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March 5, 2010

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Higher expenses erode Sina's Q4 profit

SINA Corp yesterday reported lower fourth-quarter profit as the company increased spending to add services for its users.

Its net earnings during the fourth quarter of 2009 tumbled 35 percent on an annual basis to US$19.1 million, the Internet portal operator said in a statement.

Revenue fell 3 percent to US$98.2 million in the quarter from a year earlier. Operating expenses rose 48 percent year on year to US$58.2 million with higher marketing expenditure. Its advertising revenue added 12 percent annually to US$63.2 million.

"We will continue to offer a wide range of social media products and communication tools to increase user base," CEO Charles Chao said during a conference call yesterday.

Sina has begun to offer the beta version of its Twitter-like microblog service since September, which has attracted around 5 million registered users. Other domestic portals such as Sohu and NetEase also launched similar services last year.

Chao also noted that the company is "looking very closely" at merger and acquisition opportunities in online games and e-commerce to diversify income.

Sina's revenue in 2009 stood at US$358.6 million, a 3 percent annual decrease.

There was a 21 percent rise in online advertising spending to 20.6 billion yuan last year in China, according to research firm iResearch.



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