 35% [13][49] - Net income attributable to Weibo was $139.2 million, with a net margin of 30% [58] Business Line Data and Key Metrics Changes - Advertising and marketing revenues were $398.6 million, with mobile ad revenues contributing approximately 94% of total ad revenue [50] - VAS revenue growth was primarily driven by membership and games-related services, with a 25% increase [56] - The FMCG sector showed strong momentum in food and beverage and apparel, while the automotive sector continued to grow due to the shift towards electric vehicles [51][52] Market Data and Key Metrics Changes - In September 2024, Weibo's MAUs reached 587 million and average DAUs reached 257 million, reflecting a pullback from the Olympics peak [12][47] - The ad revenue from the food and beverage sector showed strong year-over-year growth, driven by the Olympics [33] - The automotive sector's ad revenue was bolstered by the transition to electric vehicles and effective content ecosystem cultivation [52][35] Company Strategy and Development Direction - Weibo is focusing on enhancing its hot trend marketing capabilities and content marketing to sustain high operating efficiency [43][44] - The company aims to optimize brand and performance-ad offerings to improve competitiveness and expand market share [44] - Weibo's strategy includes leveraging event-driven marketing models, particularly around major events like the Olympics, to attract advertisers [31][32] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the advertising market, anticipating a gradual recovery due to government stimulus measures [54][66] - There are expectations for double-digit growth in certain sectors due to national subsidy policies targeting consumer electronics [66] - Despite challenges in the luxury products and real estate sectors, management sees potential for growth in the food and beverage and automotive sectors [66][70] Other Important Information - The Paris Olympic Games significantly boosted Weibo's ad revenue, surpassing that of the Tokyo Olympics [20][33] - Weibo's cash, cash equivalents, and short-term investments totaled $2.2 billion as of September 30, 2024 [59] Q&A Session Summary Question: Fourth quarter advertisement outlook in light of macro stimulus - Management noted a slight decrease in consumer demand but remains optimistic about Q4 due to government policies aimed at boosting demand, particularly in the 3C and consumer electronics sectors [62][66] Question: Drivers behind VAS services growth and future expectations - Management highlighted the continuous growth of membership services and the focus on high-quality user acquisition as key drivers for VAS revenue growth [73][75] Question: Updates on AI progress in content production and operational efficiencies - Management reported significant improvements in operational efficiency through AI applications, including intelligent search functions and AI-assisted content generation for key accounts [80][82]

Investment Rating - The report maintains a "BUY" rating for Weibo, with a target price of US$15.00, reflecting a potential upside of 76.3% from the current price of US$8.51 [2][16]. Core Insights - Weibo's 3Q24 results exceeded expectations, with net revenue increasing by 5% YoY to US$465 million, driven by stabilization in advertising revenue and strong growth in VAS revenue [1][2]. - The company is cautiously optimistic about macroeconomic policy stimulus but anticipates a delayed impact on consumption and advertising demand [1][2]. - Advertising revenue in 3Q24 rose by 2% YoY to US$399 million, primarily due to growth in the food & beverage and automobile sectors, while some sectors like cosmetics and handsets faced challenges [1][2]. - VAS revenue grew significantly by 25% YoY in 3Q24, supported by enhanced membership services [1][2]. - The forecast for 4Q24 indicates a potential decline in advertising revenue by 4% YoY, attributed to a high-base effect and soft demand in certain verticals [1][2]. Financial Performance Summary - For FY24E, total revenue is projected at US$1,755 million, with adjusted net profit expected to be US$466.9 million [5][9]. - The non-GAAP operating profit margin (OPM) for 3Q24 was 35.4%, a decrease of 1.6 percentage points YoY, mainly due to increased sales and marketing expenses [1][2]. - The adjusted EPS for FY24E is estimated at US$1.97, with a gradual increase expected in subsequent years [5][9]. User Engagement Metrics - Monthly Active Users (MAUs) decreased by 3% YoY to 587 million as of September 2024, but the Daily Active Users (DAU) to MAU ratio improved to 43.8% [1][2]. - Total interactions on Weibo's front page increased significantly on a quarter-over-quarter basis, indicating improved user engagement [1][2].

Investment Rating - The report maintains a "BUY" rating for the company with a target price of US$15.00, down from the previous target of US$15.50, indicating a potential upside of 76.3% from the current price of US$8.51 [9]. Core Insights - The company reported a 5% year-over-year increase in net revenue for Q3 2024, reaching US$465 million, which exceeded Bloomberg consensus estimates by 7% [6]. - Advertising revenue grew by 2% year-over-year to US$399 million, primarily driven by strong performance in the food and beverage sector due to the Paris Olympics [7]. - The management remains cautiously optimistic about macroeconomic policy stimulus, although they believe the effects will take time to materialize [8]. Financial Performance Summary - For FY24E, the company expects revenue of US$1,755 million, with adjusted net profit projected at US$467 million and adjusted EPS at US$1.97 [12]. - The non-GAAP operating profit margin for Q3 2024 was 35.4%, a decline of 1.6 percentage points year-over-year, attributed to increased sales and marketing investments [8]. - The company anticipates a 4% decline in advertising revenue for Q4 2024 due to high base effects and weak demand in certain consumer-related verticals [8]. Revenue Breakdown - The company’s revenue for Q3 2024 was supported by a 25% increase in value-added services (VAS) revenue, which reached US$66 million [7]. - Monthly active users (MAUs) decreased by 3% year-over-year to 587 million, but the daily active users to monthly active users ratio improved to 43.8% [7]. Future Outlook - The management expects that the advertising business recovery will require more time, particularly in sectors like cosmetics and luxury goods, where demand has not shown significant improvement [8]. - The company is projected to benefit from policy stimulus and a gradual recovery in consumer spending, with a non-GAAP P/E ratio of 5x for FY25, indicating a favorable margin of safety [8].