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  • Weibo predicts revenue reduction due to coronavirus

    Owner of the largest social network in China, Weibo Corp. reported a 43% drop in net income in October-December 2019 to $95.068 million, or 42 cents per share, from $166.507 million, or 73 cents per share a year earlier. In the first quarter, the company expects revenue to decrease by 15-20% due to the coronavirus.

    Weibo predicts revenue reduction due to coronavirus

    The company's adjusted earnings per share in the reporting quarter were 77 cents. Analysts surveyed by Bloomberg had expected an average of 72 cents. Weibo's quarterly revenue fell 3% to $468,148 million, while analysts forecast $ 468.9 million in advertising and marketing revenue fell to $405,921 million from $417,016 million.

    The number of users of social networks with account activity at least once a month by the end of December increased to 516 million, which is 54 million more than a year earlier. The number of active users daily increased by 22 million, to 222 million.

    Weibo noted that the high level of uncertainty around the development of the situation with the coronavirus makes it difficult to predict the impact of the epidemic on financial performance. "According to our current best estimate, Weibo’s revenue in the first quarter will be reduced by 15-20% on an annualized basis, excluding currency fluctuations," the report said.

    Weibo ADRs are down 11.9% in electronic trading in New York. Since the beginning of the year, the company's capitalization has decreased by 6.4% to $5.35 billion.

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