China Internet Portal Sina Sees Fourth-Quarter Profit Drop 21 Percent

From MarketWatch:

"The Shanghai-based company said its profit was $13.8 million, or 24 cents a share, down from $17.4 million, or 30 cents a share for the period ended Dec. 31, 2004.

Pro forma per-share income for the quarter was $12.4 million, or 21 cents, compared with 31 cents last year. Analysts polled by Thomson First Call expected earnings of 22 cents a share.

Revenue fell 9% to $52 million, compared to $56.9 million from the year-ago period. Analysts were expecting sales of $51.9 million.

Sina said its advertising revenue was $25 million, up 37% from a year ago."



Excerpt from the Q4 Conference Call (about Sina's Search business)

William Bao Bean - Deutsche Bank AG
A last question. Could you just give us a sense of how you expect search revenues to play out over the next year or two? Just some rough guidance there? Are you really focused on just traffic, or are you going to start monetizing? And if so, when?

Hurst Lin (COO Sina Corp)
In terms of SINA, right now because we are still not a major player in the search arena, I think we are certainly not in the top three, as you are aware of. So we are going to be leaning towards increasing the traffic, increasing the number of unique users rather than trying to clutter our search with lots and lots of ads. So I think it is fair to say that we are going to be more focusing on grabbing traffic and grabbing users, spreading out the brand among the end users before we think about heavily monetizing.

Wang Yan (CEO Sina Corp)
To add to that, I would just like to make it clear here. I think it is a very important question here. In terms of search revenue, before our search revenue mainly was generated from a search engine called [dodatar]. That search engine was utilizing a different platform and we sold a lot of pay by listing products to our customers on that search engine and in Q1 2006 we are actually starting to promote our search engine and to make our search engine, iAsk, the primarily search engine on our website.

That search engine, we actually are not selling anything at this point. In fact, we are going to see search revenues decline in 2006 compared to 2005 because we are concentrating our resources to promote our search engine. That search engine cannot really, is in the process of being monetized at this point. So the traffic for the other search engine, the previous search engine, [dodatar], I think you are going to see a lot of revenues will go away.

SOURCE Seeking Alpha