Welcome!

News Feed Item

Renren Announces Unaudited Second Quarter 2014 Financial Results

BEIJING, Aug. 25, 2014 /PRNewswire/ -- Renren Inc. (NYSE: RENN) ("Renren" or the "Company"), a leading real-name social networking internet platform in China, today announced its unaudited financial results for the second quarter ended June 30, 2014.

Second Quarter 2014 Highlights

  • Total net revenues were US$25.0 million, a 42.4% decrease from the corresponding period in 2013.
    • Renren net revenues were US$15.1 million, a 26.7% decrease from the corresponding period in 2013.
    • Games net revenues were US$9.9 million, a 56.6% decrease from the corresponding period in 2013.
  • Gross profit was US$9.1 million, a 65.0% decrease from the corresponding period in 2013.
  • Operating loss was US$30.4 million, compared to an operating loss of US$25.9 million in the corresponding period in 2013.
  • Net income attributable to the Company was US$31.3 million, compared to a net loss of US$9.3 million in the corresponding period in 2013.
  • Adjusted net income (1) (non-GAAP) was US$37.4 million, compared to an adjusted net loss of US$3.8 million in the corresponding period in 2013.

(1)  Adjusted net income (loss) is a non-GAAP measure, which is defined as net income (loss) excluding share-based compensation expenses, amortization of intangible assets and impairment of intangible assets.

"In the beginning of this year, Renren made a strategic shift to focus on college students and young generations in China. We are encouraged to see the progress we have made in this direction, as Renren has increasingly become the go-to brand for reaching and influencing this important demographic in China. Meanwhile, our on-line video business, 56.com, has also seen strong growth in daily video viewership and UGC video uploads, which both reached record highs," commented Joseph Chen, Chairman and Chief Executive Officer, "On the other hand, we continue to face challenges in monetization of most of our assets. As a result, we have taken further steps to streamline the organization and enhanced our efforts to explore new monetization approaches. We will do our best to reduce the gap between our user base size and the monetization level, and unlock the value of our assets."

Second Quarter 2014 Results

Total net revenues for the second quarter of 2014 were US$25.0 million, representing a 42.4% decrease from the corresponding period in 2013.

Renren net revenues were US$15.1 million, representing a 26.7% decrease from the corresponding period of 2013. Within Renren net revenues, online advertising revenues were US$11.7 million for the second quarter of 2014, a 23.9% decrease from the corresponding period of 2013. The decrease was due to increased competition and to the Company's being still in the early stages of monetizing its mobile traffic. Internet Value-Added Services (IVAS) revenues were US$3.4 million, representing a 35.0% decrease from the corresponding period in 2013. Monthly unique log-in users decreased from approximately 54 million in June 2013 to approximately 44 million in June 2014.

Games net revenues were US$9.9 million for the second quarter of 2014, a 56.6% decrease from the corresponding period of 2013. The decrease was mainly due to previously launched games having entered into mature stages and to the fact that the restructuring of our gaming business since late 2013 has yet to result in the launch of successful new titles.

Cost of revenues was US$15.9 million, a 9.1% decrease from the corresponding period of 2013.

Operating expenses were US$39.5 million, a 23.8% decrease from the corresponding period of 2013.

Selling and marketing expenses were US$11.6 million, a 37.3% decrease from the corresponding period of 2013. The decrease was primarily due to the decrease in advertising and promotions for online games plus decreased headcount and personnel related expense for Renren.

Research and development expenses were US$13.4 million, a 33.9% decrease from the corresponding period in 2013. The decrease was primarily due to headcount reduction and decrease in personnel related expenses.

General and administrative expenses were US$14.0 million, a 7.6% increase from the corresponding period in 2013. The increase was primarily due to the increase in bad debt expenses related to our SME advertising customers.

Share-based compensation expenses, which were all included in operating expenses, were US$5.3 million, compared to US$5.2 million in the corresponding period in 2013.

Operating loss was US$30.4 million, compared to an operating loss of US$25.9 million in the corresponding period in 2013.

Realized gain on short-term investments was US$86.0 million, compared to US$0.1 million in the corresponding period in 2013. The gain was primarily derived from sales of marketable securities.

Net income attributable to the Company was US$31.3 million, compared to a net loss of US$9.3 million in the corresponding period in 2013. This was primarily due to the US$86.0 million gain on the sales of short-term investments.

Adjusted net income (non-GAAP) was US$37.4 million, compared to an adjusted net loss of US$3.8 million in the corresponding period in 2013. This was primarily due to the US$86.0 million gain on the sales of short-term investments. Adjusted net income (loss) is defined as net income (loss) excluding share-based compensation expenses, amortization of intangible assets and impairment of intangible assets.

Share Repurchase Program

Our previous share repurchase program expired on June 27, 2014, with approximately 22.4 million ADSs repurchased with a total consideration of US$69.4 million. Our board of directors has authorized a new share repurchase program to repurchase up to US$100 million of the Company's ADSs within one year from June 28, 2014.

Business Outlook

The Company expects to generate revenues in an amount ranging from US$19 million to US$21 million in the third quarter of 2014, representing a 48.9% to 53.8% year-over-year decline. This forecast reflects Renren's current and preliminary view, which is subject to change.

Conference Call Information

Management will host an earnings conference call at 9:00 p.m. Eastern Time on Monday, August 25, 2014 (Beijing/Hong Kong Time: 9:00 a.m., Tuesday, August 26, 2014).

Interested parties may participate in the conference call by dialing the numbers below and entering the passcode 10-15 minutes prior to the initiation of the call.

Dial-in Information:

US: +1 845-675-0437
Hong Kong: +852-2475-0994
China: +86 800-819-0121
International: + 65-6723-9381
Passcode: Renren

A replay of the call will be available for one week and dial-in information is as follows:

International: + 61 2-8199-0299
Passcode: 88543599

This call will be webcast live and the replay will be available on Renren's corporate web site at http://ir.renren-inc.com for 12 months.

About Renren Inc.

Renren Inc. (NYSE: RENN) operates a leading real name social networking internet platform in China. It enables users to connect and communicate with each other, share information and user generated content, play online games, watch videos and enjoy a wide range of other features and services. Renren's businesses primarily include the main social networking website renren.com, the game development and operating platform Renren Games, and the user-generated content focused video sharing website 56.com. Renren.com had approximately 214 million activated users as of June 30, 2014. Renren's American depositary shares, each of which represents three Class A ordinary shares, trade on NYSE under the symbol "RENN".

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook for the third quarter of 2014 and quotations from management in this announcement, as well as Renren's strategic and operational plans, contain forward-looking statements. Renren may also make written or oral forward-looking statements in its filings with the U.S. Securities and Exchange Commission ("SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Renren's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: our goals and strategies; our future business development, financial condition and results of operations; the expected growth of the social networking site market in China; our expectations regarding demand for and market acceptance of our services; our expectations regarding the retention and strengthening of our relationships with key advertisers and customers; our plans to enhance user experience, infrastructure and service offerings; competition in our industry in China; and relevant government policies and regulations relating to our industry. Further information regarding these and other risks is included in our annual report on Form 20-F and other documents filed with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Renren does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Renren's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), Renren uses "adjusted net income (loss)" which is defined as "a non-GAAP financial measure" by the SEC, in evaluating its business. We define adjusted net income (loss) as net income (loss) excluding share-based compensation expenses, amortization of intangible assets and impairment of intangible assets. We present adjusted net income (loss) because it is used by our management to evaluate our operating performance. We also believe that this non-GAAP financial measure provide useful information to investors and others in understanding and evaluating our consolidated results of operations in the same manner as our management and in comparing financial results across accounting periods and to those of our peer companies.

The presentation of this non-GAAP financial measure is not intended to be considered in isolation from, or as a substitute for, the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliation of non-GAAP results of operations measures to the comparable GAAP financial measures" at the end of this release.

For more information, please contact:

Cynthia Liu
Investor Relations
Renren Inc.
Tel: (86 10) 8448 1818 ext 1300
Email: [email protected]

 

RENREN INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)















(Amounts in US dollars, in thousands, except shares,



December 31,



June 30,

per shares, ADS, and per ADS data)



2013



2014








 ASSETS














 Current assets:







 Cash and cash equivalents


$

154,308


$

238,898

 Term deposits



492,699



574,215

 Short-term investments



301,995



73,589

 Accounts and notes receivable, net



15,958



15,399

 Prepaid expenses and other current assets



34,080



29,318

 Amounts due from related parties



62,411



508

 Deferred tax assets-current



628



628

 Equity method investment-current



60,508



-

 Total current assets



1,122,587



932,555








 Non-current assets:







 Property and equipment, net



58,560



52,984

 Intangible assets, net



27,397



26,050

 Goodwill



61,407



59,924

 Long-term investments



107,842



140,923

 Deferred tax assets-non-current



1,109



1,144

 Other non-current assets



6,784



24,117

 Total non-current assets



263,099



305,142

 TOTAL ASSETS


$

1,385,686


$

1,237,697








 LIABILITIES AND EQUITY














 Current liabilities:







 Accounts payable


$

10,170


$

8,319

 Accrued expenses and other payables



33,314



27,446

 Amounts due to related parties



61,062



187

 Deferred revenue and advance from customers 



8,639



7,603

 Derivative contract liabilities



-



13,644

 Income tax payable



2,077



8,597

 Total current liabilities



115,262



65,796








 Non-current liabilities:







 Other non-current liabilities



156



209

 Total non-current liabilities



156



209

 TOTAL LIABILITIES



115,418



66,005








 Shareholders' Equity:







 Class A ordinary shares



790



753

 Class B ordinary shares



305



305

 Additional paid-in capital



1,285,283



1,250,899

 Statutory reserves



6,712



6,712

 Accumulated deficit



(197,726)



(134,102)

 Accumulated other comprehensive income 



174,781



47,003

 Total Renren Inc. shareholders' equity



1,270,145



1,171,570

 Noncontrolling Interests



123



122

 TOTAL EQUITY



1,270,268



1,171,692

 TOTAL LIABILITIES AND EQUITY


$

1,385,686


$

1,237,697

 












RENREN INC.










CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)






















For the Three Months Ended

(Amounts in US dollars, in thousands, except shares,


June 30,


March 31,


June 30,

per shares, ADS, and per ADS data)


2013


2014


2014











Net revenues










 Renren


$

20,611


$

12,235


$

15,105

 Games



22,835



12,660



9,904

Total net revenues



43,446



24,895



25,009

Cost of revenues 



(17,523)



(16,160)



(15,933)

Gross profit



25,923



8,735



9,076

Operating expenses:










 Selling and marketing



(18,552)



(10,791)



(11,641)

 Research and development



(20,232)



(15,669)



(13,379)

 General and administrative



(13,024)



(11,423)



(14,007)

 Impairment of intangible assets



-



(66)



(445)

Total operating expenses



(51,808)



(37,949)



(39,472)

Loss from operations



(25,885)



(29,214)



(30,396)











Other income



7



265



272

Exchange gain (loss) on offshore bank accounts



358



(2,527)



301

Interest income



3,057



2,733



2,897

Realized gain on short-term investments



144



27,093



85,994











Income (loss) before provision of income tax, earnings (loss) in equity method investments and noncontrolling interest, net of income taxes



(22,319)



(1,650)



59,068

Income tax (expenses) benefit



307



19



(591)











 Income (loss) before earnings (loss) in equity method investments and noncontrolling interest, net of income taxes



(22,012)



(1,631)



58,477

(Loss) earnings in equity method investments, net of income taxes



21,451



(23,145)



(27,170)

Income (loss) from continuing operations



(561)



(24,776)



31,307











Discontinued operation










Loss from operations of discontinued operations, net of income taxes



(8,823)



-



-

Gain on disposal of equity method investment, net of income tax



-



57,092



-

Gain (loss) from discontinued operations, net of income taxes



(8,823)



57,092



-











Net income (loss)



(9,384)



32,316



31,307

Net loss attributable to noncontrolling interests



58



1



-











Net income (loss) attributable to Renren Inc.


$

(9,326)


$

32,317


$

31,307











Net income (loss) per share from continuing operations attributable to Renren Inc. shareholders:










 Basic



(0.00)


$

(0.02)


$

0.03

 Diluted



(0.00)


$

(0.02)


$

0.03

Net income (loss) per share from discontinued operations attributable to
    Renren Inc. shareholders:










 Basic



(0.01)


$

0.05


$

-

 Diluted



(0.01)


$

0.05


$

-

Net income (loss) per share attributable to Renren Inc. shareholders:










 Basic



(0.01)


$

0.03


$

0.03

 Diluted



(0.01)


$

0.03


$

0.03

Net income (loss) attributable to Renren Inc. shareholders per ADS:










 Basic



(0.03)


$

0.09


$

0.09

 Diluted



(0.03)


$

0.09


$

0.09











Weighted average number of shares used in calculating net income (loss) per ordinary share from continuing operations attributable to Renren Inc. shareholders:










 Basic



1,126,080,546



1,082,856,840



1,062,632,013

 Diluted



1,126,080,546



1,082,856,840



1,072,951,501

Weighted average number of shares used in calculating net income (loss) per ordinary share from discontinued operations attributable to Renren Inc. shareholders:










 Basic



1,126,080,546



1,082,856,840



1,062,632,013

 Diluted



1,126,080,546



1,092,355,990



1,062,632,013




Reconciliation of Non-GAAP results of operations measures to the comparable GAAP financial measures


Adjusted net income (loss)






















 For the Three Months Ended

(Amounts in US dollars, in thousands)


June 30,



March 31,



June 30,

2013



2014



2014











Net income (loss)


$

(9,384)


$

32,316


$

31,307

Add back: Shared-based compensation expenses



5,182



3,351



5,313

     Add back: Amortization of intangible assets



377



319



308

Add back: Impairment of intangible assets






66



445

Adjusted net income (loss)


$

(3,825)


$

36,052


$

37,373

 

SOURCE Renren Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
"Space Monkey by Vivent Smart Home is a product that is a distributed cloud-based edge storage network. Vivent Smart Home, our parent company, is a smart home provider that places a lot of hard drives across homes in North America," explained JT Olds, Director of Engineering, and Brandon Crowfeather, Product Manager, at Vivint Smart Home, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Conference Guru has been named “Media Sponsor” of the 22nd International Cloud Expo, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. A valuable conference experience generates new contacts, sales leads, potential strategic partners and potential investors; helps gather competitive intelligence and even provides inspiration for new products and services. Conference Guru works with conference organizers to pass great deals to gre...
DevOps is under attack because developers don’t want to mess with infrastructure. They will happily own their code into production, but want to use platforms instead of raw automation. That’s changing the landscape that we understand as DevOps with both architecture concepts (CloudNative) and process redefinition (SRE). Rob Hirschfeld’s recent work in Kubernetes operations has led to the conclusion that containers and related platforms have changed the way we should be thinking about DevOps and...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develop...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
The next XaaS is CICDaaS. Why? Because CICD saves developers a huge amount of time. CD is an especially great option for projects that require multiple and frequent contributions to be integrated. But… securing CICD best practices is an emerging, essential, yet little understood practice for DevOps teams and their Cloud Service Providers. The only way to get CICD to work in a highly secure environment takes collaboration, patience and persistence. Building CICD in the cloud requires rigorous ar...
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.
"Evatronix provides design services to companies that need to integrate the IoT technology in their products but they don't necessarily have the expertise, knowledge and design team to do so," explained Adam Morawiec, VP of Business Development at Evatronix, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. In his session at @BigDataExpo, Jack Norris, Senior Vice President, Data and Applications at MapR Technologies, reviewed best practices to ...
Widespread fragmentation is stalling the growth of the IIoT and making it difficult for partners to work together. The number of software platforms, apps, hardware and connectivity standards is creating paralysis among businesses that are afraid of being locked into a solution. EdgeX Foundry is unifying the community around a common IoT edge framework and an ecosystem of interoperable components.
"ZeroStack is a startup in Silicon Valley. We're solving a very interesting problem around bringing public cloud convenience with private cloud control for enterprises and mid-size companies," explained Kamesh Pemmaraju, VP of Product Management at ZeroStack, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Large industrial manufacturing organizations are adopting the agile principles of cloud software companies. The industrial manufacturing development process has not scaled over time. Now that design CAD teams are geographically distributed, centralizing their work is key. With large multi-gigabyte projects, outdated tools have stifled industrial team agility, time-to-market milestones, and impacted P&L stakeholders.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Enterprises are adopting Kubernetes to accelerate the development and the delivery of cloud-native applications. However, sharing a Kubernetes cluster between members of the same team can be challenging. And, sharing clusters across multiple teams is even harder. Kubernetes offers several constructs to help implement segmentation and isolation. However, these primitives can be complex to understand and apply. As a result, it’s becoming common for enterprises to end up with several clusters. Thi...
"Infoblox does DNS, DHCP and IP address management for not only enterprise networks but cloud networks as well. Customers are looking for a single platform that can extend not only in their private enterprise environment but private cloud, public cloud, tracking all the IP space and everything that is going on in that environment," explained Steve Salo, Principal Systems Engineer at Infoblox, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Conventio...