Sina, the firm behind China’s hugely popular Sina Weibo microblogging platform, announced improved financial results for Q1 2013 as increased revenue saw its net loss reduced to $13.2 million. That’s down from a loss of $13.7 million one year prior.
The company, which also operates a successful Internet portal business, recorded overall net revenue of $126.0 million, up from $106.2 million for the same period in 2012. Sina says advertising revenue jumped 20 percent year-on-year (to $94.3 million — within its forecast range), well non-advertising revenue was also up, rising 14 percent to $31.7 million (above its forecast).
Revenue was down on Q4 2012 ($139.1 million) when it posted a slim $2.4 million net profit. However, with Chinese New Year in February, Q1 2013 is traditionally a quieter time for Internet companies so some decrease was expected.
Sina Weibo has more than 400 million registered users and the service enjoys a large profile in China; though it is moderated, it is often a forum for dissent against the government and a platform for ‘free'(er) speech in China. Yet, the company has found it difficult to translate its success into monetization, particularly on mobile devices.
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In an earnings call this morning, the company revealed that Weibo has almost 50 million active users per day, with more 75 percent logging into the service from their smartphone, as noted by the Wall Street Journal’s Paul Mozur.
Sina has come under significant pressure from Tencent‘s WeChat mobile messaging service, which has more than 300 million registered users, all but 40 million of whom are in China.
Chairman and CEO Charles Chao previously said WeChat was responsible for cutting the average user session on Weibo, but, on the call today, Sina said it had seen an increase in time spent on Weibo during the last quarter.
The company is betting on mobile commerce, after the Alibaba Group grabbed an 18 percent slice in the company for $586 million. The deal will see the two companies work on combined products to connect Alibaba’s numerous Web retail stores — including B2B Taobao and B2C Tmall — to Sina Weibo.
That tie-up is significant since Tencent is preparing to introduce e-commerce to WeChat, via an integration with its Tenpay service. Not only are Sina and Alibaba moving first as they explore the potential of social payments, but the sheer amount of data each has will be key for the future.
A statement from Chao explained more about the mobile push, and alliance with Alibaba.
As we start 2013, we are making good progress in transitioning from a PC-centric to a mobile-centric Internet company with new product launches and improved monetization.
In April, we formed a strategic alliance with Alibaba Group to catapult us into social commerce. By partnering with Alibaba, Weibo is well positioned to play a key role in the future of e-commerce, particularly in mobile commerce as we explore ways for our users to search, share and buy the goods and services of the millions of merchants on Taobao and Tmall.
Sina is forecasting Q2 2013 net revenue of between $143 million and $147 million: “Advertising revenue to be between $117 million and $119 million, and non-GAAP non-advertising revenue to be between $26 million and $28 million,” according to a statement.
Previous earnings: SINA sees mixed Q4 2012 earnings with $139.1m in revenue, EPS of $0.03 as it updates its leadership
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