Sina profit rises 38pc as adverts go online
Sina Corp, which runs the biggest website on the mainland, said second-quarter profit surged 38.4 per cent as more companies bought online advertisements.
Net income rose to US$14.5 million from US$10.4 million a year earlier, beating the US$12 million estimate in a Bloomberg analyst survey.
Sales rose 11 per cent to US$59.8 million and the firm estimated that third-quarter revenue would range between US$63 million and US$65 million.
'This is the low end of market estimates,' said Dick Wei, China internet analyst of JP Morgan.
Shares of Sina dropped 4.9 per cent to US$39.62 in after-hour trading on the Nasdaq on Monday.
Its key income driver in the second quarter was online advertising, which grew more than 40 per cent and generated 68.9 per cent of total revenue.
'As the Beijing Olympics approach and the internet takes an increasing share of advertisers' budgets, the growth in online advertising will continue,' said Mr Wei.
Sina's wireless business fell 24 per cent and Mr Wei expected that to remain flat with the absence of new policies by the government and mobile operators to boost the sector. Other non-advertising revenues, mainly search and fee-based revenues, fell 10 per cent to US$1.6 million.
Compared with the first quarter, the sector's revenue rose 27 per cent after Sina gave up on its own search engine and partnered Google in June. Mr Wei expected Sina and Google to experiment on services in the coming quarters.
Meanwhile, the company has named Herman Yu as chief financial officer. Mr Yu joined Sina in 2004.