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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 20-F
 o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF
THE SECURITIES EXCHANGE ACT OF 1934
 OR
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2007
 OR
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    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 OR
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    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 Date of event requiring this shell company report
 Commission file number 000-30698
 SINA CORPORATION
 (Exact name of Registrant as specified in its charter)
 Cayman Islands  (Jurisdiction of incorporation or organization)
 Room 1802, United Plaza
1468 Nan Jing Road West
Shanghai 200040, China  (Address of principal executive offices)
 Contact Person: Corporate Secretary
Phone: +8610 8262 8888
Facsimile: +8610 8260 7166
Address: 20/F Beijing Ideal International Plaza
No. 58 Northwest 4th Ring Road
Haidian District, Beijing, 100080, Peoples Republic of China  (name, telephone, e-mail and/or facsimile number and address of company contact person)
 Securities registered or to be registered pursuant to Section 12(b) of the Act.
 Title of each class
    
    Name of each exchange on which registeredOrdinary Shares, $0.133 par value 
Ordinary Shares Purchase Rights
    
    NASDAQ Global Market
 Securities registered or to be registered pursuant to Section 12(g) of the Act.
 Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
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TABLE OF CONTENTS
 INTRODUCTIONINFORMATION REGARDING FORWARD-LOOKING STATEMENTSPART I
    
    
    2Item 1. Identity of Directors, Senior Management and Advisers
    
    
    2Item 2. Offer Statistics and Expected Timetable
    
    
    2Item 3. Key Information
    
    
    2Item 4. Information on the Company
    
    
    23Item 4A. Unresolved Staff Comments
    
    
    43Item 5. Operating and Financial Review and Prospects
    
    
    43Item 6. Directors, Senior Management and Employees
    
    
    58Item 7. Major Shareholders and Related Party Transactions
    
    
    68Item 8. Financial Information
    
    
    71Item 9. The Offer and Listing
    
    
    71Item 10. Additional Information
    
    
    72Item 11. Quantitative and Qualitative Disclosures About Market Risk
    
    
    77Item 12. Description of Securities Other than Equity Securities
    
    
    78PART II
    
    
    78Item 13. Defaults, Dividend Arrearages and Delinquencies
    
    
    78Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
    
    
    78Item 15. Controls and Procedures
    
    
    78Item 16A. Audit Committee Financial Expert
    
    
    79Item 16B. Code of Ethics
    
    
    79Item 16C. Principal Accountant Fees and Services
    
    
    79Item 16D. Exemptions from the Listing Standards for Audit Committees
    
    
    79Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
    
    
    79PART III
    
    
    80Item 17. Financial Statements
    
    
    80Item 18. Financial Statements
    
    
    80Item 19. Exhibits
    
    
    80SIGNATURES
    
    
    84EXHIBIT 4.44EXHIBIT 4.45EXHIBIT 4.46EXHIBIT 4.47EXHIBIT 8.1EXHIBIT 12.1EXHIBIT 12.2EXHIBIT 13.1EXHIBIT 13.2EXHIBIT 15.1EXHIBIT 15.2
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INTRODUCTION
 In this annual report, except where the context otherwise requires and for purposes of this annual report only:
 
    
    we, us, our company, the Company, our and SINA refer to
SINA Corporation, its subsidiaries, and, in the context of describing
our operations and consolidated financial information, include our
consolidated variable interest entities (VIEs) in China;
    
    China or PRC refers to the Peoples Republic of China solely for
the purpose of this annual report, and do not include the Hong Kong
Special Administrative Region, the Macau Special Administrative Region
or Taiwan;
    
    GAAP refers to general accepted accounting principles in the United
States; PRC GAAP refers to general accepted accounting principles in
the PRC;
    
    shares or common shares refer to our ordinary shares;
    
    all references to RMB or renminbi are to the legal currency of
China, and all references to $, dollars, US$ and U.S. dollars
are to the legal currency of the United States; and
    
    all discrepancies in any table between the amounts identified as total
amounts and the sum of the amounts listed therein are due to rounding.
 
 INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
 This Annual Report on Form 20-F contains forward-looking statements. These statements relate
to future events or our future financial performance. In some cases, you can identify
forward-looking statements by terminology such as may, will, should, expect, plan,
anticipate, believe, estimate, predict, potential or continue, the negative of such
terms or other comparable terminology. These statements are only predictions. Actual events or
results may differ materially.
 Although we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance or achievements.
Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness
of the forward-looking statements. We undertake no duty to update any of the forward-looking
statements after the date of this report to conform such statements to actual results or to changes
in our expectations.
 Readers are also urged to carefully review and consider the various disclosures made by us
which attempt to advise interested parties of the factors which affect our business, including
without limitation the disclosures made under the caption Risk Factors included herein.
 
 PART I
 
 Item 1. Identity of Directors, Senior Management and Advisers
  
 Item 2. Offer Statistics and Expected Timetable
  
 Item 3. Key Information
 A. Selected Financial Data
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Years ended December 31,2007
    
    2006
    
    2005
    
    2004
    
    2003(In thousands, except per share data)Operations:Net revenues
    
    $
    246,127
    
    
    $
    212,854
    
    
    $
    193,552
    
    
    $
    199,987
    
    
    $
    114,285Gross profit*
    
    
    151,425
    
    
    
    133,444
    
    
    
    130,445
    
    
    
    138,376
    
    
    
    79,848Income from operations
    
    
    51,014
    
    
    
    34,907
    
    
    
    41,508
    
    
    
    69,325
    
    
    
    37,041Income before income taxes
    
    
    64,233
    
    
    
    43,967
    
    
    
    45,525
    
    
    
    69,224
    
    
    
    32,318Net income *
    
    
    57,729
    
    
    
    39,916
    
    
    
    43,115
    
    
    
    65,996
    
    
    
    31,423Net income per share*Basic
    
    $
    1.05
    
    
    $
    0.74
    
    
    $
    0.82
    
    
    $
    1.33
    
    
    $
    0.66Diluted
    
    $
    0.97
    
    
    $
    0.69
    
    
    $
    0.75
    
    
    $
    1.15
    
    
    $
    0.58
 December 31,2007
    
    2006
    
    2005
    
    2004
    
    2003(In thousands)Financial position:Cash, cash equivalents
and short-term
investments
    
    $
    477,999
    
    
    $
    362,751
    
    
    $
    300,689
    
    
    $
    275,635
    
    
    $
    227,164Working capital
    
    
    377,608
    
    
    
    267,116
    
    
    
    297,910
    
    
    
    252,027
    
    
    
    219,866Total assets
    
    
    662,263
    
    
    
    538,809
    
    
    
    468,721
    
    
    
    430,425
    
    
    
    289,897Long-term liabilities
    
    
    1,337
    
    
    
    
    
    
    
    100,000
    
    
    
    102,142
    
    
    
    100,000Total liabilities
    
    
    167,287
    
    
    
    150,996
    
    
    
    149,099
    
    
    
    177,080
    
    
    
    130,390Total shareholders equity
    
    
    494,976
    
    
    
    387,813
    
    
    
    319,622
    
    
    
    253,345
    
    
    
    159,507
 
 *
    
    The Company began to include stock-based compensation charges in its costs of revenues and
operating expenses starting January 1, 2006 in accordance with the Statement of Financial
Accounting Standards (SFAS) No. 123 (revised 2004), Share-Based Payment. Stock-based
compensation charges for fiscal 2007 and 2006 were $8.7 million and $9.5 million, or $0.15
diluted net income per share and $0.16 diluted net income per share, respectively. B. Capitalization and Indebtedness
  C. Reasons for the Offer and Use of Proceeds
  D. Risk Factors
 Due to our limited operating history and the relatively new and evolving market that we
operate in, we cannot predict whether we will meet internal or external expectations of future
performance.
  
    
    offer new and innovative products;
    
    attract buyers for our mobile value-added services (MVAS);
    
    attract advertisers;
    
    attract a larger audience to our network;
    
    derive revenue from our users from fee-based Internet services;
    
    respond effectively to competitive pressures and address the effects of strategic
relationships or corporate combinations among our competitors;
    
    maintain our current, and develop new, strategic relationships;
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
    
    increase awareness of our brand and continue to build user loyalty;
    
    attract and retain qualified management and employees;
    
    upgrade our technology to support increased traffic and expanded services; and
    
    expand the content and services on our network or secure premium content.
  You should not place undue reliance on our financial guidance, nor should you rely on our
quarterly operating results as an indication of our future performance because our results of
operations are subject to significant fluctuations.
  We are relying on advertising sales as a significant part of our future revenues, but the
online advertising market is subject to many uncertainties, which could cause our advertising
revenues to decline.
  
    
    the development and retention of a large base of users possessing demographic
characteristics attractive to advertisers;
    
    the maintenance and enhancement of our brands in a cost effective manner;
    
    increased competition and potential downward pressure on online advertising prices and
limitations on web page space;
    
    changes in government policy that curtail or restrict our online advertising services;
    
    the acceptance of online advertising as an effective way for advertisers to market their
businesses;
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
    
    the development of independent and reliable means of verifying levels of online
advertising and traffic; and
    
    the effectiveness of our advertising delivery, tracking and reporting systems.
    The consolidation of advertising agencies in China could increase the bargaining power of
larger advertising agencies, which may adversely impact our revenue growth.
  We are relying on MVAS for a significant portion of our future revenue. Our MVAS revenues have
declined in the past and may decrease further in the future.
  
    
    our ability to develop new services that become accepted by the market;
    
    our ability to retain existing customers of our subscription services;
    
    our ability to attract new subscribers in a cost-effective manner;
    
    our ability to provide satisfactory services to our customers;
    
    competitors, including operators, may launch competing or better products than ours;
    
    changes in policy, process and/or system by China Mobile Communication Corporation
(China Mobile), China Unicom Co., Ltd. (China Unicom) or other operators, on whom we
rely for service delivery, billing and payment collection, and who in the past have made
sudden changes that have significantly impacted our revenues and may continue to do so in
the future; and
    
    changes in government regulations, which could restrict our MVAS offerings, curtail our
ability to market our services or change user adoption or usage patterns in a negative way.
For example, in August 2007, the Ministry of Information Industry (MII) tightened the
regulations over direct advertising in China, which reduced the effectiveness of our direct
advertising on MVAS and increased the difficulties of new user recruitment. In December
2007, MII unified the dialing codes of each service provider (SP), which increased the
number of digits a user must input to subscribe to an SPs
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MVAS, thereby, making the purchasing process more complicated. MII has proposed to require
mobile users, including pre-paid card subscribers, to register their real identity.
Implementation of these changes has led to in the past and may lead to in the future fewer
subscriptions of MVAS and a decrease in new customers.
  With respect to MVAS, we rely on China Mobile, China Unicom and other operators for marketing,
service delivery, billing and payment collection, and we may be negatively affected by changes
which they may make suddenly and unilaterally.
   
    
    In mid 2004, operators began transitioning SMS to new billing platforms, which has
resulted in added operational controls and procedures in areas such as customer subscription
and customer billing. Such change has increased the difficulties for new user recruitment
and the failure rate for fee collection from our SMS users.
    
    In January 2005, China Mobile stopped its MMS Album service, which allowed users to
retrieve their subscribed MMS messages from China Mobiles web site when the subscribed MMS
messages could not be successfully delivered to their mobile phones. With the termination of
MMS Album, we are no longer able to collect fees from users when the MMS messages could not
be delivered to such users mobile phones.
    
    In March 2005, China Mobile began migrating MMS onto a new billing platform, which has
resulted in added operational controls and procedures and, correspondingly, increased
difficulties for new user recruitment and increased the failure rate for fee collection from
our users.
    
    In April 2006, China Unicom issued a new policy that sets price ceilings for usage-based
and monthly subscription SMS. Such change may require us to lower our current prices on
certain SMS services or discontinue offering these services completely.
    
    In July 2006, China Mobile made significant changes to its policy on subscription-based
MVAS, which included requiring double confirmations on new MVAS subscriptions as well as
sending SMS reminders to existing monthly subscribers of SMS, MMS and WAP to inform them of
their MVAS subscription and fee information. In addition, China Mobiles provincial
subsidiaries have been canceling existing WAP subscriptions that have been inactive for the
prior four months and existing SMS subscriptions of users who have not successfully received
more than three SMS messages during the month. These policy changes from China Mobile have
reduced our ability to acquire new monthly MVAS subscribers and increased the churn rate of
existing monthly MVAS subscribers.
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
    
    In September 2006, China Unicom began enforcing a policy of double confirmation on new
MVAS subscriptions. Such change has significantly reduced our ability to acquire new monthly
MVAS subscribers.
    
    In April 2007, China Unicom changed its service fee settlement method with service
providers from estimated collection to actual collection. As a result of the switch, fee
settlement, based on the receipt of billing statement, with China Unicom has taken up to
four months, which has negatively impacted our cash flow. In addition, if we are unable to
rely on historical confirmation rates from China Unicom as a result of the change in fee
settlement method, we may need to defer recognition of such revenues until the billing
statements are received.
    
    In July 2007, China Mobile began implementing a score and ranking system that attempts to
reward larger, higher growth service providers with lesser user complaints. Receiving a low
score or ranking, e.g., as a result of too many complaints filed by our MVAS customers,
would result in a negative impact to our results of operations, cash flows and financial
condition.
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The markets for MVAS and Internet services are highly competitive, and we may be unable to
compete successfully against new entrants and established industry competitors, which could reduce
our market share and adversely affect our financial performance.
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Our business is highly sensitive to the strength of our brands in the marketplace, and we may
not be able to maintain current or attract new users, customers and strategic partners for our
products and offerings if we do not continue to increase the strength of our brands and develop new
brands successfully in the marketplace.
  Our investment in Web 2.0 services, search and WAP portal may not be successful.
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If we fail to successfully develop and introduce new products and services, our competitive
position and ability to generate revenues could be harmed.
  If we are unable to keep up with the rapid technological changes of the Internet industry, our
business may suffer.
  We may be adversely affected by complexity, uncertainties and changes in PRC regulation of
Internet business and companies, including limitations on our ability to own key assets such as our
web site.
   Circular of the Ministry of
Information Industry on Intensifying the Administration of Foreign Investment in Value-added
Telecommunication Services
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Accordingly, Beijing SINA Internet Information Service Co., Ltd., a Chinese company controlled by
the Company through contractual arrangement (the ICP Company) submitted the Self-Correction
Scheme of the ICP Companys Multi-regional Value-added Telecommunication Business(the
Self-Correction Scheme) to MII on November 17, 2006. Under the Self-Correction Scheme, (i) the
domain name www.sina.com.cn mainly used by the ICP Company shall be transferred from
Beijing SINA Information Technology Co., Ltd. (formerly known as Beijing Stone Rich Sight
Information Technology Co., Ltd.), one of the Companys wholly owned subsidiaries (BSIT) to the
ICP Company, and (ii) the trademark SINA
((CHINESE CHARACTERS)) used by the ICP Company shall be transferred from
BSIT to the ICP Company. According to the Notice of Acceptance of Transfer Applicationissued by
the Trademark Office of the State Administration for Industry and Commerce (SAIC) to the ICP
Company on December 26, 2006, the application for transfer of trademark is currently in the
process of substantial review. The domain name
www.sina.com.cn has been transferred to the ICP
Company.
   Administrative Provisions on Internet Audio-Visual Program Service
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License for Online Transmission of Audio-Visual Programs after its expiration. Should any
official explanations or implementation rules of the Audio-Visual Program Provisions be
promulgated by SARFT or MII explicitly forbidding any non-state-controlled entities from engaging
in Internet audio-visual program service, SINA may be disqualified from operating online
transmission of audio-visual programs after the License for Online Transmission of Audio-Visual
Programs currently held by the ICP Company expires.
  Government
Regulation and Legal Uncertainties
 In order to comply with PRC regulatory requirements, we operate our main businesses through
companies with which we have contractual relationships but in which we do not have controlling
ownership. If the PRC government determines that our agreements with these companies are not in
compliance with applicable regulations, our business in the PRC could be adversely affected.
 Item 4.C.
Organizational Structure
  We rely on contractual arrangements with our VIEs for our China operations, which may not be
as effective in providing control over these entities as direct ownership.
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If tax benefits available to us in China are reduced or repealed, our results of operations
could suffer significantly and your investment in our shares may be adversely affected.
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Restrictions on paying dividends or making other payments to us bind our subsidiaries and VIEs
in China.
  Currency fluctuations and restrictions on currency exchange
may adversely affect our business, including limiting our ability to convert Chinese renminbi into
foreign currencies and, if renminbi were to decline in value, reducing our revenues and profits in
U.S. dollar terms.
 Even if we are in compliance with Chinese governmental regulations relating to licensing and
foreign investment prohibitions, the Chinese government may prevent us from advertising or
distributing content that it believes is inappropriate and we may be liable for such content or we
may have to stop profiting from such content.
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The Chinese legal system has inherent uncertainties that could limit the legal protections
available to you.
  Increases in labor costs and the new labor law in the PRC may adversely affect our business
and our profitability.
  Our strategy of acquiring complementary assets, technologies and businesses may fail and may
result in equity or earnings dilution.
  We may not be able to manage our expanding operations effectively, which could harm our
business.
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Our business and growth could suffer if we are unable to hire and retain key personnel that
are in high demand.
  We may be subject to litigation for user generated content provided on our websites, which may
be time-consuming to defend.
  You may experience difficulties in effecting service of legal process, enforcing foreign
judgments or bringing original actions in China based on United States or other foreign laws
against us.
  We may have to register our encryption software with Chinese regulatory authorities, and if
they request that we change our encryption software, our business operations could be disrupted as
we develop or license replacement software.
 Regulations for the Administration of Commercial Encryption
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Privacy concerns may prevent us from selling demographically targeted advertising in the
future and make us less attractive to advertisers.
 Hong Kong Personal Data Ordinance
 Concerns about the security of electronic commerce transactions and confidentiality of
information on the Internet may reduce use of our network and impede our growth.
  Our significant amount of deposits in certain banks in China may be at risk if these banks go
bankrupt or otherwise not have the liquidity to pay us during our deposit period.
  We may not be able to adequately protect our intellectual property, which could cause us to be
less competitive.
  We may be exposed to infringement claims by third parties, which, if successful, could cause
us to pay significant damage awards.
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We may be subject to claims based on the content we provide over our network and the products
and services sold on our network, which, if successful, could cause us to pay significant damage
awards.
   We have contracted with third parties to provide content and services for our portal network
and we may lose users and revenue if these arrangements are terminated.
     The law of the Internet remains largely unsettled, which subjects our business to legal
uncertainties that could harm our business.
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The high cost of Internet access could hinder the growth of Internet users in China and thus
hamper the expansion of our user base.
  If we failed to scale our systems proportionally with the growing Internet population in
China, our website traffic growth would be adversely affected.
  We must rely on the Chinese government to develop Chinas Internet infrastructure and, if it
does not develop this infrastructure, our ability to grow our business could be hindered.
  Our operations could be disrupted by unexpected network interruptions caused by system
failures, natural disasters or unauthorized tampering with our systems.
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We have limited business insurance coverage.
  Future outbreaks of Severe Acute Respiratory Syndrome (SARS), Avian flu or other widespread
public health problems could adversely affect our business.
  Political and economic conditions in Greater China and the rest of Asia are unpredictable and
may disrupt our operations if these conditions become unfavorable to our business.
   We have $99 million of zero-coupon, convertible, subordinated notes due 2023, or possibly
earlier upon a change of control, which we may not be able to repay in cash and could result in
dilution of our basic earnings per share.
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Currency fluctuations and restrictions on currency exchange may adversely affect our business,
including limiting our ability to convert Chinese renminbi into foreign currencies and, if Chinese
renminbi were to decline in value, reducing our revenues and profits in U.S. dollar terms.
    Changes to existing accounting pronouncements, including SFAS 123R, or taxation rules or
practices, including FIN 48, may adversely affect our reported results of operations or how we
conduct our business.
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We may be required to record a significant charge to earnings
if we are required to reassess our
goodwill or other amortizable intangible assets arising from acquisitions.
   We may be required to record a significant charge to earnings from the declines in fair value
of our marketable securities if such declines become other than temporary or if we are unable to
hold such investments until maturity.
  While we believe that we currently have adequate internal control procedures in place, we are
still exposed to potential risks from legislation requiring companies to evaluate controls under
Section 404 of the Sarbanes-Oxley Act of 2002.
  Our stock price has been historically volatile and may continue to be volatile, which may make
it more difficult for you to resell shares when you want at prices you find attractive.
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We may be classified as a passive foreign investment company, which could result in adverse
U.S. tax consequences to U.S. investors.
  Anti-takeover provisions in our charter documents and SINAs shareholder rights plan may
discourage our acquisition by a third party, which could limit our shareholders opportunity to
sell their shares at a premium.
    
 Item 4. Information on the Company
 A. History and Development of the Company
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B. Business Overview
 Overview
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Market Opportunities
  Properties and Product Offerings
  Revenue
    
    Advertising (online advertising)Classification
    

Non-advertising (MVAS, search, and other fee-based services)
 PropertiesandServices
    
    SINA.com
    
    SINA Community
    
    SINA Mobile
    
    SINA.net
    
    SINA E-Commerce§     News and
online vertical
content
§     Online
advertising
    
    §     Blog
§     Podcasting
§     Album
§     Bar
§     Notepad
    
    §     SMS
§     IVR
§     MMS
§     WAP
§     CRBT
    
    §     Search
§     Enterprise
solutions
    
    §     Online
Shopping§     Instant Messanging
    
    §     KJAVA§     Group§     BBS§     eMail§     Post
 SINA.com
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SINA News
 SINA Sports
 SINA Entertainment.
 SINA Auto
 SINA Finance.
 SINA Real Estate.
 SINA Technology.
 SINA Game.
 SINA Music.
 SINA Eladies.
 SINA Luxury.
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SINA Video.
 SINA WAP.
 SINA Community
  SINA Bar.
 SINA Album.
 SINA Notepad.
 SINA Circle.
 SINA UC.
 SINA Blog.
 SINA Podcast.
 SINA Mail.
 SINA BBS.
 SINA Post.
 SINA Mobile
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News and Information
    
    Community
    
    Multimedia Downloads     Headline news
    
         Games and quizzes
    
         Ring tones     Financial news
    
         Educational products
    
         Logos and pictures     Technology news
    
    
    
         Screen savers     Sports news     Weather forecast     Jokes
  SINA SMS.
 SINA MMS.
 SINA IVR.
 SINA WAP.
 SINA CRBT.
 SINA KJAVA/BREW.
 SINA.net
  Search and Listings.
 SINA iAsk.
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Google Adwords.
 SINA E-Commerce
  Segment Information
 Strategic Relationships
  Content Partnerships
  Application and Service Partnership
  Technology Infrastructure
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Seasonality
  Competition
     Intellectual Property and Proprietary Rights
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We may not be able to adequately protect our intellectual property, which could
cause us to be less competitive We may be exposed to infringement claims by third parties,
which, if successful, could cause us to pay significant damage awards
 Government Regulation and Legal Uncertainties
 The following description of PRC laws and regulations is based upon the opinions of Lawyers
from Jun He Law Offices, our PRC counsel. For a description of legal risks relating to our
ownership structure and business, see Risk Factors.
 Overview
  Telecommunications Regulations of the Peoples Republic of
China
 Regulations for the Administration of Foreign-Invested Telecommunications
Enterprises
 Measures for the Administration of Internet Information Services
 PRC Corporate Structure
 Item 4.C. Organizational Structure
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Classified Regulations
 Foreign Investment in Value-added Telecom Services
   Self-Correction Scheme of the ICP Companys
Multi-regional Value-added Telecommunication Business www.sina.com.cn  Notice of Acceptance of Transfer Application www.sina.com.cn
 Internet Information Services
 Measures for the Administration of Internet Information Services
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Online News Publishing
 Provisional Regulations for the Administration
of Web site Operation of News Publication Services Provisions for the Administration of
Internet News Information Services, respectively,
   Online Transmission of Audio-Visual Programs
 Measures for the Administration of Publication of
Audio-Visual Programs through Internet or Other Information Network
 Reply on Approvals for Beijing SINA Internet Information Service Co., Ltd.
Engaging in the Business of Information Services Relating to Online Transmission of Audio-Visual
Programs
 Administrative Provisions on
Internet Audio-Visual Program Service
   33




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##### Table of Contents



MVAS
 Administrative Measures for Telecommunication Business
Operating Licenses
     Short Message Services
 Notice on Certain Issues Regarding the Regulation of Short
Message Services
 Internet Publishing
 Provisional Rules for the Administration
of Internet Publishing
 34




---



##### Table of Contents



Online Games
 Rules for the Administration of Electronic Publications
 the Provisional Regulations for the Administration of Online Culture
 the
Notice on Carrying out the Decision from the State Council Regarding the Approval of Electronic and
Online Games Publications
 Circular of the Ministry of Culture on Strengthening the Examination of
Content of Online Games Products
 Circular on Review and Renewal of Online Culture
Operating Permit
 Internet Medical, Health and Drug Information Services
 Measures for the Administration of Internet Medical and Health Information
Services Measures for
the Administration of Internet Drug Information Services
  Notice concerning the Passage of Re-examination of
Health-related Information Service
 Online Cultural Products
 Provisional Regulations for the Administration of Online Culture
 35




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##### Table of Contents




    
    production, duplication, import, wholesale, retail, leasing or broadcasting of online
cultural products;
    
    publishing of online cultural products on the Internet or transmission thereof to
computers, fixed-line or mobile phones, radios, television sets or gaming consoles for the
purpose of browsing, reading, using or downloading such products; or
    
    exhibitions or contests related to online cultural products.
 Circular on Review and Renewal of Online Culture Operating Permit
 Online Advertising
 Notice on Registration Issues for Enterprises Specialized in Advertising
Business
  www.sina.com.cn www.sina.com.cn
 International Connections for Computer Information Networks
  
    
    Measures for the Administration of International Connections to Chinas Public Computer
Interconnected Networks (1996);
    
    Provisional Regulations of the Peoples Republic of China for the Administration of
International Connections to Computer Information Networks (1997) and their Implementing
Measures (1998);
    
    Reply Concerning the Verification and Issuance of Operating Permits for Business Relating
to International Connections for Computer Information Networks and for Public Multimedia
Telecommunications Business (1998); and
    
    Administrative Measures for International Communications Gateways (2002).
  
    
    be a PRC legal person;
    
    have the appropriate equipment, facilities and technical and administrative personnel;
    
    have implemented and registered a system of information security and censorship; and
 36




---



##### Table of Contents




    
    effect all international connections through an international communications gateway
established with the approval of MII.
  Information Security and Censorship
  
    
    The Law of the Peoples Republic of China on the Preservation of State Secrets (1988) and
its Implementing Rules (1990);
    
    The Law of the Peoples Republic of China Regarding State Security (1993) and its
Implementing Rules (1994);
    
    Rules of the Peoples Republic of China for Protecting the Security of Computer
Information Systems (1994);
    
    Notice Concerning Work Relating to the Filing of Computer Information Systems with
International Connections (1996);
    
    Administrative Regulations for the Protection of Secrecy on Computer Information Systems
Connected to International Networks (1997);
    
    Regulations for the Protection of State Secrets for Computer Information Systems on the
Internet (2000);
    
    Notice issued by the Ministry of Public Security of the Peoples Republic of China
Regarding Issues Relating to the Implementation of the Administrative Measure for the
Security Protection of International Connections to Computer Information Networks (2000);
    
    Decision of the Standing Committee of the National Peoples Congress Regarding the
Safeguarding of Internet Security (2000);
    
    Measures for the Administration of Commercial Web site Filings for the Record (2002)
their Implementing Rules (2002);
    
    Measures for the Administration of IP Address Archiving (2005); and
    
    Provision on Technical Measures for Internet Security Protection (2005).
  Detailed Implementing Rules for the Measures for the Administration of
Commercial Web site Filings for the Record,
 
    
    file with the BAIC and obtain electronic registration marks;
    
    place the registration marks on their web sites homepages; and
    
    register their web site names with the BAIC.
   37




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##### Table of Contents



Encryption Software
   
    
    Only specialized hardware and software, the core functions of which are encryption and
decoding, fall within the administrative scope of the regulations as encryption products
and equipment containing encryption technology. Other products such as wireless telephone,
Windows software and browsers do not fall within this scope.
    
    The PRC government has already begun to study the laws in question in accordance with WTO
rules and Chinas external commitments, and will make revisions wherever necessary. The
Administrative Regulations on Commercial Encryptionwill also be subject to such scrutiny
and revision.
  Risk Factors  We may have to register our encryption software with Chinese regulatory
authorities, and if they request that we change our encryption software, our business operations
could be disrupted as we develop or license replacement software.
 Online Education
 Measures for the Administration of Educational web sites and Online Education
School
  Administrative Protection of Internet Copyright
 Measures for the Administrative Protection of Internet Copyright Measures for Imposing Copyright Administrative Penalties
  38




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##### Table of Contents



Foreign Exchange
  
    
    Foreign Currency Administration Rules (the Exchange Rules) promulgated by the State
Council on January 29, 1996, which was amended on January 14, 1997; and
    
    Administration Rules of the Settlement, Sale and Payment of Foreign Exchange (the
Administration Rules) promulgated by China Peoples Bank on June 20, 1996.
    Income Tax
  39




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40




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##### Table of Contents



Labor Law
   Risk Factors  Even if we are in compliance with Chinese governmental regulations
relating to licensing and foreign investment prohibitions, the Chinese government may prevent us
from distributing content that it deems as inappropriate and we may be liable for such content.
 C. Organizational Structure
  JurisdictionSubsidiary
    
    of Organization
    
    
    
    
    
    OwnershipSINA.com Online
    
    United States of America
    
    
    
    
    
    
    100
    %Rich Sight Investment Limited
    
    Hong Kong
    
    
    
    
    
    
    100
    %SINA Hong Kong Limited
    
    Hong Kong
    
    
    
    
    
    
    100
    %Memestar Limited
    
    British Virgin Islands
    
    
    
    
    
    
    100
    %Crillion Corporation
    
    British Virgin Islands
    
    
    
    
    
    
    100
    %Davidhill Capital Inc.
    
    British Virgin Islands
    
    
    
    
    
    
    100
    %Beijing SINA Internet Technology Service Co., Ltd.
    
    Peoples Republic of China
    
    
    
    
    
    
    100
    %Beijing New Media Information Technology Co., Ltd.
    
    Peoples Republic of China
    
    
    
    
    
    
    100
    %SINA.com Technology (China) Co. Ltd.
    
    Peoples Republic of China
    
    
    
    
    
    
    100
    %Fayco Network Technology Development (Shenzhen) Co. Ltd.
    
    Peoples Republic of China
    
    
    
    
    
    
    100
    %
  
    
    Beijing SINA Internet Information Service Co., Ltd., a China company controlled by us
through a series of contractual arrangements. The ICP Company is responsible for operating
www.sina.com.cn in connection with its Internet content company license, selling the
advertisements to advertisers and providing MVAS with its Value-Added
 41




---



##### Table of Contents



Telecommunication Services Operating License in China via third party operators to the users.
It is 1.5% owned by Yan Wang, the Companys Chairman of the Board, 22.50% owned by the
Companys executive officer Tong Chen, 26.75% owned by the Companys executive officer Hong
Du, and 49.25% owned by two other non-executive PRC employees of the Company. The registered
capital of the ICP Company is $2.5 million.
 
    
    Guangzhou Media Message Technologies, Inc., a China company controlled by us through a
series of contractual arrangements. Xunlong is responsible for providing MVAS in China via
third party operators to the users under its Value-Added Telecommunication Services
Operating License. It is owned by three non-executive PRC employees of the Company. The
registered capital of the Xunlong is $1.2 million.
    
    Beijing Star-Village Online Cultural Development Co., Ltd., a China company controlled by
us through a series of contractual arrangements. StarVI is responsible for providing MVAS in
China via third party operators to the users under its Value-Added Telecommunication
Services Operating License. It is owned by three non-executive PRC employees of the Company.
The registered capital of the StarVI is $1.2 million.
    
    Shenzhen Wang Xing Technology Co., Ltd., a China company controlled by us through a
series of contractual arrangements. Wangxing is responsible for providing MVAS in China via
third party operators to the users under its Value-Added Telecommunication Services
Operating License. It is owned by three non-executive PRC employees of the Company. The
registered capital of Wangxing is $1.2 million.
    
    Beijing SINA Infinity Advertising Co., Ltd. (the IAD Company), a China company
controlled by us through a series of contractual arrangements. The IAD Company is an
advertising agency. It is 20% owned by the Companys executive officer Tong Chen and 80%
owned by four non-executive PRC employees of the Company. This entity has an approved
business scope including design, production, agency and issuance of advertisements. The
registered capital of the IAD Company is $0.1 million.
 .
  D. Property, Plants and Equipment
  42




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##### Table of Contents



Item 4A. Unresolved Staff Comments
  
 Item 5. Operating and Financial Review and Prospects
 This report contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Exchange Act, including, without limitation,
statements regarding our expectations, beliefs, intentions or future strategies that are signified
by the words expect, anticipate, intend, believe, the negative of such terms or other
comparable terminology. All forward-looking statements included in this document are based on
information available to us on the date hereof, and we undertake no obligation to update any such
forward-looking statements. Actual results could differ materially from those projected in the
forward-looking statements. In evaluating our business, you should carefully consider the
information set forth above in Item 3. Key Information  D. Risk Factors. We caution you that our
businesses and financial performance are subject to substantial risks and uncertainties, including
the factors identified in Item 3. Key Information  D. Risk Factors, that could cause actual
results to differ materially from those in the forward-looking statements.
 Overview
    Critical Accounting Policies, Judgments and Estimates
  43




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##### Table of Contents



Revenue recognition
 Advertising
  MVAS
     Income taxes
  44




---



##### Table of Contents



Foreign currency
  Impairment of goodwill and long-lived assets
   Property and Equipment
  45




---



##### Table of Contents



Stock-based compensation
   Stock-based Compensation
 Marketable securities
  Allowance for doubtful accounts
  Equity investments
  46




---



##### Table of Contents



Advertising expenses
  Recent accounting pronouncements
       47




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##### Table of Contents



A. Operating Results
 Net revenues
 Years ended December 31,2007
    
    
    2006
    
    
    2005
    
    
    % of Change(in thousands, except percentages)YOY
    
    
    YOY07 & 06
    
    
    06 & 05Net RevenuesAdvertising
    
    $
    168,926
    
    
    
    69
    %
    
    $
    120,067
    
    
    
    56
    %
    
    $
    84,999
    
    
    
    44
    %
    
    
    41
    %
    
    
    41
    %Non-advertising:MVAS
    
    
    70,489
    
    
    
    29
    %
    
    
    86,257
    
    
    
    41
    %
    
    
    98,070
    
    
    
    51
    %
    
    
    -18
    %
    
    
    -12
    %Others
    
    
    6,712
    
    
    
    2
    %
    
    
    6,530
    
    
    
    3
    %
    
    
    10,483
    
    
    
    5
    %
    
    
    3
    %
    
    
    -38
    %Subtotal
    
    
    77,201
    
    
    
    31
    %
    
    
    92,787
    
    
    
    44
    %
    
    
    108,553
    
    
    
    56
    %
    
    
    -17
    %
    
    
    -15
    %Total net revenues
    
    $
    246,127
    
    
    
    100
    %
    
    $
    212,854
    
    
    
    100
    %
    
    $
    193,552
    
    
    
    100
    %
    
    
    16
    %
    
    
    10
    %
  Advertising.
  Non-advertising.
 48




---



##### Table of Contents



MVAS
 Years ended December 31,2007
    
    
    2006
    
    
    2005
    
    
    % of Change(in thousands, except percentages)YOY
    
    
    YOY07 & 06
    
    
    06 & 052.0G products
    
    $
    55,404
    
    
    
    79
    %
    
    $
    73,665
    
    
    
    85
    %
    
    $
    83,745
    
    
    
    85
    %
    
    
    -25
    %
    
    
    -12
    %2.5G products
    
    
    15,085
    
    
    
    21
    %
    
    
    12,592
    
    
    
    15
    %
    
    
    14,325
    
    
    
    15
    %
    
    
    20
    %
    
    
    -12
    %Total MVAS revenues
    
    $
    70,489
    
    
    
    100
    %
    
    $
    86,257
    
    
    
    100
    %
    
    $
    98,070
    
    
    
    100
    %
    
    
    -18
    %
    
    
    -12
    %
    
 
 
 
 49




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##### Table of Contents




  Other non-advertising revenues
  Costs of revenues
 Years ended December 31,2007
    
    
    2006
    
    
    2005
    
    
    % of Change
    
    
    % of ChangeYOY 07 & 06
    
    
    YOY 06 & 05(In thousands, except percentages)Costs of revenues:Advertising
    
    $
    63,466
    
    
    $
    42,529
    
    
    $
    27,627
    
    
    
    49
    %
    
    
    54
    %Non-advertising:MVAS
    
    
    29,339
    
    
    
    34,255
    
    
    
    33,814
    
    
    
    -14
    %
    
    
    1
    %Other
    
    
    1,897
    
    
    
    2,626
    
    
    
    1,666
    
    
    
    -28
    %
    
    
    58
    %Subtotal
    
    
    31,236
    
    
    
    36,881
    
    
    
    35,480
    
    
    
    -15
    %
    
    
    4
    %Total costs of revenues
    
    $
    94,702
    
    
    $
    79,410
    
    
    $
    63,107
    
    
    
    19
    %
    
    
    26
    %
  Advertising.
  Non-advertising.
 50




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##### Table of Contents



Gross profit margins
 Years ended December 31,2007
    
    2006
    
    2005Gross profit margins:Advertising
    
    
    62
    %
    
    
    65
    %
    
    
    67
    %Non-advertising:MVAS
    
    
    58
    %
    
    
    60
    %
    
    
    66
    %Other
    
    
    72
    %
    
    
    60
    %
    
    
    84
    %Subtotal
    
    
    60
    %
    
    
    60
    %
    
    
    67
    %Overall
    
    
    62
    %
    
    
    63
    %
    
    
    67
    %
  Advertising.
 Non-advertising.
 Operating expenses
 Years ended December 31,2007
    
    2006
    
    2005
    
    % of change(In thousands, except percentages)% of net
    
    
    
    
    
    % of net
    
    
    
    
    
    % of net
    
    YOY
    
    YOYrevenues
    
    
    
    
    
    revenues
    
    
    
    
    
    revenues
    
    07 & 06
    
    06 & 05Sales and marketing expenses
    
    $
    50,555
    
    
    
    21
    %
    
    $
    49,972
    
    
    
    23
    %
    
    $
    51,690
    
    
    
    27
    %
    
    
    1
    %
    
    
    -3
    %Product development expenses
    
    $
    21,942
    
    
    
    9
    %
    
    $
    19,573
    
    
    
    9
    %
    
    $
    15,268
    
    
    
    8
    %
    
    
    12
    %
    
    
    28
    %General and administrative expenses
    
    $
    26,738
    
    
    
    11
    %
    
    $
    27,172
    
    
    
    13
    %
    
    $
    18,820
    
    
    
    10
    %
    
    
    -2
    %
    
    
    44
    %
 51




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##### Table of Contents



Sales and marketing expenses.
 Product development expenses.
 General and administrative expenses.
  Amortization of intangible assets
 Interest and other income
 Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)Interest Income
    
    $
    11,522
    
    
    $
    8,510
    
    
    $
    6,551Other Income
    
    
    1,209
    
    
    
    39
    
    
    
    $
    12,731
    
    
    $
    8,549
    
    
    $
    6,551
  Amortization of convertible debt issuance cost
  52




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Gain on sale of business and equity investments, net
  Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)Bravado
    
    $
    
    
    
    $
    161
    
    
    $
    1,487COAL
    
    
    
    
    
    
    
    
    
    
    2,649Shanghai NC Soft
    
    
    
    
    
    
    2,006
    
    
    
    Others
    
    
    830
    
    
    
    (134
    )
    
    
    $
    830
    
    
    $
    2,033
    
    
    $
    4,136% of total net revenues
    
    

    
    *
    
    
    1
    %
    
    
    2
    %
 
 *
    
    Less than 1%  Loss on equity investments, net
  Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)COAL
    
    $
    
    
    
    $
    
    
    
    $
    (2,187
    )Shanghai NC Soft
    
    
    
    
    
    
    (108
    )
    
    
    33Others
    
    
    
    
    
    
    (582
    )
    
    
    (656
    )$
    
    
    
    $
    (690
    )
    
    $
    (2,810
    )% of total net revenues
    
    

    
    *
    
    

    
    *
    
    
    (1
    %)
 
 *
    
    Less than 1% Provision for income taxes
 Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)Current income tax provision
    
    $
    6,030
    
    
    $
    4,401
    
    
    $
    2,671Deferred income tax
    
    
    474
    
    
    
    (350
    )
    
    
    (261
    )Total
    
    $
    6,504
    
    
    $
    4,051
    
    
    $
    2,410Income subject to China operation
    
    $
    70,167
    
    
    $
    56,128
    
    
    $
    51,874Effective tax rate for China operation
    
    
    9
    %
    
    
    7
    %
    
    
    5
    %
   53




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##### Table of Contents



If tax benefits
available to us in China are reduced or repealed, our results of operations could suffer
significantly and your investment in our shares may be adversely affected Income Taxes
 54




---



##### Table of Contents



B. Liquidity and Capital Resources
 As of December 312007
    
    2006
    
    2005(In thousands)Cash and cash equivalents and short-term investments
    
    $
    477,999
    
    
    $
    362,751
    
    
    $
    300,689Working capital
    
    $
    377,608
    
    
    $
    267,116
    
    
    $
    297,910Shareholders equity
    
    $
    494,976
    
    
    $
    387,813
    
    
    $
    319,622
      Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)Net cash provided by operating activities
    
    $
    89,065
    
    
    $
    63,097
    
    
    $
    58,273Net cash used in investing activities
    
    
    (5,857
    )
    
    
    (850
    )
    
    
    (133,810
    )Net cash provided by financing activities
    
    
    19,037
    
    
    
    9,979
    
    
    
    7,015Effect of exchange rate changes on cash and cash equivalents
    
    
    6,244
    
    
    
    2,541
    
    
    
    3,164Net increase (decrease) in cash and cash equivalents
    
    
    108,489
    
    
    
    74,767
    
    
    
    (65,358
    )Cash and cash equivalents at beginning of period
    
    
    163,177
    
    
    
    88,410
    
    
    
    153,768Cash and cash equivalents at end of period
    
    $
    271,666
    
    
    $
    163,177
    
    
    $
    88,410
 55




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##### Table of Contents



Operating activities
    Investing activities
    Financing activities
  56




---



##### Table of Contents



C. Research and Development, Patents and Licenses, etc.
  D. Trend Information
  E. Off-Balance Sheet Arrangements
  F. Contractual Obligations
  Payments due by periodLess than one
    
    
    One to
    
    
    Three to
    
    
    More thanTotal
    
    
    year
    
    
    three years
    
    
    five years
    
    
    five years( In thousands)Operating lease obligations
    
    $
    7,333
    
    
    $
    4,691
    
    
    $
    2,642
    
    
    $
    
    
    
    $
    Purchase commitments
    
    
    43,232
    
    
    
    34,029
    
    
    
    8,724
    
    
    
    434
    
    
    
    45Total contractual obligations
    
    $
    50,565
    
    
    $
    38,720
    
    
    $
    11,366
    
    
    $
    434
    
    
    $
    45
    Item 8. Financial Information  A. Consolidated
Statements and Other Financial Information  Legal
Proceedings.
 57




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##### Table of Contents



Item 6. Directors, Senior Management and Employees
 A. Directors and Senior Management
  Name
    
    Age
    
    PositionCharles Chao
    
    42
    
    President, Chief Executive Officer
and Director (Principal Executive Officer)Herman Yu
    
    37
    
    Chief Financial Officer (Principal Financial and Accounting Officer)Hong Du
    
    36
    
    Chief Operating OfficerTong Chen
    
    41
    
    Executive Vice President & Chief EditorBin Wang
    
    42
    
    Senior Vice President, SINA MobileYan Wang
    
    35
    
    Chairman of the BoardPehong Chen
    
    50
    
    Independent DirectorLip-Bu Tan
    
    48
    
    Independent DirectorTer Fung Tsao
    
    62
    
    Independent DirectorYichen Zhang
    
    44
    
    Independent DirectorSong-Yi Zhang
    
    52
    
    Independent DirectorHurst Lin
    
    43
    
    Director
 Charles Chao
 Herman Yu
 Hong Du
 Tong Chen
 58




---



##### Table of Contents



Bin Wang
 Yan Wang
 Pehong Chen
 Lip-Bu Tan
 Ter Fung Tsao
 Yichen Zhang
 Song-Yi Zhang
 Hurst Lin
 59




---



##### Table of Contents



B. Amounts of Compensation Paid and Benefits Granted
 Compensation
    Stock-based Compensation
 Share Incentive Plans
  Stock-based Compensation
  60




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Ordinary SharesUnderlying
    
    
    
    
    
    Exercise PriceName
    
    Outstanding Options
    
    
    
    
    
    (US$/Share)
    
    Grant Date
    
    Expiration DateChao, Charles
    
    
    *
    
    
    
    
    
    
    $
    3.13
    
    
    January 8, 2001
    
    January 8, 2011*
    
    
    
    
    
    
    $
    1.50
    
    
    March 29, 2001
    
    March 29, 2011*
    
    
    
    
    
    
    $
    1.35
    
    
    August 29, 2001
    
    August 29, 2011*
    
    
    
    
    
    
    $
    17.50
    
    
    June 16, 2003
    
    June 16, 2013*
    
    
    
    
    
    
    $
    24.23
    
    
    July 27, 2004
    
    July 27, 2014*
    
    
    
    
    
    
    $
    24.73
    
    
    June 7, 2006
    
    June 7, 2012*
    (1)
    
    
    

    
    
    
    
    
    
    November 16, 2007
    
    
    Yu, Herman
    
    
    *
    
    
    
    
    
    
    $
    20.86
    
    
    September 7, 2004
    
    September 7, 2014*
    
    
    
    
    
    
    $
    24.73
    
    
    June 7, 2006
    
    June 7, 2012*
    (1)

    
    
    
    
    
    
    
    
    
    November 16, 2007
    
    
    Du, Hong
    
    
    *
    
    
    
    
    
    
    $
    12.98
    
    
    May 21, 2003
    
    May 21, 2013*
    
    
    
    
    
    
    $
    20.86
    
    
    September 7, 2004
    
    September 7, 2014*
    
    
    
    
    
    
    $
    26.43
    
    
    April 25, 2005
    
    April 25, 2015*
    
    
    
    
    
    
    $
    24.73
    
    
    June 7, 2006
    
    June 7, 2012*
    (1)
    
    
    

    
    
    
    
    
    
    November 16, 2007
    
    
    Chen, Tong
    
    
    *
    
    
    
    
    
    
    $
    1.88
    
    
    August 14, 2002
    
    August 14, 2012*
    
    
    
    
    
    
    $
    15.47
    
    
    May 29, 2003
    
    May 29, 2013*
    
    
    
    
    
    
    $
    20.86
    
    
    September 7, 2004
    
    September 7, 2014*
    
    
    
    
    
    
    $
    24.73
    
    
    June 7, 2006
    
    June 7, 2012*
    (1)
    
    
    

    
    
    
    
    
    
    November 16, 2007
    
    
    Wang, Bin
    
    
    *
    
    
    
    
    
    
    $
    24.73
    
    
    June 7, 2006
    
    June 7, 2012Chen, Pehong
    
    
    *
    
    
    
    
    
    
    $
    33.68
    
    
    September 26, 2003
    
    September 26, 2013*
    
    
    
    
    
    
    $
    36.40
    
    
    June 28, 2004
    
    June 28, 2014*
    
    
    
    
    
    
    $
    24.39
    
    
    June 23, 2006
    
    June 23, 2016*
    
    
    
    
    
    
    $
    49.95
    
    
    December 6, 2007
    
    December 6, 2013Chen, Xiaotao (2)
    
    
    
    
    
    
    
    
    
    
    N/A
    
    
    
    N/A

    
    
    N/ADuan, Yongji (3)
    
    
    *
    
    
    
    
    
    
    $
    49.95
    
    
    December 6, 2007
    
    December 6, 2013Tan, Lip-Bu
    
    
    *
    
    
    
    
    
    
    $
    17.00
    
    
    April 12, 2000
    
    April 12, 2010*
    
    
    
    
    
    
    $
    1.32
    
    
    November 27, 2001
    
    November 27, 2011*
    
    
    
    
    
    
    $
    4.94
    
    
    December 16, 2002
    
    December 16, 2012*
    
    
    
    
    
    
    $
    33.68
    
    
    September 26, 2003
    
    September 26, 2013*
    
    
    
    
    
    
    $
    36.40
    
    
    June 28, 2004
    
    June 28, 2014*
    
    
    
    
    
    
    $
    26.37
    
    
    September 27, 2005
    
    September 27, 2015*
    
    
    
    
    
    
    $
    24.39
    
    
    June 23, 2006
    
    June 23, 2016*
    
    
    
    
    
    
    $
    49.95
    
    
    December 6, 2007
    
    December 6, 2013Tsao, Ter Fung
    
    
    *
    
    
    
    
    
    
    $
    17.00
    
    
    April 12, 2000
    
    April 12, 2010*
    
    
    
    
    
    
    $
    33.68
    
    
    September 26, 2003
    
    September 26, 2013*
    
    
    
    
    
    
    $
    36.40
    
    
    June 28, 2004
    
    June 28, 2014*
    
    
    
    
    
    
    $
    26.37
    
    
    September 27, 2005
    
    September 27, 2015*
    
    
    
    
    
    
    $
    24.39
    
    
    June 23, 2006
    
    June 23, 2016*
    
    
    
    
    
    
    $
    49.95
    
    
    December 6, 2007
    
    December 6, 2013Zhang, Song-Yi
    
    
    *
    
    
    
    
    
    
    $
    30.35
    
    
    April 28, 2004
    
    April 28, 2014*
    
    
    
    
    
    
    $
    26.37
    
    
    September 27, 2005
    
    September 27, 2015*
    
    
    
    
    
    
    $
    24.39
    
    
    June 23, 2006
    
    June 23, 2016*
    
    
    
    
    
    
    $
    49.95
    
    
    December 6, 2007
    
    December 6, 2013Zhang, Yi-Chen
    
    
    *
    
    
    
    
    
    
    $
    33.68
    
    
    September 26, 2003
    
    September 26, 2013*
    
    
    
    
    
    
    $
    36.40
    
    
    June 28, 2004
    
    June 28, 2014*
    
    
    
    
    
    
    $
    26.37
    
    
    September 27, 2005
    
    September 27, 2015*
    
    
    
    
    
    
    $
    24.39
    
    
    June 23, 2006
    
    June 23, 2016*
    
    
    
    
    
    
    $
    49.95
    
    
    December 6, 2007
    
    December 6, 2013Wang, Yan
    
    
    *
    
    
    
    
    
    
    $
    24.23
    
    
    July 27, 2004
    
    July 27, 2014Lin, Frank Hurst
    
    
    *
    
    
    
    
    
    
    $
    17.50
    
    
    June 16, 2003
    
    June 16, 2013*
    
    
    
    
    
    
    $
    24.23
    
    
    July 27, 2004
    
    July 27, 2014
 61




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##### Table of Contents



Ordinary SharesUnderlying
    
    
    
    
    
    Exercise PriceName
    
    Outstanding Options
    
    
    
    
    
    (US$/Share)
    
    Grant Date
    
    Expiration DateOther employees
    
    
    1,667,000
    
    
    
    
    
    
    From $0.5 to $33.29
    
    From June 17, 1999 to March 20, 2008

    
    From June 17, 2009 to September
7, 201473,000
    (1)
    
    

    
    
    
    
    

    
    March 20, 2008

    
    
    Total
    
    
    3,357,000
 
 *
    
    Less than one percent of the outstanding ordinary shares. (1)
    
    Restricted share units.(2)
    
    Mr. Chen resigned from SINAs board of directors in April 2008.(3)
    
    Mr. Duan vacated his seat on SINAs board of directors in March 2008.
   Change of Control and Severance Agreements
 Board Practices  Potential Payments upon Termination or Change of
Control
 C. Board Practices
 Terms of Directors and Executive Officers
  Item 6.A. Directors and Senior Management
 62




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##### Table of Contents



Item 6.A. Directors and Senior Management
 Board Committees
  Independent accountant
 1.
    
    Appoint the independent accountant for ratification by the stockholders and approve the
compensation of and oversee the independent accountant.2.
    
    Confirm that the proposed audit engagement team for the independent accountant complies
with the applicable auditor rotation rules.3.
    
    Ensure the receipt of, and review, a written statement from the Companys independent
accountant delineating all relationships between the accountants and the Company,
consistent with Independence Standards Board Standard 1.4.
    
    Review with the Companys independent accountant any disclosed relationship or service
that may impact the objectivity and independence of the accountant.5.
    
    Pre-approve all audit services and permitted non-audit services to be provided by the
independent accountant as required by the Exchange Act.6.
    
    Review the plan for and the scope of the audit and related services at least annually.
 Financial Reporting
 7.
    
    Review and discuss with finance management the Companys earnings press releases as
well as earnings guidance provided to analysts.8.
    
    Review the annual reports of the Company with finance management and the independent
accountant prior to filing of the reports with the SEC.9.
    
    Review with finance management and the independent accountant at the completion of the
annual audit:
 a.
    
    The Companys annual financial statements and related footnotes;b.
    
    The independent accountants audit of the financial statements;c.
    
    Any significant changes required in the independent accountants audit
plan;d.
    
    Any serious difficulties or disputes with management encountered during
the course of the audit;e.
    
    Other matters related to the conduct of the audit which are to be
communicated to the Committee under generally accepted auditing standards.
 Related Party and Relationship Disclosure
 10.
    
    Ensure the receipt of, and review, a report from the independent accountant required by
Section 10A of the Exchange Act.11.
    
    Oversee the Companys compliance with SEC requirements for disclosure of accountants
services and Audit Committee members and activities.12.
    
    Review and approve all related party transactions other than compensation transactions.
 63




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##### Table of Contents



Critical Accounting Policies & Principles and Key Transactions
 13.
    
    Review with finance management and the independent accountant at least annually the
Companys application of critical accounting policies and its consistency from period to
period, and the compatibility of these accounting policies
with generally accepted accounting principles, and (where appropriate) the Companys
provisions for future occurrences which may have a material impact on the financial
statements of the Company.14.
    
    Oversee the Companys finance function, which may include the adoption from time to
time of a policy with regard to the investment of the Companys assets.15.
    
    Periodically discuss with the independent accountant, without Management being present,
(i) their judgments about the quality, appropriateness, and acceptability of the Companys
accounting principles and financial disclosure practices, as applied in its financial
reporting, and (ii) the completeness and accuracy of the Companys financial statements.16.
    
    Review and discuss with finance management all material off-balance sheet transactions,
arrangements, obligations (including contingent obligations) and other relationships of the
Company with unconsolidated entities or other persons, that may have a material current or
future effect on financial condition, changes in financial condition, results of
operations, liquidity, capital resources, capital reserves or significant components of
revenues or expenses.
 Internal Control and Related Matters
 17.
    
    Oversee the adequacy of the Companys system of internal controls. Obtain from the
independent accountant management letters or summaries on such internal controls. Review
any related significant findings and recommendations of the independent accountant together
with managements responses thereto.18.
    
    Oversee the Companys Anti-Fraud and Whistleblower Program.19.
    
    Perform annual self assessment on Audit Committee effectiveness.
    Potential Payments upon Termination or Change of Control
  Terms of Potential Payments  Termination
  64




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##### Table of Contents



Terms of Potential Payments  Change of Control
    D. Employees
  65




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##### Table of Contents



E. Share Ownership
  
    
    each shareholder known to us to own beneficially more than 5% of the ordinary shares;
    
    each director;
    
    each of our executive officers listed in Directors and Senior Management above; and
    
    all of our current directors and executive officers as a group.
  Number of Shares
    
    Percent ofName and Address of Beneficial Owners
    
    Beneficially Owned (#)
    
    Shares Beneficially Owned (%)(1)Major ShareholdersFMR LLC (2)
    
    
    5,361,092
    
    
    
    9.4182 Devonshire StreetBoston, MA 02109Davide Erro
and affiliates (3)
    
    
    3,319,125
    
    
    
    5.836th Floor, 65 Curzon StreetLondon W1J 8PE, EnglandGilder,
Gagnon, Howe & Co. LLC (4)
    
    
    3,130,847
    
    
    
    5.501775 Broadway, 26th FloorNew York, NY 10019Bridger
Management, LLC (5)
    
    
    3,000,000
    
    
    
    5.27101 Park Avenue, 48th FloorNew York, NY 10178OppenheimerFunds, Inc. (6)
    
    
    2,898,202
    
    
    
    5.09Two World Financial Center, 225 Liberty StreetNew York, NY 10281Directors and Executive OfficersLip-Bu Tan (7)
    
    
    *
    
    
    
    *c/o Walden InternationalOne California Street, 28th FloorSan Francisco, CA 94111Ter Fung
Tsao (8)
    
    
    *
    
    
    
    *c/o Helen Hsiao,8F, Suite 801136, Jean-Ai Road, SEC. 3Taipei, TaiwanHurst Lin (9)
    
    
    *
    
    
    
    *Pehong Chen
(10)
    
    
    *
    
    
    
    *333 Distel CircleLos Altos, CA 94022Yan Wang (11)
    
    
    *
    
    
    
    *Yichen Zhang
(12)
    
    
    *
    
    
    
    *CITIC 26/F CITIC Tower1 Tim Mei Avenue,Central Hong KongSong-Yi
Zhang (13)
    
    
    *
    
    
    
    *c/o Morgan Stanley27/F, Three Exchange Square,Central Hong KongCharles Chao
(14)
    
    
    *
    
    
    
    *Herman Yu (15)
    
    
    *
    
    
    
    *Hong Du (16)
    
    
    *
    
    
    
    *Tong Chen (17)
    
    
    *
    
    
    
    *Bin Wang (18)
    
    
    *
    
    
    
    *All
directors and executive officers as a group (12 persons) (19)
    
    
    1,237,452
    
    
    
    2.17
 66




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##### Table of Contents



*
    
    Less than one percent of the outstanding ordinary shares. (1)
    
    For each named person, the percentage ownership includes ordinary shares which the person has
the right to acquire within 60 days after June 6, 2008. However, such shares shall not be
deemed outstanding with respect to the calculation of ownership percentage for any other
person. Beneficial ownership calculations for 5% shareholders are based solely on
publicly-filed Schedule 13Ds or 13Gs, which 5% shareholders are required to file with the
SEC.(2)
    
    Beneficial ownership calculation is based solely on a review of a Schedule 13G filing made
with the SEC on February 14, 2008.(3)
    
    Beneficial ownership calculation is based solely on a review of a Schedule 13G filing made
with the SEC on January 29, 2008 for Grandhara Advisors Europe LLP, Grandhara Master Fund
Limited and Davide Erro.(4)
    
    Beneficial ownership calculation is based solely on a review of a Schedule 13G/A filing made
with the SEC on February 6, 2008.(5)
    
    Beneficial ownership calculation is based solely on a review of a Schedule 13G and Schedule
13G/A filings made with the SEC on February 14, 2008.(6)
    
    Beneficial ownership calculation is based solely on a review of a Schedule 13G filing made
with the SEC on February 6, 2008.(7)
    
    Includes 3,000 shares held by a trust for which Mr. Tan and his wife serve as trustees and
127,750 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(8)
    
    Includes 10,000 shares held by Mr. Tsao and 97,750 shares issuable upon exercise of options
exercisable within 60 days of June 6, 2008.(9)
    
    Includes 60,972 shares held by Mr. Lin and 16,668 shares issuable upon exercise of options
exercisable within 60 days of June 6, 2008.(10)
    
    Includes 6,882 shares held by a trust controlled by Mr. Chen and 45,250 shares issuable upon
exercise of options exercisable within 60 days of June 6, 2008.
 67




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##### Table of Contents



(11)
    
    Includes 200,000 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(12)
    
    Includes 60,250 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(13)
    
    Includes 67,750 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(14)
    
    Consists of 428,637 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(15)
    
    Includes 6,875 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(16)
    
    Includes 34,209 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(17)
    
    Includes 61,459 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(18)
    
    Includes 10,000 shares issuable upon exercise of options exercisable within 60 days of June 6, 2008.(19)
    
    Includes 1,156,598 shares issuable upon exercise of options within 60 days of June 6, 2008
held by all our directors and officers as a group.
  Item 6.B. Compensation  Share Incentive
Plans
 
 Item 7. Major Shareholders and Related Party Transactions
 A. Major Shareholders
   B. Related Party Transactions
    68




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##### Table of Contents



Commercial Contracts
    Control Agreements
  
    
    Our subsidiary STC agreed to provide Yan Wang, our former Chief Executive Officer and
current Chairman of the Board, an interest-free loan of RMB300,000 for purposes of providing
capital to Beijing SINA Internet Information Services Co., Ltd. and RMB300,000 for purposes
of providing capital to Guangdong SINA Internet Information Service Co., Ltd. The entire
principal amount of each of these loans is currently outstanding. Each of these loans was
extended as replacement for loans previously extended to Mr. Wang by BSIT in the same
principal amounts disclosed above and on the same terms as described below, except where
noted, which loans were replaced by the STC loans due to BSIT being dissolved by the
Company.
 69




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##### Table of Contents




    
    STC also agreed to provide Tong Chen, our Executive Vice President and Chief Editor,
interest-free loans totaling RMB300,000 for purposes of providing capital to Guangdong SINA
Internet Information Service Co., Ltd. In addition, STC has agreed to provide Tong Chen
interest-free loans totaling RMB4,500,000 for purposes of providing capital to Beijing SINA
Internet Information Service Co., Ltd. and an interest-free loan of RMB200,000 for purposes
of providing capital to Beijing SINA Infinity Advertising Co., Ltd. The entire principal
amount of each of these loans is currently outstanding. Each of these loans was extended as
replacement for loans previously extended to Mr. Chen by BSIT in the same principal amounts
disclosed above and on the same terms as described below, except where noted, which loans
were replaced by the STC loans due to BSIT being dissolved by the Company.
    
    STC agreed to provide Hong Du, our Chief Operating Officer, an interest-free loan of
RMB5,350,000 for purposes of providing capital to Beijing SINA Internet Information Service
Co., Ltd. The entire principal amount of the loan is currently outstanding. The loan was
extended as replacement for the loan previously extended to Ms. Du by BSIT in the same
principal
amount as disclosed above and on the same terms as described below, except where noted, which
loans were replaced by the STC loans due to BSIT being dissolved by the Company.
    
    The aforementioned capital investments in the VIEs are funded by SINA and recorded as
interest-free loans to the PRC officers and employees. Such interest-free loans are extended
solely for subscription of the shares of the VIEs, and the transfer of ownership of the
shares in the VIEs, as directed by SINA, is the requisite form of repayment of such
interest-free loans. These are not personal loans. Under various contractual agreements,
employee shareholders of the VIEs are required to transfer their ownership in these entities
to our subsidiaries in China when permitted by PRC laws and regulations or to our designees
at any time, and all shareholders of the VIEs are obligated to waive their right of first
refusal or any other rights that are restrictive on such requested transfer. In addition,
our employee shareholders of the VIEs have pledged their shares in the VIEs (and all rights
relating thereto) as collateral for non-payment of (i) the interest-free loans and (ii) fees
on technical and other services due to us. Except as set forth above, employee shareholders
of the VIEs are not otherwise permitted to transfer, pledge or otherwise encumber their
ownership of VIEs without STCs written approval. All voting rights with respect to the
shares of the VIEs are assigned to us. We have the power to appoint all directors and senior
management personnel of the VIEs. Through our wholly-owned subsidiaries in China, we have
also entered into exclusive technical agreements and other service agreements with the VIEs,
under which these subsidiaries provide technical services and other services to the VIEs in
exchange for substantially all net income of the VIEs. In addition to the terms described
above which were also applicable to the BSIT loans, STC has entered into a letter agreement
with the PRC officers and employees that provides for (i) the cancellation of such officers
and employees obligations under the contractual agreements upon the transfer or acquisition
of shares held by such officers and employees and (ii) the indemnification of such officers
and employees for any liability incurred in the course of discharging such officers and
employees obligations under any of the contractual agreements.
 Employment and Compensation Agreements
 Item 6. Directors, Senior
Management and Employees
 Indemnification Agreements
  Registration Rights Agreements
  C. Interests of Experts and Counsel
  70




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##### Table of Contents



Item 8. Financial Information
 A. Consolidated Statements and Other Financial Information
  Legal Proceedings
  Dividend Policy
  B. Significant Changes
  
 Item 9. The Listing
 A. Listing Details
  Trading PriceHigh
    
    LowAnnual Highs and Lows2003
    
    
    46.27
    
    
    
    5.222004
    
    
    49.50
    
    
    
    18.882005
    
    
    34.25
    
    
    
    20.182006
    
    
    30.36
    
    
    
    20.232007
    
    
    59.27
    
    
    
    29.16Quarterly Highs and LowsFirst Quarter 2006
    
    
    28.11
    
    
    
    20.82Second Quarter 2006
    
    
    30.36
    
    
    
    22.35Third Quarter 2006
    
    
    26.61
    
    
    
    20.23Fourth Quarter 2006
    
    
    29.75
    
    
    
    24.20First Quarter 2007
    
    
    37.73
    
    
    
    29.16Second Quarter 2007
    
    
    43.27
    
    
    
    31.53Third Quarter 2007
    
    
    50.45
    
    
    
    34.65Fourth Quarter 2007
    
    
    59.27
    
    
    
    43.50First Quarter 2008
    
    
    46.97
    
    
    
    32.00Monthly Highs and LowsDecember 2007
    
    
    50.57
    
    
    
    43.50January 2008
    
    
    46.97
    
    
    
    34.65February 2008
    
    
    45.90
    
    
    
    38.85March 2008
    
    
    41.22
    
    
    
    32.00April 2008
    
    
    49.45
    
    
    
    35.23May 2008
    
    
    58.60
    
    
    
    45.30
 71




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##### Table of Contents



B. Plan of Distribution
  C. Markets
  D. Selling Shareholders
  E. Dilution
  F. Expenses of the Issue
  
 Item 10. Additional Information
 A. Share Capital
  B. Memorandum and Articles of Association
  C. Material Contracts
  D. Exchange Controls
 Item 4. Information on the CompanyB. Business Overview Government Regulation and
Legal Uncertainties Classified Regulations Foreign Exchange. Item 3. Key Information  Risk Factors -
Restrictions on paying dividends or making other payments to us bind our subsidiaries and VIEs in
China
 E. Taxation
  72




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##### Table of Contents



Cayman Islands Taxation
  United States Federal Income Taxation
   
    
    banks;
    
    financial institutions;
    
    insurance companies;
    
    broker dealers;
    
    traders that elect to mark to market;
    
    tax-exempt entities;
    
    persons liable for alternative minimum tax;
    
    persons holding common share as part of a straddle, hedging, conversion or integrated
transaction;
    
    persons that actually or constructively own 10% or more of our voting shares;
    
    persons holding ordinary shares through partnerships or other pass-through entities; or
    
    persons who acquired ordinary shares pursuant to the exercise of any employee share
option or otherwise as consideration.
   73




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##### Table of Contents




    
    a citizen or individual resident of the United States;
    
    a corporation (or other entity taxable as a corporation for United States federal income
tax purposes) organized under the laws of the United States, any State or the District of
Columbia;
    
    an estate whose income is subject to United States federal income taxation regardless of
its source; or
    
    a trust that (1) is subject to the supervision of a court within the United States and
the control of one or more United States persons or (2) has a valid election in effect under
applicable United States Treasury regulations to be treated as a United States person.
   Taxation of Dividends and Other Distributions on the Ordinary Shares
     Taxation of Disposition of Shares
  74




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##### Table of Contents



Passive Foreign Investment Company
  
    
    at least 75% of its gross income is passive income (the income test), or
    
    at least 50% of the value of its assets (based on an average of the quarterly values of
the assets during a taxable year) is attributable to assets that produce or are held for the
production of passive income (the asset test).
    
    
    the excess distribution or gain will be allocated ratably over your holding period for
the ordinary shares,
    
    the amount allocated to the current taxable year, and any taxable year prior to the first
taxable year in which we became a PFIC, will be treated as ordinary income, and
    
    the amount allocated to each other taxable year will be subject to the highest tax rate
in effect for that taxable year and the interest charge generally applicable to
underpayments of tax will be imposed on the resulting tax attributable to each such taxable
year.
   75




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##### Table of Contents



de minimis
   Information Reporting and Backup Withholding
   F. Dividends and Paying Agents
  G. Statement by Experts
  H. Documents on Display
 http://corp.sina.com http://www.sec.gov
 76




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##### Table of Contents



I. Subsidiary Information
 Item 4. Information on the Company  C.
Organizational Structure
 
 Item 11. Quantitative and Qualitative Disclosures About Market Risk
 Interest Rate and Security Market Risk
    Foreign Currency Exchange Rate Risk
  TranslationChange
in the value of
    
    adjustments to
    
    Transaction gainChinese renminbi against the
    
    comprehensive income
    
    (loss)U.S.
dollar
    
    (in thousands)
    
    (in thousands)Appreciate 2%
    
    $
    7,690
    
    
    $
    (340
    )Appreciate 5%
    
    $
    19,250
    
    
    $
    (850
    )Depreciate 2%
    
    $
    (7,680
    )
    
    $
    340Depreciate 5%
    
    $
    (19,160
    )
    
    $
    850
 77




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##### Table of Contents



Investment Risk
 Equity investment
  Investment in marketable debt securities
  
 Item 12. Description of Securities Other than Equity Securities
  
 PART II
 
 Item 13. Defaults, Dividend Arrearages and Delinquencies
  
 Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
  
 Item 15. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Managements Annual Report on Internal Control over Financial Reporting
 Internal Control-Integrated Framework
   78




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##### Table of Contents



Changes in Internal Control over Financial Reporting
  
 Item 16A. Audit Committee Financial Expert
  
 Item 16B. Code of Ethics
 www.corp.sina.com
 
 Item 16C. Principal Accountant Fees and Services
  2007
    
    2006Audit Fees
    
    $
    1,077,218
    
    
    $
    1,387,080Audit-Related Fees (1)
    
    
    102,547
    
    
    
    Tax Fees (2)
    
    
    36,900
    
    
    
    30,425All Other Fees (3)
    
    
    1,500
    
    
    
    5,500
 
 (1)
    
    Audit-Related Fees consist of fees billed for assurance and related services by our principal
auditors that are reasonably related to the performance of the audit or review of our
financial statements and are not reported under Audit fees.(2)
    
    Tax fees consist of fees billed for professional services related to tax advice and
assistance with tax reporting.(3)
    
    All Other Fees for 2007 includes $1,500 subscription fee for accounting rules and materials.
All Other Fees for 2006 includes $1,500 subscription fee for accounting rules and materials
and $4,000 training fee for FIN 48 Accounting for Uncertainty in Income Taxes.  
 Item 16D. Exemptions from the Listing Standards for Audit Committees
  
 Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
  79




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PART III
 
 Item 17. Financial Statements
  
 Item 18. Financial Statements
  
 Item 19. Exhibits
 ExhibitNumber
    
    Description1.1
    
    Amended and Restated Articles of Association of SINA Corporation (Filed as Exhibit 3.1 to the Companys
Annual Report on Form 10-K filed on March 16, 2005 and incorporated by reference herein).1.2
    
    Amended and Restated Memorandum of Association of SINA.com (Filed as Exhibit 3.1 to the Companys Annual
Report on Form 10-K filed on March 16, 2005 and incorporated by reference herein).2.1
    
    Form of Subordinated Note due July 15, 2023 (Filed as Exhibit 4.1 to the Companys Report on Form 10-Q for
the three month period ended June 30, 2003, and incorporated herein by reference).2.2
    
    Indenture, dated as of July 7, 2003, by and between the Company and the Bank of New York (Filed as Exhibit
4.2 to the Companys Report on Form 10-Q for the three month period ended June 30, 2003, and incorporated
herein by reference).2.3
    
    Registration Rights Agreement, dated as of July 7, 2003, by and between the Company and Credit Suisse
First Boston LLC (Filed as Exhibit 4.3 to the Companys Report on Form 10-Q for the three month period
ended June 30, 2003, and incorporated herein by reference).2.4
    
    Rights Agreement dated as of February 22, 2005 between SINA Corporation and American Stock Transfer &
Trust Company, as Rights Agent (Filed as Exhibit 4.1 to the Companys Report on Form 8-K filed on February
24, 2005, and incorporated herein by reference).4.1
    
    Form of Indemnification Agreement between SINA.com and each of its officers and directors (Filed as
Exhibit 10.1 to the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on
March 27, 2000, as amended, and incorporated herein by reference).4.2
    
    SRS International Ltd. 1997 Stock Option Plan and form of incentive stock option agreement (Filed as
Exhibit 10.2 to the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on
March 27, 2000, as amended, and incorporated herein by reference).4.3
    
    Sinanet.com 1997 Stock Plan and form of stock option agreement (Filed as Exhibit 10.3 to the Companys
Registration Statement on Form F-1, Registration No. 333-11718, filed on March 27, 2000, as amended, and
incorporated herein by reference).4.4
    
    Amended SINA.com 1999 Stock Plan and form of share option agreement (Filed as Exhibit 10.4 to the
Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on March 27, 2000, as
amended, and incorporated herein by reference).4.5
    
    Form of share option agreement under the amended SINA.com 1999 Stock Plan (Filed as Exhibit 10.5 to the
Companys Annual Report on Form 10-K filed on March 16, 2005 and incorporated by reference herein).4.6
    
    1999 Directors Stock Option Plan (Filed as Exhibit 10.6 to the Companys Registration Statement on Form
F-1, Registration No. 333-11718, filed on March 27, 2000, as amended, and incorporated herein by
reference).4.7
    
    Form of nonstatutory stock option agreement under the 1999 Directors Stock Option Plan (Filed as Exhibit
10.6 to the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on March 27,
2000, as amended, and incorporated herein by reference).
 80




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##### Table of Contents



ExhibitNumber
    
    Description4.8
    
    SINA.com 1999 Executive Stock Plan (Filed as Exhibit 10.19 to the Companys Registration Statement on Form
F-1, Registration No. 333-11718, filed on March 27, 2000, as amended, and incorporated herein by
reference).4.9
    
    Lease Agreement of Ideal International Plaza dated April 16, 2004 between SINA Information Technology
Company Limited and Beijing Zhongwu Ideal Real Estate Development Co., Ltd. for the office located in
Suite 01  12, Floor 20, Ideal International Plaza, 2 Zhongguancun High-Tech Square, Beijing, PRC (Filed
as Exhibit 10.1 to the Companys Report on Form 10-Q for the three month period ended June 30, 2004, and
incorporated herein by reference).4.10
    
    Form Lease Agreement of Ideal International Plaza between the Registrants subsidiaries or VIEs and
Beijing Zhongwu Ideal Real Estate Development Co., Ltd. for the office located in Ideal International
Plaza, 2 Zhongguancun High-Tech Square, Beijing, PRC, and the list of the lease agreements (Filed as
Exhibit 10.1 to the Companys Report on Form 10-Q for the three month period ended September 30, 2004, and
incorporated herein by reference).4.11
    
    Business Cooperation Agreement dated March 7, 2000 between Beijing SINA Internet Information Services Co.,
Ltd. and BSRS (Filed as Exhibit 10.23 to the Companys Registration Statement on Form F-1, Registration
No. 333-11718, filed on March 27, 2000, as amended, and incorporated herein by reference).4.12
    
    Equipment and Leased Line Transfer Agreement dated March 7, 2000 between Beijing SINA Internet Information
Services Co., Ltd. and BSRS (Filed as Exhibit 10.23 to the Companys Registration Statement on Form F-1,
Registration No. 333-11718, filed on March 27, 2000, as amended, and incorporated herein by reference).4.13
    
    Advertising Agency Agreement dated March 7, 2000 between Beijing SINA Internet Information Services Co.,
Ltd. and SINA.com (Filed as Exhibit 10.26 to the Companys Registration Statement on Form F-1,
Registration No. 333-11718, filed on March 27, 2000, as amended, and incorporated herein by reference).4.14
    
    Advertisement Production and Technical Service Agreement dated March 7, 2000 between Beijing Stone Rich
Sight Information Technology Co., Ltd. and Beijing SINA Interactive Advertising Co. Ltd (Filed as Exhibit
10.27 to the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on March 27,
2000, as amended, and incorporated herein by reference).4.15
    
    Advertising Publication and Cooperation Agreement dated March 7, 2000 between Beijing SINA Internet
Information Services Co., Ltd. and Beijing SINA Interactive Advertising Co., Ltd (Filed as Exhibit 10.28
to the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on March 27, 2000,
as amended, and incorporated herein by reference).4.16
    
    Amendment to Advertising Agency Agreement dated April 1, 2000 between Beijing SINA Interactive Advertising
Co., Ltd. and SINA.com (Filed as Exhibit 10.37 to the Companys Registration Statement on Form F-1,
Registration No. 333-11718, filed on March 27, 2000, as amended, and incorporated herein by reference).4.17
    
    Amendment to Advertisement Publication and Cooperation Agreement dated April 1, 2000 between Beijing SINA
Interactive Advertising Co., Ltd. and Beijing SINA Internet Information Services Co., Ltd (Filed as
Exhibit 10.38 to the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on
March 27, 2000, as amended, and incorporated herein by reference).4.18
    
    Amendment to Advertising Production and Technical Service Agreement dated April 1, 2000 between Beijing
Stone Rich Sight Information Technology Co., Ltd. and Beijing SINA Interactive Advertising Co., Ltd (Filed
as Exhibit 10.39 to the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on
March 27, 2000, as amended, and incorporated herein by reference).4.19
    
    E-Commerce Cooperation Agreement dated April 1, 2000 between Beijing Stone Rich Sight Information
Technology Co., Ltd. and Beijing SINA Internet Information Services Co., Ltd (Filed as Exhibit 10.40 to
the Companys Registration Statement on Form F-1, Registration No. 333-11718, filed on March 27, 2000, as
amended, and incorporated herein by reference).4.20
    
    Agreement on Short Message Service Cooperation dated November 12, 2002 between Guangzhou Media Message
Technologies Inc. and Guangdong Mobile Communications Corporation (Filed as Exhibit 10.37 to the Companys
Report on Form 10-K for the year ended December 31, 2003, as amended, and incorporated herein by
reference).4.21
    
    Monternet Short Message Cooperation Agreement dated April 28, 2003 between Beijing SINA Internet
Information Services Co., Ltd. and Beijing Mobile Communications Corporation (Filed as Exhibit 10.38 to
the Companys Report on Form 10-K for the year ended December 31, 2003, as amended, and incorporated
herein by reference).
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ExhibitNumber
    
    Description4.22
    
    Form of Loan Agreement between Beijing Sina Information Technology Co., Ltd (a subsidiary of the Company)
and the Companys employees for funding the Variable Interest Entities controlled by the Company (Filed as
Exhibit 10.39 to the Companys Report on Form 10-K for the year ended December 31, 2003, as amended, and
incorporated herein by reference).4.23
    
    Form of Agreement on Authorization to Exercise Shareholders Voting Power between Beijing Sina Information
Technology Co., Ltd (a subsidiary of the Company) and the Companys employees in relation to Variable
Interest Entities controlled by the Company (Filed as Exhibit 10.40 to the Companys Report on Form 10-K
for the year ended December 31, 2003, as amended, and incorporated herein by reference).4.24
    
    Technical Services Agreement dated September 1, 2003 between Beijing New Media Information Technology Co.,
Ltd. and Guangzhou Media Message Technologies Inc (Filed as Exhibit 10.41 to the Companys Report on Form
10-K for the year ended December 31, 2003, as amended, and incorporated herein by reference).4.25
    
    Technical Cooperation Agreement dated September 28, 2003 between Beijing New Media Information Technology
Co., Ltd. and Guangzhou Media Message Technologies Inc (Filed as Exhibit 10.42 to the Companys Report on
Form 10-K for the year ended December 31, 2003, as amended, and incorporated herein by reference).4.26
    
    Technical Services Agreement dated September 1, 2003 between Beijing New Media Information Technology Co.,
Ltd. and Guangdong SINA Internet Information Services Co., Ltd (Filed as Exhibit 10.43 to the Companys
Report on Form 10-K for the year ended December 31, 2003, as amended, and incorporated herein by
reference).4.27
    
    Technical Services Agreement dated January 10, 2003 between Star-Village.com (Beijing) Internet Technology
Limited and Guangzhou Media Message Technologies Inc (Filed as Exhibit 10.44 to the Companys Report on
Form 10-K for the year ended December 31, 2003, as amended, and incorporated herein by reference).4.28
    
    Technical Services Agreement dated January 1, 2003 between Beijing SINA Internet Technology Services Co.,
Ltd. and Beijing SINA Internet Information Services Co., Ltd (Filed as Exhibit 10.45 to the Companys
Report on Form 10-K for the year ended December 31, 2003, as amended, and incorporated herein by
reference).4.29
    
    Technical Services Agreement dated February 24, 2004 between Beijing New Media Information Technology Co.,
Ltd. and Shenzhen Wang Xing Technology Co., Ltd (Filed as Exhibit 10.1 to the Companys Report on Form
10-Q for the three month period ended March 31, 2004, and incorporated herein by reference).4.30
    
    Translation of Monternet Short Message Cooperation Agreement dated March 23, 2004 between Beijing SINA
Internet Information Services Co., Ltd. and Guangdong Mobile Communications Corporation (Filed as Exhibit
10.48 to the Companys Annual Report on Form 10-K filed on March 16, 2005 and incorporated by reference
herein).4.31
    
    Translation of Technical Services Agreement dated January 1, 2005 between SINA.com Technology (China) Co.,
Ltd. and Beijing SINA Infinity Advertising Co., Ltd. (Filed as Exhibit 10.48 to the Companys Report on
Form 10-K for the year ended December 31, 2005, and incorporated herein by reference).4.32
    
    Translation of Technical Services Agreement dated January 1, 2005 between SINA.com Technology (China) Co.,
Ltd. and Beijing SINA Internet Information Services Co., Ltd. (Filed as Exhibit 10.49 to the Companys
Report on Form 10-K for the year ended December 31, 2005, and incorporated herein by reference).4.33
    
    Change of Control Agreement dated November 27, 2000 with Yan Wang (Filed as Exhibit 10.47 to the Companys
Report on Form 10-Q for the three month period ended December 31, 2000, and incorporated herein by
reference).4.34
    
    Change of Control Agreement dated November 27, 2000 with Hurst Lin (Filed as Exhibit 10.46 to the
Companys Report on Form 10-Q for the three month period ended December 31, 2000, and incorporated herein
by reference).4.35
    
    Change of Control Agreement dated February 1, 2001 with Charles Chao (Filed as Exhibit 10.48 to the
Companys Report on Form 10-Q for the three month period ended March 31, 2001, and incorporated herein by
reference).4.36
    
    Employment Agreement dated July 31, 2006 between Charles Guowei Chao and SINA Corporation (Filed as
Exhibit 10.1 to the Companys Report on Form 10-Q for the three month period ended September 30, 2006, and
incorporated herein by reference).
 82




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ExhibitNumber
    
    Description4.37
    
    Stock Purchase Agreement dated February 24, 2004, among SINA, Crillion, the shareholders of Crillion
listed on Part I of Exhibit A of the Stock Purchase Agreement and the individuals listed on Part II of
Exhibit A of the Stock Purchase Agreement (Filed as Exhibit 2.1 to the Companys Report on Form 8-K filed
on April 7, 2004, and incorporated herein by reference).4.38
    
    Amendment Agreement dated March 23, 2004, among SINA, Crillion, the shareholders of Crillion listed on
Part I of Exhibit A of the Stock Purchase Agreement and the individuals listed on Part II of Exhibit A of
the Stock Purchase Agreement (Filed as Exhibit 2.2 to the Companys Report on Form 8-K filed on April 7,
2004, and incorporated herein by reference).4.39
    
    Equity Transfer Agreement dated February 24, 2004, among the individuals listed on Schedule A attached to
the Equity Transfer Agreement, Shenzhen Wang Xing Technology Co., Ltd., a limited liability company
organized and existing under the laws of the Peoples Republic of China, and the individuals listed on
Schedule B attached to the Equity Transfer Agreement (Filed as Exhibit 2.3 to the Companys Report on Form
8-K filed on April 7, 2004, and incorporated herein by reference).4.40
    
    Stock Purchase Agreement dated July 1, 2004 among SINA Corporation, Davidhill Capital Inc., the
shareholders of Davidhill Capital Inc. listed on Part I of Exhibit A to such agreement, and the company
and individuals listed on Part II of Exhibit A to such agreement. (Filed as Exhibit 2.1 to the Companys
Report on Form 8-K filed on October 22, 2004, and incorporated herein by reference).4.41
    
    Amendment Agreement dated October 13, 2004 among SINA Corporation, Davidhill Capital Inc., the
shareholders of Davidhill Capital Inc. listed on Part I of Exhibit A to the Stock Purchase Agreement, and
the company and individuals listed on Part II of Exhibit A to the Stock Purchase Agreement. (Filed as
Exhibit 2.2 to the Companys Report on Form 8-K filed on October 22, 2004, and incorporated herein by
reference).4.42
    
    Asset Purchase Agreement dated July 1, 2004 by and between Guiyang Longmaster Information Technology Co.,
Ltd. and Beijing Davidhill Internet Technology Service Co., Ltd. (Filed as Exhibit 2.3 to the Companys
Report on Form 8-K filed on October 22, 2004, and incorporated herein by reference).4.43
    
    2007 Share Incentive Plan (Filed as Exhibit 4.2 to the Companys Report on Form
S-8 filed on July 26, 2007, and incorporated herein by reference).4.44*
    
    Form of share option agreement for non-employee directors under the 2007 Share Incentive Plan4.45*
    
    Form of restricted share unit agreement for existing service providers under the 2007 Share Incentive Plan.4.46*
    
    Form of performance restricted share unit agreement under the 2007 Share Incentive Plan.4.47*
    
    Form of share option agreement for
existing service providers under the 2007 Share Incentive Plan.8.1*
    
    List of Subsidiaries.12.1*
    
    Certificate of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a)
as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.12.2*
    
    Certificate of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a)
as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.13.1*
    
    Certificate of Chief Executive Officer pursuant to 18 U.S.C. section 1350.13.2*
    
    Certificate of Chief Financial Officer pursuant to 18 U.S.C. section 1350.15.1*
    
    Consent of Independent Registered Public Accounting Firm.15.2*
    
    Consent of Jun He Law offices.
 
 *
    
    Filed herewith. 83




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##### Table of Contents



SIGNATURES
  SINA CorporationBy:
    
    /s/ CHARLES CHAOCharles ChaoDate:
June 30, 2008
    
    
    
    President and Chief Executive Officer
 84




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##### Table of Contents



INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 PageConsolidated Financial Statements:Report of Independent Registered Public Accounting Firm
    
    
    F-2Consolidated Balance Sheets at December 31, 2007 and 2006
    
    
    F-3Consolidated Statements of Operations for the years ended December 31, 2007, 2006 and 2005
    
    
    F-4Consolidated Statements of Shareholders Equity for the years ended December 31, 2007, 2006 and 2005
    
    
    F-5Consolidated Statements of Cash Flows for the years ended December 31, 2007, 2006 and 2005
    
    
    F-6Notes to Consolidated Financial Statements
    
    
    F-7
 F-1




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  Internal Control  Integrated Framework
    /s/ PricewaterhouseCoopers Zhong Tian CPAs Limited Company
 
 F-2




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##### Table of Contents



SINA CORPORATION
 
 CONSOLIDATED BALANCE SHEETS
 (In thousands, except per share data)
 December 31,2007
    
    
    2006ASSETSCurrent assets:Cash and cash equivalents
    
    $
    271,666
    
    
    $
    163,177Short-term investments
    
    
    206,333
    
    
    
    199,574Accounts receivable, net of allowances for doubtful accounts of $5,663 and $4,471, respectively
    
    
    56,719
    
    
    
    45,031Short-term deferred tax assets
    
    
    344
    
    
    
    437Prepaid expenses and other current assets
    
    
    8,496
    
    
    
    9,893Total current assets
    
    
    543,558
    
    
    
    418,112Property and equipment, net
    
    
    26,846
    
    
    
    27,101Equity investments
    
    
    1,300
    
    
    
    1,170Intangible assets, net
    
    
    6,695
    
    
    
    7,871Goodwill
    
    
    82,663
    
    
    
    82,663Other assets
    
    
    1,201
    
    
    
    1,892Total assets
    
    $
    662,263
    
    
    $
    538,809LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    940
    
    
    $
    1,614Accrued liabilities
    
    
    56,931
    
    
    
    41,993Income taxes payable
    
    
    9,079
    
    
    
    7,389Convertible debt
    
    
    99,000
    
    
    
    100,000Total current liabilities
    
    
    165,950
    
    
    
    150,996Long-term liabilities:Other liabilities
    
    
    1,337
    
    
    
    Total liabilities
    
    
    167,287
    
    
    
    150,996Commitments and contingencies (Note 17)Shareholders equity:Ordinary Shares: $0.133 par value; 150,000 shares authorized; 55,521 and 54,344 shares issued
and outstanding
    
    
    7,384
    
    
    
    7,228Additional paid-in capital
    
    
    332,461
    
    
    
    303,868Retained earnings
    
    
    123,702
    
    
    
    65,973Accumulated other comprehensive income (loss):Unrealized loss on investments in marketable securities
    
    
    (920
    )
    
    
    (2,371
    )Cumulative translation adjustments
    
    
    32,349
    
    
    
    13,115Total shareholders equity
    
    
    494,976
    
    
    
    387,813Total liabilities and shareholders equity
    
    $
    662,263
    
    
    $
    538,809
  F-3




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##### Table of Contents



SINA CORPORATION
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (In thousands, except per share data)
 Years ended December 31,2007
    
    
    2006
    
    
    2005Net revenues:Advertising
    
    $
    168,926
    
    
    $
    120,067
    
    
    $
    84,999Non-advertising
    
    
    77,201
    
    
    
    92,787
    
    
    
    108,553246,127
    
    
    
    212,854
    
    
    
    193,552Costs of revenue:Advertising (*)
    
    
    63,466
    
    
    
    42,529
    
    
    
    27,627Non-advertising
    
    
    31,236
    
    
    
    36,881
    
    
    
    35,48094,702
    
    
    
    79,410
    
    
    
    63,107Gross profit
    
    
    151,425
    
    
    
    133,444
    
    
    
    130,445Operating expenses:Sales and marketing (*)
    
    
    50,555
    
    
    
    49,972
    
    
    
    51,690Product development (*)
    
    
    21,942
    
    
    
    19,573
    
    
    
    15,268General and administrative (*)
    
    
    26,738
    
    
    
    27,172
    
    
    
    18,820Amortization of intangible assets
    
    
    1,176
    
    
    
    1,820
    
    
    
    3,159Total operating expenses
    
    
    100,411
    
    
    
    98,537
    
    
    
    88,937Income from operations
    
    
    51,014
    
    
    
    34,907
    
    
    
    41,508Interest and other income, net
    
    
    12,731
    
    
    
    8,549
    
    
    
    6,551Amortization of convertible debt issuance cost
    
    
    (342
    )
    
    
    (685
    )
    
    
    (685
    )Gain on sale of business and investment, net
    
    
    830
    
    
    
    2,033
    
    
    
    4,136Loss on investment in Tidetime Sun
    
    
    
    
    
    
    (147
    )
    
    
    (3,175
    )Share of loss of equity investments, net
    
    
    
    
    
    
    (690
    )
    
    
    (2,810
    )Income before income taxes
    
    
    64,233
    
    
    
    43,967
    
    
    
    45,525Income tax expenses
    
    
    (6,504
    )
    
    
    (4,051
    )
    
    
    (2,410
    )Net income
    
    $
    57,729
    
    
    $
    39,916
    
    
    $
    43,115Basic net income per share
    
    $
    1.05
    
    
    $
    0.74
    
    
    $
    0.82Shares used in computing basic income per share
    
    
    55,038
    
    
    
    53,696
    
    
    
    52,485Diluted net income per share
    
    $
    0.97
    
    
    $
    0.69
    
    
    $
    0.75Shares used in computing diluted income per share
    
    
    60,020
    
    
    
    58,549
    
    
    
    58,792
 
 (*)
    
    Costs of revenues and operating expenses for the years ended December 31, 2007 and 2006
include stock-based compensation expense in accordance with SFAS 123R, which the Company
adopted on January 1, 2006. See Note 13  Stock-based Compensation to the Consolidated
Financial Statements for additional information.  F-4




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##### Table of Contents



SINA CORPORATION
 
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
 (In thousands)
 Retained
    
    
    AccumulatedAdditional
    
    
    Earnings
    
    
    Other
    
    
    TotalOrdinary Shares
    
    
    Paid-in
    
    
    (Accumulated
    
    
    Comprehensive
    
    
    ShareholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Deficit)
    
    
    Income(Loss)
    
    
    EquityBalances at December 31, 2004
    
    
    51,359
    
    
    $
    6,834
    
    
    $
    263,912
    
    
    $
    (17,058
    )
    
    $
    (343
    )
    
    $
    253,345Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    43,115
    
    
    
    
    
    
    
    43,115Unrealized loss on marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,508
    )
    
    
    (2,508
    )Currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,773
    
    
    
    4,773Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    45,380Issuance of ordinary shares pursuant to stock plans
    
    
    1,589
    
    
    
    208
    
    
    
    6,807
    
    
    
    
    
    
    
    
    
    
    
    7,015Business acquisition
    
    
    317
    
    
    
    42
    
    
    
    13,840
    
    
    
    
    
    
    
    
    
    
    
    13,882Balances at December 31, 2005
    
    
    53,265
    
    
    
    7,084
    
    
    
    284,559
    
    
    
    26,057
    
    
    
    1,922
    
    
    
    319,622Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    39,916
    
    
    
    
    
    
    
    39,916Unrealized gain on marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    532
    
    
    
    532Currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,290
    
    
    
    8,290Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    48,738Issuance of ordinary shares pursuant to stock plans
    
    
    895
    
    
    
    119
    
    
    
    9,860
    
    
    
    
    
    
    
    
    
    
    
    9,979Stock-based compensation expenses
    
    
    
    
    
    
    
    
    
    
    9,474
    
    
    
    
    
    
    
    
    
    
    
    9,474Business acquisition
    
    
    184
    
    
    
    25
    
    
    
    (25
    )
    
    
    
    
    
    
    
    
    
    
    Balances at December 31, 2006
    
    
    54,344
    
    
    
    7,228
    
    
    
    303,868
    
    
    
    65,973
    
    
    
    10,744
    
    
    
    387,813Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    57,729
    
    
    
    
    
    
    
    57,729Unrealized gain on marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,451
    
    
    
    1,451Currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,234
    
    
    
    19,234Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    78,414Issuance of ordinary shares pursuant to stock plans
    
    
    1,138
    
    
    
    151
    
    
    
    18,886
    
    
    
    
    
    
    
    
    
    
    
    19,037Stock-based compensation expenses
    
    
    
    
    
    
    
    
    
    
    8,712
    
    
    
    
    
    
    
    
    
    
    
    8,712Issuance of ordinary shares pursuant to
convertible bonds conversion
    
    
    39
    
    
    
    5
    
    
    
    995
    
    
    
    
    
    
    
    
    
    
    
    1,000Balances at December 31, 2007
    
    
    55,521
    
    
    $
    7,384
    
    
    $
    332,461
    
    
    $
    123,702
    
    
    $
    31,429
    
    
    $
    494,976
  F-5




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##### Table of Contents



SINA CORPORATION
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 Years ended December 31,2007
    
    
    2006
    
    
    2005Cash flows from operating activities:Net income
    
    $
    57,729
    
    
    $
    39,916
    
    
    $
    43,115Adjustments to reconcile net income to net cash provided by operating activities:Depreciation
    
    
    13,374
    
    
    
    9,892
    
    
    
    9,593Stock-based compensation expense
    
    
    8,712
    
    
    
    9,474
    
    
    
    Amortization of convertible debt issuance cost
    
    
    342
    
    
    
    685
    
    
    
    685Amortization of intangible assets
    
    
    1,176
    
    
    
    1,820
    
    
    
    3,159Provision for losses on receivables
    
    
    5,294
    
    
    
    5,044
    
    
    
    2,271Deferred income taxes
    
    
    474
    
    
    
    (350
    )
    
    
    (261
    )Gain on sale of business and investment, net
    
    
    (830
    )
    
    
    (2,033
    )
    
    
    (4,136
    )Loss on investment in Tidetime Sun
    
    
    
    
    
    
    147
    
    
    
    3,175Share of loss of equity investments, net
    
    
    
    
    
    
    690
    
    
    
    2,810Loss on disposal of property and equipment
    
    
    83
    
    
    
    17
    
    
    
    156Changes in assets and liabilities (net of effect from disposal):Accounts receivable
    
    
    (14,241
    )
    
    
    (14,791
    )
    
    
    4,324Prepaid expenses and other current assets
    
    
    2,003
    
    
    
    (490
    )
    
    
    3,227Other assets
    
    
    77
    
    
    
    1,429
    
    
    
    (803
    )Accounts payable
    
    
    (58
    )
    
    
    (1
    )
    
    
    (513
    )Accrued liabilities
    
    
    12,426
    
    
    
    8,726
    
    
    
    (8,217
    )Income taxes payable
    
    
    2,504
    
    
    
    2,922
    
    
    
    (312
    )Net cash provided by operating activities
    
    
    89,065
    
    
    
    63,097
    
    
    
    58,273Cash flows from investing activities:Purchases of short-term investments
    
    
    (98,792
    )
    
    
    (102,135
    )
    
    
    (212,532
    )Maturities of short-term investments
    
    
    104,354
    
    
    
    120,121
    
    
    
    122,040Purchases of property and equipment
    
    
    (12,158
    )
    
    
    (14,090
    )
    
    
    (15,369
    )Cash paid for business acquisitions
    
    
    
    
    
    
    (11,266
    )
    
    
    (26,141
    )Cash paid for equity investments
    
    
    (1,261
    )
    
    
    
    
    
    
    (3,024
    )Deposits on equity investment and acquisition
    
    
    
    
    
    
    
    
    
    
    (800
    )Proceeds from sale of business, net
    
    
    
    
    
    
    636
    
    
    
    1,730Proceeds from sale of investments
    
    
    2,000
    
    
    
    5,315
    
    
    
    286Proceeds from sale of investment in Tidetime Sun
    
    
    
    
    
    
    569
    
    
    
    Net cash used in investing activities
    
    
    (5,857
    )
    
    
    (850
    )
    
    
    (133,810
    )Cash flows from financing activities:Proceeds from issuance of ordinary shares
    
    
    19,037
    
    
    
    9,979
    
    
    
    7,015Net cash provided by financing activities
    
    
    19,037
    
    
    
    9,979
    
    
    
    7,015Effect of exchange rate change on cash and cash equivalents
    
    
    6,244
    
    
    
    2,541
    
    
    
    3,164Net increase (decrease) in cash and cash equivalents
    
    
    108,489
    
    
    
    74,767
    
    
    
    (65,358
    )Cash and cash equivalents at the beginning of the year
    
    
    163,177
    
    
    
    88,410
    
    
    
    153,768Cash and cash equivalents at the end of the year
    
    $
    271,666
    
    
    $
    163,177
    
    
    $
    88,410Supplemental disclosures of cash flow information:Cash paid for income taxes
    
    $
    3,634
    
    
    $
    1,294
    
    
    $
    2,891Cash paid for acquisitions
    
    $
    
    
    
    $
    (11,266
    )
    
    $
    (26,141
    )Supplemental disclosures of noncash financing activities:Increase in equity investment from deposit on equity investment
    
    $
    
    
    
    $
    800
    
    
    $
    Ordinary shares issued pursuance to convertible bond conversion
    
    $
    1,000
    
    
    $
    
    
    
    $
    Ordinary shares issued and subject to subsequent issuance for acquisitions
    
    $
    
    
    
    $
    
    
    
    $
    13,882
  F-6




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##### Table of Contents



SINA CORPORATION
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. Significant Accounting Policies
 Business
  Principles of consolidation and basis of presentation
    
    
    Beijing SINA Internet Information Service Co., Ltd. (the ICP Company), a China company
controlled through business agreement. The ICP Company is responsible for operating
www.sina.com.cn in connection with its Internet content company license, selling the
advertisements to advertisers and providing MVAS with its Value-Added Telecommunication
Services Operating License in China via third party operators to the users. It is 1.5% owned
by Yan Wang, the Companys Chairman of the Board, 22.50% owned by the Companys executive
officer Tong Chen, 26.75% owned by the Companys executive officer Hong Du, and 49.25% owned
by two other non-executive PRC employees of the Company. The registered capital of the ICP
Company is $2.5 million.
    
    Guangzhou Media Message Technologies, Inc. (Xunlong), a China company controlled
through business agreement. Xunlong is responsible for providing MVAS in China via third
party operators to the users under its Value-Added Telecommunication Services Operating
License. It is owned by three non-executive PRC employees of the Company. The registered
capital of the Xunlong is $1.2 million.
    
    Beijing Star-Village Online Cultural Development Co., Ltd. (StarVI), previously
translated as Beijing Star-Village.com Cultural Development Co., Ltd, a China company
controlled through business agreement. StarVI is responsible for providing
 F-7




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##### Table of Contents



MVAS in China via third party operators to the users under its Value-Added Telecommunication
Services Operating License. It is owned by three non-executive PRC employees of the Company.
The registered capital of the StarVI is $1.2 million.
    
    Shenzhen Wang Xing Technology Co., Ltd. (Wangxing), a China company controlled through
business agreement. Wangxing is responsible for providing MVAS in China via third party
operators to the users under its Value-Added Telecommunication Services Operating License.
It is owned by three non-executive PRC employees of the Company. The registered capital of
Wangxing is $1.2 million.
    
    Beijing SINA Infinity Advertising Co., Ltd. (the IAD Company), a China company
controlled through business agreement. The IAD Company is an advertising agency. It is 20%
owned by the Companys executive officer Tong Chen and 80% owned by four non-executive PRC
employees of the Company. This entity has an approved business scope including design,
production, agency and issuance of advertisements. The registered capital of the IAD Company
is $0.1 million.
   Use of estimates
  Cash equivalents
  Available-for-sale securities
   F-8




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##### Table of Contents



Allowances for doubtful accounts
  Long-lived assets
 Property and equipment.
  Goodwill.
 Intangible assets other than goodwill.
 Impairment of long-lived assets.
 Equity investments
   F-9




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##### Table of Contents



Convertible debt
  Revenue recognition
 Advertising
    Non-advertising
 MVAS
  F-10




---



##### Table of Contents



Fee-based services.
 E-commerce.
 Enterprise services.
   F-11




---



##### Table of Contents



Costs of revenues
 Advertising
  Non-advertising
  Product development expenses
  Advertising expenses
  Stock-based compensation
    F-12




---



##### Table of Contents



Stock-based Compensation
 Operating leases
  Income taxes
   Foreign currency
  F-13




---



##### Table of Contents



Net income per share
  Comprehensive income
  Recent accounting pronouncements
       F-14




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##### Table of Contents



2. Goodwill and Intangible Assets
  December 31,2007
    
    
    2006(In thousands)Crillion and Memestar (mobile-related)
    
    $
    68,891
    
    
    $
    68,891Davidhill
    
    
    13,772
    
    
    
    13,772Total
    
    $
    82,663
    
    
    $
    82,663
  December 31, 2007
    
    
    December 31, 2006Accumulated
    
    
    
    
    
    
    
    
    
    
    AccumulatedCost
    
    
    amortization
    
    
    Net
    
    
    Cost
    
    
    amortization
    
    
    Net(In thousands)Crillion and Memestar (mobile-related)Non-compete agreements
    
    $
    3,147
    
    
    $
    (3,147
    )
    
    $
    
    
    
    $
    3,147
    
    
    $
    (3,001
    )
    
    $
    146DavidhillTechnology
    
    
    10,300
    
    
    
    (3,605
    )
    
    
    6,695
    
    
    
    10,300
    
    
    
    (2,575
    )
    
    
    7,725Total
    
    $
    13,447
    
    
    $
    (6,752
    )
    
    $
    6,695
    
    
    $
    13,447
    
    
    $
    (5,576
    )
    
    $
    7,871
  F-15




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##### Table of Contents



Fiscal year
    
    (In thousands)2008
    
    $
    1,0302009
    
    
    1,0302010
    
    
    1,0302011
    
    
    1,0302012
    
    
    1,030Thereafter
    
    
    1,545Total expected amortization expense
    
    $
    6,695
 3. Investment in Tidetime Sun
 
 4. Equity Investments
  COAL
    
    
    Shanghai NC-SINA
    
    
    Others
    
    
    Total(In thousands)Balances at December 31, 2004
    
    $
    1,932
    
    
    $
    1,384
    
    
    $
    1,225
    
    
    $
    4,541Investments
    
    
    1,749
    
    
    
    
    
    
    
    1,275
    
    
    
    3,024Sale of investments
    
    
    (1,494
    )
    
    
    
    
    
    
    
    
    
    
    (1,494
    )Share of gain (loss) of equity investments
    
    
    (2,187
    )
    
    
    33
    
    
    
    (656
    )
    
    
    (2,810
    )Balances at December 31, 2005
    
    
    
    
    
    
    1,417
    
    
    
    1,844
    
    
    
    3,261Investments
    
    
    
    
    
    
    
    
    
    
    800
    
    
    
    800Share of loss of equity investments
    
    
    
    
    
    
    (108
    )
    
    
    (582
    )
    
    
    (690
    )Sale of investments
    
    
    
    
    
    
    ( 1,309
    )
    
    
    (892
    )
    
    
    (2,201
    )Balances at December 31, 2006
    
    
    
    
    
    
    
    
    
    
    1,170
    
    
    
    1,170Investment
    
    
    
    
    
    
    
    
    
    
    1,300
    
    
    
    1,300Sale of investment
    
    
    
    
    
    
    
    
    
    
    (1,170
    )
    
    
    (1,170
    )Balance at December 31, 2007
    
    $
    
    
    
    $
    
    
    
    $
    1,300
    
    
    $
    1,300
  F-16




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##### Table of Contents



5. Cash, Cash Equivalents and Short-term Investments
  As of December 31, 2007
    
    

As of December 31, 2006Unrealized
    
    
    Estimated fair
    
    
    
    
    
    
    Unrealized
    
    
    Estimated fairCarrying value
    
    
    losses
    
    
    value
    
    
    Carrying value
    
    
    losses
    
    
    value(In thousands)Cash and cash equivalents:Cash
    
    $
    147,724
    
    
    $
    
    
    
    $
    147,724
    
    
    $
    86,876
    
    
    $
    
    
    
    $
    86,876Cash equivalents:Bank time deposits
    
    
    30,433
    
    
    
    
    
    
    
    30,433
    
    
    
    22,167
    
    
    
    
    
    
    
    22,167Commercial paper
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    24,889
    
    
    
    
    
    
    
    24,889Investment in money market funds
    
    
    93,509
    
    
    
    
    
    
    
    93,509
    
    
    
    29,245
    
    
    
    
    
    
    
    29,245123,942
    
    
    
    
    
    
    
    123,942
    
    
    
    76,301
    
    
    
    
    
    
    
    76,301271,666
    
    
    
    
    
    
    
    271,666
    
    
    
    163,177
    
    
    
    
    
    
    
    163,177Short-term investments:Bank time deposits
    
    
    165,872
    
    
    
    
    
    
    
    165,872
    
    
    
    123,810
    
    
    
    
    
    
    
    123,810U.S. Treasury and federal agency bonds
    
    
    16,080
    
    
    
    (397
    )
    
    
    15,683
    
    
    
    19,128
    
    
    
    (1,146
    )
    
    
    17,982China bank notes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,532
    
    
    
    
    
    
    
    31,532Corporate bonds and notes
    
    
    20,328
    
    
    
    (138
    )
    
    
    20,190
    
    
    
    22,507
    
    
    
    (357
    )
    
    
    22,150Floating rate notes
    
    
    4,973
    
    
    
    (385
    )
    
    
    4,588
    
    
    
    4,968
    
    
    
    (868
    )
    
    
    4,100207,253
    
    
    
    (920
    )
    
    
    206,333
    
    
    
    201,945
    
    
    
    (2,371
    )
    
    
    199,574Total cash, cash equivalents and
short-term investments
    
    $
    478,919
    
    
    $
    (920
    )
    
    $
    477,999
    
    
    $
    365,122
    
    
    $
    (2,371
    )
    
    $
    362,751
   Less than 12 months
    
    
    12 months or more
    
    
    TotalGross
    
    
    
    
    
    
    Gross
    
    
    
    
    
    
    GrossEstimated
    
    
    unrealized
    
    
    Estimated
    
    
    unrealized
    
    
    Estimated
    
    
    unrealizedfair value
    
    
    losses
    
    
    fair value
    
    
    losses
    
    
    fair value
    
    
    losses(In thousands)U.S. Treasury and federal agency bonds
    
    $
    
    
    
    $
    
    
    
    $
    15,683
    
    
    $
    (397
    )
    
    $
    15,683
    
    
    $
    (397
    )Corporate bonds and notes
    
    
    9,949
    
    
    
    (129
    )
    
    
    10,241
    
    
    
    (9
    )
    
    
    20,190
    
    
    
    (138
    )Floating rate notes
    
    
    
    
    
    
    
    
    
    
    4,588
    
    
    
    (385
    )
    
    
    4,588
    
    
    
    (385
    )$
    9,949
    
    
    $
    (129
    )
    
    $
    30,512
    
    
    $
    (791
    )
    
    $
    40,461
    
    
    $
    (920
    )
   GrossEstimated
    
    
    unrealizedfair value
    
    
    losses(In thousands)Short-term investments:Due within one year
    
    $
    176,265
    
    
    $
    (15
    )Due one to five years
    
    
    4,997
    
    
    
    (3
    )Due after five years
    
    
    25,071
    
    
    
    (902
    )$
    206,333
    
    
    $
    (920
    )
  F-17




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##### Table of Contents



6. Balance Sheet Components
 December 31,2007
    
    
    2006(In thousands)Accounts receivable, net:Accounts receivable
    
    $
    62,382
    
    
    $
    49,502Allowance for doubtful accounts:Balance at beginning of year
    
    
    (4,471
    )
    
    
    (2,443
    )Charge to expenses
    
    
    (5,294
    )
    
    
    (5,044
    )Write-off, net of recoveries
    
    
    4,102
    
    
    
    3,016Balance at end of year
    
    
    (5,663
    )
    
    
    (4,471
    )$
    56,719
    
    
    $
    45,031Property and equipment, net:Computers and equipment
    
    $
    57,826
    
    
    $
    54,630Leasehold improvements
    
    
    3,805
    
    
    
    5,107Furniture and fixtures
    
    
    2,663
    
    
    
    2,995Other
    
    
    1,637
    
    
    
    1,31365,931
    
    
    
    64,045Less: Accumulated depreciation and amortization
    
    
    (39,085
    )
    
    
    (36,944
    )$
    26,846
    
    
    $
    27,101Accrued liabilities:Payroll and related expenses
    
    $
    7,990
    
    
    $
    7,478Deferred revenue
    
    
    7,443
    
    
    
    4,156Business taxes
    
    
    5,961
    
    
    
    4,231Sales rebates
    
    
    11,777
    
    
    
    8,454Marketing expenses
    
    
    4,641
    
    
    
    3,128Professional fees
    
    
    2,185
    
    
    
    1,616Content fees
    
    
    8,403
    
    
    
    6,243Others
    
    
    8,531
    
    
    
    6,687$
    56,931
    
    
    $
    41,993
 7.
Related Party Transactions
  F-18




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##### Table of Contents



8. Income Taxes
   Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands, except percentage)Loss subject to non China operation
    
    $
    (5,934
    )
    
    $
    (12,161
    )
    
    $
    (6,349
    )Income subject to China operation
    
    
    70,167
    
    
    
    56,128
    
    
    
    51,874Income before taxes
    
    $
    64,233
    
    
    $
    43,967
    
    
    $
    45,525Income tax expenses applicable to China operation
    
    $
    6,504
    
    
    $
    4,051
    
    
    $
    2,410Effective tax rate for China operation
    
    
    9
    %
    
    
    7
    %
    
    
    5
    %
 Cayman Islands
  United States of America
  Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)Loss subject to U.S. operation (including Taiwan branch)
    
    $
    (485
    )
    
    $
    (798
    )
    
    $
    (446
    )Loss subject to other operations
    
    
    (5,449
    )
    
    
    (11,363
    )
    
    
    (5,903
    )Income subject to China operation
    
    
    70,167
    
    
    
    56,128
    
    
    
    51,874Income before taxes
    
    $
    64,233
    
    
    $
    43,967
    
    
    $
    45,525
  F-19




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##### Table of Contents



December 31,2007
    
    
    2006
    
    
    2005(In thousands)Deferred tax assets:Net operating loss carryforwards
    
    $
    29,282
    
    
    $
    28,461
    
    
    $
    27,848Allowances for doubtful accounts, accruals and other liabilities
    
    
    95
    
    
    
    99
    
    
    
    117Other tax credits
    
    
    346
    
    
    
    346
    
    
    
    346Total deferred tax assets
    
    
    29,723
    
    
    
    28,906
    
    
    
    28,311Less: valuation allowance
    
    
    (29,723
    )
    
    
    (28,906
    )
    
    
    (28,311
    )Deferred tax assets
    
    $
    
    
    
    $
    
    
    
    $
    
 Hong Kong
   December 31,2007
    
    
    2006
    
    
    2005(In thousands)Deferred tax assets:Net operating loss carryforwards
    
    $
    2,130
    
    
    $
    2,290
    
    
    $
    2,013Less: valuation allowance
    
    
    (2,130
    )
    
    
    (2,290
    )
    
    
    (2,013
    )Deferred tax assets
    
    $
    
    
    
    $
    
    
    
    $
    
 China
  
  F-20




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##### Table of Contents



Composition of income tax expenses for China operation
  Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)Income tax provision
    
    $
    (6,030
    )
    
    $
    (4,401
    )
    
    $
    (2,671
    )Deferred income tax provision
    
    
    1,458
    
    
    
    2,948
    
    
    
    2,492Change in valuation allowance
    
    
    (1,932
    )
    
    
    (2,598
    )
    
    
    (2,231
    )Income tax expenses
    
    $
    (6,504
    )
    
    $
    (4,051
    )
    
    $
    (2,410
    )
 Reconciliation of the differences between statutory tax rate and the effective tax rate for China
operation
  Years ended December 31,2007
    
    2006
    
    2005Statutory EIT rate
    
    
    33
    %
    
    
    33
    %
    
    
    33
    %Effect on
preferential tax rate and dividend tax on VIEss undistributed
earnings, net
    
    
    1
    %
    
    
    
    
    
    
    (2
    %)Effect on tax holiday
    
    
    (30
    %)
    
    
    (32
    %)
    
    
    (31
    %)Permanent differences
    
    
    1
    %
    
    
    1
    %
    
    
    1
    %Change in valuation allowance
    
    
    4
    %
    
    
    5
    %
    
    
    4
    %Effective tax rate for China operations
    
    
    9
    %
    
    
    7
    %
    
    
    5
    %
  F-21




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##### Table of Contents



Years ended December 31,2007
    
    2006
    
    2005(In thousands, except per share amount)Tax holiday effect
    
    $
    20,734
    
    
    $
    18,323
    
    
    $
    16,032Basic net income per share effect
    
    $
    0.38
    
    
    $
    0.34
    
    
    $
    0.31
  December 31,2007
    
    
    2006
    
    
    2005(In thousands)Deferred tax assets:Net operating loss carryforwards *
    
    $
    1,021
    
    
    $
    1,774
    
    
    $
    964Allowances for doubtful accounts, accruals and other liabilities
    
    
    4,168
    
    
    
    3,165
    
    
    
    1,358Depreciation
    
    
    2,828
    
    
    
    1,620
    
    
    
    1,289Total deferred tax assets
    
    
    8,017
    
    
    
    6,559
    
    
    
    3,611Less: valuation allowance
    
    
    (6,761
    )
    
    
    (4,829
    )
    
    
    (2,231
    )Deferred tax assets
    
    $
    1,256
    
    
    $
    1,730
    
    
    $
    1,380
 
 *
    
    The net operating loss carryforwards will expire, if unused, in the years ending December 31,
2009 through 2012.  Aggregate net deferred tax assets
  December 31,2007
    
    
    2006
    
    
    2005(In thousands)Short-term deferred tax assets:Allowances for doubtful accounts, accruals and other liabilities
    
    
    145
    
    
    
    
    
    
    
    549Depreciation
    
    
    501
    
    
    
    697
    
    
    
    597Total deferred tax assets
    
    
    646
    
    
    
    697
    
    
    
    1,146Less: valuation allowance
    
    
    (302
    )
    
    
    (260
    )
    
    
    (289
    )Short-term deferred tax assets, net
    
    $
    344
    
    
    $
    437
    
    
    $
    857Long-term deferred tax assets included in other assets:Net operating loss carryforwards
    
    $
    32,433
    
    
    $
    32,525
    
    
    $
    30,825Allowances for doubtful accounts, accruals and other liabilities
    
    
    4,118
    
    
    
    3,264
    
    
    
    926Depreciation
    
    
    2,327
    
    
    
    923
    
    
    
    692Other tax credits
    
    
    346
    
    
    
    346
    
    
    
    346Total deferred tax assets
    
    
    39,224
    
    
    
    37,058
    
    
    
    32,789Less: valuation allowance
    
    
    (38,312
    )
    
    
    (35,765
    )
    
    
    (32,266
    )Long-term deferred tax assets, net
    
    $
    912
    
    
    $
    1,293
    
    
    $
    523Net deferred tax assets
    
    $
    1,256
    
    
    $
    1,730
    
    
    $
    1,380
 F-22




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##### Table of Contents



Movement of valuation allowances for deferred tax assets
  Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands)Balance at beginning of the year
    
    $
    36,025
    
    
    $
    32,555
    
    
    $
    23,295Provision for the year
    
    
    2,589
    
    
    
    3,470
    
    
    
    9,260Balance at end of the year
    
    $
    38,614
    
    
    $
    36,025
    
    
    $
    32,555
 9. Net Income Per Share
   Years ended December 31,2007
    
    
    2006
    
    
    2005(In thousands, except per share amounts)Basic net income per share calculation:Numerator:Net income used in computing basic net income per share
    
    $
    57,729
    
    
    $
    39,916
    
    
    $
    43,115Denominator:Weighted average ordinary shares outstanding
    
    
    55,038
    
    
    
    53,696
    
    
    
    52,455Ordinary shares to be issued for business acquisition
    
    
    
    
    
    
    
    
    
    
    30Shares used in computing basic net income per share
    
    
    55,038
    
    
    
    53,696
    
    
    
    52,485Basic net income per share
    
    $
    1.05
    
    
    $
    0.74
    
    
    $
    0.82Diluted net income per share calculation:Numerator:Net income
    
    $
    57,729
    
    
    $
    39,916
    
    
    $
    43,115Amortization of convertible debt issuance cost
    
    
    342
    
    
    
    685
    
    
    
    685Net income used in computing diluted net income per share
    
    $
    58,071
    
    
    $
    40,601
    
    
    $
    43,800Denominator:Weighted average ordinary shares outstanding
    
    
    55,038
    
    
    
    53,696
    
    
    
    52,455Weighted average ordinary shares equivalents:Stock options
    
    
    1,114
    
    
    
    967
    
    
    
    2,335Convertible debt
    
    
    3,868
    
    
    
    3,877
    
    
    
    3,877Others
    
    
    
    
    
    
    9
    
    
    
    125Shares used in computing diluted net income per share
    
    
    60,020
    
    
    
    58,549
    
    
    
    58,792Diluted net income per share
    
    $
    0.97
    
    
    $
    0.69
    
    
    $
    0.75
 10. Employee Benefit Plans
 401(k) Savings Plan
  F-23




---



##### Table of Contents



China Contribution Plan
  11. Profit Appropriation
  
 12. Shareholders Equity
 Stockholder Rights Plan
   F-24




---



##### Table of Contents



13. Stock-based Compensation
 2007 Share Incentive Plan
  1999 Stock Plan
   1999 Executive Stock Option Plan
  1999 Directors Stock Option Plan
  F-25




---



##### Table of Contents



Employee Stock Purchase Plan
  Compensation Costs
  Years ended December 31,2007
    
    2006(In thousands)Options
    
    Restricted Share Units
    
    Options
    
    Restricted Share UnitsCosts of revenues
    
    $
    1,605
    
    
    $
    183
    
    
    $
    1,743
    
    
    
    N/ASales and marketing
    
    $
    1,091
    
    
    $
    143
    
    
    $
    1,511
    
    
    
    N/AProduct development
    
    $
    1,593
    
    
    $
    
    
    
    $
    1,808
    
    
    
    N/AGeneral and administrative
    
    $
    3,455
    
    
    $
    642
    
    
    $
    4,412
    
    
    
    N/A
   F-26




---



##### Table of Contents



Year
ended December 31, 2005(In thousands,
except per share amounts)Net income:As reported
    
    
    $
    43,115Deduct: Employee stock
purchase plan related
compensation expenses
determined under fair value
based method
    
    
    
    (73
    )Deduct: Stock-based employee
compensation expenses
determined under fair value
based method
    
    
    
    (9,332
    )Pro forma
    
    
    $
    33,710Basic net income per share:As reported
    
    
    $
    0.82Pro forma
    
    
    $
    0.64Diluted net income per share:As reported
    
    
    $
    0.75Pro forma
    
    
    $
    0.59
 Valuation of Stock Options
  Years ended December 31,2007
    
    2006
    
    2005Stock options:Expected term (in years)
    
    
    4.0
    
    
    
    3.8-5.0
    
    
    
    1.0-4.0Expected volatility
    
    
    50%
    
    
    
    68%-71%
    
    
    
    61%-87%Risk-free interest rate
    
    
    3.2%
    
    
    
    5.0%-5.2%
    
    
    
    2.93%-4.09%Expected dividend yield
    
    
    0
    
    
    
    0
    
    
    
    0
   Shares AvailableDecember 31, 2004
    
    
    1,317Additional approved
    
    
    1,125Granted
    
    
    (146
    )Cancelled/expired/forfeited
    
    
    385December 31, 2005
    
    
    2,681Granted
    
    
    (2,100
    )Cancelled/expired/forfeited
    
    
    722December 31, 2006
    
    
    1,303Increased authorization
    
    
    5,000Granted *
    
    
    (434
    )Cancelled/expired/forfeited
    
    
    (1,300
    )December 31, 2007
    
    
    4,569
 
 *
    
    In 2007, 84,000
options and 200,000 restricted shares units, or 350,000 equivalent
shares, were granted. F-27




---



##### Table of Contents



Summary of Stock Option
  Weighted AverageOptions
    
    
    Weighted Average
    
    
    Remaining
    
    
    AggregateOutstanding
    
    
    Exercise Price
    
    
    Contractual Life
    
    
    Intrinsic Value(in thousands)
    
    
    
    
    
    
    (in years)
    
    
    (in thousands)December 31, 2004
    
    
    5,418
    
    
    $
    11.62Granted
    
    
    146
    
    
    $
    26.38Exercised
    
    
    (1,569
    )
    
    $
    4.30Cancelled/expired/forfeited
    
    
    (385
    )
    
    $
    15.59December 31, 2005
    
    
    3,610
    
    
    $
    14.97Granted
    
    
    2,100
    
    
    $
    23.90Exercised
    
    
    (896
    )
    
    $
    11.14Cancelled/expired/forfeited
    
    
    (722
    )
    
    $
    11.84December 31, 2006
    
    
    4,092
    
    
    $
    20.95
    
    
    
    6.14
    
    
    $
    32,668Granted
    
    
    84
    
    
    $
    49.95Exercised
    
    
    (1,138
    )
    
    $
    16.73Cancelled/expired/forfeited
    
    
    (238
    )
    
    $
    22.31December 31, 2007
    
    
    2,800
    
    
    $
    23.41
    
    
    
    5.22
    
    
    $
    58,981Vested and expected to vest as of
December 31, 2006
    
    
    3,898
    
    
    $
    20.82
    
    
    
    6.16
    
    
    $
    31,658Exercisable as of December 31, 2006
    
    
    1,882
    
    
    $
    18.56
    
    
    
    6.38
    
    
    $
    20,015Vested and expected to vest as of
December 31, 2007
    
    
    2,711
    
    
    $
    23.32
    
    
    
    5.24
    
    
    $
    57,321Exercisable as of December 31, 2007
    
    
    1,561
    
    
    $
    21.86
    
    
    
    5.53
    
    
    $
    35,046
     Weighted Average
    
    
    Weighted
    
    
    
    
    
    
    WeightedOptions
    
    
    Remaining
    
    
    Average
    
    
    Options
    
    
    AverageRange of Exercise prices
    
    Outstanding
    
    
    Contractual Life
    
    
    Exercise Price
    
    
    Exercisable
    
    
    Exercise Price(in thousands)
    
    
    (in years)
    
    
    
    
    
    
    (in thousands)$0.5  $20.86
    
    
    692
    
    
    
    5.36
    
    
    $
    15.67
    
    
    
    578
    
    
    $
    14.66$23.17  $23.17
    
    
    739
    
    
    
    4.45
    
    
    $
    23.17
    
    
    
    183
    
    
    $
    23.17$24.23  $24.73
    
    
    1,022
    
    
    
    5.27
    
    
    $
    24.58
    
    
    
    543
    
    
    $
    24.48$25.57  $49.95
    
    
    347
    
    
    
    6.48
    
    
    $
    35.94
    
    
    
    257
    
    
    $
    31.582,800
    
    
    
    5.22
    
    
    $
    23.41
    
    
    
    1,561
    
    
    $
    21.86
 F-28




---



##### Table of Contents



Summary
of Service-Based Restricted Share Units
  Shares Granted
    
    Weighted-Average Grant-Date(in thousands)
    
    Fair ValueJanuary 1, 2007
    
    
    
    
    
    
    Awarded
    
    
    100
    
    
    $
    46.83Issued
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    December 31, 2007
    
    
    100
    
    
    $
    46.83
   Summary
of Performance-Based Restricted Share Units
  Shares Granted
    
    Weighted-Average Grant-Date(in thousands)
    

Fair ValueJanuary 1, 2007
    
    
    
    
    
    
    Awarded
    
    
    100
    
    
    $
    46.83Issued
    
    
    
    
    
    
    Forfeited
    
    
    (2
    )
    
    
    December 31, 2007
    
    
    98
    
    
    $
    46.83
   14. Segment Information
   Advertising
    
    MVAS
    
    Other
    
    Total(In thousands)Year ended and as of December 31, 2007:Net revenues
    
    $
    168,926
    
    
    $
    70,489
    
    
    $
    6,712
    
    
    $
    246,127Costs of revenues
    
    
    63,466
    
    
    
    29,339
    
    
    
    1,897
    
    
    
    94,702Gross profit margins
    
    
    62
    %
    
    
    58
    %
    
    
    72
    %
    
    
    62
    %Year ended and as of December 31, 2006:Net revenues
    
    $
    120,067
    
    
    $
    86,257
    
    
    $
    6,530
    
    
    $
    212,854Costs of revenues
    
    
    42,529
    
    
    
    34,255
    
    
    
    2,626
    
    
    
    79,410Gross profit margins
    
    
    65
    %
    
    
    60
    %
    
    
    60
    %
    
    
    63
    %Year ended and as of December 31, 2005:Net revenues
    
    $
    84,999
    
    
    $
    98,070
    
    
    $
    10,483
    
    
    $
    193,552Costs of revenues
    
    
    27,627
    
    
    
    33,814
    
    
    
    1,666
    
    
    
    63,107Gross profit margins
    
    
    67
    %
    
    
    66
    %
    
    
    84
    %
    
    
    67
    %
 F-29




---



##### Table of Contents



China
    
    U.S.
    
    Hong Kong
    
    Taiwan
    
    Total(In thousands)Year ended and as of December 31, 2007:Revenues
    
    $
    242,036
    
    
    $
    2,026
    
    
    $
    1,805
    
    
    $
    260
    
    
    $
    246,127Long-lived assets
    
    
    25,481
    
    
    
    174
    
    
    
    924
    
    
    
    267
    
    
    
    26,846Year ended and as of December 31, 2006:Revenues
    
    $
    209,200
    
    
    $
    1,942
    
    
    $
    1,395
    
    
    $
    317
    
    
    $
    212,854Long-lived assets
    
    
    25,726
    
    
    
    157
    
    
    
    1,147
    
    
    
    71
    
    
    
    27,101Year ended and as of December 31, 2005:Revenues
    
    $
    189,207
    
    
    $
    2,060
    
    
    $
    1,775
    
    
    $
    510
    
    
    $
    193,552Long-lived assets
    
    
    21,746
    
    
    
    143
    
    
    
    175
    
    
    
    143
    
    
    
    22,207
  15. Certain Risks and Concentrations
     Years ended December 31,As a percentage of total net revenues
    
    2007
    
    2006
    
    2005MVAS revenues billed via China Mobile
    
    
    21
    %
    
    
    30
    %
    
    
    46
    %Revenues from SMS product line
    
    
    15
    %
    
    
    26
    %
    
    
    37
    %
 December 31,As a percentage of total accounts receivables
    
    2007
    
    2006Receivables from China Mobile
    
    
    *
    
    
    
    25
    %
 
 *
    
    Less than 10% F-30




---



##### Table of Contents



16. Convertible Debt
  F-31




---



##### Table of Contents



17. Commitments and Contingencies
  Less than one
    
    One to
    
    Three to
    
    More thanTotal
    
    year
    
    Three years
    
    five years
    
    five years(In thousands)Operating lease commitments
    
    $
    7,333
    
    
    $
    4,691
    
    
    $
    2,642
    
    
    $
    
    
    
    $
    
  Less than one
    
    One to
    
    Three to
    
    More thanTotal
    
    year
    
    Three years
    
    Five years
    
    five years(In thousands)Purchase commitments
    
    $
    43,232
    
    
    $
    34,029
    
    
    $
    8,724
    
    
    $
    434
    
    
    $
    45
   18. Subsequent Events
  F-32