eastunder
12 years ago
Changyou Reports Third Quarter 2012 Unaudited Financial Results
Monday , November 05, 2012 00:35ET
BEIJING, Nov. 5, 2012 /PRNewswire/ -- Changyou.com Limited ("Changyou" or the "Company") (NASDAQ: CYOU), a leading online game developer and operator in China, today announced its unaudited financial results for the third quarter ended September 30, 2012.
Third quarter 2012 Highlights
-- Total revenues reached a record US$165.8 million, an increase of 13%
quarter-over-quarter and 29% year-over-year, exceeding the high end of
the Company's guidance by US$8.8 million.
-- Online game revenues reached a record US$151.1 million, an increase of
10% quarter-over-quarter and 30% year-over-year, exceeding the high end
of the Company's guidance by US$7.1 million.
-- Online advertising revenues reached a record US$12.8 million, an
increase of 40% quarter-over-quarter and 32% year-over-year, exceeding
the high end of the Company's guidance by US$0.8 million.
-- Net income attributable to Changyou.com Limited reached a record US$72.9
million, or US$1.37 per fully diluted ADS[1]. Net income attributable to
Changyou.com Limited increased 6% quarter-over-quarter and 18%
year-over-year.
-- Non-GAAP[2] net income attributable to Changyou.com Limited reached a
record US$75.9 million, or US$1.42 per fully diluted ADS. Non-GAAP net
income attributable to Changyou.com Limited increased 5%
quarter-over-quarter and 20% year-over-year, exceeding the high end of
the Company's guidance by US$3.9 million.
-- On August 6, 2012, the Company's board of directors declared a special
one-time cash dividend of US$1.9 per Class A or Class B ordinary share,
or US$3.8 per American Depositary Share ("ADS"). The total amount of
this dividend was approximately US$201 million. The dividend was paid to
shareholders on September 21, 2012.
Mr. Tao Wang, Changyou's chief executive officer, commented, "The third quarter is a testimony to our corporate philosophy of putting our customers first. Our key operational metrics and financial results demonstrate that we have a solid base of players who are engaged and willing to spend in our games as we continue to invest the resources to keep them fresh and exciting. In our flagship MMO game, Tian Long Ba Bu, or TLBB, we saw higher player engagement levels and spending from our core players after the release of the July 12(th) expansion pack and the October 25th major expansion pack. Meanwhile, our new web game Wartune continued to build momentum as it was launched on more platforms and in more countries during the quarter. Changyou is one of the few online game companies in China with a leading presence in all three key markets of the online games industry, MMO games, web games and online game media. With the talents, customer base and marketing networks accumulated in each of these three areas, we believe we can take our businesses further, both in China and globally, and build the company into an even greater success."
Mr. Dewen Chen, president and chief operating officer, continued, "Our online advertising business benefited from the traditionally strong summer season for online games advertising in the third quarter. 17173.com is the portal of choice for online game advertisers and we achieved higher utilization rates of our advertising resources due to strong demand. We are building 17173.com into an even better portal for game-related news. We launched two brand-new news channels in the third quarter, one dedicated to web games and the other to mobile games, and have plans to deliver news for international gamers as well."
Mr. Alex Ho, Changyou's chief financial officer, added, "In the third quarter, we once again topped past quarters' financial performance, in both GAAP and non-GAAP terms, on our top-line and bottom-line results. Both our online games business and online advertising business grew in terms of revenues and are highly profitable and cash-generative. With the strong and stable cash flows from our operations, we plan to keep investing in people and products to take advantage of the many growth opportunities we see in the market and create greater shareholder value over the long term."
Third Quarter 2012 Operational Results
The Company's operational results for the third quarter of 2012, which exclude those of 7Road's games, were as follows:
-- Aggregate registered accounts for the Company's games[3] increased 12%
quarter-over-quarter and 41% year-over-year to 223.5 million.
-- Aggregate PCU for the Company's games increased 1% quarter-over-quarter
and decreased 5% year-over-year to 1.09 million.
-- Aggregate APA for the Company's games decreased 8% quarter-over-quarter
and 20% year-over-year to 2.41 million. The quarter-over-quarter and
year-over-year decreases reflected a decline in the number of
low-spending active paying accounts that did not make a purchase in the
third quarter of 2012 as the Company continued last quarter's strategy
of giving away virtual items and reducing in-game promotions in TLBB.
-- ARPU for the Company's games increased 15% quarter-over-quarter and 46%
year-over-year to RMB319. The quarter-over-quarter and year-over-year
increases were mainly due to the decline in TLBB's low-spending active
paying accounts and TLBB's core players increasing their spending in the
third quarter of 2012.
7Road's operational results for the third quarter of 2012 were as follows:
-- Aggregate active accounts[4] for 7Road's games[5] were 66.8 million, an
increase of 23% quarter-over-quarter and 42% year-over-year. The
increases in active accounts were mainly due to new gamers on
third-party web platforms playing Wartune (also known as Shen Qu) in the
third quarter of 2012.
-- Aggregate active charging accounts[6] for 7Road's games were 1.66
million, a decrease of 5% quarter-over-quarter and 3% year-over-year.
The decreases in active charging accounts resulted primarily from
certain players of DDTank having ceased purchasing game coins because in
the new version of DDTank, DDTank II, they were prevented from
purchasing virtual items at discounted prices from other players. The
decreases in active charging accounts also reflected the fact that
DDTank, which has been in operation since 2008, has entered into a
relatively mature phase. This resulting decrease in active charging
accounts for DDTank was offset in part by an increase in the number of
active charging accounts for Wartune (also known as Shen Qu) in the
third quarter of 2012.
-- Average revenue recognized per active charging account[7] ("ARCA") for
7Road's games was RMB100 an increase of 61% quarter-over-quarter and
163% year-over-year. The increases resulted primarily from Wartune
tending to have a higher ARCA than DDTank, and from ARCA for DDTank
having increased as relatively lower-spending players ceased purchasing
game coins after the discount market was closed when the new version of
DDTank, DDTank II, was released.
Third Quarter 2012 Unaudited Financial Results
Revenues
Total revenues for the third quarter of 2012 increased 13% quarter-over-quarter and 29% year-over-year to US$165.8 million.
Online game revenues, which include revenues from Changyou's game operations and overseas licensing revenues and revenues from 7Road, increased 10% quarter-over-quarter and 30% year-over-year to US$151.1 million. The quarter-over-quarter and year-over-year increases were mainly due to the growth momentum of TLBB and Wartune in China in the third quarter of 2012.
Online advertising revenues, which consist of revenues generated from the 17173 business, increased 40% quarter-over-quarter and 32% year-over-year to US$12.8 million. The quarter-over-quarter increase was mainly due to the seasonal pickup typical for advertising in China and higher utilization rates of our advertising resources in the third quarter of 2012. The year-over-year increase was mainly due to higher advertising prices and higher utilization rates of our advertising resources in the third quarter of 2012 than in the third quarter last year.
Other revenues, which consist of cinema advertising revenues, were US$1.9 million, an increase of 80% quarter-over-quarter and a decrease of 40% year-over-year. The quarter-over-quarter increase was mainly due to the seasonal pickup typical for advertising in China in the third quarter of 2012. The year-over-year decrease was mainly due to the streamlining of the cinema advertising business in 2012.
Gross profit
Gross profit increased 9% quarter-over-quarter and 23% year-over-year to US$134.8 million. Non-GAAP gross profit increased 9% quarter-over-quarter and 23% year-over-year to US$134.9 million. Both gross margin and non-GAAP gross margin were 81%, compared with 84% in the second quarter of 2012 and 85% in the third quarter of 2011.
Gross profit of the online games business increased 9% quarter-over-quarter and 29% year-over-year to US$130.0 million. Non-GAAP gross profit of the online games business increased 9% quarter-over-quarter and 29% year-over-year to US$130.1 million. Both gross margin and non-GAAP gross margin of the online games business were 86%, compared with 87% in the second quarter of 2012 and 87% in the third quarter of 2011. The decline in gross margin and non-GAAP gross margin for the online games business was mainly due to an increase in headcount and related salaries and benefits expenses in the third quarter of 2012.
Gross profit of the online advertising business increased 43% quarter-over-quarter and 28% year-over-year to US$11.0 million. Non-GAAP gross profit of the online advertising business increased 43% quarter-over-quarter and 27% year-over-year to US$11.1 million. Gross margin of the online advertising business was 87%, compared with 85% in the second quarter of 2012 and 89% in the third quarter of 2011. Non-GAAP gross margin of the online advertising business was 87%, compared with 85% in the second quarter of 2012 and 90% in the third quarter of 2011. The quarter-over-quarter increases in gross margin and non-GAAP gross margin for the online advertising business were mainly due to an increase in online advertising revenues in the third quarter of 2012. The year-over-year decrease in gross margin and non-GAAP gross margin for the online advertising business were mainly due to higher bandwidth cost and increased salaries and benefits expenses due to the hiring of more editors in the third quarter of 2012.
Gross loss and non-GAAP gross loss of other business were US$6.3 million compared with US$2.8 million in the second quarter of 2012 and US$246,000 in the third quarter of 2011. The greater gross loss and non-GAAP gross loss of other business were mainly due to the impairment provision for the advertising resources at cinema circuits of $4.0 million in the third quarter of 2012.
Operating expenses
Total operating expenses were US$42.4 million, an increase of 1% quarter-over-quarter and 12% year-over-year.
Product development expenses were US$18.1 million, an increase of 8% quarter-over-quarter and 44% year-over-year. The quarter-over-quarter and year-over-year increases were mainly due to an increase in salaries and benefits after the Company hired more game engineers in the third quarter of 2012.
Sales and marketing expenses were US$16.4 million, an increase of 13% quarter-over-quarter and a decrease of 7% year-over-year. The quarter-over-quarter increase was mainly due to higher advertising spending for the promotion of expansion packs in the third quarter of 2012. The year-over-year decrease was mainly due to lower advertising spending as we carried out a nationwide marketing campaign to promote the launch of a new game, Duke of Mount Deer, in the third quarter of 2011.
General and administrative expenses were US$7.8 million, an increase of 1% quarter-over-quarter and 3% year-over-year. The quarter-over-quarter and year-over-year increases were mainly due to an increase in headcount and related salaries and benefits expenses in the third quarter of 2012.
Operating profit
Operating profit increased 13% quarter-over-quarter and 29% year-over-year to US$92.4 million. Operating margin was 56%, compared with 56% in the second quarter of 2012 and 56% in the third quarter of 2011.
Non-GAAP operating profit increased 9% quarter-over-quarter and 28% year-over-year to US$93.2 million. Non-GAAP operating margin was 56%, compared with 58% in the second quarter of 2012 and 57% in the third quarter of 2011.
Net income
Net income increased 10% quarter-over-quarter and 23% year-over-year to US$77.4 million. Net margin was 47%, compared with 48% in the second quarter of 2012 and 49% in the third quarter of 2011.
Non-GAAP net income increased 10% quarter-over-quarter and 25% year-over-year to US$80.4 million. Non-GAAP net margin was 49%, compared with 50% in the second quarter of 2012 and 50% in the third quarter of 2011.
Net income attributable to mezzanine classified non-controlling interests
Net income attributable to mezzanine classified non-controlling interests increased 311% quarter-over-quarter and 312% year-over-year to US$4.5 million. In the third quarter of 2012, the increase in net income attributable to mezzanine classified non-controlling interests of $3.4 million was mainly because Changyou increased the estimated redemption value of the mezzanine classified non-controlling interests in 7Road. Changyou increased the estimated redemption value because judging from 7Road's performance in the first three quarters of 2012, Changyou estimates that 7Road will likely exceed its originally estimated performance for year 2012 and 2013, which will be the basis to determine the exercise price of the put option that gives the non-controlling shareholders the right to put their shares to Changyou at a pre-determined price if 7Road achieves specified performance milestones before the expiry of the put option and certain circumstances occur. Please refer to the section "Notes to Financial Information", for further details on the put option. The increase in the redemption value was recognized prospectively over the period from the date of the change in estimate to the earliest exercise date of the put right as an increase in net income attributable to mezzanine classified non-controlling interests.
Net income attributable to Changyou.com Limited
Net income attributable to Changyou.com Limited increased 6% quarter-over-quarter and 18% year-over-year to US$72.9 million. Fully diluted earnings per ADS attributable to Changyou.com Limited were US$1.37, up from US$1.29 in the second quarter of 2012 and US$1.16 in the third quarter of 2011. Net margin attributable to Changyou.com Limited was 44%, compared with 47% in the second quarter of 2012 and 48% in the third quarter of 2011.
Non-GAAP net income attributable to Changyou.com Limited increased 5% quarter-over-quarter and 20% year-over-year to US$75.9 million. Non-GAAP fully diluted earnings per ADS attributable to Changyou.com Limited were US$1.42, up from US$1.35 in the second quarter of 2012 and US$1.18 in the third quarter of 2011. Non-GAAP net margin attributable to Changyou.com Limited was 46%, compared with 49% in the second quarter of 2012 and 49% in the third quarter of 2011.
Liquidity
As of September 30, 2012, Changyou had a combined balance of cash and cash equivalents and short-term investments of US$340.6 million, which decreased from US$464.9 million as of June 30, 2012. Operating cash flow for the third quarter of 2012 was a net inflow of US$100.2 million.
The decrease in the Company's combined balance of cash and cash equivalents and short-term investments was due to the payment of a special cash dividend of US$201 million in the third quarter.
As of September 30, 2012, Changyou had short-term and long-term bank loans of US$222.4 million and current and non-current restricted time deposits of US$225.5 million. The bank loans and restricted time deposits were mainly related to offshore bridge loans from banks that the Company obtained in order to expedite the payment of the special cash dividend to the Company's shareholders. The offshore bridge loans were secured with an equivalent or higher amount of Renminbi-denominated onshore bank deposits by the Company's subsidiaries in China.
Other Business Developments in the Third Quarter of 2012
Changyou Declared and Paid Special Cash Dividend to Shareholders
On August 6, 2012, the Company's board of directors declared a special one-time cash dividend of US$1.9 per Class A or Class B ordinary share, or US$3.8 per ADS. The total amount of this dividend was approximately US$201 million. The dividend was paid to shareholders on September 21, 2012.
Business Outlook
For the fourth quarter of 2012, Changyou expects:
-- Total revenues to be between US$166.0 million and US$170.0 million,
including online game revenues of US$152.0 million to US$155.0 million
and online advertising revenues of US$12.0 million to US$13.0 million.
-- Non-GAAP net income attributable to Changyou.com Limited to be between
US$69.0 million and US$71.0 million.
-- Non-GAAP fully diluted earnings per ADS attributable to Changyou.com
Limited to be between US$1.29 and US$1.33.
-- Assuming no new grants of share-based awards, share-based compensation
expense to be between US$0.5 million and US$1.0 million, reducing fully
diluted earnings per ADS attributable to Changyou.com Limited by US$0.01
to US$0.02.
Continued at: http://www.knobias.com/story.htm?eid=3.1.40a337ec057905b41f7ee357552797b3d38652cc29b997bcde50f3be26b428ef
eastunder
12 years ago
Changyou.com Announces US$3.8 Special Cash Dividend per American Depositary Share
Monday , August 06, 2012 01:00ET
http://www.knobias.com/story.htm?eid=3.1.9447d6d15269577447d01cc833c52d77ef93167387293f71d57792a503d587c0
BEIJING, Aug. 6, 2012 /PRNewswire-Asia/ -- Changyou.com Limited ("Changyou" or the "Company") (NASDAQ: CYOU), a leading online game developer and operator in China, today announced that its board of directors declared a special one-time cash dividend of US$1.9 per Class A or Class B ordinary share, or US$3.8 per American Depositary Share ("ADS"). The total amount of the special cash dividend is approximately US$201 million.
Record holders of the Company's Class A and Class B ordinary shares at the close of business U.S. Eastern Time on August 17, 2012 (the "Record Date") will be entitled to receive the special cash dividend. Holders of the Company's ADSs, each representing two Class A ordinary shares, as of the Record Date will be entitled to the special cash dividend. Changyou expects, Bank of New York Mellon, depositary bank for Changyou's ADR program, to pay out dividends to ADS holders on or before September 30, 2012. The actual distribution date may change. The Company will issue another press release in the event that there is any significant change in the scheduled distribution date.
Mr. Tao Wang, chief executive officer of Changyou commented, "Our business is growing as our online games continue its popularity in China and we continue to generate strong free cash flows from operations each quarter. As we have accumulated a sizable cash reserve since our initial public offering, we are happy to announce this special cash dividend in an effort to return value to shareholders. Our strong balance sheet and robust free cash flows will allow us to keep investing in our businesses to strengthen our position as a leading game developer and operator in China and capture arising opportunities in the global online games market. We are confident in our long-term growth potential and ongoing ability to further increase shareholder value."
In order to expedite the payment of the special cash dividend, Changyou is expected to finance the payment through offshore bridging bank loans, which would be secured by an equivalent amount of Renminbi-denominated onshore bank deposits of our subsidiaries in China.
As of June 30, 2012, the Company had US$464.9 million in cash and cash equivalents and short-term investments. The Company generated US$276.6 million in cash inflows from operations for the year ended December 31, 2011, the most recent year for which financial results have been reported.
eastunder
12 years ago
Changyou Reports Second Quarter 2012 Unaudited Financial Results
Monday , August 06, 2012 01:00ET
http://www.knobias.com/story.htm?eid=3.1.9e074b8827822bf91fd67907c63517fee22e2dfee0d35d217247c25a8ee42be1
BEIJING, Aug. 6, 2012 /PRNewswire-Asia/ -- Changyou.com Limited ("Changyou" or the "Company") (NASDAQ: CYOU), a leading online game developer and operator in China, today announced its unaudited financial results for the second quarter ended June 30, 2012.
Second quarter 2012 Highlights
-- Total revenues reached a record US$147.3 million, an increase of 8%
quarter-over-quarter and an increase of 30% year-over-year, exceeding
the high end of the Company's guidance by US$3.8 million.
-- Online game revenues reached a record US$137.2 million, an increase of
8% quarter-over-quarter and 35% year-over-year, exceeding the high end
of the Company's guidance by US$4.2 million.
-- Net income attributable to Changyou.com Limited was US$69.1 million, or
US$1.29 per fully diluted ADS[1]. Net income attributable to
Changyou.com Limited increased 6% quarter-over-quarter and 14%
year-over-year.
-- Non-GAAP[2] net income attributable to Changyou.com Limited reached a
record US$72.3 million, or US$1.35 per fully diluted ADS. Non-GAAP net
income attributable to Changyou.com Limited increased 9%
quarter-over-quarter and 16% year-over-year, exceeding the high end of
the Company's guidance by US$12.3 million.
Mr. Tao Wang, Changyou's chief executive officer, commented, "The second quarter has underscored once again the staying power of Tian Long Ba Bu and the early strong reception of our new web game, Wartune (also known as Shen Qu). Our strong financial performance demonstrates the resilience of the online games business to business cycles and the current economic slowdown. Looking ahead, the outlook for online games is strong, particularly as gamers globally increasingly demand quick access to games online and as new game formats, like web games, gain popularity. With the launch of several MMO and web games in the second half of the year, we look to acquire more users and capture market share to further strengthen our position as a leading game developer and operator in China."
Mr. Dewen Chen, president and chief operating officer, continued, "We have been working behind the scenes to turn our online games portal, 17173.com, into an even more important resource for the online games industry. In addition to MMO games, we will be covering the fast-evolving web game and mobile game markets. It takes time to build up the resources, including star quality journalists, to do this, but we are making solid progress. Meanwhile, we continue to see strong demand for advertising on 17173.com. As we work on enhancing the website and expanding news coverage, we look to further enhance the leading position of 17173.com within the game portals and online game communities in China."
Mr. Alex Ho, Changyou's chief financial officer, added, "We set new records for both top-line and bottom-line performance during the quarter. Our ongoing MMO games business and acquired web game and online advertising business generated higher returns and rich cash flows, while we implemented cost control measures that led to cost savings. With a strong cash position and a proven cash generative business, we have capacity to continue investing in the development and marketing of games and in emerging growth opportunities that can further increase shareholder value."
Second Quarter 2012 Operational Results
The Company's operational results for the second quarter of 2012, which exclude those of 7Road's games, were as follows:
-- Aggregate registered accounts for the Company's games[3] increased 6%
quarter-over-quarter and 51% year-over-year to 199.5 million.
-- Aggregate PCU for the Company's games were flat quarter-over-quarter and
increased 11% year-over-year to 1.08 million.
-- Aggregate APA for the Company's games decreased 16% quarter-over-quarter
and decreased 10% year-over-year to 2.61 million. The decreases
reflected a decline in the number of low-spending active paying accounts
that did not make a purchase in the second quarter of 2012 as a result
of less in-game promotions and the give-away of virtual items in TLBB to
celebrate the game's fifth year anniversary.
-- ARPU for the Company's games increased 23% quarter-over-quarter and 31%
year-over-year to RMB277. The increase was mainly due to the decline in
low-spending active paying accounts in the second quarter of 2012.
7Road's operational results for the second quarter of 2012 were as follows:
-- Aggregate active accounts[4] for 7Road's games[5] were 54.3 million, an
increase of 15% quarter-over-quarter. The increase in active accounts
was mainly due to new gamers on third-party web platforms playing
Wartune (also known as Shen Qu) in the second quarter of 2012.
-- Aggregate active charging accounts[6] for 7Road's games was 1.74
million, an increase of 12% quarter-over-quarter. The increase in active
charging accounts was mainly due to an increase in the number of active
charging accounts for Wartune in the second quarter of 2012.
-- Average revenue recognized per active charging account[7] ("ARCA") for
7Road's games were RMB62, an increase of 24% quarter-over-quarter. The
increase was mainly because of more paying players in Wartune, which
tends to have a higher ARCA than DDTank .
Second Quarter 2012 Unaudited Financial Results
Revenues
Total revenues for the second quarter of 2012 increased 8% quarter-over-quarter and 30% year-over-year to US$147.3 million.
Online game revenues, which include revenues from Changyou's game operations and overseas licensing revenues and revenues from 7Road, increased 8% quarter-over-quarter and 35% year-over-year to US$137.2 million. The quarter-over-quarter increase was mainly due to the ongoing popularity of TLBB and the growth of Wartune in China. The year-over-year increase was mainly due to a full quarter's revenue contribution from 7Road, the ongoing popularity of TLBB and the growth of Wartune in China.
Online advertising revenues, which consist of revenues generated from the 17173 business, increased 11% quarter-over-quarter and 10% year-over-year to US$9.1 million. The quarter-over-quarter increase was mainly due to the seasonal pickup typical for advertising in China. The year-over-year increase was mainly due to higher advertising prices in the second quarter of 2012 than in the second quarter last year.
Other revenues, which consist of cinema advertising revenues, were US$1.1 million, down 7% quarter-over-quarter and 69% year-over-year. The decreases were mainly due to continued streamlining of the cinema advertising business in the second quarter.
Gross profit
Gross profit and non-GAAP gross profit increased 7% quarter-over-quarter and 26% year-over-year to US$123.8 million. Both gross margin and non-GAAP gross margin were 84%, compared with 84% in the first quarter of 2012 and 87% in the second quarter of 2011.
Gross profit and non-GAAP gross profit of the online games business increased 7% quarter-over-quarter and 30% year-over-year to US$118.9 million. Both gross margin and non-GAAP gross margin of the online games business were 87%, compared with 87% in the first quarter of 2012, and 90% in the second quarter of 2011. The year-over-year decline in gross margin and non-GAAP gross margin for the online games business was mainly due to an increase in headcount and related salaries and benefits expenses and higher bandwidth and server costs as Changyou operated a larger portfolio of online games in the second quarter of 2012.
Gross profit and non-GAAP gross profit of the online advertising business increased 14% quarter-over-quarter and 5% year-over-year to US$7.7 million. Both gross margin and non-GAAP gross margin of the online advertising business was 85%, compared with 83% in the first quarter of 2012 and 89% in the second quarter of 2011. The quarter-over-quarter increases in gross margin and non-GAAP gross margin for the online advertising business were mainly due to an increase in online advertising revenues in the second quarter of 2012. The year-over-year decreases in gross margin and non-GAAP gross margin for the online advertising business were mainly due to higher bandwidth and server costs in the second quarter of 2012.
Gross loss and non-GAAP gross loss of other business were US$2.8 million compared with US$2.4 million in the first quarter of 2012 and US$650,000 in the second quarter of 2011.
Operating expenses
Total operating expenses increased 18% quarter-over-quarter and 41% year-over-year to US$42.0 million.
Product development expenses were US$16.8 million, a decrease of 3% quarter-over-quarter and an increase 35% year-over-year. The quarter-over-quarter decrease was mainly due to decreased expenses related to royalties for licensed games, which was partially offset by an increase in salaries and benefits in the second quarter of 2012. The year-over-year increase was mainly due to an increase in salaries and benefits after Changyou hired more game engineers in the second quarter of 2012.
Sales and marketing expenses were US$14.5 million, an increase of 48% quarter-over-quarter and 30% year-over-year. The quarter-over-quarter and year-over-year increases were mainly due to higher advertising spending for the promotion of new game launches and expansion packs in the second quarter of 2012.
General and administrative expenses were US$7.8 million, a decrease of 8% quarter-over-quarter and an increase of 26% year-over-year. The quarter-over-quarter decrease was mainly due to a reduction in bad debt expenses related to the cinema advertising business in the second quarter of 2012. The year-over-year increase was mainly due to an increase in headcount and related salaries and benefits expenses in the second quarter of 2012.
Operating profit
Operating profit increased 2% quarter-over-quarter and 19% year-over-year to US$81.8 million. Operating margin was 56%, compared with 58% in the first quarter of 2012 and 60% in the second quarter of 2011.
Non-GAAP operating profit increased 6% quarter-over-quarter and 22% year-over-year to US$85.7 million. Non-GAAP operating margin was 58%, compared with 59% in the first quarter of 2012 and 62% in the second quarter of 2011.
Net income
Net income increased 6% quarter-over-quarter and 15% year-over-year to US$70.2 million. Net margin was 48%, compared with 49% in the first quarter of 2012 and 54% in the second quarter of 2011.
Non-GAAP net income increased 9% quarter-over-quarter and increased 17% year-over-year to US$73.4 million. Non-GAAP net margin was 50%, compared with 49% in the first quarter of 2012 and 55% in the second quarter of 2011.
Net income attributable to Changyou.com Limited
Net income attributable to Changyou.com Limited increased 6% quarter-over-quarter and 14% year-over-year to US$69.1 million. Fully diluted earnings per ADS attributable to Changyou.com Limited were US$1.29, up from US$1.22 in the first quarter of 2012 and US$1.14 in the second quarter of 2011. Net margin attributable to Changyou.com Limited was 47%, compared with 48% in the first quarter of 2012 and 54% in the second quarter of 2011.
Non-GAAP net income attributable to Changyou.com Limited increased 9% quarter-over-quarter and 16% year-over-year to US$72.3 million. Non-GAAP fully diluted earnings per ADS attributable to Changyou.com Limited were US$1.35, up from US$1.24 in the first quarter of 2012 and US$1.16 in the second quarter of 2011. Non-GAAP net margin attributable to Changyou.com Limited was 49%, compared with 49% in the first quarter of 2012 and 55% in the second quarter of 2011.
Liquidity
As of June 30, 2012, Changyou had cash and cash equivalents and short-term investments of US$464.9 million, which increased from US$396.8 million as of March 31, 2012. Operating cash flow for the second quarter of 2012 was a net inflow of US$82.5 million.
Business Outlook
For the third quarter of 2012, Changyou expects:
-- Total revenues to be between US$153 million and US$157 million,
including online game revenues of US$141 million to US$144 million and
online advertising revenues of US$11 million to US$12 million.
-- Non-GAAP net income attributable to Changyou.com Limited to be between
US$70 million and US$72 million.
-- Non-GAAP fully diluted earnings per ADS attributable to Changyou.com
Limited to be between US$1.31 and US$1.35.
-- Assuming no new grants of share-based awards, share-based compensation
expense to be between US$1.0 million and US$1.5 million, reducing fully
diluted earnings per ADS attributable to Changyou.com Limited by US$0.02
to US$0.03.
eastunder
14 years ago
Changyou.com to Acquire a Majority Stake in 7Road
Monday , April 25, 2011 00:45ET
BEIJING, April 25, 2011 /PRNewswire-Asia/ -- Changyou.com Limited ("Changyou" or the "Company") (NASDAQ: CYOU), a leading online game developer and operator in China, today announced it has recently entered into a definitive agreement with Shenzhen 7Road Technology Co., Ltd. under which it will acquire 68.258% of the equity of Shenzhen 7Road Technology Co., Ltd. and its affiliates ("7Road"), a reputable web-based game company in China. The acquisition accelerates Changyou's position in China's online games industry and adds a new category of games to its growing product portfolio.
Changyou will acquire 68.258% of the equity of 7Road for fixed cash consideration of approximately US$68.26 million, plus additional variable cash consideration of up to a maximum of US$32.76 million that is contingent upon the achievement of specified performance milestones through December 31, 2012. The acquisition is expected to be completed by June 30, 2011, subject to regulatory approvals and other customary conditions specified in the agreement.
"Web-based games, which can be played in a browser without installation of a client application, are experiencing rapid growth and this is the right time to invest to and enter this space," said Mr. Tao Wang, Changyou's chief executive officer. "Changyou has been leading the market for massively multiplayer online games in China, and with the addition of a proven development team from 7Road, their successful game and wide network of partner websites, we are pushing forward in our plans to reach new audiences with the addition of quality products designed for different consumers."
"Changyou's vision and game development philosophy are consistent with our own, and we could not be more excited about becoming a part of Changyou," said Mr. Johnny Cao, CEO and Founder of 7Road. "With Changyou's support, we can concentrate on creating high quality titles as we move further ahead in the Web-based games market."
7Road is a developer of Web-based games and the creator of DDTank, one of the most popular multiplayer Web-based shooting games in China. The game currently ranks among China's top five web-based games on the Baidu search ranking for web-based games. DDTank had more than 350,000 peak concurrent users globally, in the fourth quarter of 2010. 7Road jointly operates DDTank with over 50 of the most frequently visited game portals and SNS sites in China and overseas, such as Duowan, Baidu, Kaixin001 and RenRen. Translated into 9 different languages, DDTank has been launched in countries overseas including Vietnam, Taiwan, Brazil and others.
eastunder
14 years ago
Changyou Reports First Quarter 2011 Results
Monday , April 25, 2011 01:00ET
BEIJING, April 25, 2011 /PRNewswire-Asia/ -- Changyou.com Limited ("Changyou" or the "Company") (NASDAQ: CYOU), a leading online game developer and operator in China, today announced its unaudited financial results for the first quarter ended March 31, 2011.
First Quarter 2011 Highlights
-- Total revenues reached a record US$97.1 million, an increase of 6%
quarter-over-quarter and 35% year-over-year, and exceeded the high end
of the Company's guidance by US$2.1 million.
-- Net income reached a record US$52.8 million, or US$0.99 per fully
diluted ADS(1). Net income increased by 11% quarter-over-quarter and 33%
year-over-year.
-- Non-GAAP(2) net income (i.e., excluding share-based compensation
expenses) reached a record US$54.6 million, or US$1.02 per fully diluted
ADS, exceeding the high end of the Company's guidance by US$3.6 million.
Non-GAAP net income increased by 10% quarter-over-quarter and 28%
year-over-year.
-- Aggregate registered accounts for the Company's games(3) grew 5%
quarter-over-quarter and 33% year-over-year to 116.5 million.
-- Aggregate active paying accounts ("APA") for the Company's games grew 7%
quarter-over-quarter and 21% year-over-year to approximately 2.88
million.
(1) Each American depositary share ("ADS") represents two Class A
ordinary shares.
(2) Explanation of the Company's non-GAAP financial measures and
related reconciliations to GAAP financial measures are included in
the accompanying "Non-GAAP Disclosure" and "Reconciliations to
Unaudited Condensed Consolidated Statements of Operations."
(3) Comprises the following games operated in China: Tian Long Ba Bu
("TLBB"), Blade Online, Blade Hero 2, Da Hua Shui Hu, Zhong Hua Ying
Xiong, Immortal Faith and San Jie Qi Yuan.
Mr. Tao Wang, Changyou's Chief Executive Officer, commented, "2011 is an exciting year for Changyou as we prepare for the launch of new games, such as Duke of Mount Deer, or DMD, while our current games continue to generate solid returns. Our leading game franchise, Tian Long Ba Bu, or TLBB, has continued to attract new, existing and returning players to its thriving community as we constantly update the game with new content. Similarly, we are seeing growing interest from players for our upcoming game. DMD, which entered a new round of closed beta testing today, is slated for a launch this summer. In this round of testing, game testers will also be able to carry over user accounts through the full launch period. With the updated version, we have unveiled a new, self-developed server technology and a host of unique gameplay not found in any other existing massively multiplayer online games. With the continued strength of the online games industry in China, the imminent launch of DMD, and the ongoing success of our TLBB franchise, we look to accelerate our position as a leading online game company in China."
Mr. Dewen Chen, president and chief operating officer, continued, "To expand on our existing business, we have recently signed a definitive agreement to acquire a majority stake in Shenzhen 7Road Technology Co., Ltd. and its affiliates, a reputable Web-based game developer that developed DDTank, one of the most popular Web-based games in China. We expect that our new venture into this fast-growing segment will not only bring many opportunities, but will also supplement growth in our core MMORPG business."
Mr. Alex Ho, Changyou's chief financial officer, added, "The first quarter of 2011 marks a strong start to the year as we once again delivered record total revenues and record non-GAAP net income. Management's confidence in Changyou's business prospects, our strong cash position, and debt-free balance sheet give us the flexibility to invest in growth initiatives as they arise and put the necessary disciplines in place to continue to create value for our shareholders."
First Quarter 2011 Operational Results
Aggregate registered accounts for the Company's games as of March 31, 2011 increased 5% quarter-over-quarter and 33% year-over-year to 116.5 million.
Aggregate peak concurrent users ("PCU") for the Company's games was 1 million, a decrease of 3% quarter-over-quarter and an increase of 10% year-over-year.
Aggregate APA for the Company's games increased 7% quarter-over-quarter and 21% year-over-year to 2.88 million.
Average revenue per active paying account ("ARPU") for the Company's games decreased 4% quarter-over-quarter and increased 4% year-over-year to RMB210, which is consistent with the Company's intention to have ARPU within a range that keeps the Company's games affordable for the majority of Chinese game players.
First Quarter 2011 Unaudited Financial Results
Revenues
Total revenues for the first quarter of 2011 increased 6% quarter-over-quarter and 35% year-over-year to US$97.1 million.
Online game revenues for the first quarter of 2011, which includes revenues from game operations and overseas licensing revenues, increased 3% quarter-over-quarter and 32% year-over-year to US$94.9 million.
Revenues from game operations for the first quarter of 2011 increased 4% quarter-over-quarter and 32% year-over-year to US$92.9 million. The increases were mainly due to the continued popularity of TLBB in China.
Overseas licensing revenues for the first quarter of 2011 decreased 10% quarter-over-quarter and increased 7% year-over-year to US$2.0 million. The sequential decrease was largely the result of greater competition in mature online game markets abroad. The year-over-year increase was mainly due to increased momentum of TLBB in Vietnam and Thailand in the first quarter of 2011.
Other revenues for the first quarter of 2011 were $2.2 million, and reflect cinema advertising revenues from our wholly-owned subsidiary, Shanghai Jing Mao Cultural Communications Ltd. and its affiliate ("Jing Mao"), which were consolidated into the Company's financial statements commencing February 1, 2011.
Gross Profit
Gross profit for the first quarter of 2011 increased 3% quarter-over-quarter and 28% year-over-year to US$85.5 million. Non-GAAP gross profit for the first quarter of 2011 increased 3% quarter-over-quarter and 28% year-over-year to US$85.6 million. Both gross margin and non-GAAP gross margin in the first quarter of 2011 were 88%, which compares with 90% in the fourth quarter of 2010 and 93% in the first quarter of 2010. The decline in gross margin was mainly due to the consolidation of Jing Mao, which operates a lower-margin cinema advertising business, into the Company's financial statements commencing February 1, 2011.
Gross profit and non-GAAP gross profit of the online games business for the first quarter of 2011 increased 4% quarter-over-quarter and 29% year-over-year to US$86.0 million. Both gross margin and non-GAAP gross margin of the online games business for the first quarter of 2011 was 91%, which compares with 90% in the fourth quarter of 2010 and 93% in the first quarter of 2010. Gross loss and non-GAAP gross loss of other business for the first quarter of 2011 were US$0.4 million.
Operating Expenses
For the first quarter of 2011, total operating expenses were US$25.0 million, down 9% quarter-over-quarter and up 17% year-over-year. Non-GAAP operating expenses were US$23.2 million, down 9% quarter-over-quarter and up 26% year-over-year.
GAAP product development expenses decreased 18% quarter-over-quarter and increased 55% year-over-year to US$10.7 million. Non-GAAP product development expenses decreased 17% quarter-over-quarter and increased 83% year-over-year to US$10.0 million. The quarter-over-quarter decreases in both GAAP and non-GAAP product development expenses were mainly because the Company incurred expenses related to royalties for licensed games in the fourth quarter of 2010. The year-over-year increases in both GAAP and non-GAAP product development expenses were mainly due to higher salaries and benefits in the first quarter of 2011.
GAAP sales and marketing expenses decreased 12% quarter-over-quarter and 10% year-over-year to US$8.7 million. Non-GAAP sales and marketing expenses decreased 13% quarter-over-quarter and 11% year-over-year to US$8.5 million. The sequential and year-over-year decreases in GAAP and non-GAAP sales and marketing expenses were primarily due to a reduction in advertising spending in the first quarter of 2011 in order to focus on the preparation for the promotion of the Company's new game, Duke of Mount Deer.
GAAP general and administrative expenses were US$5.5 million, an increase of 23% quarter-over-quarter and 16% year-over-year. Non-GAAP general and administrative expenses were US$4.8 million, an increase of 28% quarter-over-quarter and 37% year-over-year. The sequential increases in GAAP and non-GAAP general and administrative expenses were primarily due to an increase in professional fees in the first quarter of 2011. The year-over-year increases in GAAP and non-GAAP general and administrative expenses were primarily due to higher salaries and benefits in the first quarter of 2011.
Operating Profit
Operating profit for the first quarter of 2011 increased 9% quarter-over-quarter and 34% year-over-year to US$60.5 million. Operating margin in the first quarter of 2011 was 62%, up from 60% in the fourth quarter of 2010 and down from 63% in the first quarter of 2010. Non-GAAP operating profit for the first quarter of 2011 increased 9% quarter-over-quarter and 29% year-over-year to US$62.3 million. Non-GAAP operating margin in the first quarter of 2011 was 64%, up from 62% in the fourth quarter of 2010 and down from 67% in the first quarter of 2010.
Net Income
For the first quarter of 2011, net income increased 11% quarter-over-quarter and 33% year-over-year to US$52.8 million. Non-GAAP net income increased 10% quarter-over-quarter and 28% year-over-year to US$54.6 million. Fully diluted earnings per ADS were US$0.99, up from US$0.90 in the fourth quarter of 2010 and US$0.75 in the first quarter of 2010. Non-GAAP fully diluted earnings per ADS were US$1.02, up from US$0.93 in the fourth quarter of 2010 and US$0.80 in the first quarter of 2010. Net margin for the first quarter of 2011 was 54%, up from 52% in the fourth quarter of 2010 and down from 55% in the first quarter of 2010. Non-GAAP net margin for the first quarter of 2011 was 56%, up from 54% in the fourth quarter of 2010 and down from 59% in the first quarter of 2010.
Cash Balances
As of March 31, 2011, Changyou had a net cash balance of US$406.5 million, up from US$351.0 million as of December 31, 2010. Operating cash flow for the first quarter of 2011 was a net inflow of US$58.9 million.
Other Business Developments
Changyou to Acquire Majority Stake in 7Road
On April 22, 2011, Changyou entered into a definitive agreement under which Changyou will acquire 68.258% of the equity in Shenzhen 7Road Technology Co., Ltd. and its affiliates ("7Road") for fixed cash consideration of approximately US$68.26 million, plus additional variable cash consideration of up to a maximum of US$32.76 million that is contingent upon the achievement of specified performance milestones through December 31, 2012. 7Road is a developer of Web-based games and the creator of DDTank, one of the most popular multiplayer Web-based shooting games in China. The acquisition will broaden Changyou's product offerings to include Web-based games and bring in a team of experienced developers. The acquisition is expected to be completed by June 30, 2011, subject to regulatory approvals and other customary conditions specified in the agreement.
Business Outlook
The following guidance excludes the acquisition of 7Road.
For the second quarter of 2011, Changyou estimates:
-- Total revenues to be between US$97.0 million and US$100.0 million,
including online games revenues of US$95.0 million to US$97.0 million.
-- Non-GAAP net income to be between US$49.0 million and US$50.5 million.
-- Non-GAAP fully diluted earnings per ADS to be between US$0.92 and
US$0.95.
-- Assuming no new grants of share-based awards, share-based compensation
expense to be between US$1.0 million and US$1.5 million, reducing fully
diluted earnings per ADS by US$0.02 to US$0.03.
eastunder
15 years ago
CYOU 3Q earnings 10-26-09 BMO
Changyou.com to Report Third Quarter 2009 Financial Results on October 26, 2009
8:00 am ET 10/13/2009- PR Newswire
BEIJING, Oct. 13 /PRNewswire-Asia/ -- Changyou.com Limited ("Changyou" or
the "Company") (Nasdaq: CYOU), a leading online game developer and operator in
China, will report its third quarter 2009 unaudited financial results on
Monday, October 26, 2009, before U.S. market hours.
(Logo: http://www.newscom.com/cgi-bin/prnh/20090402/CNTH020 )
Changyou's management team will host an earnings conference call on the
same day at 7 a.m. U.S. Eastern Time, October 26, 2009 (7 p.m.Beijing/Hong
Kong, October 26, 2009) following the quarterly results announcement.
To listen to the conference call, please use the dial-in numbers below:
US: +1-866-314-5050
Hong Kong: +852-3002-1672
International: +1-617-213-8051
Please dial in 10 minutes before the call is scheduled to begin and
provide the passcode to join the call. The passcode is "CYOU."
A replay of the conference call may be accessed by phone at the following
number until November 2, 2009:
International: +1-617-801-6888
Passcode: 58929515
The conference call will be available on webcast live and available for
replay at: http://www.changyou.com/ir/.
About Changyou
Changyou.com Limited's ("Changyou") (NASDAQ: CYOU) massively multi-player
online role-playing games ("MMORPG") business began operations as a business
unit within Sohu.com Inc. (NASDAQ: SOHU) in 2003. Changyou was carved out as a
separate, stand-alone company in December 2007 and is now a leading developer
and operator of online games in China and completed an initial public offering
on April 7, 2009. Changyou currently operates three online games, including
the in-house developed Tian Long Ba Bu, one of the most popular online games
in China, and the licensed Blade Online and Blade Hero 2. Changyou's pipeline
games include the licensed Immortal Faith, Legend of the Ancient World, and
the in-house developed Duke of Mount Deer, which received an award as one of
China's most anticipated online games. Changyou's leading technology platform
includes an advanced 2.5D graphics engine, a uniform game development platform,
effective anti-cheating and anti-hacking technologies, proprietary cross-
networking technology and advanced data protection technology. For more
information about Changyou, please visit http://www.changyou.com/en/.
MistySteel
15 years ago
This is what I've been waiting for :)...
Changyou.com Announces Launch of 'Blade Hero 2'
6:00a ET September 9, 2009 (PR NewsWire)
Changyou.com Limited ("Changyou" or the "Company") (Nasdaq: CYOU), a leading online game developer and operator in China, today announced that it has launched Blade Hero 2, the Company's new 2.5D martial arts-style fighting massively multi-player online role-playing game.
Blade Hero 2, created as a sequel to the Company's existing game Blade Online, features a fighting and team-combat system that allows players to experiment with authentic fighting techniques and weapons from different sects of martial arts, including the use of hidden weapons, as well as deploy Chinese combat strategies in battles. Blade Hero 2 also employs the Company's dynamic graphic technology, which can exhibit detailed fighting moves and other special effects to enhance the virtual fighting experience.
Mr. Tao Wang, Changyou's chief executive officer, said, "We are pleased to announce the launch of Blade Hero 2, which supports our strategy to further diversify our game portfolio. Blade Hero 2 includes popular features, and we expect the game to further expand our user base."
Blade Hero 2 began its ultimate closed beta testing today and is now publicly available for game players to download. All game account data will be saved permanently without cancellation.
About Changyou
Changyou.com Limited's ("Changyou") (NASDAQ: CYOU) massively multi-player online role-playing games ("MMORPG") business began operations as a business unit within Sohu.com Inc. (NASDAQ: SOHU) in 2003. Changyou was carved out as a separate, stand-alone company in December 2007 and is now a leading developer and operator of online games in China and completed an initial public offering on April 7, 2009. Changyou currently operates three online games, including the in-house developed Tian Long Ba Bu, one of the most popular online games in China, and the licensed Blade Online and Blade Hero 2. Changyou's pipeline games include the licensed Immortal Faith, Legend of the Ancient World, and the in-house developed Duke of Mount Deer, which received an award as one of China's most anticipated online games. Changyou's leading technology platform includes an advanced 2.5D graphics engine, a uniform game development platform, effective anti-cheating and anti-hacking technologies, proprietary cross-networking technology and advanced data protection technology. For more information about Changyou, please visit http://www.changyou.com/en/ .
Safe Harbor Statement
This announcement contains forward-looking statements. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements involve inherent risks and uncertainties. The Company cautions that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, the current global financial and credit markets crisis and its potential impact on the Chinese economy, the slower growth the Chinese economy experienced during the latter half of 2008 and the first half of 2009, which could continue through the remainder of 2009, the uncertain regulatory landscape in the People's Republic of China, fluctuations in Changyou's quarterly operating results, Changyou's historical and possible future losses and limited operating history, and the Company's reliance on Tian Long Ba Bu as its major revenue source. Further information regarding these and other risks is included in Changyou's Registration Statement on Form F-1 originally filed on March 17, 2009 as amended through March 31, 2009, and other filings with the Securities and Exchange Commission.
For investor and media inquiries, please contact: In China: Ms. Angie Chang Investors Relations Manager Changyou.com Limited Tel: +86-10-5956-3358 Email: ir@cyou-inc.com Ms. Cathy Li Ogilvy Financial, Beijing Tel: +86-10-8520-6104 Email: cathy.li@ogilvy.com In the United States: Ms. Jessica Barist Cohen Ogilvy Financial, New York Tel: +1-646-460-9989 Email: jessica.cohen@ogilvypr.com
SOURCE Changyou.com Limited
http://www.changyou.com/en
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