Weibo is currently shifting its marketing budget to channels with higher ROI, which Morgan Stanley believes will increase the DAU/MAU ratio.
According to the report released by Morgan Stanley after participating in the China TMT Conference, Weibo-SW (09898) is expected to maintain an annual dividend of USD 200 million. The company's total cash balance is USD 3.3 billion, which is sufficient to pay off the USD 800 million bond that is due to expire on July 24 and USD 330 million convertible bonds.
According to the report cited by Weibo, advertising revenue in the second quarter of 2024 is expected to be flat year-on-year, but will grow in the third quarter, driven by the Olympic Games. Due to the reduction in budgets of international brands and the shift to short videos, the advertising revenue of skin care and makeup products decreased in the second quarter compared to the same period last year, or may bottom out in the second half of this year. Weibo is currently shifting its marketing budget to channels with higher ROI, which Morgan Stanley believes will increase the DAU/MAU ratio.