SINA Corp (SINA) reported non-GAAP fourth-quarter 2012 earnings of 13 cents per share, down from 21 cents per share reported in the year-ago quarter. Including stock-based compensation, earnings came in at 5 cents per share, much better than the Zacks Consensus Estimate of a loss of 2 cents per share.
Revenues
Total revenue (excluding deferred revenue) jumped 4.4% year over year to $134.4 million in the reported quarter and in line with management’s guided range of $132.0 million to $136.0 million. However, revenues fell shy of the Zacks Consensus Estimate of $143.0 million.
The year-over-year growth in total revenue was primarily driven by higher advertising revenue in the quarter, up 6.7% year over year to $110.7 million, and was slightly ahead of the low end of management’s guided range of $110.0 million to $112.0 million. Weibo display advertising contributed 19.0% or $21.3 million of total advertising revenues. Moreover, advertising from telecommunications, IT services and FMCG sector further contributed to the growth in advertising revenues.
Non-advertising revenue decreased 4.8% year over year to $23.8 million in the quarter, slightly ahead of the mid-point of management’s guided range of $22.0 million to $24.0 million. Mobile-value-added-services (:MVAS) revenues were $13.2 million, down 38.0% from the year-ago quarter. However, Weibo value-added services helped the rest of the non-advertising revenues to increase by a staggering 181.0% from the year-ago quarter to $10.6 million.
Operating Results
Gross profit on a non-GAAP basis increased 9.3% year over year to $75.4 million in the quarter. Gross margin expanded 250 basis points (“bps”) from the year-ago quarter to 56.1% due to higher revenue base and prudent product mix. Including stock-based compensation, gross profit came in at $74.7 million.
Operating profit on a non-GAAP basis came in at $6.4 million in the quarter compared with a profit of $6.7 million in the year-ago quarter. The year-over-year decline was primarily due to higher operating expenses, which increased 10.6% from the year-ago period, owing to higher personnel-related expenses, lease expenses and infrastructure costs. Including stock-based compensation of $5.5 million, income from operations came in at $0.9 million.
Net income on a non-GAAP basis was $8.9 million compared with $13.9 million in the year-ago quarter. Including stock-based compensation, earnings came in at $3.5 million.
Balance Sheet
SINA exited the fourth quarter with cash, cash equivalents and short-term investments of $713.6 million compared with $696.2 million at the end of the third quarter. Cash flow from operating activities in the quarter was $33.5 million.