During a morning session, Jeffrey Katzenberg, CEO of DreamWorks Animation, told delegates he was keen to realize his dream of bringing the finest technology and artists to China to create world-class animation.

“The country will be able to make world-class animation within a handful of years,” said the head of the world’s largest animation maker, which established a joint venture, Oriental DreamWorks, in Shanghai last year.

“We have set the goal ‘create in China, for China’,” he said, adding that he was confident Oriental DreamWorks will be standing on its own in a few years.

“As the second-largest film market in the world, China’s box office will reach 22 billion yuan ($3.6 billion) this year, and it will overtake the United States to become number one in the world within five year’s time,” added Katzenberg.

He said in film industry terms, at least, “the Chinese market is not emerging anymore – it has already arrived”.

Wang Jianlin, chairman of Dalian Wanda Group, agreed with Katzenberg, and estimated the value of China’s film market will be twice as big as the US within a decade.

Dalian Wanda spent $2.6 billion last year on AMC Theatres, the second-largest cinema chain in the US.

Wang said there is a huge appetite for film in China, especially for domestic movie s.

…/…

full article

source: China Daily, china economic net

This collaboration builds upon the existing close relationship between Youku Tudou and Weibo users. Sharing Youku and Tudou videos has long been one of the most popular activities on Weibo. According to the most recent report from Deutsche Bank, in April, videos from Youku platform represented 47.7% of videos retweeted on Weibo, the most for any video site while content from Tudou platform earned the second-most retweets, with 15.9%.

Youku Tudou’s content is scheduled to be promoted throughout Weibo starting in July. The promotion takes multiple forms including through personalized recommendation section embedded between micro-blogging posts. Search results for movies and TV dramas will provide direct thumbnail links to watch the title instantly. “Home page” for each title will be set up to provides direct links to watch it on Youku or Tudou platforms and feature reviews, mentions of that title from other Weibo users, and other information that users might find useful. Also under the deal, Youku Tudou and Weibo will cross-promote each other’s premium members and their content.

“Creating and sharing content is at the core of the Internet, and Youku Tudou’s cooperation with social networking sites such as Weibo is a powerful move towards deepening consumers’ online video viewing and sharing experience,” said Dele Liu, President of Youku Tudou. “We look forward to showcasing our content in new and innovative marketing formats as we work to expand our lead in the online video industry.”

Youku Tudou’s extensive video library is one of the largest in China. As of December 31, 2012, our video content library contained more than 4,500 movie titles, 2,700 television serial drama titles and over 900 variety shows. Youku Tudou hosts user-generated content and creates award-winning in-house productions, two highly popular video categories that are available for viewing onYouku.com and Tudou.com.

About Youku Tudou Inc.

Youku Tudou Inc. (NYSE: YOKU) is China’s leading Internet television company. Its Youku and Tudou Internet television platforms enable users to search, view and share high-quality video content quickly and easily across multiple devices. Its Youku brand and Tudou brand are among the most recognized online video brands in China. Youku Tudou’s American depositary shares, each representing 18 of Youku Tudou’s Class A ordinary shares, are traded on the NYSE under the symbol “YOKU.”

First Quarter 2013 Highlights

• Total revenues increased by 17.7% year-over-year to RMB281.4 million (US$45.3 million), driven by a 29.1% increase in net advertising revenues.
• Net income attributable to Phoenix New Media Limited increased by 19.0% year-over-year to RMB39.2 million (US$6.3 million).
• Adjusted net income attributable to Phoenix New Media Limited^[1] was RMB38.7 million (US$6.2 million), as compared to RMB36.3 million in the first quarter of 2012.

Mr. Shuang Liu, CEO of Phoenix New Media, stated, “We are very pleased with our first quarter financial results which exceeded both consensus estimates and our prior guidance, providing us with a strong start in 2013. Our net advertising revenues grew over 29% year-over-year, which was driven by rapid growth of brand advertising across our PC, video and mobile platforms. The increased demand demonstrates our progress in creating unique solutions for advertisers on our converged media platform, helping drive incremental revenue growth and margin improvement. In addition, ifeng remained one of the top four Chinese Internet portals, in terms of average daily unique visitors which grew year-over-year by 49.1%, according to iResearch.”

Mr. Liu continued, “We are also excited about the solid progress we have achieved in our growing games business. Launched in the second half of 2012, our game platform has enabled us to leverage our 34 million daily users by supplementing our core media contents with an increasing number of entertainment options. We believe options like these will continue to provide us with an effective way to monetize our growing user traffic, creating new incremental revenue streams in the long run”.

First Quarter 2013 Financial Results

REVENUES

Total revenues for the first quarter of 2013 increased by 17.7% to RMB281.4 million (US$45.3 million) from RMB239.1 million in the first quarter of 2012.

Net advertising revenues, calculated net of advertising agency service fees, for the first quarter of 2013 increased by 29.1% to RMB166.4 million (US$26.8 million) from RMB128.9 million in the first quarter of 2012, primarily due to an increase in average revenue per advertiser (“ARPA”) of 25.9% to RMB690,600 (US$111,200) for 241 total advertisers.

Paid service revenues^[2] for the first quarter of 2013 increased by 4.3% to RMB114.9 million (US$18.5 million) from RMB110.2 million in the first quarter of 2012. Mobile value-added services (“MVAS”)^[3] revenues decreased by 8.2% to RMB95.9 million (US$15.4 million) in the first quarter of 2013 from RMB104.6 million in the first quarter of 2012 due to decrease in sales from 2G text message based pay-per-view services. Games and others^[4] revenues increased by 238.8% to RMB19.0 million (US$3.1 million) in the first quarter of 2013 from RMB5.6 million in the first quarter of 2012, primarily due to increase in revenues generated from the web-based games on the Company’s game platform.

COST OF REVENUES AND GROSS PROFIT

Cost of revenues for the first quarter of 2013 increased by 6.5% to RMB143.9 million (US$23.2 million) from RMB135.0 million in the first quarter of 2012, primarily due to increases in content and operational costs, bandwidth costs, and sales taxes and surcharges, offset by a decrease in revenue sharing fees. Revenue sharing fees to telecom operators and channel partners decreased to RMB49.5 million (US$8.0 million) in the first quarter of 2013 from RMB64.1 million in the first quarter of 2012, primarily due to the decrease in WVAS revenues. Content and operational costs increased to RMB57.1 million (US$9.2 million) in the first quarter of 2013 from RMB44.2 million in the first quarter of 2012 due to the increase in staff-related costs. Bandwidth costs increased to RMB18.4 million (US$3.0 million) in the first quarter of 2013 from RMB11.8 million in the first quarter of 2012, primarily due to the greater demand for live broadcasting video content and the significant growth in user traffic. Sales taxes and surcharges increased to RMB18.8 million (US$3.0 million) in the first quarter of 2013 from RMB15.0 million in the first quarter of 2012. Share-based compensation expenses included in cost of revenues was RMB0.6 million (US$0.1 million) in the first quarter of 2013 as compared to RMB0.8 million in the first quarter of 2012.

Gross profit for the first quarter of 2013 increased by 32.2% to RMB137.5 million (US$22.1 million) from RMB104.0 million in the first quarter of 2012. Gross margin increased to 48.9% in the first quarter of 2013 from 43.5% in the first quarter of 2012, mainly due to the increased revenue contribution from higher-margin advertising services business and the decrease in revenue sharing fees to telecom operators and channel partners. Adjusted gross margin, which excludes share-based compensation expense, increased to 49.1% in the first quarter of 2013 from 43.9% in the first quarter of 2012.

OPERATING EXPENSESAND INCOME FROM OPERATIONS

Total operating expenses for the first quarter of 2013 increased by 37.3% to RMB105.5 million (US$17.0 million) from RMB76.9 million in the first quarter of 2012. The increase in operating expenses was primarily attributable to the increase in staff-related costs, expenses associated with the Company’s marketing and promotions, and provision for allowance for doubtful accounts. Share-based compensation expense included in operating expenses was negative RMB1.1 million (US$0.2 million) in the first quarter of 2013 as compared to RMB2.6 million in the first quarter of 2012, primarily due to the true-up adjustment made to recognize actual forfeitures.

Income from operations for the first quarter of 2013 increased by 17.6% to RMB32.0 million (US$5.1 million) from RMB27.2 million in the first quarter of 2012. Operating margin was 11.4% for the first quarter of 2013, which remained stable on a year-over-year basis.

Adjusted income from operations for the first quarter of 2013, which excludes share-based compensation expense, increased by 2.8% to RMB31.4 million (US$5.1 million) from RMB30.6 million in the first quarter of 2012.Adjusted operating margin for the first quarter of 2013 was 11.2% as compared to 12.8% in the first quarter of 2012.

FOREIGN CURRENCY EXCHANGE GAIN AND INTEREST INCOME

Foreign currency exchange gain for the first quarter of 2013 was RMB2.2 million (US$0.3 million), as compared to an exchange gain of RMB0.8 million in the first quarter of 2012. Interest income for the first quarter of 2013 was RMB6.9 million (US$1.1 million), as compared to RMB8.8 million in the first quarter of 2012.

NET INCOME

Net income attributable to Phoenix New Media Limited for the first quarter of 2013 increased by 19.0% to RMB39.2 million (US$6.3 million) from RMB32.9 million in the first quarter of 2012. Net margin for the first quarter of 2013 was 13.9% as compared to 13.8% in first quarter of 2012.Net income per diluted ADS^[5] in the first quarter of 2013 was RMB0.50 (US$0.08) as compared to RMB0.41 in the first quarter of 2012.

Adjusted net income attributable to Phoenix New Media Limited for the first quarter of 2013, which excludes share-based compensation expense, increased by 6.4% to RMB38.7 million (US$6.2 million) from RMB36.3 million in the first quarter of 2012. Adjusted net margin for the first quarter of 2013 was 13.7% as compared to 15.2% in the first quarter of 2012. Adjusted net income per diluted ADS in the first quarter of 2013 was RMB0.49 (US$0.08) as compared to RMB0.45 in the first quarter of 2012.

For the first quarter of 2013, the Company’s weighted average number of ADSs used in computing diluted net income per ADS was 78,778,294.

Business Outlook

For the second quarter of 2013, the Company expects its total revenues to be between RMB331 million and RMB341 million. Net advertising revenues are expected to be between RMB195 million and RMB200 million. Paid service revenues are expected to be between RMB136 million and RMB141 million. These forecasts reflect the Company’s current and preliminary view on the market and operational conditions, which are subject to change.

About Phoenix New Media Limited

Phoenix New Media Limited (FENG) is the leading new media company providing premium content on an integrated platform across Internet, mobile and TV channels 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 and through their mobile devices. Phoenix New Media’s platform includes its ifeng.com channel, consisting of its ifeng.com website and web-based game platform, its video channel, comprised of its dedicated video vertical and mobile video services, and its mobile channel, including its mobile Internet website, mobile applications and mobile value-added services.

First Quarter Highlights

• Total revenues were US$308 million, up 36% year-over-year and 3% quarter-over-quarter.
• Brand advertising revenues were US$80 million, up 32% year-over-year and down 2% quarter-over-quarter.
• Sogou[1] revenues were US$39 million, up 73% year-over-year and down 4% quarter-over-quarter.
• Online game revenues were US$167 million, up 33% year-over-year and 6% quarter-over-quarter.
• GAAP net income attributable to Sohu.com Inc. was US$23 million, or US$0.60 per fully diluted share. Non-GAAP net income attributable to Sohu.com Inc. was US$24 million, or US$0.62 per fully diluted share.

Dr. Charles Zhang, Chairman and CEO of Sohu.com Inc. commented, “I am pleased to report our Group’s three key properties, namely online media, including portal and online video, Sogou and Changyou are all making strong starts into 2013. For the first quarter, the Group revenues were up 36% year-on-year, exceeding our expectations. By business unit, online video, delivered double digit sequential revenue growth in a typical slowest quarter of the year. Sogou business was solid as its core products continued to gain user traction. Changyou set new records for both top-line and bottom-line, driven by decent performance of its MMO and web games. ”

Dr. Zhang added, “According to iResearch, the Sohu Group now has approximately 450 million users on a monthly basis, and this puts us as a solid No.3 in China’s internet industry. Traffic growth for our PC internet services is stable while our mobile products are gaining strong traction as the total user base of two of our popular mobile APPs surpassed 100 million mark.”

Ms. Belinda Wang, Co-President and COO added, “ Recognizing Internet sector’s profound shift from PC to mobile, Sohu Group has made mobile one of the most important parts of our strategy.  And thanks to our early investments, the Group now owns a number of leading mobile applications across our business lines, including Sohu News Mobile App and Sohu Video App for our online media businesses, as well as Sogou Pinyin and Sogou Voice Assistant for Sogou. Our range of products are becoming indispensable for tens of millions of China’s mobile Internet users .”

First Quarter Financial Results

Revenues

Total revenues for the first quarter of 2013 were US$308 million, up 36% year-over-year and 3% quarter-over-quarter.

Total online advertising revenues, which include revenues from brand advertising and search and others businesses for the first quarter of  2013, were US$116 million, up 41% year-over-year and down 4% quarter-over-quarter.

Brand advertising revenues for the first quarter of 2013 totaled US$80 million, up 32% year-over-year and down 2% quarter-over-quarter. The year-over-year increases was mainly due to increased revenues from real estate and fast-moving consumer goods sectors.

Search and others revenues for the first quarter of 2013 were US$36 million, up 67% year-over-year and down 7% quarter-over-quarter. The year-over-year increase was mainly contributed by pay-for-click services, as well as online marketing services on the Sogou Web Directory, both as a result of increased traffic and improved monetization of traffic.

Online game revenues for the first quarter of 2013 were US$167 million, up 33% year-over-year and 6% quarter-over-quarter.

Wireless revenues for the first quarter of 2013 were US$14 million, up 3% year-over-year and 9% quarter-over-quarter.

Gross Margin

Both GAAP and non-GAAP gross margin was 66% for the first quarter of 2013, compared with 69% in the fourth quarter of 2012 and 65% in the first quarter of 2012.

Online advertising gross margin for the first quarter of 2013 was 44%, compared with 52% in the fourth quarter of 2012 and 39% in the first quarter of 2012. Non-GAAP online advertising gross margin for the first quarter of 2013 was 44%, compared with 53% in the fourth quarter of 2012 and 40% in the first quarter of 2012.

Brand advertising gross margin for the first quarter of 2013 was 44%, compared with 56% in the fourth quarter of 2012 and 39% in the first quarter of 2012. Non-GAAP brand advertising gross margin for the first quarter of 2013 was 44%, compared with 56% in the fourth quarter of 2012 and 40% in the first quarter of 2012. The year-over-year increase in gross margin was primarily due to an increase in revenues, partially offset by higher costs. The quarter-over-quarter decrease in gross margin was primarily due to increases in content and compensation costs.

Both GAAP and non-GAAP gross margin for search and others business in the first quarter of 2013 were 42%, compared with 44% in the fourth quarter of 2012 and 39% in the first quarter of 2012.

Both GAAP and non-GAAP gross margin for online games in the first quarter of 2013 were 86%, compared with 86% in the fourth quarter of 2012 and 87% in the first quarter of  2012.

Both GAAP and non-GAAP gross margin for the wireless business for the first quarter of 2013 were 33%, compared with 34% in the fourth quarter of 2012 and 34% in the first quarter of 2012.

Operating Expenses

For the first quarter of 2013, operating expenses totaled $133 million, up 40% year-over-year and down 6% quarter-over-quarter. Non-GAAP operating expenses were $132 million, up 43% year-over-year and down 4% quarter-over-quarter. The year-over-year increase was primarily due to an increase in the number of employees, average compensation and higher expenses associated with marketing and promotion activities.

Operating Profit

Operating profit for the first quarter of 2013 was US$71 million, up 36% year-over-year and up 10% quarter-over-quarter. Operating margin was 23% for the first quarter of 2013, compared with 22% in the previous quarter and 23% in the first quarter of 2012.

Non-GAAP operating profit for the first quarter of 2013 was US$72 million, up 31% year-over-year and 6% quarter-over-quarter. Non-GAAP operating margin was 23% for the first quarter of 2013, compared with 23% in the previous quarter and 24% in the first quarter of 2012.

Income Tax Expense

For the first quarter of 2013, both GAAP and non-GAAP income tax expenses were US$20 million.

Net Income

Before deducting the share of net income pertaining to the Non-controlling Interest, GAAP net income for the first quarter of 2013 was US$58 million, up 42% year-over-year and 14% quarter-over-quarter. Non-GAAP net income for the first quarter of 2013 was US$59 million, up 32% year-over-year and  4% quarter-over-quarter.

GAAP net income attributable to Sohu.com Inc. for the first quarter of 2013 was US$23 million, or US$0.60 per fully diluted share, up 14% year-over-year and flat quarter-over-quarter. Non-GAAP net income attributable to Sohu.com Inc. for the first quarter of 2013 was US$24 million, or US$0.62 per fully diluted share, up 1% year-over-year and down 15% quarter-over-quarter.

Cash Balance

As of Mach 31, 2013, Sohu Group had cash and cash equivalents of US$798 million, compared with US$834 million as of December 31, 2012.

Ms. Carol Yu, Co-President and CFO of Sohu.com Inc. commented, “While many of our key initiatives are at investment phase, all of our key properties are progressing well on both PC and mobile fronts. Management is confident that our investment will create long-term returns for shareholders. ”

Supplementary Information for Online Game Results

First Quarter 2013 Operational Results

• Aggregate registered accounts for Changyou’s games[2] , excluding 7Road’s games, increased 45% year-over-year and  10% quarter-over-quarter to 272.7 million.
• Aggregate peak concurrent users (“PCU”) for Changyou’s games, excluding 7Road’s games, increased 4% year-over-year and increased 2% quarter-over-quarter to 1.12 million.
• Aggregate active paying accounts (“APA”) for Changyou’s games, excluding 7Road’s games, decreased 34% year-over-year and 7% quarter-over-quarter to 2.04 million. The year-over-year and quarter-over-quarter decreases reflected a decline in the number of low-spending active paying accounts that did not make a purchase in the first quarter of 2013 as Changyou continued the strategy of the previous quarters of giving away virtual items and limiting the variety of in-game promotions carried out in TLBB.
• Average revenue per active paying account (“ARPU”) for Changyou’s games, excluding 7Road’s games, increased 77% year-over-year and 13% quarter-over-quarter to RMB399. The year-over-year and quarter-over-quarter increases were mainly due to the decline in TLBB’s low-spending active paying accounts and TLBB’s advanced-level players increasing their spending in the first quarter of 2013.

Business Outlook 

For the second quarter of 2013, Sohu estimates:

• Total revenues to be between US$333 million and US$342 million.
• Brand advertising revenues to be between $98 million and $100 million; this implies a sequential increase of 22% to 25% and an annual increase of 41% to 44%.
• Sogou revenues to be between $48 million and $50 million; this implies a sequential increase of 22% to 27% and an annual growth of 58% to 65%.
• Online game revenues to be between US$165 million and US$170 million.
• Before deducting the share of non-GAAP net income pertaining to the Non-Controlling interest, non-GAAP net income to be between US$53 million and US$56 million.
• Non-GAAP net income attributable to Sohu.com Inc. to be between US$19 million and US$21 million, and non-GAAP fully diluted earnings per share to be between US$0.50 and US$0.55.
• Assuming no new grants of share-based awards, we estimate that compensation expenses relating to share-based awards to be around US$2 million to US$3 million. The estimated impact of this expense is expected to reduce Sohu’s fully diluted earnings per share for the second quarter of 2013 under US GAAP by 5 to 7 US cents.

full press release

About Sohu.com

Sohu.com Inc. (NASDAQ: SOHU) is China’s premier online brand and indispensable to the daily life of millions of Chinese, providing a network of web properties and community based/web 2.0 products which offer the vast Sohu user community a broad array of choices regarding information, entertainment and communication. Sohu has built one of the most comprehensive matrices of Chinese language web properties and proprietary search engines, consisting of the mass portal and leading online media destination www.sohu.com; interactive search engine www.sogou.com; #1 games information portal www.17173.com; the top real estate website www.focus.cn; #1 online alumni club www.chinaren.com; leading online mapping service provider www.go2map.com; and developer and operator of online games www.changyou.com/en/.

 Sohu corporate services consist of online brand advertising on its matrix of websites as well as bid listing and home page on its in-house developed search directory and engine. Sohu also offers wireless value-added services such as news, information, music, ringtone and picture content sent over mobile phones. Sohu’s online game subsidiary, Changyou.com (NASDAQ: CYOU) has a diverse portfolio of online games that includes Tian Long Ba Bu, one of the most popular massively multi-player online (“MMO”) games in China, and DDTank and Wartune (also known as Shen Qu), which are two popular web games in China. Sohu.com, established by Dr. Charles Zhang, one of China’s internet pioneers, is in its seventeen year of operation.

　　The two companies will cooperate in the areas of user account connectivity, data exchange, online payment and online marketing, among other things, and will explore new business models for social commerce based on the interactions of the hundreds of millions of users on Weibo and on Alibaba’s e-commerce platforms. The strategic alliance is expected to generate approximately $380 million in advertising and social commerce services revenues in aggregate for Weibo over the next three years.

　　Separately, the Company announced that Alibaba, through a wholly owned subsidiary, has invested $586 million to purchase preferred and ordinary shares representing approximately 18% of Weibo on a fully-diluted basis. SINA has also granted an option to Alibaba to enable Alibaba to increase its ownership in Weibo to 30% on a fully-diluted basis at a mutually agreed valuation within a certain period of time in the future.

　　“We are excited to partner with the largest e-commerce platform in China to develop social commerce. We believe e-commerce will play a vital role in building an eco-system around Weibo’s open platform.” said Charles Chao, Chairman and CEO of SINA. “Weibo and Alibaba’s e-commerce platforms are natural partners. Together we provide a unique proposition not only to existing online merchants, but also to individuals or businesses, who wish to offer products and services on social networking platform to take advantage of the traffic shift toward social and mobile Internet.”

　　“We believe that this strategic alliance helps to create a stronger Weibo. It affirms our view of the vitality and importance of social media in unleashing value in e-commerce activities. We believe that the cooperation of our two robust platforms will bring unique and valuable services to Weibo users, as well as making the mobile Internet a core part of Alibaba’s strategy.” said Jack Ma, Chairman of Alibaba.

　　About SINA

　　SINA is an online media company serving China and the global Chinese communities. Our digital media network of SINA.com (portal), SINA.cn (mobile portal) and Weibo.com (social media) enable Internet users to access professional media and user-generated content in multi-media formats from the web and mobile devices and share their interests to friends and acquaintances.

　　SINA.com offers distinct and targeted professional content and a range of complementary offerings on each of our region-specific websites. SINA.cn provides information and entertainment content from SINA portal customized for mobile (WAP) users. Based on an open platform architecture to host organically developed and third-party applications, Weibo.com is a form of social media, featuring microblogging services and social networking services that allow users to connect and share information on our platform anywhere, anytime and with anyone.

　　Through these properties and other product lines and businesses, SINA offers an array of online media and social networking services to our users to create a rich canvas for businesses and brand advertisers to connect and engage with their targeted audiences. SINA generates the majority of its revenues from online advertising, MVAS and fee-based services.

Immediately after completion of the merger, Parent will be beneficially owned by Jason Nanchun Jiang, the Chairman and Chief Executive Officer of the Company; affiliates of and funds managed by Giovanna Investment Holdings Limited, an entity owned and controlled by Carlyle Asia Partners III, L.P.; Gio2 Holdings Ltd., an entity owned and controlled by FountainVest China Growth Capital Fund, L.P., FountainVest China Growth Capital Fund II, L.P., and their respective parallel funds and affiliates; Power Star Holdings Limited, an entity owned and controlled by CITIC Capital China Partners II, L.P.; State Success Limited, an entity owned and controlled by affiliates of China Everbright Structured Investment Holdings Limited; and Fosun International Limited and/or its affiliates. 
Approximately 78.7% of the Company’s total outstanding ordinary shares voted in person or by proxy at today’s extraordinary general meeting. Of those ordinary shares, approximately 99.5% were voted in favor of the proposal to authorize and approve the merger agreement and any and all transactions contemplated by the merger agreement, including the merger.
The parties currently expect to complete the merger in May 2013, subject to the satisfaction or waiver of the conditions set forth in the merger agreement. Upon completion of the merger, Focus Media will become a privately held company and its American depositary shares will no longer be listed on the Nasdaq Stock Market.

About Focus Media Holding Limited 

Focus Media Holding Limited (Nasdaq: FMCN) operates China’s largest lifestyle targeted interactive digital media network. The Company offers one of the most comprehensive targeted interactive digital media platforms aimed at Chinese consumers at various urban locations. The increasingly fragmented and mobile lifestyle of Chinese urban consumers has created the need for more efficient media means to capture consumer attention. Focus Media’s mission is to build an increasingly comprehensive and measurable interactive urban media network that reaches consumers at various out-of-home locations.

First Quarter 2013 Highlights

Total revenues in the first quarter of 2013 were RMB5.969 billion ($961.0 million), a 40.0% increase from the corresponding period in 2012.
Operating profit in the first quarter of 2013 was RMB2.210 billion ($355.9 million), a 5.7% increase from the corresponding period in 2012.
Net income attributable to Baidu in the first quarter of 2013 was RMB2.043 billion ($328.9 million), an 8.5% increase from the corresponding period in 2012. Diluted earnings attributable to Baidu per ADS for the first quarter of 2013 were RMB5.88 ($0.95); diluted earnings attributable to Baidu per ADS excluding share-based compensation expenses (non-GAAP) for the first quarter of 2013 were RMB6.20 ($1.00).
“We saw healthy financial results in the first quarter of 2013 as we continued to invest in establishing China’s leading mobile ecosystem.” said Robin Li, chairman and chief executive officer of Baidu. “Our mobile offering is making exciting progress, with our flagship mobile search product having now surpassed 100 million daily active users, an over 25% increase from the end of the fourth quarter.”

Mr. Li continued, “Continually developing the most advanced search technology remains central to Baidu’s overall strategy, and we’re very excited by the possibilities opened up by innovation in image and voice recognition. Our focus will remain on tightly integrating our leading search core with valuable vertical products in areas such as travel, e-commerce and location based services to bring users the information they want as quickly as possible on both desktop and mobile devices.”

Jennifer Li, Baidu’s chief financial officer, commented, “We remain committed to investing aggressively, particularly in marketing and R&D. By deploying resources in the most strategically important areas of our business, we’re confident we can build exceptional long-term value for shareholders. For the quarter, we also recognized a whole quarter consolidation of iQiyi.”

First Quarter 2013 Results

Baidu reported total revenues of RMB5.969 billion ($961.0 million) for the first quarter of 2013, representing a 40.0% increase from the corresponding period in 2012.

Online marketing revenues for the first quarter of 2013 were RMB5.953 billion ($958.5 million), representing a 39.7% increase from the corresponding period in 2012. Baidu had about 410,000 active online marketing customers in the first quarter of 2013, representing a 27.7% increase from the corresponding period in 2012 and a 1.0% increase from the fourth quarter of 2012.

Revenue per online marketing customer for the first quarter was approximately RMB14,500 ($2,335), a 9.0% increase from the corresponding period in 2012 and a 6.5% decrease compared to the fourth quarter of 2012.

Traffic acquisition cost (TAC) as a component of cost of revenues was RMB609.6 million ($98.2 million), representing 10.2% of total revenues, as compared to 7.8% in the corresponding period in 2012 and 9.6% in the fourth quarter of 2012. The increase mainly reflects increased contextual ads contributions and hao123 promotions through our network.

Bandwidth costs as a component of cost of revenues were RMB404.9 million ($65.2million), representing 6.8% of total revenues, compared to 5.2% in the corresponding period in 2012. Depreciation costs as a component of cost of revenues were RMB333.1 million ($53.6 million), representing 5.6% of total revenues, compared to 5.4% in the corresponding period in 2012. These increases were mainly due to an increase in network infrastructure capacity.

Content costs as a component of cost of revenues were RMB95.8 million ($15.4 million), representing 1.6% of total revenues, compared to 0.7% in the corresponding period in 2012. This increase mainly reflects the full quarter impact of iQiyi’s consolidation. 

Selling, general and administrative expenses were RMB848.1 million ($136.6 million), representing an increase of 77.2% from the corresponding period in 2012, primarily due to an increase in promotional expenses.

Research and development expenses were RMB810.7 million ($130.5 million), an 82.9% increase from the corresponding period in 2012. The increase was primarily due to an increase in the number of research and development personnel.

Share-based compensation expenses, which were allocated to related operating costs and expense line items, were RMB110.9 million ($17.9 million) in the first quarter of 2013, compared to RMB35.2 million in the corresponding period in 2012 and RMB66.6 million in the fourth quarter of 2012. The increase from the corresponding period was a result of increased share grants to employees.

Operating profit was RMB2.210 billion ($355.9 million), representing a 5.7% increase from the corresponding period in 2012. Operating profit excluding share-based compensation expenses (non-GAAP) was RMB2.321 billion ($373.8 million), a 9.2% increase from the corresponding period in 2012.

Income tax expense was RMB388.9 million ($62.6 million), compared to an income tax expense of RMB331.2 million in the corresponding period in 2012. The effective tax rate for the first quarter of 2013 was 16.2% as compared to 15.1% for the corresponding period in 2012 and 16.2% in the fourth quarter of 2012.

Net income attributable to Baidu was RMB2.043 billion ($328.9 million), representing an 8.5% increase from the corresponding period in 2012. Basic and diluted earnings per ADSfor the first quarter of 2013 amounted to RMB5.89 ($0.95) and RMB5.88 ($0.95), respectively.

Net income attributable to Baidu excluding share-based compensation expenses (non-GAAP) was RMB2.154 billion ($346.8 million), a 12.3% increase from the corresponding period in 2012. Basic and diluted earnings per ADS excluding share-based compensation expenses (non-GAAP) for the first quarter of 2013 amounted to RMB6.20 ($1.00) andRMB6.20 ($1.00), respectively.

As of March 31, 2013, the Company had cash, cash equivalents and short-term investments of RMB33.817 billion ($5.445 billion). Net operating cash inflow for the first quarter of 2013 was RMB2.186 billion ($351.9 million). Capital expenditures for the first quarter of 2013 were RMB 468.2 million ($75.4 million).

Adjusted EBITDA (non-GAAP), defined in this announcement as earnings before interest, taxes, depreciation, amortization, other non-operating income and share-based compensation expenses, was RMB2.781 billion ($447.8million) for the first quarter of 2013, representing a 13.9% increase from the corresponding period in 2012.

Outlook for Second Quarter 2013

Baidu currently expects to generate total revenues in an amount ranging from RMB7.370 billion ($1.187 billion) to RMB7.550 billion ($1.216 billion) for the second quarter of 2013, representing a 35.1% to 38.4% year-over-year increase. This forecast reflects Baidu’s current and preliminary view, which is subject to change.

 full press release

About Baidu

Baidu, Inc. is the leading Chinese language Internet search provider. As a technology-based media company, Baidu aims to provide the best way for people to find information. In addition to serving individual Internet search users, Baidu provides an effective platform for businesses to reach potential customers. Baidu’s ADSs trade on the NASDAQ Global Select Market under the symbol “BIDU”. Currently, ten ADSs represent one Class A ordinary share.
 

Mr. Ho’s proven leadership and know-how bring to GigaMedia the necessary expertise to advance the company’s growth across Greater China.

“Ronald is a trusted leader with a wealth of experience in Greater China who consistently delivers results,”stated GigaMedia Limited Chief Executive Officer Collin Hwang. “I have tremendous confidence in his ability to align Giga’s games business with industry trends and leading practices and drive growth in Greater China.”

“GigaMedia’s strategy has never been more focused – more compelling,”stated FunTown Chief Operating Officer Ronald Ho. “I am excited to help lead the business to its next phase of innovation and growth tied to operational excellence.”

Ronald joins GigaMedia from Gamania China Digital Entertainment Co., Ltd., a Taiwan-listed online games leader with 2012 revenues of approximately US$235 million and operations across Greater China. During his successful 13-year career at Gamania, Ronald was instrumental in driving growth and held a number of positions. Most recently, he served as chief operating officer of China operations, leading Gamania’s overall China market strategy and execution, including internal development of browser/Web games.

GigaMedia expects extension of its online games business to self-developed browser/mobile games to drive growth and improved performance. Management plans to begin launching new self-developed casual social games in browser/mobile formats in the second half of 2013, including reformatted versions of certain of GigaMedia’s existing popular PC-based casual games and all-new games.

About GigaMedia

Headquartered in Taipei, Taiwan, GigaMedia Limited (Singapore registration number: 199905474H) is a diversified provider of online games and cloud computing services. GigaMedia’s online games business develops and operates a suite of games in Taiwan and Hong Kong, with focus on Web-based/mobile games. The company’s cloud computing business is focused on providing SMEs in Greater China with critical communications services and IT solutions that increase flexibility, efficiency and competitiveness. More information on GigaMedia can be obtained from www.gigamedia.com.

 Financial Highlights:

 - Net revenues in the second half of 2012 amounted to RMB51.0 million (US$8.2 million), representing a decrease of 51% from RMB103.4 million (US$16.6 million) in the first half of 2012 and a decrease of 7% from RMB55.1 million (US$8.8 million) in the second half of 2011.

 - Net loss attributable to holders of ordinary shares in the second half of 2012 amounted to RMB284.6 million (US$45.7 million), representing an increase of 24% from RMB229.4 million (US$36.8 million) in the first half of 2012 and an increase of 30% from RMB219.7 million (US$35.3 million) in the second half of 2011.

 Management Comments:

Jun Zhu, Chairman and Chief Executive Officer of The9 said, “2012 was a difficult year for the company as we spent most of our resources on product development. I am pleased to announce that we currently plan to launch our three Massively Multiplayer Online games, or MMO games, including Planetside 2, Firefall and QiJi2 between June and September of 2013. We plan to commence the open beta test of Planetside 2 in China on June 25, 2013. The open beta test of Firefall in the U.S. and Europe is expected to commence on July 9, 2013. We also plan to commence the open beta test of QiJi2 in China on September 28, 2013. Our product development team has devoted significant resources to develop these games and we believe the launches of these three MMO games will help bring The9 into a new era. Coupled with our continued commitment to web games, social games and mobile games, we expect to enjoy positive results in the coming years and cement our status as one of the first-tier online game developers in China in 2013.”

Discussion of The9’s Unaudited Third and Fourth Quarter 2012 Results

Net Revenues

Our net revenues in the third quarter of 2012 amounted to RMB32.4 million (US$5.2 million), representing a decrease of 41% from RMB54.8 million (US$8.8 million) in the second quarter of 2012 and an increase of 19% from RMB27.2 million (US$4.4 million) in the third quarter of 2011. The decrease over the previous quarter was primarily due to a decrease in revenue from ShenXianZhuan which recorded a higher level of revenue in the second quarter of 2012. The increase from the third quarter of 2011 was primarily due to an increase in revenue from ShenXianZhuan which was commercially launched in August 2011.

 Our net revenues in the fourth quarter of 2012 amounted to RMB18.6 million (US$3.0 million), representing a decrease of 43% from RMB32.4 million (US$5.2 million) in the third quarter of 2012 and a decrease of 33% from RMB27.9 million (US$4.5 million) in the fourth quarter of 2011. Such decreases were primarily due to a decrease in revenues from ShenXianZhuan and other MMO games during the same periods. In August 2012, due to the weaker-than-expected performance of ShenXianZhuan, we restructured our investments in and deconsolidated Hangzhou Fire Rain Network Technology Co., Ltd.(“Fire Rain”), the developer of ShenXianZhuan.

 Gross Profit (Loss)

 Our gross profit in the third quarter of 2012 amounted to RMB14.8 million (US$2.4 million), representing a decrease of 62% from RMB38.8 million (US$6.2 million) in the second quarter of 2012 and an increase of 9% from RMB13.6 million (US$2.2 million) in the third quarter of 2011. The decrease over the second quarter of 2012 was primarily due to a decrease in net revenue from ShenXianZhuan and an increase of amortization costs related to Firefall upon its small-scale launch in September 2012. The increase over the third quarter of 2011 was primarily due to an increase in net revenue from ShenXianZhuan.

Our gross loss in the fourth quarter of 2012 amounted to RMB1.3 million (US$0.2 million), compared to gross profit of RMB14.8 million (US$2.4 million) in the third quarter of 2012 and gross profit of RMB13.3 million (US$2.1 million) in the fourth quarter of 2011, primarily reflecting a decrease in net revenue from ShenXianZhuan and other MMO games and increase of amortization costs related to Firefall.

 Operating Expenses

 In the third quarter of 2012, our operating expenses were RMB205.0 million (US$32.9 million), representing a 21% increase from RMB168.8 million (US$27.1 million) in the second quarter of 2012 and a 45% increase from RMB141.4 million (US$22.7 million) in the third quarter of 2011. These increases were primarily due to an increase in marketing expenses relating to Firefall and Planetside 2, an increase in product development expenses relating to Firefall and web and mobile games and a loss recorded in the third quarter of 2012 in connection with our restructuring of investments in and termination of certain contractual arrangements with two variable interest entities, namely Fire Rain and Wanyouyl, which primarily engaged in game development and operation activities. As a result of such restructuring, we deconsolidated Fire Rain and Wanyouyl and recorded a loss of RMB18.1 million (US$2.9 million). In the third quarter of 2012, share-based compensation was RMB11.4 million (US$1.8 million), compared to RMB8.9 million (US$1.4 million) in the second quarter of 2012 and RMB10.8 million (US$1.7 million) in the third quarter of 2011.

 In the fourth quarter of 2012, our operating expenses were RMB148.9 million (US$23.9 million), representing a 27% decrease from RMB205.0 million (US$32.9 million) in the third quarter of 2012 and a 6% increase from RMB140.2 million (US$22.5 million) in the fourth quarter of 2011. The decrease over the third quarter of 2012 was primarily due to a decrease in marketing expenses, a decrease in product development expenses relating to mobile game business and the loss recorded in the third quarter of 2012 in connection with our restructuring of investments in and termination of certain contractual arrangements with Fire Rain and Wanyouyl. The increase over the fourth quarter of 2011 was primarily due to an increase in marketing expenses related to Firefall and Planetside 2. In the fourth quarter of 2012, share-based compensation was RMB7.3 million (US$1.2 million), compared to RMB11.4 million (US$1.8 million) in the third quarter of 2012 and RMB10.0 million (US$1.6 million) in the fourth quarter of 2011.

 Interest Income

 Interest income in the third quarter of 2012 was RMB4.9 million (US$0.8 million), compared to RMB6.5 million (US$1.0 million) in the second quarter of 2012 and RMB8.6 million (US$1.4 million) in the third quarter of 2011.Such decreases were primarily due to a decrease in cash balance.

 Interest income in the fourth quarter of 2012 was RMB3.5 million (US$0.6 million), compared to RMB4.9 million (US$0.8 million) in the third quarter of 2012 and RMB7.1 million (US$1.1 million) in the fourth quarter of 2011. Such decreases were also primarily due to a decrease in cash balance.

full press release

About The9 Limited

The9 Limited is an online game developer and operator. The9 develops and operates, directly or through its affiliates, its proprietary MMO games including Firefall and QiJi2. The9 also develops and operates web games and social games including ReXueWuShuang and Winning Dunk. The9 has also obtained exclusive licenses to operate other games in mainland China such as Planetside 2. In 2010, The9 established its Mobile Internet Unit to focus on mobile internet business.

Mr. Yuzhu Shi, Giant’s Chairman commented, “I am very proud of what Giant has achieved in the past nine years since we founded the Company in 2004. From developing the landmark free-to-play MMORPG ZT Online to being a public company listed on the NYSE, I have always envisioned Giant becoming a mature company with a self-sustaining culture and core values, relying on the entire team to produce the results which we demand of ourselves. Over the past several years we reorganized our research and development organization into independent studios, in order to foster the cross-fertilization of ideas and incentivize our developers to continually create innovative and commercially successful games. Our young talents have led their teams to create breakthrough games such as ZT Online 2 and the upcoming World of Xianxia, and have proved that this industry truly belongs to the young. I will continue to oversee the Company’s strategic direction as Chairman of the Board, and to provide my full support to our management team and talents as Giant strides into the future, relying on the values we have nurtured company-wide to pave the way for exciting opportunities ahead.”

 About Giant Interactive Group Inc.

 Giant Interactive Group Inc. (NYSE:GA) is a leading online game developer and operator in China, and focuses on massivelymultiplayer online role playing games. Currently, Giant operates multiple games, including the ZT Online 1 Series,ZT Online 2, GiantOnline, XT Online, The Golden Land, Elsword, and AllodsOnline.