Sina Shares Slump on Outlook (SINA)
Chinese online media company, Sina Corp. (NASDAQ: SINA) slumped 15.12% on Friday after the company following closing bell ring in the preceding session provided a lackluster outlook for the current quarter revenue even though earnings in the fiscal third quarter topped analysts’ expectation.
For the fourth quarter, the company now expects net revenue in the range of $132 million $136 million. Advertising revenue for the period is expected to rise between 6 % to 8% percent from the year earlier quarter.
Analysts polled by Thomson Reuters are expecting revenue of $151.9 million.
Sina, which generates bulk of the revenue mainly through online advertising on its website and microblogging site, Weibo , is facing stiff challenge this year as advertisers cut their promotional and marketing budgets in the wake of rising macroeconomic uncertainty.
Analysts also said that recent bickering between China and Japan over few desolated islands located in East China Sea might have also impacted Company’s website advertising sales since most Japanese firms, mainly automobile makers, slashed advertising in China.
For the fiscal third quarter, Sina reported net profit of $9.9 million, compared to a loss of $336.3 million reported in the year earlier quarter.
Analysts’ consensus estimate was for earnings of $7.5 million.
Revenue from advertising rose 19% to $120.6 million in the third quarter as strong revenue from microblogging site helped in offsetting weaker advertising sales in its website.
Revenue from non-advertising operations soared 9% to $31.8 million, beating company’s own guidance of $25.0 million to $26.0 million. Revenue from Mobile-value-added-services (MVAS) came at $19.1 million, compared to $21.4 million in the year-ago quarter.
Overall net revenue stood at $152.4 million compared to $130.3 million, in the year earlier period.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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