2nd Quarter 2016 Outcomes Overall net revenues for the second quarter of 2016 were US$ 14.4 million, representing a 38.5% increase from the corresponding period in 2015.
Advertising and IVAS net revenues were US$ 7.6 million, representing a 14.6% reduction from the corresponding duration of 2015. Marketing revenues were US$ 0.8 million for the 2nd quarter of 2016, a 78.7% decline from the corresponding period of 2015. The decline was because of increasing competition and the continuing migration of our traffic to mobile. Internet Value-Added Services (IVAS) profits were US$ 6.8 million, representing a 34.7% increase from the matching period in 2015. The increase was generally due to the revenue from woxiu and the new Renren mobile live streaming earnings began this quarter. Month-to-month distinct log-in users decreased from around 45million in June2015 to approximately 35million in June 2016.
Financing earnings was US$ 6.8 million for the 2nd quarter of 2016, compared to US$ 1.5 million in the matching duration of 2015. The increase was in line with the increase of funding receivable from US$ 62.4 million as of June 30, 2015 to US$ 207.2 million as of June 30, 2016.
Cost of profits was US$ 13.1 million, a 75.4% boost from the corresponding duration of 2015.
Operating costs were US$ 20.1 million, a 28.7% reduction from the matching duration of 2015.
Offering and marketing expenses were US$ 5.2 million, a 40.5% reduction from the corresponding duration of 2015. The reduction was mainly due to a decline in advertising expenses, headcount decreases, and a reduction in workers related cost.
Research and development expenditures were US$ 4.6 million, a 46.5% reduction from the corresponding duration in 2015. The decline was primarily due to headcount reductions and a reduction in workers associated expense.
General and administrative expenses were US$ 10.2 million, a 4.9% reduction from the corresponding duration in 2015.
Share-based compensation costs, which were all included in operating expendituresbusiness expenses, were US$ 5.5 million, compared with US$ 6.2 million in the corresponding duration in 2015.
Operating loss was US$ 18.8 million, compared to an operating loss of US$ 25.3 million in the corresponding duration in 2015.
Recognized gain on short-term investments was US$ 0.7 million, compared to a loss of US$ 48.8 million in the corresponding period in 2015.
Incomes in equity technique financial investments were US$ 1.4 million, compared with profits of US$ 3.3 million in the corresponding period in 2015.
Net loss attributable to the Company was US$ 46.1 million, compared to a net loss of US$ 70.3 million in the corresponding period in 2015.
Changed net loss (non-GAAP) was US$ 40.6 million, compared with an adjusted bottom line of US$ 64.3 million in the matching period in 2015. Changed net loss is defined as loss omitting share-based payment expenses and amortization of intangible assets.
Business Outlook The Business expects to create earnings in an amount varying from US$ 17.5 million to US$ 19.5 million in the 3rd quarter of 2016, representing a 98.4% to 121.1% year-over-year boost, driven by the new Renren mobile live streaming and financing company. This projection reflects Renrens current and preliminary view, which is subject to change.
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About Renren Inc. Renren Inc. (NYSE: RENN)runs a leading real name social networking service (SNS) and an internet financing business in China. Our SNS enables users to connect and interact with each other, share images and access mobile live streaming. Our web finance company includes mainly consumer funding and auto financing. Renren.com and our renren mobile application had around 236 million triggered users as of June 30, 2016. RenrensAmerican depositary shares, each of which represents 3 Class A common shares, trade onNYSEunder the sign RENN.
Safe Harbor Statement This announcement includes forward-looking statements. These declarations are made under the safe harbor arrangements of the US Personal Securities Lawsuits Reform Act of 1995. These positive statements can be identified by terms such as will, expects, expects, future, intends, strategies, thinks, estimates and similar statements. Amongst other things, the businessbusiness outlook for the 3rd quarter of 2016 and quotes from management in this statement, along with Renrens strategic and functional plans, include forward-looking statements. Renren may likewise make composed or oral positive declarations in its filings with the United States Securities and Exchange Commission (SEC), in its annual report to shareholders, in press releases and other written materials and in oral declarations made by its officers, directors or workers to 3rd celebrations. Declarations that are not historical truths, consisting of declarations about Renrens beliefs and expectations, are forward-looking declarations. Positive statements include intrinsic risks and uncertainties. A variety of aspects might cause actual outcomesresult in vary materially from those consisted of in any positive declaration, including but not limited to the following: our goals and techniques; our future business development, monetary condition and results of operations; the expected development of the social networking site market in China; our expectations concerning demand for and market approval of our services; our expectations regarding the retention and strengthening of our relationships with key advertisers and consumers; our plans to boost user experience, facilities and service offerings; competition in our industry in China; and relevant federal government policies and policies connecting to our industry. More information regarding these and other dangers is consisted of in our yearly report on Form20-F and other files submitted with the SEC. All information provided in this pressreleaseand in the attachments is as of the date of this news release, and Renren does not carry out any obligation to update anyforward-looking declaration, except as required under suitable law.
About Non-GAAP Financial Measures
To supplement Renrens combined monetary outcomes presented in accordance with United States Typically Accepted Accounting Principles (GAAP), Renren utilizes adjusted net incomeearnings (loss) which is defined as a non-GAAP financial procedure by the SEC, in assessing its business. We define adjusted net income (loss) as net earningsearnings (loss) leaving out share-based payment expenses and amortization of intangible possessions. We provide adjusted net incomeearnings (loss) due to the fact that it is utilized by our management to evaluate our operating efficiency. We also think that this non-GAAP financial step supply helpful details to financiers and others in understanding and assessing our combined outcomes of operations in the very same way as our management and in comparing financial outcomes throughout accounting periods and to those of our peer business.
The presentation of this non-GAAP financial step is not meant to be considered in seclusion from, or as a replacement for, the monetary details ready and provided in accordance with GAAP. For more infoFor additional information on these non-GAAP monetary steps, please see the table captioned Reconciliation of non-GAAP outcomes of operations steps to the equivalent GAAP financial measures at the end of this release.
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