Release Date: May 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Weibo Corp (WB, Financial) reported a 1% year-over-year increase in total revenues on a constant currency basis, reaching USD396.9 million.
- The company's non-GAAP operating income reached USD129.5 million, representing a healthy operating margin of 33%.
- Weibo's MAUs reached 591 million, and DAUs reached 261 million, indicating strong user engagement and growth.
- Advertising revenue related to the Spring Festival achieved double-digit growth year over year, with a notable increase in the number of participating advertisers.
- Weibo has successfully integrated AI technology into its search and advertising products, enhancing user experience and competitive edge.
Negative Points
- Total ad revenues remained flat year over year, indicating challenges in growing advertising income.
- The online game sector faced a year-over-year decline, negatively impacting overall advertising revenue growth.
- The handset manufacturing sector saw a decline in revenue due to shifts in product launch timelines.
- Despite improvements, the effectiveness of AI on advertising revenue remains limited, with only single-digit improvements in some metrics.
- The beauty and personal care sector experienced a narrow year-over-year revenue decline, impacting overall ad revenue.
Q & A Highlights
Q: Can you provide insights into Weibo's future strategy for its search product and how AI integration has impacted advertising?
A: Gaofei Wang, CEO, explained that Weibo's AI search, particularly after integrating DeepSeek, has significantly improved user engagement, with MAUs surpassing 30 million. While there are no plans to make the search product independent, it enhances Weibo's competitive edge in news and entertainment content. AI integration has improved ad click-through rates by about 10%, but overall impact on advertising revenue remains limited.
Q: What are the expectations for advertising in Q2, and how are different industry verticals performing?
A: Gaofei Wang, CEO, noted that Q2 expectations are similar to Q1, with strong performance anticipated in automotive, handsets, and e-commerce due to national subsidies. The healthcare sector is also promising. However, challenges persist in the gaming industry, with reduced budgets from major players like Tencent and NetEase.
Q: How is Weibo updating its advertising products and strategies?
A: Gaofei Wang, CEO, emphasized Weibo's focus on new product and content-based marketing. The company plans to capitalize on brand launches and hot topics, maintaining its competitive edge. Investments in performance-based ads have shown growth, and AI-driven ad technologies are expected to enhance user engagement and attract new customers.
Q: How has Weibo's user growth and engagement trended in Q1 2025?
A: Fei Cao, CFO, reported that Weibo's MAUs reached 591 million and DAUs 261 million, with net additions of 3 million and 6 million users year-over-year, respectively. The DAU/MAU ratio remains healthy, indicating strong user engagement.
Q: Can you elaborate on Weibo's financial performance in Q1 2025?
A: Fei Cao, CFO, highlighted that Weibo's net revenues were USD396.9 million, with a non-GAAP operating income of USD129.5 million, representing a 33% operating margin. Net income attributable to Weibo increased by 12% to USD119.5 million, driven by operating efficiency and higher net interest income.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
