Weibo Reports Third Quarter 2023 Unaudited Financial Results
11/09/23
BEIJING, Nov. 9, 2023 /PRNewswire/ -- Weibo Corporation ("Weibo" or the "Company") (NASDAQ: WB and HKEX: 9898), a leading social media in China, today
announced its unaudited financial results for the third quarter ended September 30, 2023.
"We further improved our platform's traffic structure and enhanced our operating efficiency this quarter," said Gaofei Wang, CEO of Weibo. "On user front, our MAUs
crossed the 600 million milestone and continued to grow healthily. On content operation, we focused on reinforcing our content ecosystem through developing key
content verticals, aiming to drive traffic growth across various content verticals, improve user engagement and unlock monetization potentials of our platform. On
monetization, our advertising business exhibited modest recovery this quarter. We also achieved further margin expansion through solid execution of our efficiency
initiatives, with operating margin and non-GAAP operating margin reaching 30% and 37% this quarter, respectively."
Third Quarter 2023 Highlights

Net revenues were US$442.2 million, a decrease of 3% year-over-year or an increase of 2% year-over-year on a constant currency basis[1].
Advertising and marketing revenues were US$389.3 million, a decrease of 1% year-over-year or an increase of 3% year-over-year on aconstant currency basis [1].
Value-added services ("VAS") revenues were US$52.9 million, a decrease of 12% year-over-year or a decrease of 7% year-over-year on aconstant currency basis [1].
Income from operations was US$134.0 million, representing an operating margin of 30%.
Net income attributable to Weibo's shareholders was US$77.5 million and diluted net income per share was US$0.32.
Non-GAAP income from operations was US$163.9 million, representing a non-GAAP operating margin of 37%.
Non-GAAP net income attributable to Weibo's shareholders was US$136.6 million and non-GAAP diluted net income per share was
US$0.57.
Monthly active users ("MAUs") were 605 million in September 2023, a net addition of approximately 21 million users on a year-over-yearbasis. Mobile MAUs represented 95% of MAUs.
Average daily active users ("DAUs") were 260 million in September 2023, a net addition of approximately 8 million users on a
year-over-year basis.
[1] On a constant currency (non-GAAP) basis, we assume that the exchange rate in the third quarter of 2023 had been the same as it was in the third quarter of 2022, or

RMB6.85=US$1.00.
Third Quarter 2023 Financial Results
For the third quarter of 2023, Weibo's total net revenues were US$442.2 million, a decrease of 3% compared to US$453.6 million for the same period last year.
Advertising and marketing revenues for the third quarter of 2023 were US$389.3 million, a decrease of 1% compared to US$393.4 million for the same period last year.
Advertising and marketing revenues excluding ad revenues from Alibaba were US$367.6 million, a decrease of 3% compared to US$378.4 million for the same period
last year.
VAS revenues for the third quarter of 2023 were US$52.9 million, a decrease of 12% year-over-year compared to US$60.1 million for the same period last year, primarily
due to decrease of game-related revenues.
Costs and expenses for the third quarter of 2023 totaled US$308.2 million, a decrease of 7% compared to US$330.3 million for the same period last year. The decreaseof costs and expenses was mainly resulted from unfavorable foreign exchange impact on the reported numbers as well as decrease of personnel related costs.
Income from operations for the third quarter of 2023 was US$134.0 million, compared to US$123.2 million for the same period last year. Operating margin was 30%,
compared to 27% last year. Non-GAAP income from operations was US$163.9 million, compared to US$162.1 million for the same period last year. Non-GAAP operating
margin was 37%, compared to 36% last year.
Non-operating loss for the third quarter of 2023 was US$28.4 million, compared to US$120.4 million for the same period last year. Non-operating loss for the third quarterof 2023 mainly included (i) a US$19.5 million net interest and other loss; (ii) a US$15.9 million investment related impairment, which was excluded under non-GAAP
measures; and (iii) a US$6.9 million gain from fair value change of investments in DiDi Global Inc. (OTC Pink: DIDIY), which was excluded under non-GAAP measures.
Income tax expenses were US$25.4 million, compared to US$19.8 million for the same period last year.
Net income attributable to Weibo's shareholders for the third quarter of 2023 was US$77.5 million, compared to a loss of US$17.1 million for the same period last year.
Diluted net income per share attributable to Weibo's shareholders for the third quarter of 2023 was US$0.32, compared to diluted net loss per share attributable to
Weibo's shareholders of US$0.07 for the same period last year. Non-GAAP net income attributable to Weibo's shareholders for the third quarter of 2023 was US$136.6
million, compared to US$119.0 million for the same period last year. Non-GAAP diluted net income per share attributable to Weibo's shareholders for the third quarter of2023 was US$0.57, compared to US$0.50 for the same period last year.
As of September 30, 2023, Weibo's cash, cash equivalents and short-term investments totaled US$2.8 billion. For the third quarter of 2023, cash provided by operating
activities was US$131.6 million, capital expenditures totaled US$7.8 million, and depreciation and amortization expenses amounted to US$13.9 million.
Conference Call
Weibo's management team will host a conference call from 6:00 AM to 7:00 AM Eastern Time on November 9, 2023 (or 7:00 PM to 8:00 PM Beijing Time on November 9,2023) to present an overview of the Company's financial performance and business operations.
Participants who wish to dial in to the teleconference must register through the below public participant link. Dial in and instruction will be in the confirmation email uponregistering.

Participants Registration Link: https://register.vevent.com/register/BI29b93112bc7446d5b0a9680e9ba2f1d7
Additionally, a live and archived webcast of this conference call will available at http://ir.weibo.com.
Non-GAAP Financial Measures
This release contains the following non-GAAP financial measures: non-GAAP income from operations, non-GAAP net income attributable to Weibo's shareholders,
non-GAAP diluted net income per share attributable to Weibo's shareholders and adjusted EBITDA. These non-GAAP financial measures should be considered inaddition to, not as a substitute for, measures of the Company's financial performance prepared in accordance with U.S. GAAP.
The Company's non-GAAP financial measures exclude stock-based compensation, amortization of intangible assets resulting from business acquisitions, non-cashcompensation cost to non-controlling interest shareholders, impairment of intangible assets, net results of impairment and provision on investments, gain/loss on sale ofinvestments and fair value change of investments, non-GAAP to GAAP reconciling items on the share of equity method investments, non-GAAP to GAAP reconciling
items for the income/loss attributable to non-controlling interests, income tax expense related to the amortization of intangible assets resulting from business acquisitions
and fair value change of investments (other non-GAAP to GAAP reconciling items have no tax effect), and amortization of issuance cost of convertible debt, senior notes
and long-term loans. Adjusted EBITDA excludes interest income/expense, net, income tax expenses, and depreciation expenses.
The Company's management uses these non-GAAP financial measures in their financial and operating decision-making, because management believes these measuresreflect the Company's ongoing operating performance in a manner that allows more meaningful period-to-period comparisons. The Company believes that these
non-GAAP financial measures provide useful information to investors and others in the following ways: (i) in comparing the Company's current financial results with theCompany's past financial results in a consistent manner, and (ii) in understanding and evaluating the Company's current operating performance and future prospects inthe same manner as management does. The Company also believes that the non-GAAP financial measures provide useful information to both management andinvestors by excluding certain expenses, gains/losses and other items (i) that are not expected to result in future cash payments or (ii) that are non-recurring in nature or
may not be indicative of the Company's core operating results and business outlook.
Use of non-GAAP financial measures has limitations. The Company's non-GAAP financial measures do not include all income and expense items that affect theCompany's operations. They may not be comparable to non-GAAP financial measures used by other companies. Accordingly, care should be exercised in understanding
how the Company defines its non-GAAP financial measures. Reconciliations of the Company's non-GAAP financial measures to the nearest comparable GAAP
measures are set forth in the section below titled "Unaudited Reconciliation of Non-GAAP to GAAP Results."
About Weibo
Weibo is a leading social media for people to create, share and discover content online. Weibo combines the means of public self-expression in real time with a powerfulplatform for social interaction, content aggregation and content distribution. Any user can create and post a feed and attach multi-media and long-form content. User
relationships on Weibo may be asymmetric; any user can follow any other user and add comments to a feed while reposting. This simple, asymmetric and distributed
nature of Weibo allows an original feed to become a live viral conversation stream.
Weibo enables its advertising and marketing customers to promote their brands, products and services to users. Weibo offers a wide range of advertising and marketing
solutions to companies of all sizes. The Company generates a substantial majority of its revenues from the sale of advertising and marketing services, including the saleof social display advertisement and promoted marketing offerings. Designed with a "mobile first" philosophy, Weibo displays content in a simple information feed format
and offers native advertisement that conform to the information feed on our platform. To support the mobile format, we have developed and continuously refining oursocial interest graph recommendation engine, which enables our customers to perform people marketing and target audiences based on user demographics, social
relationships, interests and behaviors, to achieve greater relevance, engagement and marketing effectiveness.
Safe Harbor Statement
This press release contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation ReformAct of 1995. These forward-looking statements can be identified by terminology, such as "will," "expects," "anticipates," "future," "intends," "plans," "believes,""confidence," "estimates" and similar statements. Among other things, Weibo's expected financial performance and strategic and operational plans, as described, without
limitation, in quotations from management in this press release, contain forward-looking statements. Weibo may also make written or oral forward-looking statements in
the Company's periodic reports to the U.S. Securities and Exchange Commission ("SEC"), in announcements, circulars or other publications made on the website of The
Stock Exchange of Hong Kong Limited (the "Hong Kong Stock Exchange"), in press releases and other written materials and in oral statements made by its officers,
directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking
statements. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from thosecontained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, Weibo's limited operating history in certain new businesses;
failure to grow active user base and the level of user engagement; the uncertain regulatory landscape in China; fluctuations in the Company's quarterly operating results;
the Company's reliance on advertising and marketing sales for a majority of its revenues; failure to successfully develop, introduce, drive adoption of or monetize newfeatures and products; failure to compete effectively for advertising and marketing spending; failure to successfully integrate acquired businesses; risks associated with
the Company's investments, including equity pick-up and impairment; failure to compete successfully against new entrants and established industry competitors; changes
in the macro-economic environment, including the depreciation of the Renminbi; and adverse changes in economic and political policies of the PRC government and its
impact on the Chinese economy. Further information regarding these and other risks is included in Weibo's annual report on Form 20-Fs and other filings with the SEC
and the Hong Kong Stock Exchange. All information provided in this press release is current as of the date hereof, and Weibo assumes no obligation to update suchinformation, except as required under applicable law.
Contact:
Investor Relations
Weibo Corporation
Phone: +86 10 5898-3336
Email: ir@staff.weibo.com

WEIBO CORPORATIONUNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(In thousands of U.S. dollars, except per share data)

Three months ended
September 30,

June 30,

September 30,

Nine months ended
September 30,

September 30,

2022
Net revenues:
Advertising and marketing$

Value-added services

393,426
60,134

2023$

453,560

Net revenues

2023

385,674
54,566$440,240

2022

2023

389,301
52,850$ 1,206,106
182,228$ 1,130,275
165,894442,151

1,388,334

1,296,169

Costs and expenses:
Cost of revenues (1)94,383

94,272

93,998294,498

274,123

Sales and marketing (1)113,619

105,425

109,776

354,442

321,695

Product development (1)97,02592,94582,764

315,862

266,385

General and administrative (1)25,322-

24,145-

21,627-93,358
10,17680,037-

330,349

316,787

308,165

1,068,336

942,240

123,211

123,453

133,986

319,998

353,929(105,901)(14,460)(25,190)
11,357(8,915)(19,498)(309,527)(21,765)(6,950)(5,459)(120,361)(13,833)(28,413)(331,292)(12,409)2,850
19,760109,620
25,450105,573
25,407(11,294)
48,978341,520
72,709(16,910)
227-

84,170257
2,526

80,166474
2,203(60,272)(3,911)-

268,811
1,287
8,156

Impairment of intangible assets
Total costs and expenses
Income from operations
Non-operating loss:
Investment related loss, net
Interest and other income (loss), net

Income (loss) before income tax expenses
Less: Income tax expenses
Net income (loss)
Less: Net income (loss) attributable to non-controlling interests
Accretion to redeemable non-controlling interests
Net income (loss) attributable to Weibo's shareholders

Basic net income (loss) per share attributable to Weibo's
shareholders
Diluted net income (loss) per share attributable to Weibo's
shareholders$(17,137)$

81,387$

77,489$(56,361)$

259,368$(0.07)

$

0.35

$

0.33

$

(0.24)$

1.10$(0.07)

$

0.34

$

0.32

$

(0.24)$

1.09

Shares used in computing basic net income (loss) per share
attributable to Weibo's shareholders
Shares used in computing diluted net income (loss) per share
attributable to Weibo's shareholders(1) Stock-based compensation in each category:
Cost of revenues
Sales and marketing
Product development
General and administrative$

235,894

235,361

235,842

235,543

235,307

235,894

237,886

238,655

235,543

237,817

2,544
5,107
14,424
7,749

$

2,238
4,113
13,256
6,460

$

2,308
4,243
13,306
5,834

$

7,597
15,22444,52020,995WEIBO CORPORATIONUNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS(In thousands of U.S. dollars)
December 31,
2022

September 30,
2023

AssetsCurrent assets:
Cash and cash equivalents
Short-term investments
Accounts receivable, net
Prepaid expenses and other current assets
Amount due from SINA(1)Current assets subtotal
Property and equipment, net
Goodwill and intangible assets, net
Long-term investments$

2,690,768
480,428
502,443
391,502$2,455,007
314,629434,069
374,940

487,117497,108

4,552,258

4,075,753

249,553245,223
993,630

216,765
218,428
1,283,578$

7,082
12,96940,362
18,9701,088,790

Other non-current assets$

Total assets

916,013

7,129,454

Liabilities, Redeemable Non-controlling Interests and Shareholders' Equity
Liabilities:
Current liabilities:
Accounts payable$
161,029
Accrued expenses and other current liabilities
923,678
Income tax payable
55,282
Deferred revenues
79,949Unsecured senior notes
Current liabilities subtotal
Long-term liabilities:
Unsecured senior notes
Long-term loans
Other long-term liabilities
Total liabilities
Redeemable non-controlling interests
Shareholders' equity :Weibo shareholders' equity
Non-controlling interests
Total shareholders' equity
Total liabilities, redeemable non-controlling interests andshareholders' equity$$

6,710,537$

156,243
606,608
74,88779,028798,991

1,219,938

1,715,757

1,540,717
880,855
97,404743,453888,947
84,9303,738,914

3,433,087

45,79559,2963,330,250
14,4953,207,129
11,025

3,344,745

3,218,154

7,129,454$

6,710,537(1) Included short-term loans to and interest receivable from SINA of US$420.4 million as of December 31, 2022 and US$429.0 million as of
September 30, 2023.

WEIBO CORPORATIONUNAUDITED RECONCILIATION OF NON-GAAP TO GAAP RESULTS(In thousands of U.S. dollars, except per share data)
Three months ended

Income from operations
Add: Stock-based compensation
Amortization of intangible assets resulting from business acquisitions
Accrual of non-cash compensation cost to non-controlling interest
shareholders

Nine months ended

September 30,
2022

June 30,
2023

September 30,
2023

September 30,
2022

September 30,
2023$

123,21129,8244,381$ 123,453
26,067
4,271

$

$

$

4,689
-

-

Impairment of intangible assets

133,986
25,691
4,209-

319,998
88,33615,027
15,587
10,176353,929
79,383
12,919
-Non-GAAP income from operations$

162,105$ 153,791$

163,886$

449,124$446,231

Net income (loss) attributable to Weibo's shareholders
Add: Stock-based compensation
Amortization of intangible assets resulting from business acquisitions
Accrual of non-cash compensation cost to non-controlling interest
shareholders
Impairment of intangible assets$(17,137)
29,824
4,381$$

77,48925,691
4,209$(56,361)
88,33615,027$259,368
79,383
12,91981,387
26,067
4,271

4,689
-

-

-

15,587
10,176-

Investment related gain/loss, net (1)Non-GAAP to GAAP reconciling items on the share of equity method
investments
Non-GAAP to GAAP reconciling items for the income/loss
attributable to non-controlling interests

105,901

25,1908,915

309,5276,950(3,503)(11,262)

19,4302,414

12,351

(154)

(156)

(101)

(5,063)(414)

Tax effects on non-GAAP adjustments (2)Amortization of issuance cost of convertible debt, unsecured seniornotes and long-term loans(6,605)

(727)

(645)

(22,917)(1,176)

Non-GAAP net income attributable to Weibo's shareholders

$

1,611

1,606

119,007$ 126,376

1,607$

136,595

4,833$

361,559

4,819$

374,200

Non-GAAP diluted net income per share attributable to Weibo's
shareholders$

Shares used in computing GAAP diluted net income (loss) per share
attributable to Weibo's shareholders
Add: The number of shares for dilution resulted from convertible debt (3)The number of shares for dilution resulted from unvested restricted
share units (3)Shares used in computing non-GAAP diluted net income per share
attributable to Weibo's shareholders
Adjusted EBITDA:
Net income (loss) attributable to Weibo's shareholders$

Non-GAAP adjustments
Non-GAAP net income attributable to Weibo's shareholders
Interest (income) expense, net
Income tax expenses
Depreciation expenses$

Adjusted EBITDA

0.50 * $

0.53

$

0.57

$

1.52 *$

1.57

235,894

237,886

238,655

235,543

237,817

6,753

-

-

6,753

-

1,550

-

-

1,167

-

244,197

237,886

238,655

243,463

237,817(17,137)
136,144$

81,38744,989119,007(8,896)26,365
8,268

126,376
1,366
26,177
9,962

144,744$ 163,881$

77,48959,106$

136,595
2,823
26,052
9,354$

174,824(56,361)
417,920$

361,559(28,325)
71,89525,614$

430,743

259,368
114,832
374,200(5,554)73,88629,917$472,449(1) To adjust impairment and provision on investments, gain/loss on sale of investments and fair value change of investments.
To adjust the income tax effects of non-GAAP adjustments, which primarily related to amortization and impairment of intangible assets resulting from businessacquisitions and fair value change of investments. Other non-GAAP adjustment items have no tax effect, because (i) they were recorded in entities established in(2) tax free jurisdictions, or (ii) full valuation allowances were provided for related deferred tax assets as it is more-likely-than-not they will not be realized.
(3) To adjust the number of shares for dilution resulted from convertible debt and unvested restricted share units which were anti-dilutive under GAAP measures.
*

Net income attributable to Weibo's shareholders is adjusted for interest expense of convertible debt for calculating diluted EPS.

WEIBO CORPORATIONUNAUDITED ADDITIONAL INFORMATION(In thousands of U.S. dollars)
Three months ended
September 30,
2022
Net revenues
Advertising and marketing
Non-Ali advertisers$

Alibaba - as an advertiser
Subtotal
Value-added services$

June 30,2023

378,378 $
15,048358,894
26,780393,426

385,674

60,13454,566453,560 $

440,240

Nine months ended

September 30, September 30, September 30,
2023
2022
2023

$

$

367,633
21,668$ 1,141,405
64,701$ 1,063,558
66,717389,301

1,206,106

1,130,275

52,850182,228

165,894442,151$ 1,388,334$ 1,296,169

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SOURCE Weibo Corporation