Weibo Shares Slide After Weak Q4 Earnings and Rising Costs
Shares of Weibo Corp dropped sharply in Hong Kong trading on Thursday after the company reported weaker-than-expected fourth-quarter earnings. The decline was driven by margin pressure and a shift to a net loss despite modest revenue growth.
The Chinese social media company posted quarterly revenue of $473.3 million, marking a 4% increase compared to the same period last year. However, Weibo recorded a net loss of $4.7 million, reversing from a profit of $8.9 million a year earlier.
Stock Hits Multi-Month Low as Profitability Weakens
Weibo shares plunged 12.7% to HK$67.10, reaching their lowest level since May 2025. The sharp drop reflects investor concerns over declining profitability and rising operating costs.
Operating income fell significantly to $91.6 million from $117.9 million in the previous year. As a result, the company’s operating margin narrowed to 19%, down from 26%, as total costs and expenses increased by 13%.
Advertising Growth Offset by Decline in Other Segments
Advertising and marketing revenue, Weibo’s main income source, rose 5% to $403.8 million. Growth was supported by demand from sectors such as e-commerce and local services.
However, revenue from value-added services declined by 2%, highlighting uneven performance across business segments.
Outlook: Stable Revenue but Ongoing Margin Pressure
The latest earnings report suggests that while Weibo continues to achieve steady top-line growth, profitability remains under pressure. Rising expenses are offsetting gains in advertising revenue, raising concerns about future earnings performance.
Despite the weak results, the company announced plans to pay an annual dividend of approximately $0.61 per share for fiscal year 2025.
