BEIJING, May 19, 2016 /PRNewswire/ -- Cheetah Mobile
Inc. (NYSE: CMCM) ("Cheetah Mobile" or the "Company"), a leading
mobile internet company that provides mission critical applications
to help make the internet and mobile experience speedier, simpler,
and safer for users worldwide, today announced its unaudited
consolidated financial results for the first quarter of 2016.
First Quarter 2016 Financial
Highlights[1]
- Total revenues were RMB1,115.0 million
(US$172.9 million). Excluding the
Kingsoft Japan consolidation impact, total revenues were
RMB1,096.0 million (US$170.0 million), representing a 63.0%
year-over-year increase.
- Mobile revenues increased by 110.5% year-over-year to
RMB826.6 million (US$128.2 million), which was primarily driven by
robust growth in mobile advertising revenues in both the overseas
and China markets. Mobile revenues
accounted for 74.1% of total revenues.
- Overseas revenues[2] increased by
115.6% year-over-year to RMB633.6
million (US$98.3 million),
which was driven by a continued increase in mobile advertising
revenues in the overseas markets. Overseas revenues accounted
for 56.8% of total revenues and 76.7% of mobile revenues.
- Net income attributable to Cheetah Mobile shareholders
was RMB10.7 million (US$1.7 million). Non-GAAP net income
attributable to Cheetah Mobile shareholders was
RMB102.2 million (US$15.8 million), representing an increase of
32.6% year-over-year.
[1] On
January 29, 2016, the Company gained control of Kingsoft Japan
Inc., or Kingsoft Japan. As the Company and Kingsoft Japan were
under common control by Kingsoft Corporation Limited both before
and after the closing of the transaction, in accordance with ASC
805-50, unless otherwise stated, the unaudited consolidated
financial information of the Company reported in this press release
has been prepared as if Kingsoft Japan had been controlled by the
Company throughout the periods presented. See "Basis of
Presentation for Unaudited Consolidated Financial
Results."
|
[2]
Overseas revenues refers to revenues generated by our operating
legal entities incorporated outside China. Such revenues are
primarily attributable to customers located outside
China.
|
First Quarter 2016 Key Operating Metrics
- Mobile monthly active users ("Mobile MAUs") increased by 16
million quarter-over-quarter to 651 million in March 2016. Mobile MAUs from overseas markets
were 79.5% of total mobile MAUs in March
2016.
- Total global mobile user installations increased by 421 million
quarter-over-quarter to 2,762 million as of March 31, 2016.
Mr. Sheng Fu, Cheetah Mobile's
Chief Executive Officer, stated, "We have begun 2016 on a solid
note with revenues coming in at the high-end of our guidance.
But, contrary to our previous expectation of a seasonal rebound,
revenues have not grown as anticipated in the early part of the
second quarter. Our analysis suggests that there are three
key reasons for the weakness in our expected mobile revenues
growth, which is a key driver of our overall growth: 1) a decline
in eCPMs from some of our third-party advertising platform partners
in the international markets; 2) slower than expected progress in
expanding our direct sales force; and 3) longer than expected time
for us to execute our content product strategy. To address
these problems, we have implemented several initiatives, including
continued product promotion in key developed markets as well as
renewed focus on new product launches. Additionally, we have
begun implementing a two-pronged approach to boost our long-term
growth prospects. These efforts include actively investing in
new content products to increase user engagement, as well as
strengthening our direct sales operations globally to diversify our
customer base and to capture a bigger share of the fast-growing
brand advertising business. For example, we recently hired
Todd Miller, a former vice president
at Yahoo, as our global sales vice president. While recognizing the
challenges that lay ahead, I am confident that, with focus and
determination, we will be able to rejuvenate our company for
sustainable and profitable growth as one of the world's leading
mobile Internet companies.
Mr. Andy Yeung, Cheetah Mobile's
Chief Financial Officer, commented, "Driven by our solid mobile and
overseas performance, we continued to make progress both
operationally and financially in the first quarter of 2016. For
2016, we have a very clear strategy to reaccelerate revenue growth.
While our content products and direct sales initiatives are
beginning to take hold, it will take more time for these
initiatives to show meaningful results. However, over the
years, we have successfully evolved our operational direction and
strategy to address the rapid changes in the internet
space. With that in mind, we remain confident
that our business strategy is on the right track and we will
continue to aggressively execute that strategy, managing user
acquisition, user engagement, revenue growth and profitability for
the long-term sustainable growth."
Basis of Presentation for Unaudited Consolidated Financial
Results
On January 29, 2016, the Company
started to consolidate the financial results of Kingsoft Japan into
its consolidated financial statements. The Company acquired an
aggregate amount of approximately 46% equity interest in Kingsoft
Japan through strategic investments in March
2014, October 2014, and
January 2016. On January 29, 2016, the Company entered into an
agreement with its controlling shareholder Kingsoft Corporation
Limited, pursuant to which Kingsoft Corporation Limited delegated
the voting right of 5% of the total shares of Kingsoft Japan to
Cheetah Mobile. As a result, the Company obtained control of 51% in
aggregate of the total voting rights in Kingsoft Japan, and
accounted for Kingsoft Japan as a business combination under common
control.
As Cheetah Mobile and Kingsoft Japan were under common control
by Kingsoft Corporation Limited both before and after the
combination, in accordance with ASC 805-50, Cheetah Mobile's
unaudited consolidated financial information reported in this press
release, unless otherwise stated, has been prepared as if Kingsoft
Japan had been controlled and operated by Cheetah Mobile
retrospectively throughout the periods presented at historical
carrying values.
First Quarter 2016 Consolidated Financial Results
REVENUES
Total revenues increased by 57.2% to RMB1,115.0 million (US$172.9 million) in the first quarter of 2016
from RMB709.4 million in the prior
year period. This increase was mainly driven by the Company's
organic business growth, which was attributable to the Company's
growing global mobile user base and substantial improvements in
mobile monetization, especially in the overseas markets.
Excluding the Kingsoft Japan consolidation impact, total revenues
were RMB1,096.0 million (US$170.0 million), representing an increase of
63.0% year-over-year.
- Revenues from online marketing services increased by
69.7% to RMB992.3 million
(US$153.9 million) in the first
quarter of 2016 from RMB584.8 million
in the prior year period. Mobile advertising revenues represented
approximately 77% of online marketing revenues in the quarter,
which increased from approximately 60% of online marketing revenues
in the prior year period. The increase in mobile advertising
revenues was driven by the Company's growing global mobile user
base, and increased demand from advertisers, including third-party
advertising platforms, for the Company's mobile advertising
services worldwide, as well as the monetization of light causal
games through in-game advertising.
- Revenues from internet value added services ("IVAS")
increased by 5.3% to RMB102.3 million
(US$15.9 million) in the first
quarter of 2016 from RMB97.2 million
in the prior year period. The year-over-year increase was driven by
the growth of mobile game publishing revenues in the overseas
markets, including the increased monetization of the Company's
free-to-play light causal game, which was launched in late
2015.
- Revenues from internet security services and others
decreased by 25.6% to RMB20.4 million
(US$3.2 million) in the first quarter
of 2016 from RMB27.5 million in the
prior year period. The year-over-year decrease was primarily due to
a decline in sales of the Company's air purifier product.
By platform, revenues generated from mobile business
increased by 110.5% to RMB826.6
million (US$128.2 million)
from RMB392.7 million in the prior
year period. This increase was primarily driven by the Company's
growing global mobile user base, and the increasing popularity of
the Company's mobile marketing services in overseas and
China markets.
By region, revenues generated from overseas markets
increased by 115.6% to RMB633.6
million (US$98.3 million) from
RMB293.8 million in the prior year
period. This increase was primarily due to continued growth of the
Company's overseas mobile user base, and rapid growth of the
Company's mobile advertising revenues in the overseas markets.
COST OF REVENUES AND GROSS PROFIT
Cost of revenues increased by 96.7% to RMB321.0 million (US$49.8
million) in the first quarter of 2016 from RMB163.2 million in the prior year period. This
increase was mainly due to an increase in traffic acquisition costs
associated with the Company's third-party advertising publishing
business on the Cheetah Ad Platform, and an increase in bandwidth
and internet data center costs associated with increased user
traffic worldwide and increased data analytics.
Gross profit increased by 45.4% to RMB794.0 million (US$123.1
million) in the first quarter of 2016 from RMB546.2 million in the prior year period.
OPERATING INCOME AND EXPENSES
Total operating income and expenses increased by 57.7% to
RMB771.7 million (US$119.7 million) in the first quarter of 2016
from RMB489.4 million in the prior
year period. Total non-GAAP operating income and expenses increased
by 53.3% to RMB680.6 million
(US$105.6 million) from RMB443.9 million in the prior year period.
- Research and development expenses increased by 56.4% to
RMB207.5 million (US$32.2 million) from RMB132.7 million in the prior year period. The
increase was primarily due to an increase in personnel-related
costs and share-based compensation expenses. The increase in
personnel costs associated with research and development was
primarily due to the Company's stepped-up investments in big data
analytics and new product development, particularly the development
of new content-driven mobile applications and services. Non-GAAP
research and development expenses, which exclude share-based
compensation expenses, increased by 38.0% to RMB167.3 million (US$26.0
million) from RMB121.2 million
in the prior year period.
- Selling and marketing expenses increased by 75.6% to
RMB443.8 million (US$68.8 million) from RMB252.7 million in the prior year period. The
increase was primarily due to the spending on promotional
activities for the Company's mobile business, including the
continued global promotions for a mobile game recently launched by
the Company. Non-GAAP selling and marketing expenses, which exclude
share-based compensation expenses, increased by 74.5% to
RMB437.6 million (US$67.9 million) from RMB250.8 million in the prior year period.
The Company plans to aggressively expand its direct sales
operations in the North American and European regions, which may
result in higher personnel-related selling and marketing expenses
throughout 2016.
- General and administrative expenses increased by 34.9% to
RMB133.1 million (US$20.6 million) from RMB98.7 million in the prior year period. The
year-over-year growth was primarily due to an increase in expenses
associated with increased headcount, share-based compensation
expenses and staff benefits. Non-GAAP general and administrative
expenses, which exclude share-based compensation expenses,
increased by 32.8% to RMB88.3 million
(US$13.7 million) from RMB66.4 million in the prior year period.
Operating profit decreased by 60.8% year over year to
RMB22.2 million (US$3.4 million) from RMB56.7 million in the prior year period.
Non-GAAP operating profit increased by 10.3% to RMB113.7 million (US$17.6
million) from RMB103.1 million
in the prior year period.
Share-based compensation expenses increased by 97.4% to
RMB91.4 million (US$14.2 million), from RMB46.3 million in the prior year period.
NET INCOME ATTRIBUTABLE TO CHEETAH MOBILE
SHAREHOLDERS
Net income attributable to Cheetah Mobile shareholders decreased
by 65.2% to RMB10.7 million
(US$1.7 million) in the first quarter
of 2016 from RMB30.7 million in the
prior year period.
Excluding the Kingsoft Japan consolidation impact, net income
attributable to Cheetah Mobile shareholders decreased by 65.9% to
RMB10.5 million (US$1.6 million) in the first quarter of 2016 from
RMB30.7 million in the prior year
period.
Non-GAAP net income attributable to Cheetah Mobile shareholders
increased by 32.6% to RMB102.2
million (US$15.8 million) from
RMB77.1 million in the prior year
period.
Excluding the Kingsoft Japan consolidation impact, non-GAAP net
income attributable to Cheetah Mobile shareholders increased by
32.4% to RMB101.8 million
(US$15.8 million) in the first
quarter of 2016 from RMB76.9 million
in the prior year period.
NET INCOME PER ADS
Diluted earnings per ADS in the first quarter of 2016 decreased
by 66.7% to RMB0.07 (US$0.01) from RMB0.21 in the prior year period.
Non-GAAP diluted earnings per ADS in the first quarter of 2016
increased by 31.5% to RMB0.71
(US$0.11) from RMB0.54 in the prior year period.
ADJUSTED EBITDA
Adjusted EBITDA (Non-GAAP) was RMB150.8
million (US$23.4 million) for
the first quarter of 2016, representing an 11.4% increase from
RMB135.3 million in the prior year
period.
CASH AND CASH EQUIVALENTS, RESTRICTED CASH AND SHORT-TERM
INVESTMENTS BALANCE
As of March 31, 2016, the Company
had cash and cash equivalents, restricted cash and short-term
investments of RMB1,839.2 million
(US$285.2 million).
SHARES ISSUED AND OUTSTANDING
As of March 31, 2016, the Company
had a total of 1,424,588,645 Class A and Class B ordinary shares
issued and outstanding. One ADS represents 10 Class A ordinary
shares.
Recent Developments
To strengthen our direct sales operations in the international
markets, we are very pleased to announce that Todd Miller has joined us recently as our VP of
Global Sales. Todd is a very seasoned sales executive in the
Internet space. Before joining us, Todd was a VP at Yahoo,
where he led Yahoo's various sales operations over the past 13
years. Todd will help us aggressively build out our North
American and European sales teams.
Update on Share Repurchase Program
On March 16, 2016, the Board of
Directors of the Company authorized a share repurchase plan,
pursuant to which the Company was authorized to repurchase its own
issued and outstanding ADSs up to an aggregate value of
US$100 million from the open market,
in negotiated transactions off the market, or through other legally
permissible means in accordance with applicable securities laws
from time to time within one year. The share repurchase plan does
not require the Company to acquire a specific number of shares. As
of May 18, 2016, no ADS was
repurchased by the Company. The repurchased ADSs, if any, will be
recorded as treasury ADSs at purchase cost at the time of
repurchase.
Business Outlook
For the second quarter of 2016, the Company expects and
estimates its total revenues to be between RMB975 million (US$151
million) and RMB1,000 million
(US$155 million), representing an
estimated year-over-year growth of 10% to 13%. This estimate
represents the management's preliminary view as of the date of this
release, which is subject to change and any change could be
material.
Conference Call Information
Company will hold a conference call on Thursday, May 19, 2016 at 8:00 am Eastern Time or 8:00 pm Beijing Time to discuss the financial
results. Listeners may access the call by dialing the following
numbers:
International:
|
+1-412-902-4272
|
United States Toll
Free:
|
+1-888-346-8982
|
China Toll
Free:
|
4001-201203
|
Hong Kong Toll
Free:
|
800-905945
|
Conference
ID:
|
Cheetah
Mobile
|
A live and archived webcast of the conference call will also be
available at the Company's investor relations website at
http://ir.cmcm.com/.
Exchange Rate
This press release contains translations of certain Renminbi
amounts into U.S. dollars at specified rates solely for the
convenience of readers. Unless otherwise noted, all translations
from Renminbi to U.S. dollars in this press release were made at a
rate of RMB6.4480 to US$1.00, the noon buying rate in effect on
March 31, 2016 in the City of New York for cable transfers in
Renminbi per U.S. dollar as certified for customs purposes by the
Federal Reserve Bank of New York.
Such translations should not be construed as representations that
RMB amounts could be converted into U.S. dollars at that rate or
any other rate, or to be the amounts that would have been reported
under accounting principles generally accepted in the United States of America ("U.S.
GAAP").
About Cheetah Mobile Inc.
Cheetah Mobile is a leading mobile internet company. It aims to
provide the best apps for mobile users worldwide, while building a
leading global mobile ad platform for advertisers.
Cheetah Mobile had approximately 651 million global mobile
monthly active users in March 2016.
Its mission critical applications, including Clean Master, CM
Security, Battery Doctor and Duba Anti-virus, help make the
internet and mobile experience speedier, simpler, and safer for
users worldwide. The Company also provides multiple user traffic
entry points and global content promotional channels capable of
delivering targeted content to hundreds of millions of users. Its
customers include direct advertisers and mobile advertising
networks through which advertisers place their advertisements.
Safe Harbor Statement
This press release contains forward-looking statements.
These statements, including management quotes and business outlook,
constitute forward-looking statements under 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. Such
statements involve inherent risks and uncertainties. A number of
factors could cause actual results to differ materially from those
contained in the forward-looking statements, including but are not
limited to the following: Cheetah Mobile's growth strategies;
Cheetah Mobile's ability to retain and increase its user base and
expand its product and service offerings; Cheetah Mobile's ability
to monetize its platform; Cheetah Mobile's future business
development, financial condition and results of operations;
competition with companies in a number of industries including
internet companies that provide online marketing services and
internet value-added services; expected changes in Cheetah Mobile's
revenues and certain cost or expense items; and general economic
and business condition globally and in China. Further information regarding these and
other risks is included in Cheetah Mobile's filings with the U.S.
Securities and Exchange Commission. Cheetah Mobile does not
undertake any obligation to update any forward-looking statement as
a result of new information, future events or otherwise, except as
required under applicable law.
Use of Non-GAAP Financial Measures
To supplement Cheetah Mobile's consolidated financial
information presented in accordance with U.S. GAAP, Cheetah Mobile
uses the following non-GAAP financial measures:
- Non-GAAP operating income and expenses reflect operating
expenses excluding share-based compensation expenses.
- Non-GAAP operating profit reflects operating profit
excluding share-based compensation expenses.
- Non-GAAP net income attributable to Cheetah Mobile
shareholders is net income attributable to Cheetah Mobile
shareholders excluding share-based compensation expenses.
- Non-GAAP diluted earnings per ADS is non-GAAP net income
attributable to Cheetah Mobile shareholders divided by weighted
average number of diluted ADSs.
- Adjusted EBITDA is earnings before interest, taxes,
depreciation, amortization, other non-operating income and
share-based compensation expenses.
The Company believes that separate analysis and exclusion of
share-based compensation expenses and the use of Adjusted EBITDA
add clarity to the constituent parts of its performance from the
cash perspective. The Company reviews these non-GAAP financial
measures together with GAAP financial measures to obtain a better
understanding of its operating performance. It uses the non-GAAP
financial measures for planning, forecasting and measuring results
against the forecast. The Company believes that non-GAAP financial
measures are useful supplemental information for investors and
analysts to assess its operating performance without the effect of
share-based compensation expenses, which have been and will
continue to be significant recurring expenses in its business.
However, the use of non-GAAP financial measures has material
limitations as an analytical tool. One of the limitations of using
non-GAAP financial measures is that they do not include all items
that impact the Company's net income for the period. In addition,
because non-GAAP financial measures are not measured 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 non-GAAP financial
measure in isolation from or as an alternative to the financial
measure prepared in accordance with U.S. GAAP. For more information
on these non-GAAP financial measures, please see the tables
captioned "Cheetah Mobile Inc. Reconciliations of GAAP and Non-GAAP
Results" and "Cheetah Mobile Inc. Reconciliation of Net Income
Attributable to Cheetah Mobile Shareholders to Adjusted EBITDA
(Non-GAAP)" at the end of this release.
Investor Relations Contact
Cheetah Mobile Inc.
Helen Jing Zhu
Tel: +86 10 6292 7779 ext. 1600
Email: IR@cmcm.com
ICR, Inc.
Vera Tang
Tel: +1 (646) 417-5395
Email: IR@cmcm.com
Cheetah Mobile
Inc.
|
|
|
|
|
|
Condensed
Consolidated Balance Sheets
|
|
|
|
|
|
(Unaudited, in '000,
except for per share data)
|
|
|
|
|
|
|
|
|
As
of
|
|
|
|
December
31, 2015
|
|
March 31,
2016
|
|
March 31,
2016
|
|
RMB
|
|
RMB
|
|
USD
|
|
(As
adjusted, unaudited) (a)
|
|
(a)
|
|
(a)
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
1,843,233
|
|
1,388,402
|
|
215,323
|
Restricted
cash
|
156,161
|
|
155,494
|
|
24,115
|
Short-term
investments
|
29,234
|
|
295,295
|
|
45,796
|
Accounts
receivable
|
633,440
|
|
715,516
|
|
110,967
|
Prepayments and other
current assets
|
360,004
|
|
424,978
|
|
65,908
|
Due from related
parities
|
60,794
|
|
48,023
|
|
7,448
|
Deferred tax
assets
|
5,101
|
|
5,660
|
|
878
|
Total current
assets
|
3,087,967
|
|
3,033,368
|
|
470,435
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
Property and
equipment, net
|
121,241
|
|
127,193
|
|
19,726
|
Intangible assets,
net
|
233,092
|
|
191,753
|
|
29,738
|
Goodwill
|
617,863
|
|
615,767
|
|
95,497
|
Investment in equity investees
|
124,708
|
|
116,931
|
|
18,134
|
Other long-term investments
|
700,113
|
|
756,192
|
|
117,275
|
Deferred tax
assets
|
12,843
|
|
20,737
|
|
3,216
|
Other non-current
assets
|
28,724
|
|
28,905
|
|
4,483
|
Total non-current
assets
|
1,838,584
|
|
1,857,478
|
|
288,069
|
|
|
|
|
|
|
Total
assets
|
4,926,551
|
|
4,890,846
|
|
758,504
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Bank loans
|
130,273
|
|
130,145
|
|
20,184
|
Accounts
payable
|
137,883
|
|
168,795
|
|
26,178
|
Accrued expenses and
other current liabilities
|
1,308,717
|
|
1,209,973
|
|
187,651
|
Redemption right
liabilities
|
474
|
|
450
|
|
70
|
Deferred
revenue
|
56,070
|
|
52,032
|
|
8,069
|
Due to related
parties
|
56,932
|
|
61,159
|
|
9,485
|
Income tax
payable
|
29,822
|
|
32,700
|
|
5,072
|
Deferred tax
liabilities
|
414
|
|
166
|
|
26
|
Total current
liabilities
|
1,720,585
|
|
1,655,420
|
|
256,735
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
Bank loans
|
10,523
|
|
9,914
|
|
1,538
|
Deferred
revenue
|
8,166
|
|
8,432
|
|
1,308
|
Deferred tax
liabilities
|
99,006
|
|
96,438
|
|
14,956
|
Other non-current
liabilities
|
73,826
|
|
19,431
|
|
3,013
|
Total non-current
liabilities
|
191,521
|
|
134,215
|
|
20,815
|
|
|
|
|
|
|
Total
liabilities
|
1,912,106
|
|
1,789,635
|
|
277,550
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
Ordinary
shares
|
226
|
|
228
|
|
35
|
Additional paid-in
capital
|
2,414,706
|
|
2,495,033
|
|
386,947
|
Retained
earnings
|
317,818
|
|
328,523
|
|
50,947
|
Accumulated other
comprehensive income
|
121,317
|
|
114,651
|
|
17,781
|
Total Cheetah
Mobile shareholders' equity
|
2,854,067
|
|
2,938,435
|
|
455,710
|
Noncontrolling
interests
|
160,378
|
|
162,776
|
|
25,244
|
Total
equity
|
3,014,445
|
|
3,101,211
|
|
480,954
|
|
|
|
|
|
|
Total liabilities,
noncontrolling interests and shareholders' equity
|
4,926,551
|
|
4,890,846
|
|
758,504
|
|
|
|
|
|
|
Note:
|
|
|
|
|
|
(a) The above
condensed consolidated balance sheets have been prepared as if the
Kingsoft Japan had been owned and operated by the Cheetah Mobile
throughout the periods
presented in accordance with ASC 805-50. Kingsoft Japan became a
subsidiary of the Company on January 29, 2016.
|
Cheetah Mobile
Inc.
|
Condensed
Consolidated Statements of Comprehensive Income
|
(Unaudited, in '000,
except for per share data and number of shares and ADSs)
|
|
|
|
March 31,
2015
|
December 31,
2015
|
March 31,
2016
|
March 31,
2016
|
|
RMB
|
RMB
|
RMB
|
USD
|
|
(As
adjusted, unaudited) (a)
|
(As
adjusted, unaudited) (a)
|
(a)
|
(a)
|
Revenues
|
709,401
|
1,149,546
|
1,114,988
|
172,919
|
Online marketing
services
|
584,781
|
1,036,091
|
992,279
|
153,889
|
Internet value-added
services
|
97,151
|
89,337
|
102,268
|
15,860
|
Internet security
services and others
|
27,469
|
24,118
|
20,441
|
3,170
|
|
|
|
|
|
Cost of revenues
(a)
|
(163,225)
|
(295,110)
|
(321,010)
|
(49,784)
|
Gross
profit
|
546,176
|
854,436
|
793,978
|
123,135
|
|
|
|
|
|
Operating income
and expenses:
|
|
|
|
|
Research and
development (a)
|
(132,688)
|
(210,415)
|
(207,462)
|
(32,175)
|
Selling and marketing
(a)
|
(252,676)
|
(513,368)
|
(443,782)
|
(68,825)
|
General and
administrative (a)
|
(98,689)
|
(98,611)
|
(133,085)
|
(20,640)
|
Impairment of
goodwill and intangible assets
|
(5,391)
|
(12,525)
|
(2,350)
|
(364)
|
Other operating
income
|
-
|
60,273
|
14,948
|
2,318
|
Total operating
income and expenses
|
(489,444)
|
(774,646)
|
(771,731)
|
(119,686)
|
|
|
|
|
|
Operating
profit
|
56,732
|
79,790
|
22,247
|
3,449
|
Other (expenses)
income:
|
|
|
|
|
Interest income,
net
|
5,149
|
2,815
|
3,387
|
525
|
Changes in fair value
of redemption right and put options granted
|
-
|
68
|
20
|
3
|
Settlement and
changes in fair value of contingent consideration
|
(3,478)
|
9,098
|
(683)
|
(106)
|
Foreign exchange
(loss) gain, net
|
(193)
|
1,470
|
(1,362)
|
(211)
|
Impairment loss of
long-term investments
|
(25,891)
|
(8,837)
|
-
|
-
|
(Losses) gains
from equity method investments
|
(3,633)
|
4,390
|
(7,731)
|
(1,199)
|
Other income
(expense), net
|
10,251
|
(136)
|
651
|
101
|
|
|
|
|
|
Income before
taxes
|
38,937
|
88,658
|
16,529
|
2,562
|
Income tax
expenses
|
(7,637)
|
(31,954)
|
(2,998)
|
(465)
|
Net
income
|
31,300
|
56,704
|
13,531
|
2,097
|
Less: net income
attributable to noncontrolling interests
|
564
|
23
|
2,826
|
438
|
Net income
attributable to Cheetah Mobile shareholders
|
30,736
|
56,681
|
10,705
|
1,659
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
Basic
|
0.02
|
0.04
|
0.01
|
0.00
|
Diluted
|
0.02
|
0.04
|
0.01
|
0.00
|
|
|
|
|
|
Earnings per
ADS
|
|
|
|
|
Basic
|
0.23
|
0.41
|
0.08
|
0.01
|
Diluted
|
0.21
|
0.40
|
0.07
|
0.01
|
|
|
|
|
|
Weighted average
number of shares outstanding
|
|
|
|
|
Basic
|
1,360,580,383
|
1,385,225,872
|
1,392,324,511
|
1,392,324,511
|
Diluted
|
1,431,681,212
|
1,434,672,741
|
1,441,882,966
|
1,441,882,966
|
Weighted average
number of ADSs used in computation
|
|
|
|
|
Basic
|
136,058,038
|
138,522,587
|
139,232,451
|
139,232,451
|
Diluted
|
143,168,121
|
143,467,274
|
144,188,297
|
144,188,297
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income, net of tax of nil
|
|
|
|
|
Foreign currency
translation adjustments
|
6,835
|
41,018
|
(6,473)
|
(1,004)
|
Unrealized (losses)
gains on available-for-sale
securities, net
|
(1,064)
|
3,219
|
1,215
|
188
|
Reclassification
adjustments for gains included in the consolidated statement of
profit or loss
|
(6,814)
|
-
|
-
|
-
|
Other
comprehensive (loss) income
|
(1,043)
|
44,237
|
(5,258)
|
(816)
|
Total
comprehensive income
|
30,257
|
100,941
|
8,273
|
1,281
|
Less: Total
comprehensive income (loss) attributable to noncontrolling
interests
|
687
|
(196)
|
4,234
|
657
|
Total
comprehensive income attributable to Cheetah Mobile
shareholders
|
29,570
|
101,137
|
4,039
|
624
|
|
|
|
|
|
(a) Share-based
compensation expenses
|
|
|
|
|
|
|
|
|
|
(In
'000)
|
|
|
March 31,
2015
|
December 31,
2015
|
March 31,
2016
|
March 31,
2016
|
|
RMB
|
RMB
|
RMB
|
USD
|
|
(Restated
Unaudited)
|
(Restated
Unaudited)
|
(Unaudited)
|
(Unaudited)
|
Cost of
revenues
|
746
|
(1,623)
|
339
|
53
|
Research and
development
|
11,470
|
48,740
|
40,129
|
6,223
|
Selling and
marketing
|
1,859
|
5,725
|
6,144
|
953
|
General and
administrative
|
32,253
|
45,652
|
44,835
|
6,953
|
Total
|
46,328
|
98,494
|
91,447
|
14,182
|
|
|
|
|
|
Notes:
|
|
|
|
|
(a) The above
condensed consolidated statements of comprehensive income have been
prepared as if the Kingsoft Japan had been owned and operated by
the Cheetah Mobile throughout
the periods presented in accordance with ASC 805-50. Kingsoft Japan
became a subsidiary of the Company on January 29, 2016.
|
Cheetah Mobile
Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP and Non-GAAP Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In'000, except for
per share data and percentage)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended March 2016
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
Non-GAAP
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
Result
($)
|
Revenues
|
1,114,988
|
|
|
|
|
|
|
|
1,114,988
|
|
|
|
172,920
|
Cost of
revenues
|
(321,010)
|
|
28.8%
|
|
339
|
|
0.0%
|
|
(320,671)
|
|
28.8%
|
|
(49,732)
|
Gross
profit
|
793,978
|
|
71.2%
|
|
339
|
|
0.0%
|
|
794,317
|
|
71.2%
|
|
123,188
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(207,462)
|
|
18.6%
|
|
40,129
|
|
3.6%
|
|
(167,333)
|
|
15.0%
|
|
(25,951)
|
Selling and
marketing
|
(443,782)
|
|
39.8%
|
|
6,144
|
|
0.6%
|
|
(437,638)
|
|
39.3%
|
|
(67,872)
|
General and
administrative
|
(133,085)
|
|
11.9%
|
|
44,835
|
|
4.0%
|
|
(88,250)
|
|
7.9%
|
|
(13,686)
|
Impairment of
goodwill and intangible assets
|
(2,350)
|
|
0.2%
|
|
-
|
|
-
|
|
(2,350)
|
|
0.2%
|
|
(364)
|
Other operating
income
|
14,948
|
|
1.3%
|
|
-
|
|
-
|
|
14,948
|
|
1.3%
|
|
2,318
|
Total operating
income and expenses
|
(771,731)
|
|
69.2%
|
|
91,108
|
|
8.2%
|
|
(680,623)
|
|
61.0%
|
|
(105,555)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
22,247
|
|
2.0%
|
|
91,447
|
|
8.2%
|
|
113,694
|
|
10.2%
|
|
17,633
|
Net income
attributable to Cheetah Mobile shareholders
|
10,705
|
|
1.0%
|
|
91,447
|
|
8.2%
|
|
102,152
|
|
9.2%
|
|
15,842
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.01
|
|
|
|
0.06
|
|
|
|
0.07
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
0.07
|
|
|
|
0.64
|
|
|
|
0.71
|
|
|
|
|
Diluted earnings per
ADS (USD)
|
0.01
|
|
|
|
0.10
|
|
|
|
0.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended December 31, 2015
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
|
Revenues
|
1,149,546
|
|
|
|
|
|
|
|
1,149,546
|
|
|
|
|
Cost of
revenues
|
(295,110)
|
|
25.7%
|
|
(1,623)
|
|
-0.1%
|
|
(296,733)
|
|
25.8%
|
|
|
Gross
profit
|
854,436
|
|
74.3%
|
|
(1,623)
|
|
-0.1%
|
|
852,813
|
|
74.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(210,415)
|
|
18.3%
|
|
48,740
|
|
4.2%
|
|
(161,675)
|
|
14.1%
|
|
|
Selling and
marketing
|
(513,368)
|
|
44.7%
|
|
5,725
|
|
0.5%
|
|
(507,643)
|
|
44.2%
|
|
|
General and
administrative
|
(98,611)
|
|
8.6%
|
|
45,652
|
|
4.0%
|
|
(52,959)
|
|
4.6%
|
|
|
Impairment of
goodwill and intangible assets
|
(12,525)
|
|
1.1%
|
|
-
|
|
-
|
|
(12,525)
|
|
1.1%
|
|
|
Other operating
income
|
60,273
|
|
5.2%
|
|
-
|
|
-
|
|
60,273
|
|
5.2%
|
|
|
Total operating
income and expenses
|
(774,646)
|
|
67.4%
|
|
100,117
|
|
8.7%
|
|
(674,529)
|
|
58.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
79,790
|
|
6.9%
|
|
98,494
|
|
8.6%
|
|
178,284
|
|
15.5%
|
|
|
Net income
attributable to Cheetah Mobile shareholders
|
56,681
|
|
4.9%
|
|
98,494
|
|
8.6%
|
|
155,175
|
|
13.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.04
|
|
|
|
0.07
|
|
|
|
0.11
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
0.40
|
|
|
|
0.68
|
|
|
|
1.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended March 2015
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
|
Revenues
|
709,401
|
|
|
|
|
|
|
|
709,401
|
|
|
|
|
Cost of
revenues
|
(163,225)
|
|
23.0%
|
|
746
|
|
0.1%
|
|
(162,479)
|
|
22.9%
|
|
|
Gross
profit
|
546,176
|
|
77.0%
|
|
746
|
|
0.1%
|
|
546,922
|
|
77.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(132,688)
|
|
18.7%
|
|
11,470
|
|
1.6%
|
|
(121,218)
|
|
17.1%
|
|
|
Selling and
marketing
|
(252,676)
|
|
35.6%
|
|
1,859
|
|
0.3%
|
|
(250,817)
|
|
35.4%
|
|
|
General and
administrative
|
(98,689)
|
|
13.9%
|
|
32,253
|
|
4.5%
|
|
(66,436)
|
|
9.4%
|
|
|
Impairment of
goodwill and intangible assets
|
(5,391)
|
|
0.8%
|
|
-
|
|
-
|
|
(5,391)
|
|
0.8%
|
|
|
Total operating
expenses
|
(489,444)
|
|
69.0%
|
|
45,582
|
|
6.4%
|
|
(443,862)
|
|
62.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
56,732
|
|
8.0%
|
|
46,328
|
|
6.5%
|
|
103,060
|
|
14.5%
|
|
|
Net income
attributable to Cheetah Mobile shareholders
|
30,736
|
|
4.3%
|
|
46,328
|
|
6.5%
|
|
77,064
|
|
10.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.02
|
|
|
|
0.03
|
|
|
|
0.05
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
0.21
|
|
|
|
0.33
|
|
|
|
0.54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cheetah Mobile
Inc.
|
|
|
|
|
Reconciliation
from Net Income Attributable to Cheetah Mobile Shareholders to
Adjusted EBITDA (Non-GAAP)
|
|
|
(Unaudited, in
'000)
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended
|
|
March 31,
2015
|
December 31,
2015
|
March 31,
2016
|
March 31,
2016
|
|
RMB
|
RMB
|
RMB
|
USD
|
Net income
attributable to Cheetah Mobile shareholders
|
30,736
|
56,681
|
10,705
|
1,659
|
Add:
|
|
|
|
|
Income tax
expense
|
7,637
|
31,954
|
2,998
|
465
|
Interest
income,net
|
(5,149)
|
(2,815)
|
(3,387)
|
(525)
|
Depreciation and amortization
|
32,225
|
38,155
|
37,076
|
5,750
|
Net income
attributable to noncontrolling interests
|
564
|
23
|
2,826
|
438
|
Other
non-operating expense (income), net
|
22,944
|
(6,053)
|
9,105
|
1,412
|
Share-based compensation
|
46,328
|
98,494
|
91,447
|
14,182
|
Adjusted
EBITDA
|
135,285
|
216,439
|
150,770
|
23,381
|
|
|
|
|
|
|
|
|
|
|
Cheetah Mobile
Inc.
|
|
|
|
|
Revenues Generated
from PC-based and Mobile-based Applications and
Services
|
|
|
(Unaudited, in
'000)
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended
|
|
March 31,
2015
|
December 31,
2015
|
March 31,
2016
|
March 31,
2016
|
|
RMB
|
RMB
|
RMB
|
USD
|
PC
|
316,714
|
341,483
|
288,398
|
44,727
|
Mobile
|
392,687
|
808,063
|
826,590
|
128,192
|
Total
|
709,401
|
1,149,546
|
1,114,988
|
172,919
|
|
|
|
|
|
Cheetah Mobile
Inc.
|
|
|
|
|
Revenues Generated
from Domestic and Overseas Markets
|
|
|
|
(Unaudited, in
'000)
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended
|
|
March 31,
2015
|
December 31,
2015
|
March 31,
2016
|
March 31,
2016
|
|
RMB
|
RMB
|
RMB
|
USD
|
Domestic
revenues
|
415,584
|
515,671
|
481,373
|
74,655
|
Overseas
revenues
|
293,817
|
633,875
|
633,615
|
98,264
|
Total
|
709,401
|
1,149,546
|
1,114,988
|
172,919
|
|
|
|
|
|
|
|
|
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/cheetah-mobile-announces-first-quarter-2016-unaudited-consolidated-financial-results-300271617.html
SOURCE Cheetah Mobile