Weibo Corp ((WB)) has held its Q4 earnings call. Read on for the main highlights of the call.
Weibo Corp’s recent earnings call revealed a mixed sentiment, balancing positive developments with ongoing challenges. The company reported stable overall revenue and growth in value-added services, alongside strong user metrics. However, it faced hurdles in advertising revenue and industry-specific struggles. Despite these challenges, Weibo remains optimistic about future growth through AI integration and strategic investments.
Stable Revenue and Growth in Value-Added Services
Weibo Corp reported a total revenue of USD 1.75 billion for the full year 2024, marking a slight increase of 1% on a constant currency basis. The company saw a notable 13% year-over-year growth in value-added service revenue, largely driven by the upgrade and restructuring of its membership services.
Strong User Metrics
The company demonstrated solid user engagement with its monthly active users (MAU) reaching 590 million and daily active users (DAUs) hitting 260 million in December 2024. These metrics underscore Weibo’s robust user base and engagement levels.
Profitability and Cash Flow
Weibo’s non-GAAP operating income for the full year 2024 was USD 584.1 million, reflecting a strong non-GAAP operating margin of 33%. The company also reported cash provided by operating activities amounting to USD 639.9 million, indicating healthy cash flow.
AI Integration and Development
Significant progress was made in AI applications, particularly in intelligent search and social interaction. These advancements are expected to enhance user experience and operational efficiency, positioning Weibo for future growth.
Annual Cash Dividend Announcement
The Board of Directors approved an annual cash dividend of USD 0.82 per ordinary share for the fiscal year 2022, totaling approximately USD 200 million, reflecting the company’s commitment to returning value to shareholders.
Advertising Revenue Decline
Weibo faced a 2% year-over-year decline in total ad revenue, which reached USD 1.5 billion for 2024. This decrease was primarily due to challenges in the online game, cosmetics, personal care, and luxury sectors.
Macroeconomic and Industry Uncertainties
Despite some government stimulus policies, broader economic measures have yet to significantly recover advertiser and consumer markets, particularly affecting discretionary categories. This uncertainty continues to pose challenges for Weibo.
Gaming Industry Uncertainty
The gaming industry saw a decline in ad revenue due to a high base effect and a lack of major game launches in 2024, creating uncertainty for 2025. This sector’s performance remains a concern for Weibo moving forward.
Forward-Looking Guidance
Looking ahead, Weibo provided guidance for the fourth quarter and fiscal year 2024. The company reported Q4 total revenue of USD 456.8 million, with ad revenue at USD 385.9 million and value-added service revenues at USD 71 million. For the full year, Weibo plans to focus on user growth, content ecosystem, and operating efficiency, alongside continued investments in AI technology to enhance product capabilities and drive long-term growth.
In conclusion, Weibo Corp’s earnings call highlighted a balanced sentiment with stable revenue and strong user metrics, countered by challenges in advertising revenue and industry uncertainties. The company’s strategic focus on AI integration and investments positions it for potential growth, despite the hurdles it faces in the current economic landscape.