Weibo (WB, Financial) announced its Q1 revenue of $396.9 million, slightly surpassing market expectations of $394.21 million. The company reported having 591 million monthly active users and 261 million average daily active users as of March.
CEO Gaofei Wang expressed satisfaction with the advancements in their AI product offerings. Weibo has focused on enhancing user experience by integrating social features and upgrading its recommendation system. This strategy led to increased user engagement and community growth in the first quarter.
Weibo also introduced the AI-powered Weibo Intelligent Search to all users, witnessing significant growth in both its user base and daily search queries. The platform's advertising business performed well, thanks to efficient content marketing and improved ad placement through real-time bidding technology.
The company's operating efficiency saw improvements, driven by a disciplined spending approach. This efficiency provides a solid foundation for future investments in product development, AI advancements, and returns to shareholders.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 18 analysts, the average target price for Weibo Corp (WB, Financial) is $11.06 with a high estimate of $14.50 and a low estimate of $8.10. The average target implies an upside of 31.41% from the current price of $8.42. More detailed estimate data can be found on the Weibo Corp (WB) Forecast page.
Based on the consensus recommendation from 18 brokerage firms, Weibo Corp's (WB, Financial) average brokerage recommendation is currently 2.6, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Weibo Corp (WB, Financial) in one year is $11.29, suggesting a upside of 34.09% from the current price of $8.42. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Weibo Corp (WB) Summary page.
WB Key Business Developments
Release Date: March 13, 2025
- Total Revenue (Q4 2024): USD456.8 million, a decrease of 1% year-over-year.
- Ad Revenue (Q4 2024): USD385.9 million, a decrease of 4% year-over-year.
- Value-Added Service Revenue (Q4 2024): USD71 million, an increase of 18% year-over-year.
- Non-GAAP Operating Income (Q4 2024): USD136.2 million, representing a non-GAAP operating margin of 30%.
- Net Income (Q4 2024): USD106.6 million, with a net margin of 23%.
- Total Revenue (Full Year 2024): USD1.75 billion, relatively flat year-over-year.
- Ad Revenue (Full Year 2024): USD1.5 billion, a decrease of 2% year-over-year.
- Value-Added Service Revenue (Full Year 2024): USD256 million, an increase of 13% year-over-year.
- Non-GAAP Operating Income (Full Year 2024): USD584.1 million, representing a non-GAAP operating margin of 33%.
- Net Income (Full Year 2024): USD478.6 million, with a net margin of 27%.
- Cash, Cash Equivalents, and Short-term Investments (End of 2024): USD2.35 billion.
- Cash Provided by Operating Activities (Q4 2024): USD244 million.
- Capital Expenditures (Q4 2024): USD17.7 million.
- Dividend Policy: Annual cash dividend of USD0.82 per ordinary share for ADS, totaling approximately USD200 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Weibo Corp (WB, Financial) reported a stable non-GAAP operating margin of 30% for Q4 2024 and 33% for the full year, indicating effective cost management.
- The company's value-added service revenues increased by 18% year-over-year in Q4 2024, driven by growth in membership and game-related services.
- Weibo Corp (WB) maintained a strong user base with 590 million MAUs and 260 million DAUs as of December 2024, showing solid user engagement.
- The company is actively investing in AI technology to enhance product capabilities, including intelligent search and content recommendation.
- Weibo Corp (WB) announced a USD200 million annual cash dividend, reflecting a commitment to shareholder returns despite a challenging ad market.
Negative Points
- Total revenue for Q4 2024 decreased by 1% year-over-year, with ad revenue declining by 4%, indicating challenges in the advertising sector.
- The online game, cosmetics, personal care, and luxury industries experienced a decline in ad revenue, impacting overall growth.
- Despite government stimulus policies, certain discretionary categories remain under pressure, affecting ad performance.
- The gaming industry is uncertain for 2025, with a lack of large game launches impacting ad revenue potential.
- Weibo Corp (WB) faces competitive pressures in the advertising market, requiring strategic adjustments to maintain growth.
