BEIJING, Nov. 21, 2016 /PRNewswire/ --Cheetah Mobile Inc.
(NYSE: CMCM) ("Cheetah Mobile" or the "Company"), a leading mobile
internet company that aims to provide leading applications to help
make the internet and mobile experience smarter, speedier, and
safer for users worldwide, today announced its unaudited
consolidated financial results for the third quarter of 2016.
Third Quarter 2016 Financial Highlights
- Total revenues increased by 9.7% year over year and
7.8% quarter over quarter to RMB1,128.3
million (US$169.2 million),
slightly above the mid-point of the Company's guidance range.
The quarter-over-quarter growth was driven by the steady and
sustained revenue growth from the Company's utility apps.
- Mobile revenues increased by 26.8% year over year and
16.3% quarter over quarter to RMB898.2
million (US$134.7
million). Mobile revenues accounted for 79.6% of total
revenues.
- Overseas revenues[1] increased by 28.9% year
over year and 28.4% quarter over quarter to RMB719.9 million (US$108.0
million). Overseas revenues accounted for 63.8% of
total revenues and 80.1% of mobile revenues.
- Net income attributable to Cheetah Mobile shareholders
was RMB0.4 million (US$0.07 million). Non-GAAP net income
attributable to Cheetah Mobile shareholders was RMB72.4 million (US$10.9
million).
Third Quarter 2016 Key Operating Metrics
- The number of mobile monthly active users ("Mobile MAUs") was
612 million in September 2016. The number of Mobile MAUs from
overseas markets accounted for 80.3% of the total number of Mobile
MAUs in September 2016.
- The number of total global mobile user installations since the
Company's inception has grown to 3,464 million as of September 30, 2016.
Mr. Sheng Fu, Cheetah Mobile's
Chief Executive Officer, stated, "We are delighted to report
strengthening financial results for the third quarter of
2016. Driven by the solid performance of our utility apps,
total revenues resumed its sequential growth and our mobile and
overseas revenues have hit all-time record highs, and the Company
returned to profitability. Our utility apps continue to see
steady revenue growth as well as improved profitability even as the
overall utilities segment continues to mature. In particular,
Clean Master maintained its No. 1 position in the U.S. tool
application category in early November, according to App Annie. In addition, two of our
content-driven apps, Live.me and News Republic, demonstrated strong
growth over the past quarter, particularly in the U.S. market.
According to App Annie's
October data, Live.me was the No.1 grossing social application in
the U.S. on Google Play and was ranked as one of the top 5 social
apps on Apple App Store. In addition, News Republic was
ranked as one of the top 3 news and magazine apps in the U.S. on
Google Play in October 2016. Looking ahead, we will continue
to implement our mobile content strategy and focus on connecting
our over 600 million global Mobile MAUs with more personalized and
rich content, further strengthening our user experience, user
engagement and growth engine for Cheetah Mobile."
Mr. Andy Yeung, Cheetah Mobile's
Chief Financial Officer, commented, "We delivered solid financial
results in the third quarter of 2016, with resumed sequential
growth in total revenues and improved profitability despite
stepped-up investments in our content apps. During the second
quarter, we set a clear goal to rejuvenate revenue growth and
expand profitability of our utility apps. We have delivered
on our promises with strong performance from our utility apps,
which continued to drive our total revenue growth and margin
expansion. Going forward, we remain focused on executing on
our mobile content strategy to establish a sustainable and
profitable growth model for the long term. We believe that
consistent, strong operational and financial performance of our
utility apps will continue to lay a solid foundation for our mobile
content strategy, providing another round of strong growth in the
coming quarters."
Third Quarter 2016 Consolidated Financial Results
REVENUES
Total revenues increased by 9.7% year over year and 7.8% quarter
over quarter to RMB1,128.3 million
(US$169.2 million) in the third
quarter of 2016, which was primarily driven by the steady and
sustained revenue growth from the Company's utility apps and the
contribution from the Company's new content-driven apps, namely
Live.me and News Republic, which accounted for approximately 4% of
total revenues in the quarter.
- Revenues from online marketing services increased by
8.9% year over year and 5.0% quarter over quarter to RMB986.4 million (US$147.9
million) in the third quarter of 2016. Mobile
advertising revenues represented approximately 82% of online
marketing revenues in the quarter, as compared with approximately
72% in the prior year period and approximately 78% in the previous
quarter. The increase in mobile advertising revenues was
driven by higher demand from advertisers, including direct
customers, 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 11.0% year over year and 38.8% quarter over quarter to
RMB110.5 million (US$16.6 million) in the third quarter of 2016,
which was primarily driven by the Company's initial monetization of
Live.me in overseas markets.
- Revenues from internet security services and others
increased by 32.3% year over year and 12.7% quarter over quarter to
RMB31.5 million (US$4.7 million) in the third quarter of 2016,
which was primarily driven by higher mobile internet software
licensing revenues.
By platform, revenues generated from mobile business
increased by 26.8% year over year and 16.3% quarter over quarter to
RMB898.2 million (US$134.7 million) in the third quarter of 2016,
which was primarily driven by higher popularity of the Company's
mobile marketing services worldwide.
By region, revenues generated from overseas markets
increased by 28.9% year over year and 28.4% quarter over quarter to
RMB719.9 million (US$108.0 million) in the third quarter of 2016,
which was primarily driven by improvements in overseas
monetization.
COST OF REVENUES AND GROSS PROFIT
Cost of revenues increased by 47.4% year over year and
13.9% quarter over quarter to RMB403.9
million (US$60.6 million) in
the third quarter of 2016, which was primarily driven by increased
investments in content for the Company's content-driven apps,
higher bandwidth and internet data center costs associated with
increased user traffic worldwide, and data analytics.
Gross profit decreased by 4.0% year over year, but
increased by 4.7% quarter over quarter to RMB724.4 million (US$108.6
million) in the third quarter of 2016.
OPERATING INCOME/LOSS AND EXPENSES
Total operating expenses increased by 7.6% year over year
and 0.4% quarter over quarter to RMB758.3
million (US$113.7 million) in
the third quarter of 2016. Total non-GAAP operating
expenses increased by 16.1% year over year and 3.0% quarter
over quarter to RMB686.5 million
(US$102.9 million).
- Research and development expenses increased by 14.8%
year over year and 3.5% quarter over quarter to RMB235.5 million (US$35.3
million) in the third quarter of 2016, which was primarily
driven by an increase in personnel-related costs. The
increase in personnel costs associated with research and
development was primarily driven by the Company's increased
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 42.5% year over year and 12.1% quarter over
quarter to RMB199.6 million
(US$29.9 million).
- Selling and marketing expenses increased by 0.5% year
over year, but decreased by 3.9% quarter over quarter to
RMB391.5 million (US$58.7 million) in the third quarter of
2016. The quarter-over-quarter decrease was due to lower
expenses on promotional activities as a result of the Company's
strategy to implement cost controls for the Company's utility apps,
which was partially offset by increased product promotional
activities for the Company's content-driven apps, and an increase
in direct sales personnel headcount. Non-GAAP selling and
marketing expenses, which exclude share-based compensation
expenses, increased by 0.8% year over year, but decreased by 5.1%
quarter over quarter to RMB385.1
million (US$57.8
million).
- General and administrative expenses increased by 8.8%
year over year, but decreased by 12.2% quarter over quarter to
RMB141.2 million (US$21.2 million) in the third quarter of
2016. The year-over year increase was primarily driven by an
increase in expenses associated with higher headcount for the
general and administration function. The quarter-over-quarter
decrease was due to lower professional service fee in the third
quarter of 2016. Non-GAAP general and administrative
expenses, which exclude share-based compensation expenses,
increased by 25.1% year over year, but decreased by 9.2% quarter
over quarter to RMB111.7 million
(US$16.8 million).
Operating loss was RMB33.8
million (US$5.1 million), as
compared with an operating profit of RMB50.0
million in the prior year period and an operating loss of
RMB63.0 million in the previous
quarter. The year-over-year decline in operating profit was
mainly attributable to increased investments in content-driven
apps, which lowered operating margin by almost 17% in the
quarter. The quarter-over-quarter improvement was due to
higher total revenues in the quarter as well as the Company's
improved efficiency and cost control measures concerning its
marketing efforts, which helped in expanding the profitability of
its utility apps.
Non-GAAP operating profit decreased by 76.9% year over
year, but increased by 49.3% quarter over quarter to RMB38.1 million (US$5.7
million) in the third quarter of 2016.
Share-based compensation expenses decreased by 37.3% year
over year and 18.8% quarter over quarter to RMB71.9 million (US$10.8
million) in the third quarter of 2016.
OTHER INCOME, NET
Other income, net was RMB30.9
million (US$4.6 million) in
the third quarter of 2016, which was primarily due to gains on
disposal of certain investment assets in the quarter.
NET INCOME/LOSS ATTRIBUTABLE TO CHEETAH MOBILE
SHAREHOLDERS
Net income attributable to Cheetah Mobile shareholders
was RMB0.4 million (US$0.07 million) in the third quarter of 2016,
which represents a decrease of 98.5% year over year, but a
significant improvement from a net loss attributable to Cheetah
Mobile shareholders of RMB150.5
million in the previous quarter.
Non-GAAP net income attributable to Cheetah Mobile
shareholders was RMB72.4 million
(US$10.9 million), which represents a
decrease of 49.6% year over year, but a significant improvement
from a non-GAAP net loss attributable to Cheetah Mobile
shareholders of RMB61.9 million in
the previous quarter.
NET INCOME PER ADS
Diluted income per ADS in the third quarter of 2016 was
RMB0.00 (US$0.00), as compared with diluted income per
ADS of RMB0.20 in the prior year
period, and diluted loss per ADS of RMB1.08 in the previous quarter.
Non-GAAP diluted income per ADS in the third quarter of
2016 was RMB0.51 (US$0.08), as compared with non-GAAP diluted
earnings per ADS of RMB1.00 in the
prior year period and non-GAAP diluted loss per ADS of RMB0.44 in the previous quarter.
ADJUSTED EBITDA
Adjusted EBITDA (Non-GAAP) decreased by 60.5% year over
year, but increased by 18.4% quarter over quarter to RMB80.1 million (US$12.0
million) in the third quarter of 2016.
CASH AND CASH EQUIVALENTS, RESTRICTED CASH AND SHORT-TERM
INVESTMENTS BALANCE
As of September 30, 2016, the
Company had cash and cash equivalents, restricted cash and
short-term investments of RMB1,437.2
million (US$215.5
million).
SHARES ISSUED AND OUTSTANDING
As of September 30, 2016, the
Company had a total of 1,425,736,715 Class A and Class B ordinary
shares issued and outstanding. One ADS represents 10 Class A
ordinary shares.
Cheetah Mobile and Tencent
Continue to Expand Strategic Cooperation Agreement
Cheetah Mobile increased the annual cap for promotional services
fees payable by Cheetah Mobile to Tencent for each of the years ending December 31, 2016 and 2017. Under the new
supplemental agreement, the annual cap for the year ending
December 31, 2016 increased from
RMB30 million to RMB47.5 million. In addition, the annual
cap for the year ending December 31,
2017 increased from RMB45
million to RMB62.5
million. Except for the foregoing, all the existing
terms and conditions under the Strategic Cooperation Agreement, as
amended, remain unchanged. For the first nine months of 2016,
the historical transaction amount for the promotion services fees
payable by Cheetah Mobile to Tencent
was RMB26 million.
Update on Share Repurchase Program
On March 16, 2016, the Company's
Board of Directors authorized a share repurchase plan, pursuant to
which the Company may repurchase its own issued and outstanding
ADSs with an aggregate value of up to 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 after March 16, 2016.
The share repurchase plan does not require the Company to acquire a
specific number of ADSs. As of November 18, 2016, the Company had repurchased a
total of 2,536,808 ADSs, representing 25,368,080 Class A ordinary
shares, at an average price of $10.7483 per ADS.
Business Outlook
For the fourth quarter of 2016, the Company expects its total
revenues to be between RMB1,200
million (US$180 million) and
RMB1,240 million (US$186 million), representing an estimated
year-over-year growth of 4% to 8%, and quarter-over-quarter growth
of 6% to 10%. This estimate represents 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 Monday, November 21, 2016 at 8:00 am Eastern Time or 9:00 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 RMB6.6685 to
US$1.00, the exchange rate in effect
as of September 30, 2016 as set forth
in the H. 10 statistical release of the Federal Reserve
Board. 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 leading apps for mobile users worldwide and connect
users with personalized content on the mobile platform.
Cheetah Mobile's products, including its popular
mission-critical utility applications Clean Master, CM Security and
Battery Doctor, help make users' mobile internet experience
smarter, speedier, and safer. The Company has attracted 612 million
global Mobile MAUs as of September
2016, of which approximately 80% are located outside of
China. Leveraging the success of its mission-critical
applications, Cheetah Mobile has launched its line of mobile
content-driven applications, including News Republic and
Live.me.
Cheetah Mobile provides its advertising customers, which include
direct advertisers and mobile advertising networks through which
advertisers place their advertisements, with direct access to
highly targeted mobile users and global promotional channels, which
are capable of delivering targeted content to hundreds of millions
of users.
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 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 (loss) attributable to Cheetah Mobile
shareholders is net income attributable to Cheetah Mobile
shareholders excluding share-based compensation expenses.
- Non-GAAP diluted earnings (loss) per ADS is non-GAAP net income
(loss) 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 (Loss) 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.
Jessie Fan
Tel: +1 (646) 417-5395
Email: IR@cmcm.com
[1]
Overseas revenues refer to revenues generated by the Company's
operating legal entities incorporated outside the People's Republic
of China (excluding Hong Kong, Macau and Taiwan for the purposes of
this press release), or the PRC. Such revenues are primarily
attributable to customers located outside the PRC.
|
CHEETAH MOBILE
INC.
|
|
|
|
|
|
Condensed
Consolidated Balance Sheets
|
|
|
|
|
(Unaudited,
amounts in thousands of Renminbi ("RMB") and US dollars
("US$")
|
|
|
|
|
|
|
|
As
of
|
|
31-Dec-15
|
|
30-Sep-16
|
|
30-Sep-16
|
|
RMB
|
|
RMB
|
|
USD
|
|
(As
adjusted, unaudited) (a)
|
|
(Unaudited)
|
|
(Unaudited)
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
1,843,233
|
|
950,467
|
|
142,531
|
Restricted
cash
|
156,161
|
|
158,131
|
|
23,713
|
Short-term
investments
|
29,234
|
|
328,588
|
|
49,275
|
Accounts
receivable
|
633,440
|
|
602,325
|
|
90,324
|
Prepayments and other
current assets
|
360,004
|
|
494,045
|
|
74,086
|
Due from related
parities
|
60,794
|
|
84,393
|
|
12,655
|
Deferred tax
assets
|
5,101
|
|
15,031
|
|
2,254
|
Total current
assets
|
3,087,967
|
|
2,632,980
|
|
394,838
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
Property and
equipment, net
|
121,241
|
|
124,716
|
|
18,702
|
Intangible assets,
net
|
233,092
|
|
242,200
|
|
36,320
|
Goodwill
|
617,863
|
|
954,745
|
|
143,172
|
Investment in equity investees
|
124,708
|
|
96,522
|
|
14,474
|
Other long term investments
|
700,113
|
|
893,303
|
|
133,959
|
Deferred tax
assets
|
12,843
|
|
40,326
|
|
6,047
|
Other non-current
assets
|
28,724
|
|
27,002
|
|
4,049
|
Total non-current
assets
|
1,838,584
|
|
2,378,814
|
|
356,723
|
|
|
|
|
|
|
Total
assets
|
4,926,551
|
|
5,011,794
|
|
751,561
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Bank loans
|
130,273
|
|
358,136
|
|
53,706
|
Accounts
payable
|
137,883
|
|
162,296
|
|
24,338
|
Accrued expenses and
other current liabilities
|
1,308,717
|
|
1,024,006
|
|
153,559
|
Redemption right
liabilities
|
474
|
|
563
|
|
84
|
Deferred
revenue
|
56,070
|
|
55,887
|
|
8,381
|
Due to related
parties
|
56,932
|
|
64,385
|
|
9,655
|
Income tax
payable
|
29,822
|
|
65,618
|
|
9,840
|
Deferred tax
liabilities
|
414
|
|
-
|
|
-
|
Total current
liabilities
|
1,720,585
|
|
1,730,891
|
|
259,563
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
Bank loans
|
10,523
|
|
127,475
|
|
19,116
|
Deferred
revenue
|
8,166
|
|
8,113
|
|
1,217
|
Deferred tax
liabilities
|
99,006
|
|
106,185
|
|
15,923
|
Other non-current
liabilities
|
73,826
|
|
33,708
|
|
5,055
|
Total non-current
liabilities
|
191,521
|
|
275,481
|
|
41,311
|
|
|
|
|
|
|
Total
liabilities
|
1,912,106
|
|
2,006,372
|
|
300,874
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
Ordinary
shares
|
226
|
|
230
|
|
34
|
Treasury
stock
|
-
|
|
(178,991)
|
|
(26,841)
|
Additional paid-in
capital
|
2,414,706
|
|
2,668,573
|
|
400,176
|
Retained
earnings
|
317,818
|
|
178,518
|
|
26,770
|
Accumulated other
comprehensive income
|
121,317
|
|
155,207
|
|
23,273
|
Total Cheetah
Mobile shareholders' equity
|
2,854,067
|
|
2,823,537
|
|
423,412
|
Noncontrolling
interests
|
160,378
|
|
181,885
|
|
27,275
|
Total
equity
|
3,014,445
|
|
3,005,422
|
|
450,687
|
|
|
|
|
|
|
Total liabilities,
noncontrolling interests and shareholders' equity
|
4,926,551
|
|
5,011,794
|
|
751,561
|
|
|
|
|
|
|
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
(Loss)
|
(Unaudited,
amounts in thousands of Renminbi ("RMB") and US dollars ("US$"),
except for number of shares and per share(or ADS)
data)
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended
|
|
30-Sep-15
|
|
30-Jun-16
|
|
30-Sep-16
|
|
30-Sep-16
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
|
(As
adjusted, unaudited) (b)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
Revenues
|
1,028,708
|
|
1,046,664
|
|
1,128,326
|
|
169,202
|
Online marketing
services
|
905,381
|
|
939,125
|
|
986,379
|
|
147,916
|
Internet value-added
services
|
99,516
|
|
79,601
|
|
110,452
|
|
16,563
|
Internet security
services and others
|
23,811
|
|
27,938
|
|
31,495
|
|
4,723
|
|
|
|
|
|
|
|
|
Cost of revenues
(a)
|
(274,089)
|
|
(354,710)
|
|
(403,900)
|
|
(60,568)
|
Gross
profit
|
754,619
|
|
691,954
|
|
724,426
|
|
108,634
|
|
|
|
|
|
|
|
|
Operating income
and expenses:
|
|
|
|
|
|
|
|
Research and
development (a)
|
(205,207)
|
|
(227,496)
|
|
(235,541)
|
|
(35,321)
|
Selling and marketing
(a)
|
(389,584)
|
|
(407,206)
|
|
(391,496)
|
|
(58,708)
|
General and
administrative (a)
|
(129,806)
|
|
(160,735)
|
|
(141,168)
|
|
(21,169)
|
Impairment of
goodwill and intangible assets
|
(11,750)
|
|
-
|
|
-
|
|
-
|
Other operating
income
|
31,763
|
|
40,446
|
|
9,938
|
|
1,490
|
Total operating
income and expenses
|
(704,584)
|
|
(754,991)
|
|
(758,267)
|
|
(113,708)
|
|
|
|
|
|
|
|
|
Operating profit
(loss)
|
50,035
|
|
(63,037)
|
|
(33,841)
|
|
(5,074)
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest income,
net
|
2,558
|
|
2,715
|
|
727
|
|
109
|
Changes in fair value
of redemption right and put options granted
|
(213)
|
|
(308)
|
|
251
|
|
38
|
Settlement and
changes in fair value of contingent consideration
|
(1,286)
|
|
(664)
|
|
981
|
|
147
|
Foreign exchange
(loss) gain, net
|
(1,302)
|
|
486
|
|
1,672
|
|
251
|
Impairment of
investments
|
-
|
|
(95,206)
|
|
-
|
|
-
|
Losses from equity
method investments
|
(6,055)
|
|
(6,070)
|
|
(451)
|
|
(68)
|
Other income,
net
|
1,089
|
|
17,620
|
|
30,949
|
|
4,641
|
|
|
|
|
|
|
|
|
Income (Loss)
before taxes
|
44,826
|
|
(144,464)
|
|
288
|
|
44
|
Income tax (expenses)
benefits
|
(14,503)
|
|
(1,964)
|
|
7,873
|
|
1,181
|
Net income
(loss)
|
30,323
|
|
(146,428)
|
|
8,161
|
|
1,225
|
Less: net income
attributable to noncontrolling interests
|
1,489
|
|
4,022
|
|
7,716
|
|
1,157
|
Net income (loss)
attributable to Cheetah Mobile
shareholders
|
28,834
|
|
(150,450)
|
|
445
|
|
68
|
|
|
|
|
|
|
|
|
Earnings (Losses)
per share
|
|
|
|
|
|
|
|
Basic
|
0.02
|
|
(0.11)
|
|
0.00
|
|
0.00
|
Diluted
|
0.02
|
|
(0.11)
|
|
0.00
|
|
0.00
|
|
|
|
|
|
|
|
|
Earnings (Losses)
per ADS
|
|
|
|
|
|
|
|
Basic
|
0.21
|
|
(1.08)
|
|
0.00
|
|
0.00
|
Diluted
|
0.20
|
|
(1.08)
|
|
0.00
|
|
0.00
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding
|
|
|
|
|
|
|
|
Basic
|
1,383,355,451
|
|
1,391,355,172
|
|
1,381,491,089
|
|
1,381,491,089
|
Diluted
|
1,434,461,272
|
|
1,391,355,172
|
|
1,417,898,001
|
|
1,417,898,001
|
Weighted average
number of ADSs used in computation
|
|
|
|
|
|
|
|
Basic
|
138,335,545
|
|
139,135,517
|
|
138,149,109
|
|
138,149,109
|
Diluted
|
143,446,127
|
|
139,135,517
|
|
141,789,800
|
|
141,789,800
|
|
|
|
|
|
|
|
|
Other
comprehensive income (loss), net of tax of nil
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
75,693
|
|
54,165
|
|
12,347
|
|
1,852
|
Unrealized gains
(losses) on available-for-sale
securities, net
|
413
|
|
(389)
|
|
(21,666)
|
|
(3,249)
|
Other
comprehensive income (loss)
|
76,106
|
|
53,776
|
|
(9,319)
|
|
(1,397)
|
Total
comprehensive income (loss)
|
106,429
|
|
(92,652)
|
|
(1,158)
|
|
(172)
|
Less: Total
comprehensive (loss) income attributable to
noncontrolling interests
|
(549)
|
|
7,117
|
|
8,522
|
|
1,278
|
Total
comprehensive income (loss) attributable to Cheetah Mobile
shareholders
|
106,978
|
|
(99,769)
|
|
(9,680)
|
|
(1,450)
|
|
|
|
|
|
|
|
|
(a) Share-based
compensation expenses
|
|
|
|
|
|
|
|
Cost of
revenues
|
1,656
|
|
140
|
|
187
|
|
28
|
Research and
development
|
65,180
|
|
49,410
|
|
35,956
|
|
5,392
|
Selling and
marketing
|
7,505
|
|
1,300
|
|
6,352
|
|
953
|
General and
administrative
|
40,471
|
|
37,707
|
|
29,449
|
|
4,416
|
Total
|
114,812
|
|
88,557
|
|
71,944
|
|
10,789
|
|
|
|
|
|
|
|
|
Notes:
|
|
|
|
|
|
|
|
(b) 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
|
|
|
(Unaudited, in'000,
except for per share data and percentage)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended September 2016
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
Non-GAAP
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
Result
($)
|
Revenues
|
1,128,326
|
|
|
|
|
|
|
|
1,128,326
|
|
|
|
169,202
|
Cost of
revenues
|
(403,900)
|
|
35.8%
|
|
187
|
|
0.0%
|
|
(403,713)
|
|
35.8%
|
|
(60,540)
|
Gross
profit
|
724,426
|
|
64.2%
|
|
187
|
|
0.0%
|
|
724,613
|
|
64.2%
|
|
108,662
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(235,541)
|
|
20.9%
|
|
35,956
|
|
3.2%
|
|
(199,585)
|
|
17.7%
|
|
(29,930)
|
Selling and
marketing
|
(391,496)
|
|
34.7%
|
|
6,352
|
|
0.6%
|
|
(385,144)
|
|
34.1%
|
|
(57,756)
|
General and
administrative
|
(141,168)
|
|
12.5%
|
|
29,449
|
|
2.6%
|
|
(111,719)
|
|
9.9%
|
|
(16,753)
|
Other operating
income
|
9,938
|
|
0.9%
|
|
-
|
|
-
|
|
9,938
|
|
0.9%
|
|
1,490
|
Total operating
income and expenses
|
(758,267)
|
|
67.2%
|
|
71,757
|
|
6.4%
|
|
(686,510)
|
|
60.8%
|
|
(102,949)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss)
profit
|
(33,841)
|
|
3.0%
|
|
71,944
|
|
6.4%
|
|
38,103
|
|
3.4%
|
|
5,713
|
Net income
attributable to Cheetah Mobile shareholders
|
445
|
|
0.0%
|
|
71,944
|
|
6.4%
|
|
72,389
|
|
6.4%
|
|
10,855
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.00
|
|
|
|
0.05
|
|
|
|
0.05
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
0.00
|
|
|
|
0.51
|
|
|
|
0.51
|
|
|
|
|
Diluted earnings per
ADS (USD)
|
0.00
|
|
|
|
0.08
|
|
|
|
0.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended June 2016
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
|
Revenues
|
1,046,664
|
|
|
|
|
|
|
|
1,046,664
|
|
|
|
|
Cost of
revenues
|
(354,710)
|
|
33.9%
|
|
140
|
|
0.0%
|
|
(354,570)
|
|
33.9%
|
|
|
Gross
profit
|
691,954
|
|
66.1%
|
|
140
|
|
0.0%
|
|
692,094
|
|
66.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(227,496)
|
|
21.7%
|
|
49,410
|
|
4.7%
|
|
(178,086)
|
|
17.0%
|
|
|
Selling and
marketing
|
(407,206)
|
|
38.9%
|
|
1,300
|
|
0.1%
|
|
(405,906)
|
|
38.8%
|
|
|
General and
administrative
|
(160,735)
|
|
15.4%
|
|
37,707
|
|
3.6%
|
|
(123,028)
|
|
11.8%
|
|
|
Other operating
income
|
40,446
|
|
3.9%
|
|
-
|
|
-
|
|
40,446
|
|
3.9%
|
|
|
Total operating
income and expenses
|
(754,991)
|
|
72.1%
|
|
88,417
|
|
8.4%
|
|
(666,574)
|
|
63.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss)
profit
|
(63,037)
|
|
6.0%
|
|
88,557
|
|
8.5%
|
|
25,520
|
|
2.4%
|
|
|
Net loss attributable
to Cheetah Mobile shareholders
|
(150,450)
|
|
14.4%
|
|
88,557
|
|
8.5%
|
|
(61,893)
|
|
5.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted losses per
ordinary share (RMB)
|
(0.11)
|
|
|
|
0.07
|
|
|
|
(0.04)
|
|
|
|
|
Diluted losses per
ADS (RMB)
|
(1.08)
|
|
|
|
0.64
|
|
|
|
(0.44)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended September 2015
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
|
Revenues
|
1,028,708
|
|
|
|
|
|
|
|
1,028,708
|
|
|
|
|
Cost of
revenues
|
(274,089)
|
|
26.6%
|
|
1,656
|
|
0.2%
|
|
(272,433)
|
|
26.5%
|
|
|
Gross
profit
|
754,619
|
|
73.4%
|
|
1,656
|
|
0.2%
|
|
756,275
|
|
73.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(205,207)
|
|
19.9%
|
|
65,180
|
|
6.3%
|
|
(140,027)
|
|
13.6%
|
|
|
Selling and
marketing
|
(389,584)
|
|
37.9%
|
|
7,505
|
|
0.7%
|
|
(382,079)
|
|
37.1%
|
|
|
General and
administrative
|
(129,806)
|
|
12.6%
|
|
40,471
|
|
3.9%
|
|
(89,335)
|
|
8.7%
|
|
|
Impairment of
goodwill and intangible assets
|
(11,750)
|
|
1.1%
|
|
-
|
|
-
|
|
(11,750)
|
|
1.1%
|
|
|
Other operating
income
|
31,763
|
|
3.1%
|
|
-
|
|
-
|
|
31,763
|
|
3.1%
|
|
|
Total operating
income and expenses
|
(704,584)
|
|
68.5%
|
|
113,156
|
|
11.0%
|
|
(591,428)
|
|
57.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
50,035
|
|
4.9%
|
|
114,812
|
|
11.2%
|
|
164,847
|
|
16.0%
|
|
|
Net income
attributable to Cheetah Mobile Shareholders
|
28,834
|
|
2.8%
|
|
114,812
|
|
11.2%
|
|
143,646
|
|
14.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.02
|
|
|
|
0.08
|
|
|
|
0.10
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
0.20
|
|
|
|
0.80
|
|
|
|
1.00
|
|
|
|
|
CHEETAH MOBILE
INC.
|
|
|
|
|
Reconciliation
from Net Income (Loss) Attributable to Cheetah Mobile Shareholders
to Adjusted EBITDA (Non-GAAP)
|
(Unaudited, in
'000)
|
|
|
|
|
|
|
|
|
For The Three
Months Ended
|
|
30-Sep-15
|
30-Jun-16
|
30-Sep-16
|
30-Sep-16
|
|
RMB
|
RMB
|
RMB
|
USD
|
Net income (loss)
attributable to Cheetah Mobile shareholders
|
28,834
|
(150,450)
|
445
|
68
|
Add:
|
|
|
|
|
Income tax
expense (benefits)
|
14,503
|
1,964
|
(7,873)
|
(1,181)
|
Interest
income,net
|
(2,558)
|
(2,715)
|
(727)
|
(109)
|
Depreciation and amortization
|
37,589
|
42,126
|
41,959
|
6,292
|
Net income
attributable to noncontrolling interests
|
1,489
|
4,022
|
7,716
|
1,157
|
Other
non-operating expense (income), net
|
7,767
|
84,142
|
(33,402)
|
(5,009)
|
Share-based compensation
|
114,812
|
88,557
|
71,944
|
10,789
|
Adjusted
EBITDA
|
202,436
|
67,646
|
80,062
|
12,007
|
Cheetah Mobile
Inc.
|
|
|
|
Revenues Generated
from PC-based and Mobile-based Applications and
Services
|
(Unaudited, in
'000)
|
|
|
|
|
|
|
|
|
For The Three
Months Ended
|
|
30-Sep-15
|
30-Jun-16
|
30-Sep-16
|
30-Sep-16
|
|
RMB
|
RMB
|
RMB
|
USD
|
PC
|
320,155
|
274,329
|
230,125
|
34,509
|
Mobile
|
708,553
|
772,335
|
898,201
|
134,693
|
Total
|
1,028,708
|
1,046,664
|
1,128,326
|
169,202
|
Cheetah Mobile
Inc.
|
|
|
|
|
Revenues Generated
from Domestic and Overseas Markets
|
|
|
(Unaudited, in
'000)
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended
|
|
30-Sep-15
|
30-Jun-16
|
30-Sep-16
|
30-Sep-16
|
|
RMB
|
RMB
|
RMB
|
USD
|
Domestic
revenues
|
470,337
|
485,972
|
408,440
|
61,249
|
Overseas
revenues
|
558,371
|
560,692
|
719,886
|
107,953
|
Total
|
1,028,708
|
1,046,664
|
1,128,326
|
169,202
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/cheetah-mobile-announces-third-quarter-2016-unaudited-consolidated-financial-results-300366464.html
SOURCE Cheetah Mobile