SINA Doesn’t Make The Grade (SINA, SOHU, BIDU)

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SINA Corporation (Nasdaq:SINA): Non-GAAP net income was $16.1 million or $0.27 diluted non-GAAP and $0.25 GAAP EPS; net revenues increased 11% year over year to $59.8 million, within the upper range of the Company’s guidance of between $58.0 million and $60.0 million.  Estimates were $0.24 non-GAAP EPS & $59.6 million in revenues.  Non-advertising revenues for the second quarter of 2007 totaled $18.6 million, a 23% decrease from the same period in 2006 and a 5% decrease from the previous quarter.  Gross margin for the second quarter of 2007 was 62%, compared to 63% in the same period last year and 59% in the last quarter.

SINA’s guestimates are total revenues for the third quarter of 2007 to be between $63.0 million and $65.0 million, with advertising revenues to be between $45.0 million and $46.0 million and non-advertising revenues to be between $18.0 million and $19.0 million. Stock-based compensation for the third quarter of 2007 is expected to be approximately $1.7 million, which excludes any new shares that may be granted.  Unfortunately consensus estimates are $64.75 million and that isn’t going to cut it for a high-beta and high-growth Chinese web company.

The soft revenues and soft guidance has shares down over 5% in after-hours trading to $39.50.  SINA’s 52-week trading range is $21.70 to $47.05.  This has shares of (NASDAQ:SOHU) down almost 1% and (NASDAQ:BIDU) down 0.3% in after-hours trading.

Jon C. Ogg
August 6, 2007

Jon Ogg can be reached at; he does not own securities in the companies he covers.