SINA Corporation (USA) : Sina Swings To 1Q Loss On Higher Expenses; Revenue Up
05/15/2012| 05:44pm US/Eastern
Sina Corp. (SINA) swung to a first-quarter loss as the Chinese Internet company posted significantly higher expenses, which outpaced improved revenue.
However, the company's loss wasn't as bad as expected and advertising revenue grew, sending shares up 8% to $55.84 after hours. The stock is down 22% over the past six months.
The company forecast adjusted second-quarter revenue, which excludes the impact of deferred-license revenue, of $126 million to $129 million, just under estimates of $130 million from analysts polled by Thomson Reuters.
Sina's core earnings have continued to deteriorate amid higher product-development and advertising costs. Yet the company, which owns the largest Internet portal in China as well as a microblogging service akin to that of Twitter Inc., still benefits from a massive user base that includes members of China's growing middle class.
In the latest quarter, Sina posted a loss of $13.7 million, or 21 cents a share, compared with a year-earlier profit of $15 million, or 23 cents a share. Excluding stock-based compensation, amortization and other adjustments, the company's per-share profit a year ago was 25 cents a share. Analysts polled by Thomson Reuters expected a loss of 23 cents a share.
Net revenue rose 6% to $106.2 million. Excluding deferred revenue, the top line was $101.5 million, in line with the company's February forecast of $101 million to $104 million.
Gross margin narrowed to 46.2% from 53.2%, as input costs rose 22%. Operating expenses rose 60%.
Advertising revenue, the biggest top-line contributor, rose 8.6% to $78.5 million, while nonadvertising revenue edged down 0.7% to $27.7 million.
-By Ben Fox Rubin, Dow Jones Newswires; 212-416-3108; firstname.lastname@example.org