Chinese Internet media and wireless services company Sina Corporation reports its net revenues and profit both fell as it announced its unaudited financial results for the quarter ended June 30, 2009.
Sina.com reported total revenues of USD90.3 million, compared to USD91.3 million in the same period in 2008 and USD73.8 million for the first quarter of 2009. Advertising revenues decreased 11% year over year to USD57.8 million, while non-advertising revenues increased 23% year over year to USD32.5 million. GAAP net income decreased 41% year over year to USD13.3 million.
"During the second quarter of 2009, we saw strong execution in our online advertising business in China, which grew 35% from the prior quarter. The sequential growth rate was faster than our typical seasonal adjustment and shows that we are able to take advantage of an economic rebound," stated Charles Chao, CEO of Sina. "While further improvement of our advertising business will depend on the depth and sustainability of the economic recovery in China, we are seeking opportunities in the current environment to play a more critical and expanded role to brand advertisers in China by leveraging Sina's leading online media platform, strong brand recognition and large, high-end user base."
Advertising revenues for the second quarter of 2009 totaled USD57.8 million, representing an 11% decrease from the same period last year and a 34% increase from last quarter. For the second quarter of 2009, advertising revenues from China, which represented 99% of the Company's total advertising revenues, decreased 11% from the same period last year and grew 35% from last quarter.
Non-advertising revenues for the second quarter of 2009 totaled USD32.5 million, representing a 23% increase from the same period in 2008 and a 6% increase from the previous quarter. For the second quarter of 2009, MVAS revenues, which accounted for 95% of non-advertising revenues, reached USD30.9 million, representing a 26% increase from the same period last year and a 7% increase from the previous quarter.
Gross margin for the second quarter of 2009 was 56%, compared to 62% for the same period last year and 52% last quarter. Operating expenses for the second quarter of 2009 totaled USD36.7 million, flat over the same period last year and an increase of 23% from last quarter. Income from operations for the second quarter of 2009 was USD13.6 million, compared to USD19.6 million for the same period last year and USD8.7 million from last quarter.
Net income for the second quarter of 2009 was USD13.3 million, compared to USD22.5 million in the same period last year and USD9.7 million last quarter. Diluted net income per share for the second quarter of 2009 was USD0.23, compared to USD0.37 in the same period last year and USD0.17 last quarter.
As of June 30, 2009, Sina's cash, cash equivalents and short-term investments totaled USD582.0 million, compared to USD540.9 million and USD603.8 million as of June 30, 2008 and December 31, 2008, respectively. Cash flow from operating activities for the second quarter of 2009 was USD18.8 million, compared to USD20.8 million for the same period last year and USD15.9 million last quarter.
On December 22, 2008, Sina.com announced that it entered into a definitive agreement with Focus Media Holding Limited to acquire substantially all of the assets of Focus Media's digital out-of-home advertising networks, including its LCD display network, poster frame network and certain in-store network. The transaction is still undergoing antitrust review by authorities in China. If the anti-trust approval is not received by the end of September 2009, both parties will need to re-negotiate an extension of the closing deadline in order to complete the transaction.
