Phoenix New Media Reports Fourth Quarter and Fiscal Year 2020 Unaudited Financial Results
Phoenix New Media Limited (NYSE: FENG) reported its unaudited financial results for Q4 and FY 2020, showing total revenues of RMB362.2 million, a decrease of 9.5% year-over-year, impacted by COVID-19. Net advertising revenues fell by 7.3% to RMB336.7 million. The company achieved net income from continuing operations of RMB454.8 million but saw a significant decrease from RMB902.5 million in Q4 2019. Total operating expenses dropped by 33.7%, reflecting strict cost control. Looking ahead, total revenues for Q1 2021 are expected between RMB210.2 million and RMB230.2 million.
- Total operating expenses decreased by 33.7%, improving cost efficiency.
- Net income from continuing operations for Q4 2020 was RMB454.8 million.
- Total revenues decreased by 9.5% year-over-year due to COVID-19.
- Paid services revenues fell by 31.4% to RMB25.5 million.
- Goodwill impairment of RMB22.8 million was recognized.
BEIJING, March 15, 2021 /PRNewswire/ -- Phoenix New Media Limited (NYSE: FENG) ("Phoenix New Media", "ifeng" or the "Company"), a leading new media company in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2020.
Mr. Shuang Liu, CEO of Phoenix New Media, commented, "We delivered encouraging results in the fourth quarter while remaining committed to the sustained growth and evolution of our business. Despite the industry-wide challenges caused by COVID-19, we continued to bolster our news leadership during the quarter and distinctively combined our editorial expertise and cutting-edge AI algorithms to provide our users with a consistent supply of up-to-date coverage. Meanwhile, we also organized several high-profile offline events in the period to further enhance our brand influence and multifaceted value propositions for advertisers and users. For our flagship news app, iFeng, we continued to fuel the development of a more video-focused content ecosystem through a number of initiatives. Going forward, this should help us to garner more PUGC creation, expand the depth and breadth of our short-form video offerings, and stimulate the social nature of iFeng's community to further boost user interactions and engagement on the platform."
Mr. Liu continued, "Beyond improving our core business lines, we also continued to focus on the cultivation of our new product development capabilities. During the quarter, for example, we leveraged our leadership in content production to launch our online e-commerce brand Phoenix Premium Products for our established massive user base. Going forward, we will continue to focus on the development of our content ecosystem, optimization of our current product offerings, and exploration of new business growth drivers. By advancing our competitive advantages in these key strategic areas, we will also improve our ability to capitalize on those new opportunities which may emerge as the economy continues to recover and people return to their normal ways of life."
Mr. Edward Lu, CFO of Phoenix New Media, further stated, "Our total revenues reached RMB362.2 million in the fourth quarter of 2020, which was in line with our previous guidance. More importantly, due to our strict cost control measures, we achieved a
Fourth Quarter 2020 Financial Results
As disclosed in the second quarter 2020 unaudited financial results announcement made on August 17, 2020, the Company sold all of its investment in Beijing Yitian Xindong Network Technology Co., Ltd. ("Yitian Xindong" or "Tadu") in the second quarter of 2020 and the disposal of Tadu was qualified for reporting as a "discontinued operation" in the Company's financial statements. Accordingly, Tadu's results of operations have been excluded from the Company's results from continuing operations in the condensed consolidated statements of comprehensive income/(loss) and are presented in separate line items as discontinued operations for all prior periods. The related assets and liabilities associated with the discontinued operations in the prior year consolidated balance sheets were classified as assets/liabilities held for sale to provide the comparable financial information, and the financial information and non-GAAP financial information disclosed in this press release is presented on a continuing operations basis, unless otherwise specifically stated.
REVENUES
Total revenues in the fourth quarter of 2020 decreased by
Net advertising revenues in the fourth quarter of 2020 decreased by
Paid services revenues[1] in the fourth quarter of 2020 decreased by
COST OF REVENUES
Cost of revenues in the fourth quarter of 2020 decreased by
- Content and operational costs in the fourth quarter of 2020 decreased to RMB158.4 million (US
$24.3 million ) from RMB172.2 million in the same period of 2019, mainly due to the Company's strict cost control measures taken to enhance its operating efficiency in 2020. Share-based compensation included in the content and operational costs in the fourth quarter of 2020 decreased to RMB0.2 million (US$0.03 million ) from RMB1.1 million in the same period of 2019.
Bandwidth costs in the fourth quarter of 2020 decreased to RMB13.9 million (US
The decrease was partially offset by the following:
- Revenue sharing fees in the fourth quarter of 2020 increased to RMB6.9 million (US
$1.1 million ) from RMB1.7 million in the same period of 2019, primarily attributable to the increase in revenue sharing fees paid to channel partners.
GROSS PROFIT
Gross profit in the fourth quarter of 2020 decreased to RMB183.0 million (US
To supplement the financial measures presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company has presented certain non-GAAP financial measures in this press release, which excludes the impact of certain reconciling items as stated in the "Use of Non-GAAP Financial Measures" section below. The related reconciliations to GAAP financial measures are presented in the accompanying "Reconciliations of Non-GAAP Results of Operation Measures to the Nearest Comparable GAAP Measures."
Non-GAAP gross margin in the fourth quarter of 2020, which excluded share-based compensation, decreased to
OPERATING EXPENSES OR GAINS AND LOSS FROM OPERATIONS
Total operating expenses in the fourth quarter of 2020 decreased by
Loss from operations in the fourth quarter of 2020 was RMB28.8 million (US
Non-GAAP loss from operations in the fourth quarter of 2020, which excluded share-based compensation and impairment of goodwill, was RMB3.3 million (US
OTHER INCOME OR LOSS
Other income or loss reflects net interest income, foreign currency exchange gain or loss, loss from equity method investments, changes in fair value of forward contract in relation to disposal of investments in Particle, gain on disposal of available-for-sale debt investments and others, net[2]. Total net other income in the fourth quarter of 2020 was RMB499.1 million (US
- Gain on disposal of available-for-sale debt investments in the fourth quarter of 2020 was RMB477.3 million (US
$73.1 million ), compared to RMB1,001.2 million in the same period of 2019, which represented the gain from the disposal of part of the Company's investments in Particle. The transaction contemplated by the share purchase agreement signed by the Company and Run Liang Tai Management Limited, or Run Liang Tai, and its designated entities (the "Buyers") in August 2020 under which the Company agreed to sell a total of 140,248,775 shares of Particle to the Buyers at a total purchase price of US$150 million and a per share purchase price of US$1.06 95 was closed on October 19, 2020. - Net interest income in the fourth quarter of 2020 increased to RMB9.3 million (US
$1.4 million ) from RMB6.7 million in the same period of 2019, mainly caused by more investments in term deposits and short term investments in the fourth quarter of 2020. - Foreign currency exchange gain in the fourth quarter of 2020 was RMB3.9 million (US
$0.6 million ), compared to foreign currency exchange gain of RMB1.0 million in the same period of 2019. - Loss from equity method investments in the fourth quarter of 2020 was RMB0.2 million (US
$0.03 million ), compared to nil in the same period of 2019. - Changes in fair value of forward contract in relation to disposal of investments in Particle in the first quarter of 2020 was nil, compared to a gain of RMB4.4 million in the same period of 2019.
- Others, net in the fourth quarter of 2020 increased to RMB8.8 million (US
$1.4 million ) from RMB3.3 million in the same period of 2019, mainly attributable to more government subsidies received in the fourth quarter of 2019.
NET INCOME OR LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED
Net income from continuing operations attributable to Phoenix New Media Limited in the fourth quarter of 2020 was RMB454.8 million (US
Non-GAAP net loss from continuing operations attributable to Company in the fourth quarter of 2020, which excluded share-based compensation, changes in fair value of forward contract in relation to disposal of investments in Particle, loss from equity method investments, gain on disposal of available-for-sale debt investments and impairment of goodwill, was RMB8.2 million (US
For the fourth quarter of 2020, the Company's weighted average number of ADSs used in the computation of diluted net loss per ADS was 72,790,541. As of December 31, 2020, the Company had a total of 582,324,325 ordinary shares outstanding, or the equivalent of 72,790,541 ADSs.
Full Year 2020 Financial Results
REVENUES
Total revenues in 2020 decreased by
Net advertising revenues in 2020 decreased by
Paid services revenues in 2020 decreased by
COST OF REVENUES
Cost of revenues in 2020 decreased by
Gross profit in 2020 increased slightly to RMB649.6 million (US
OPERATING EXPENSES OR GAINS AND LOSS FROM OPERATIONS
Total operating expense in 2020 decreased to RMB752.1million (US
Loss from operations in 2020 was RMB102.6 million (US
Non-GAAP loss from operations in 2020, which excluded share-based compensation and impairment of goodwill, was RMB70.4 million (US
NET INCOME OR LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO PHOENIX NEW MEDIA LIMITED
Net income from continuing operations attributable to the Company in 2020 was RMB418.0 million (US
Non-GAAP net loss from continuing operations attributable to the Company in the fiscal year of 2020, which excluded share-based compensation, loss/(income) from equity method investments, changes in fair value of forward contract in relation to disposal of investments in Particle, changes in fair value of loan related to co-sale of Particle shares, gain on disposal of available-for-sale debt investments, impairment of available-for-sale debt investment and impairment of goodwill, was RMB33.7 million (US
CERTAIN BALANCE SHEET ITEMS
As of December 31, 2020, the Company's cash and cash equivalents, term deposits and short term investments and restricted cash were RMB1.67 billion (US
The Company's investments in Particle were recorded as available-for sale debt investments in the balance sheet. The fair value of the Company's available-for-sale debt investments in Particle decreased from RMB1,061.3 million as of September 30, 2020 to RMB30.7 million (US
Business Outlook
For the first quarter of 2021, the Company expects its total revenues to be between RMB210.2 million and RMB230.2 million; net advertising revenues are expected to be between RMB192.0 million and RMB207.0 million; and paid services revenues are expected to be between RMB18.2 million and RMB23.2 million.
All of the above forecasts reflect the Company's management's current and preliminary view, which is subject to change and substantial uncertainty, particularly in view of the potential impact of the COVID-19, the effects of which are difficult to analyse and predict.
Conference Call Information
The Company will hold a conference call at 9:00 p.m. U.S. Eastern Time on March 15, 2021, (March 16, 2021 at 9:00 a.m. Beijing/Hong Kong time) to discuss its fourth quarter and fiscal year 2020 unaudited financial results and operating performance.
To participate in the call, please use the dial-in numbers and conference ID below:
International: | +65 67135090 |
Mainland China: | 4006208038 |
Hong Kong: | +852 30186771 |
United States: | +1 8456750437 |
United Kingdom: | +44 2036214779 |
Australia: | +61 290833212 |
Conference ID: | 8338423 |
A replay of the call will be available through March 23, 2021, by using the dial-in numbers and conference ID below:
International: | +61 2 8199 0299 |
Mainland China: | 4006322162 |
Hong Kong: | +852 30512780 |
United States: | +1 646 254 3697 |
Conference ID: | 8338423 |
A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.ifeng.com.
Use of Non-GAAP Financial Measures
To supplement the consolidated financial statements presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), Phoenix New Media Limited uses non-GAAP gross profit, non-GAAP gross margin, non-GAAP income or loss from operations, non-GAAP operating margin, non-GAAP net income or loss attributable to Phoenix New Media Limited, non-GAAP net margin and non-GAAP net income or loss per diluted ADS, each of which is a non-GAAP financial measure. Non-GAAP gross profit is gross profit excluding share-based compensation. Non-GAAP gross margin is non-GAAP gross profit divided by total revenues. Non-GAAP income or loss from operations is income or loss from operations excluding share-based compensation and impairment of goodwill. Non-GAAP operating margin is non-GAAP income or loss from operations divided by total revenues. Non-GAAP net income or loss attributable to Phoenix New Media Limited is net income or loss attributable to Phoenix New Media Limited excluding share-based compensation, income or loss from equity method investments, net of impairments, gain on disposal of available-for-sale debt investments, changes in fair value of forward contract in relation to disposal of investments in Particle, impairment of goodwill, impairment of available-for-sale debt investments and changes in fair value of loan related to co-sale of Particle shares. Non-GAAP net margin is non-GAAP net income or loss attributable to Phoenix New Media Limited divided by total revenues. Non-GAAP net income or loss per diluted ADS is non-GAAP net income or loss attributable to Phoenix New Media Limited divided by weighted average number of diluted ADSs. The Company believes that separate analysis and exclusion of the aforementioned non-GAAP to GAAP reconciling items add clarity to the constituent parts of its performance. The Company reviews these non-GAAP financial measures together with the related GAAP financial measures to obtain a better understanding of its operating performance. It uses these non-GAAP financial measures for planning, forecasting and measuring results against the forecast. The Company believes that using these non-GAAP financial measures to evaluate its business allows both management and investors to assess the Company's performance against its competitors and ultimately monitor its capacity to generate returns for investors. The Company also believes that these non-GAAP financial measures are useful supplemental information for investors and analysts to assess its operating performance without the effect of items like share-based compensation, income or loss from equity method investments, net of impairments, which have been and will continue to be significant recurring items, and without the effect of gain on disposal of available-for-sale debt investments, changes in fair value of forward contract in relation to disposal of investments in Particle, impairment of goodwill, impairment of available-for-sale debt investments and changes in fair value of loan related to co-sale of Particle shares, which have been significant and one-time items. However, the use of these non-GAAP financial measures has material limitations as an analytical tool. One of the limitations of using these non-GAAP financial measures is that they do not include all items that impact the Company's gross profit, income or loss from operations and net income or loss attributable to Phoenix New Media Limited for the period. In addition, because these non-GAAP financial measures are not calculated in the same manner by all companies, they may not be comparable to other similarly titled measures used by other companies. In light of the foregoing limitations, you should not consider these non-GAAP financial measures in isolation from, or as an alternative to, the financial measures prepared in accordance with GAAP.
Exchange Rate
This announcement contains translations of certain RMB amounts into U.S. dollars ("USD") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6.5250 to US
About Phoenix New Media Limited
Phoenix New Media Limited (NYSE: FENG) is a leading new media company providing premium content on an integrated Internet platform, including PC and mobile, in China. Having originated from a leading global Chinese language TV network based in Hong Kong, Phoenix TV, the Company enables consumers to access professional news and other quality information and share user-generated content on the Internet through their PCs and mobile devices. Phoenix New Media's platform includes its PC channel, consisting of ifeng.com website, which comprises interest-based verticals and interactive services; its mobile channel, consisting of mobile news applications, mobile video application, digital reading applications and mobile Internet website; and its operations with the telecom operators that provides mobile value-added services.
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 and quotations from management in this announcement, as well as Phoenix New Media's strategic and operational plans, contain forward−looking statements. Phoenix New Media may also make written or oral forward−looking statements in its periodic reports to the U.S. Securities and Exchange Commission ("SEC") on Forms 20−F and 6−K, 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 Phoenix New Media'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: the Company's goals and strategies; the Company's future business development, financial condition and results of operations; the expected growth of online and mobile advertising, online video and mobile paid services markets in China; the Company's reliance on online and mobile advertising and MVAS for a majority of its total revenues; the Company's expectations regarding demand for and market acceptance of its services; the Company's expectations regarding maintaining and strengthening its relationships with advertisers, partners and customers; the Company's investment plans and strategies, fluctuations in the Company's quarterly operating results; the Company's plans to enhance its user experience, infrastructure and services offerings; the Company's reliance on mobile operators in China to provide most of its MVAS; changes by mobile operators in China to their policies for MVAS; competition in its industry in China; relevant government policies and regulations relating to the Company; and the effects of the COVID-19 on the economy in China in general and on the Company's business in particular. Further information regarding these and other risks is included in the Company's filings with the SEC, including its registration statement on Form F−1, as amended, and its annual reports on Form 20−F. All information provided in this press release and in the attachments is as of the date of this press release, and Phoenix New Media does not undertake any obligation to update any forward−looking statement, except as required under applicable law.
For investor and media inquiries please contact:
Phoenix New Media Limited
Qing Liu
Email: investorrelations@ifeng.com
ICR, Inc.
Jack Wang
Tel: +1 (646) 405-4883
Email: investorrelations@ifeng.com
Phoenix New Media Limited | ||||||||||||
December 31, | December 31, | December 31, | ||||||||||
2019 | 2020 | 2020 | ||||||||||
RMB | RMB | US$ | ||||||||||
Audited | Unaudited | Unaudited | ||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | 310,876 | 357,796 | 54,835 | |||||||||
Term deposits and short term investments | 1,271,889 | 1,280,033 | 196,174 | |||||||||
Restricted cash | 66,234 | 31,039 | 4,757 | |||||||||
Accounts receivable, net | 609,627 | 675,616 | 103,543 | |||||||||
Amounts due from related parties | 56,653 | 32,587 | 4,994 | |||||||||
Prepayment and other current assets | 57,391 | 42,846 | 6,565 | |||||||||
Assets held for sale | 184,032 | - | - | |||||||||
Total current assets | 2,556,702 | 2,419,917 | 370,868 | |||||||||
Non-current assets: | ||||||||||||
Property and equipment, net | 97,357 | 62,649 | 9,601 | |||||||||
Intangible assets, net | 13,633 | 12,396 | 1,900 | |||||||||
Goodwill | 22,786 | - | - | |||||||||
Available-for-sale debt investments | 2,014,537 | 36,662 | 5,619 | |||||||||
Equity investments, net | 13,237 | 94,821 | 14,532 | |||||||||
Deferred tax assets | 73,688 | 86,867 | 13,313 | |||||||||
Operating lease right-of- use assets, net | 84,550 | 49,487 | 7,584 | |||||||||
Other non-current assets | 19,859 | 9,753 | 1,495 | |||||||||
Assets held for sale | 429,468 | - | - | |||||||||
Total non-current assets | 2,769,115 | 352,635 | 54,044 | |||||||||
Total assets | 5,325,817 | 2,772,552 | 424,912 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||
Current liabilities: | ||||||||||||
Accounts payable | 249,018 | 221,203 | 33,901 | |||||||||
Amounts due to related parties | 34,155 | 34,420 | 5,275 | |||||||||
Advances from customers | 46,172 | 38,835 | 5,952 | |||||||||
Taxes payable | 287,765 | 402,610 | 61,703 | |||||||||
Salary and welfare payable | 157,784 | 156,599 | 24,000 | |||||||||
Deposits in relation to future disposal of investment | 355,212 | - | - | |||||||||
Accrued expenses and other current liabilities | 274,122 | 172,376 | 26,417 | |||||||||
Operating lease liabilities | 37,874 | 36,370 | 5,574 | |||||||||
Liabilities held for sale | 63,341 | - | - | |||||||||
Total current liabilities | 1,505,443 | 1,062,413 | 162,822 | |||||||||
Non-current liabilities: | ||||||||||||
Deferred tax liabilities | 192,142 | 1,312 | 201 | |||||||||
Long-term liabilities | 27,612 | 28,182 | 4,319 | |||||||||
Operating lease liabilities | 49,929 | 16,672 | 2,555 | |||||||||
Liabilities held for sale | 5,676 | - | - | |||||||||
Total non-current liabilities | 275,359 | 46,166 | 7,075 | |||||||||
Total liabilities | 1,780,802 | 1,108,579 | 169,897 | |||||||||
Shareholders' equity: | ||||||||||||
Phoenix New Media Limited shareholders' equity: | ||||||||||||
Class A ordinary shares | 17,499 | 17,499 | 2,682 | |||||||||
Class B ordinary shares | 22,053 | 22,053 | 3,380 | |||||||||
Additional paid-in capital | 1,611,484 | 1,620,580 | 248,365 | |||||||||
Statutory reserves | 88,583 | 92,017 | 14,102 | |||||||||
Retained earnings | 186,324 | (88,191) | (13,516) | |||||||||
Accumulated other comprehensive income | 1,405,808 | (28,214) | (4,324) | |||||||||
Total Phoenix New Media Limited shareholders' equity | 3,331,751 | 1,635,744 | 250,689 | |||||||||
Noncontrolling interests | 213,264 | 28,229 | 4,326 | |||||||||
Total shareholders' equity | 3,545,015 | 1,663,973 | 255,015 | |||||||||
Total liabilities and shareholders' equity | 5,325,817 | 2,772,552 | 424,912 | |||||||||
Phoenix New Media Limited | |||||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | December 31, | December 31, | |||||||||||||||||||||
2019 | 2020 | 2020 | 2020 | 2019 | 2020 | 2020 | |||||||||||||||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Net advertising revenues | 363,114 | 281,308 | 336,653 | 51,594 | 1,194,761 | 1,113,017 | 170,577 | ||||||||||||||||||||
Paid service revenues | 37,259 | 21,681 | 25,546 | 3,915 | 133,020 | 95,828 | 14,686 | ||||||||||||||||||||
Total revenues | 400,373 | 302,989 | 362,199 | 55,509 | 1,327,781 | 1,208,845 | 185,263 | ||||||||||||||||||||
Cost of revenues | (188,819) | (150,036) | (179,224) | (27,467) | (683,330) | (559,286) | (85,714) | ||||||||||||||||||||
Gross profit | 211,554 | 152,953 | 182,975 | 28,042 | 644,451 | 649,559 | 99,549 | ||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||
Sales and marketing expenses | (160,581) | (64,899) | (75,660) | (11,595) | (541,772) | (279,429) | (42,824) | ||||||||||||||||||||
General and administrative expenses | (103,241) | (74,782) | (70,716) | (10,838) | (242,047) | (277,931) | (42,595) | ||||||||||||||||||||
Technology and product development expenses | (55,816) | (41,706) | (42,617) | (6,531) | (216,741) | (171,989) | (26,358) | ||||||||||||||||||||
Impairment of goodwill | - | - | (22,786) | (3,492) | - | (22,786) | (3,492) | ||||||||||||||||||||
Total operating expenses | (319,638) | (181,387) | (211,779) | (32,456) | (1,000,560) | (752,135) | (115,269) | ||||||||||||||||||||
Loss from operations | (108,084) | (28,434) | (28,804) | (4,414) | (356,109) | (102,576) | (15,720) | ||||||||||||||||||||
Other income/(loss): | |||||||||||||||||||||||||||
Interest income, net | 6,673 | 14,792 | 9,309 | 1,427 | 22,721 | 35,421 | 5,429 | ||||||||||||||||||||
Foreign currency exchange gain | 1,003 | 3,218 | 3,921 | 601 | 7,892 | 5,494 | 842 | ||||||||||||||||||||
Income/(loss) from equity method investments | - | 6,013 | (179) | (27) | (3,447) | 5,598 | 858 | ||||||||||||||||||||
Impairment of available-for-sale debt investments | - | (2,000) | - | - | - | (2,000) | (307) | ||||||||||||||||||||
Gain on disposal of available-for-sale debt investments* | 1,001,181 | - | 477,254 | 73,142 | 1,001,181 | 477,254 | 73,142 | ||||||||||||||||||||
Changes in fair value of loan related to co-sale of Particle shares | - | (4,486) | - | - | - | (24,535) | (3,760) | ||||||||||||||||||||
Changes in fair value of forward contract in relation to disposal of investments in Particle | 4,441 | - | - | - | 4,441 | 16,085 | 2,465 | ||||||||||||||||||||
Others, net | 3,351 | 13,360 | 8,770 | 1,343 | 15,031 | 35,881 | 5,499 | ||||||||||||||||||||
Income from continuing operations before income taxes | 908,565 | 2,463 | 470,271 | 72,072 | 691,710 | 446,622 | 68,448 | ||||||||||||||||||||
Income tax expense | (3,349) | (1,725) | (14,793) | (2,267) | (21,950) | (18,977) | (2,909) | ||||||||||||||||||||
Net income from continuing operations | 905,216 | 738 | 455,478 | 69,805 | 669,760 | 427,645 | 65,539 | ||||||||||||||||||||
Net income/(loss) from discontinued operations, net of income taxes | 15,360 | - | - | - | 54,242 | (62,366) | (9,558) | ||||||||||||||||||||
Net income | 920,576 | 738 | 455,478 | 69,805 | 724,002 | 365,279 | 55,981 | ||||||||||||||||||||
Net (income)/loss attributable to noncontrolling interests: | |||||||||||||||||||||||||||
Net (income) from continuing operations attributable to noncontrolling interests | (2,692) | (1,687) | (700) | (107) | (5,564) | (9,669) | (1,482) | ||||||||||||||||||||
Net (income)/loss from discontinued operations attributable to noncontrolling interests | (6,130) | - | - | - | 9,391 | 24,759 | 3,795 | ||||||||||||||||||||
Net (income)/loss attributable to noncontrolling interests | (8,822) | (1,687) | (700) | (107) | 3,827 | 15,090 | 2,313 | ||||||||||||||||||||
Net income/(loss) attributable to Phoenix New Media Limited: | |||||||||||||||||||||||||||
Net income/(loss) from continuing operations attributable to Phoenix New Media Limited | 902,524 | (949) | 454,778 | 69,698 | 664,196 | 417,976 | 64,058 | ||||||||||||||||||||
Net income/(loss) from discontinued operations attributable to Phoenix New Media Limited | 9,230 | - | - | - | 63,633 | (37,607) | (5,764) | ||||||||||||||||||||
Net income/(loss) attributable to Phoenix New Media Limited | 911,754 | (949) | 454,778 | 69,698 | 727,829 | 380,369 | 58,294 | ||||||||||||||||||||
Net income | 920,576 | 738 | 455,478 | 69,805 | 724,002 | 365,279 | 55,981 | ||||||||||||||||||||
Other comprehensive income/(loss), net of tax: fair value remeasurement for available-for-sale investments | 191,511 | 1,598 | (2,736) | (419) | 1,188,762 | (887,248) | (135,977) | ||||||||||||||||||||
Other comprehensive loss, net of tax: reclassification adjustment for disposal of available-for-sale debt investments | (1,008,795) | - | (491,197) | (75,279) | (1,008,795) | (491,197) | (75,279) | ||||||||||||||||||||
Other comprehensive (loss)/income, net of tax: foreign currency translation adjustment | (31,312) | (43,077) | (41,326) | (6,333) | 37,483 | (55,577) | (8,517) | ||||||||||||||||||||
Comprehensive income/(loss) | 71,980 | (40,741) | (79,781) | (12,226) | 941,452 | (1,068,743) | (163,792) | ||||||||||||||||||||
Comprehensive (income)/loss attributable to noncontrolling interests | (8,822) | (1,687) | (700) | (107) | 3,827 | 15,090 | 2,313 | ||||||||||||||||||||
Comprehensive income/(loss) attributable to Phoenix New Media Limited | 63,158 | (42,428) | (80,481) | (12,333) | 945,279 | (1,053,653) | (161,479) | ||||||||||||||||||||
Basic net income/(loss) per Class A and Class B ordinary share: | |||||||||||||||||||||||||||
-Continuing operations | 1.55 | - | 0.78 | 0.12 | 1.14 | 0.72 | 0.11 | ||||||||||||||||||||
-Discontinued operations | 0.02 | - | - | - | 0.11 | (0.07) | (0.01) | ||||||||||||||||||||
Basic net income/(loss) per Class A and Class B ordinary share | 1.57 | - | 0.78 | 0.12 | 1.25 | 0.65 | 0.10 | ||||||||||||||||||||
Diluted net income/(loss) per Class A and Class B ordinary share: | |||||||||||||||||||||||||||
-Continuing operations | 1.55 | - | 0.78 | 0.12 | 1.14 | 0.72 | 0.11 | ||||||||||||||||||||
-Discontinued operations | 0.02 | - | - | - | 0.11 | (0.07) | (0.01) | ||||||||||||||||||||
Diluted net income/(loss) per Class A and Class B ordinary share | 1.57 | - | 0.78 | 0.12 | 1.25 | 0.65 | 0.10 | ||||||||||||||||||||
Basic income/(loss) per ADS (1 ADS represents 8 Class A ordinary shares): | |||||||||||||||||||||||||||
-Continuing operations | 12.40 | (0.01) | 6.25 | 0.96 | 9.13 | 5.74 | 0.88 | ||||||||||||||||||||
-Discontinued operations | 0.13 | - | - | - | 0.87 | (0.51) | (0.08) | ||||||||||||||||||||
Basic net income/(loss) per ADS (1 ADS represents 8 Class A ordinary shares) | 12.53 | (0.01) | 6.25 | 0.96 | 10.00 | 5.23 | 0.80 | ||||||||||||||||||||
Diluted net income/(loss) per ADS (1 ADS represents 8 Class A ordinary shares)： | |||||||||||||||||||||||||||
-Continuing operations | 12.40 | (0.01) | 6.25 | 0.96 | 9.13 | 5.74 | 0.88 | ||||||||||||||||||||
-Discontinued operations | 0.13 | - | - | - | 0.87 | (0.51) | (0.08) | ||||||||||||||||||||
Diluted net income/(loss) per ADS (1 ADS represents 8 Class A ordinary shares) | 12.53 | (0.01) | 6.25 | 0.96 | 10.00 | 5.23 | 0.80 | ||||||||||||||||||||
Weighted average number of Class A and Class B ordinary shares used in computing net income/(loss) per share: | |||||||||||||||||||||||||||
Basic | 582,324,325 | 582,324,325 | 582,324,325 | 582,324,325 | 582,275,800 | 582,324,325 | 582,324,325 | ||||||||||||||||||||
Diluted | 582,324,325 | 582,324,325 | 582,324,325 | 582,324,325 | 582,275,800 | 582,324,325 | 582,324,325 | ||||||||||||||||||||
* The gain on disposal of available-for-sale debt investments had been net of accrued PRC withholding tax, which was calculated based on
Phoenix New Media Limited | |||||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | December 31, | December 31, | |||||||||||||||||||||
2019 | 2020 | 2020 | 2020 | 2019 | 2020 | 2020 | |||||||||||||||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||||||||||||||||
Unaudited | Unaudited | Unaudited | Unaudited | Audited* | Unaudited | Unaudited | |||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Net advertising service | 363,114 | 281,308 | 336,653 | 51,594 | 1,194,761 | 1,113,017 | 170,577 | ||||||||||||||||||||
Paid services | 37,259 | 21,681 | 25,546 | 3,915 | 133,020 | 95,828 | 14,686 | ||||||||||||||||||||
Total revenues | 400,373 | 302,989 | 362,199 | 55,509 | 1,327,781 | 1,208,845 | 185,263 | ||||||||||||||||||||
Cost of revenues | |||||||||||||||||||||||||||
Net advertising service | 181,057 | 143,463 | 165,581 | 25,376 | 623,787 | 523,813 | 80,278 | ||||||||||||||||||||
Paid services | 7,762 | 6,573 | 13,643 | 2,091 | 59,543 | 35,473 | 5,436 | ||||||||||||||||||||
Total cost of revenues | 188,819 | 150,036 | 179,224 | 27,467 | 683,330 | 559,286 | 85,714 | ||||||||||||||||||||
Gross profit | |||||||||||||||||||||||||||
Net advertising service | 182,057 | 137,845 | 171,072 | 26,218 | 570,974 | 589,204 | 90,299 | ||||||||||||||||||||
Paid services | 29,497 | 15,108 | 11,903 | 1,824 | 73,477 | 60,355 | 9,250 | ||||||||||||||||||||
Total gross profit | 211,554 | 152,953 | 182,975 | 28,042 | 644,451 | 649,559 | 99,549 | ||||||||||||||||||||
Phoenix New Media Limited | |||||||||||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||||||
December 31, | September 30, | December 31, | December 31, | December 31, | December 31, | December 31, | |||||||||||||||||||||
2019 | 2020 | 2020 | 2020 | 2019 | 2020 | 2020 | |||||||||||||||||||||
RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||||||||||||||||
Unaudited | Unaudited | Unaudited | Unaudited | Audited* | Unaudited | Unaudited | |||||||||||||||||||||
Revenue sharing fees | 1,761 | 6,026 | 6,897 | 1,057 | 25,157 | 19,550 | 2,996 | ||||||||||||||||||||
Content and operational costs | 172,152 | 129,749 | 158,458 | 24,284 | 603,573 | 482,641 | 73,968 | ||||||||||||||||||||
Bandwidth costs | 14,906 | 14,261 | 13,869 | 2,126 | 54,600 | 57,095 | 8,750 | ||||||||||||||||||||
Total cost of revenues | 188,819 | 150,036 | 179,224 | 27,467 | 683,330 | 559,286 | 85,714 | ||||||||||||||||||||
Reconciliations of Non-GAAP Results of Operations Measures to the Nearest Comparable GAAP Measures | |||||||||||||||||
(Amounts in thousands, except for number of ADSs and per ADS data) | |||||||||||||||||
Three Months Ended December 31, 2019 | Three Months Ended September 30, 2020 | Three Months Ended December 31, 2020 | |||||||||||||||
GAAP | Non-GAAP | Non- | GAAP | Non-GAAP | Non- | GAAP | Non-GAAP | Non- | |||||||||
RMB | RMB | RMB | RMB | RMB | RMB | RMB | RMB | RMB | |||||||||
Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |||||||||
Gross profit | 211,554 | 1,074 | (1) | 212,628 | 152,953 | 401 | (1) | 153,354 | 182,975 | 229 | (1) | 183,204 | |||||
Gross margin | |||||||||||||||||
3,928 | (1) | 1,758 | (1) | 2,734 | (1) | ||||||||||||
- | (2) | - | (2) | 22,786 | (2) | ||||||||||||
Loss from operations | (108,084) | 3,928 | (104,156) | (28,434) | 1,758 | (26,676) | (28,804) | 25,520 | (3,284) | ||||||||
Operating margin | (27.0)% | (26.0)% | (9.4)% | (8.8)% | (8.0)% | (0.9)% | |||||||||||
3,928 | (1) | 1,758 | (1) | 2,734 | (1) | ||||||||||||
- | (2) | - | (2) | 22,786 | (2) | ||||||||||||
- | (3) | (6,013) | (3) | 179 | (3) | ||||||||||||
(1,143,755) | (4) | - | (4) | (573,860) | (4) | ||||||||||||
(4,441) | (5) | - | (5) | - | (5) | ||||||||||||
- | (6) | 4,486 | (6) | - | (6) | ||||||||||||
- | (7) | 2,000 | (7) | - | (7) | ||||||||||||
- | (8) | - | (8) | (11,393) | (8) | ||||||||||||
142,574 | (9) | - | (9) | 96,606 | (9) | ||||||||||||
Net income/(loss) attributable | 902,524 | (1,001,694) | (99,170) | (949) | 2,231 | 1,282 | 454,778 | (462,948) | (8,170) | ||||||||
Net margin | (24.8)% | (0.3)% | (2.3)% | ||||||||||||||
Net income/(loss) per | 12.40 | (1.36) | (0.01) | 0.02 | 6.25 | (0.11) | |||||||||||
Weighted average number | 72,790,541 | 72,790,541 | 72,790,541 | 72,790,541 | 72,790,541 | 72,790,541 | |||||||||||
(1) Share-based compensation
(2) Impairment of goodwill
(3) (Income)/loss from equity method investments
(4) Gain on disposal of available-for-sale debt investments
(5) Changes in fair value of forward contract in relation to disposal of investments in Particle
(6) Changes in fair value of loan related to co-sale of Particle shares
(7) Impairment of available-for-sale debt investments
(8) Loss attributable to noncontrolling interest related to item (2)
(9) Accrued withholding taxes of item (4). Other non-GAAP to GAAP reconciling items have no income tax effect.
Reconciliations of Non-GAAP Results of Operations Measures to the Nearest Comparable GAAP Measures | |||||||||||
(Amounts in thousands, except for number of ADSs and per ADS data) | |||||||||||
Twelve Months Ended December 31, 2019 | Twelve Months Ended December 31, 2020 | ||||||||||
GAAP | Non-GAAP | Non- | GAAP | Non-GAAP | Non- | ||||||
RMB | RMB | RMB | RMB | RMB | RMB | ||||||
Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | ||||||
Gross profit | 644,451 | 5,173 | (1) | 649,624 | 649,559 | 2,613 | (1) | 652,172 | |||
Gross margin | |||||||||||
11,859 | (1) | 9,383 | (1) | ||||||||
- | (2) | 22,786 | (2) | ||||||||
Loss from operations | (356,109) | 11,859 | (344,250) | (102,576) | 32,169 | (70,407) | |||||
Operating margin | (26.8)% | (25.9)% | (8.5)% | (5.8)% | |||||||
11,859 | (1) | 9,383 | (1) | ||||||||
- | (2) | 22,786 | (2) | ||||||||
3,447 | (3) | (5,598) | (3) | ||||||||
(1,143,755) | (4) | (573,860) | (4) | ||||||||
(4,441) | (5) | (16,085) | (5) | ||||||||
- | (6) | 24,535 | (6) | ||||||||
- | (7) | 2,000 | (7) | ||||||||
- | (8) | (11,393) | (8) | ||||||||
142,574 | (9) | 96,606 | (9) | ||||||||
Net income/(loss) attributable to Phoenix New Media Limited | 664,196 | (990,316) | (326,120) | 417,976 | (451,626) | (33,650) | |||||
Net margin | (24.6)% | (2.8)% | |||||||||
Net income/(loss) per ADS-diluted | 9.13 | (4.48) | 5.74 | (0.46) | |||||||
Weighted average number of ADSs used in computing diluted net income/(loss) per ADS | 72,784,475 | 72,784,475 | 72,790,541 | 72,790,541 | |||||||
(1) Share-based compensation
(2) Impairment of goodwill
(3) Loss/(income) from equity method investments
(4) Gain on disposal of available-for-sale debt investments
(5) Changes in fair value of forward contract in relation to disposal of investments in Particle
(6) Changes in fair value of loan related to co-sale of Particle shares
(7) Impairment of available-for-sale debt investments
(8) Loss attributable to noncontrolling interest related to item (2)
(9) Accrued withholding taxes of item (4). Other non-GAAP to GAAP reconciling items have no income tax effect.
[1] Paid services revenues comprise of (i) revenues from paid contents excluding those from Tadu, which includes digital reading, audio books, paid videos, and other content-related sales activities, (ii) revenues from games, which includes web-based games and mobile games, (iii) revenues from MVAS, and (iv) revenues from others.
[2] "Others, net" primarily consists of government subsidies and litigation loss provisions.
[3] "ADS" means American Depositary Share of the Company. Each ADS represents eight Class A ordinary shares of the Company.
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SOURCE Phoenix New Media Limited
