BEIJING, Nov. 13, 2019 /PRNewswire/ -- Cheetah Mobile Inc.
(NYSE: CMCM) ("Cheetah Mobile" or the "Company"), a leading mobile
internet company with global market coverage, today announced its
unaudited consolidated financial results for the third quarter
ended September 30, 2019.
Management Commentaries
Mr. Sheng Fu, Cheetah Mobile's
Chairman and Chief Executive Officer, stated, "While our utility
products and related services business continued facing some
challenges, we remain confident in the fundamental strength of
Cheetah Mobile and believe we are in the right direction of
developing our AI-related business. In the third quarter of 2019,
we completed the deconsolidation of LiveMe, which will result in a
structural operating margin lift on the corporate level from the
fourth quarter of 2019. Notably, our AI-related business also made
substantial progress in terms of customer adoption and user
engagement. Over the past years, Cheetah Mobile has built a proven
track record in capitalizing on our private investment portfolio.
Going forward, we will look into how to capture investment returns
and use them for business development and shareholder return."
Mr. Vincent Jiang, Cheetah
Mobile's Chief Financial Officer, commented, "In the third quarter
of 2019, we continued to implement cost control measures for our
utility products and related services, which helped generate
RMB24 million in operating profit.
More importantly, Cheetah Mobile continues to have a strong balance
sheet. As of September 30, 2019, we
had cash, cash equivalents, restricted cash, short-term investments
of US$337 million, and long-term
investments of US$348 million, which
includes several prestigious private investments that we invested
in their early rounds."
Third Quarter 2019 Consolidated Financial Results
REVENUES
Total revenues were RMB919.9
million (US$128.7million) in
the third quarter of 2019, decreasing by 32.0% year over year.
Revenues from the mobile entertainment business increased
by 6.9% year over year to RMB532.2
million (US$74.5million) in
the third quarter of 2019.
Revenues from the mobile games business increased by 4.2% year
over year to RMB297.2 million
(US$41.6 million) in the third
quarter of 2019. This increase was mainly attributable to the
continued growth of Bricks n Balls.
Revenues from LiveMe increased by 10.6% year over year to
RMB235.0 million (US$32.9 million) in the third quarter of 2019.
The increase was primarily driven by higher average revenue per
paying user.
Revenues from utility products and related services
decreased by 57.8% year over year to RMB352.9 million (US$49.4
million) in the third quarter of 2019. This year-over-year
decrease was primarily due to the slowdown of activity in overseas
markets for the Company's mobile utility product business.
Continuous headwinds in the domestic online advertising market in
2019 also contributed to this decrease.
COST OF REVENUES AND GROSS PROFIT
Cost of revenues decreased by 4.2% year over year to
RMB365.7 million (US$51.2 million) in the third quarter of 2019.
The year-over-year decrease was due to a significant reduction in
costs associated with the Company's utility product business,
partially offset by the increases in channel costs related to the
Company's mobile games business and costs related to the Company's
AI business. Non-GAAP cost of revenues decreased by 4.2% to
RMB365.6 million (US$51.2 million) in the third quarter of
2019.
Gross profit decreased by 42.9% year over year to
RMB554.2 million (US$77.5 million) in the third quarter of 2019.
Non-GAAP gross profit decreased by 42.9% year over year to
RMB554.3 million (US$77.5 million).
Gross margin was 60.2% in the third quarter of 2019,
compared to 71.8% in the same period last year. Non-GAAP gross
margin was 60.3% in the third quarter of 2019, compared to 71.8% in
the third quarter of 2018.
OPERATING INCOME/LOSS AND EXPENSES
Total operating expenses decreased by 3.7% year over year
to RMB811.2 million (US$113.5 million) in the third quarter of 2019.
Total non-GAAP operating expenses decreased by 4.9% year
over year to RMB775.8 million
(US$108.5 million) in the third
quarter of 2019.
Research and development (R&D) expenses increased by
28.6% year over year to RMB225.5
million (US$31.5 million) in
the third quarter of 2019. This increase was primarily attributable
to the rise in the R&D personnel in the Company's mobile games
and AI-related businesses, partially offset by a reduction in the
personnel in the Company's utility products and related services.
Non-GAAP R&D expenses, which exclude share-based compensation
expenses, increased by 27.0% year over year to RMB211.8 million (US$29.6
million) in the third quarter of 2019.
Selling and marketing expenses decreased by 30.4% year
over year to RMB395.9 million
(US$55.4 million) in the third
quarter of 2019. This decrease was mainly due to reduced
promotional activities for the Company's utility products and
related services business, partially offset by the increased
marketing expenses for the Company's mobile games business.
Non-GAAP selling and marketing expenses, which exclude share-based
compensation expenses, decreased by 29.8% year over year to
RMB396.5 million (US$55.5 million) in the third quarter of
2019.
General and administrative expenses increased by 74.6%
year over year to RMB189.1 million
(US$26.5 million) in the third
quarter of 2019. This year-over-year increase was primarily due to
the one-time asset impairment charges, increases in employee
benefits, and other administrative expenses. Non-GAAP general and
administrative expenses, which exclude share-based compensation
expenses, increased by 77.6% year over year to RMB166.7 million (US$23.3
million) in the third quarter of 2019.
Operating loss was RMB257.1
million (US$36.0 million) in
the third quarter of 2019, compared to an operating profit of
RMB127.9 million in the same period
last year. Non-GAAP operating loss was RMB221.5 million (US$31.0
million) in the third quarter of 2019, compared to an
operating profit of RMB154.2 million
in the same period last year.
The Company has reported its operating profit (loss) along the
following segments since the second quarter of 2017:
Operating profit for utility products and related
services was RMB24.3 million
(US$3.4 million) in the third quarter
of 2019, decreasing from RMB264.1
million in the third quarter of 2018, mainly due to the
revenue decrease and a one-time increase in allowances for doubtful
accounts as the Company periodically review its accounts receivable
and other receivables.
Operating loss for the mobile entertainment business was
RMB142.4 million (US$19.9 million) in the third quarter of 2019,
compared to an operating loss of RMB74.1
million in the same period last year. The increased losses
were mainly attributable to the increased amount of investment made
into the Company's mobile games business as it continued to launch
new titles.
Operating loss for AI and other business was RMB103.4 million (US$14.5
million) in the quarter, compared to an operating loss of
RMB35.8 million in the same period
last year, mainly due to the Company's increased investment in its
AI-related business.
Share-based compensation expenses were RMB35.5 million (US$5.0
million) in the third quarter of 2019, compared to
RMB 26.3 million in the same period
last year.
OTHER INCOME, NET
Other income, net was RMB732.9
million (US$102.5 million) in
the third quarter of 2019, primarily resulting from a one-time
non-cash gain due to the deconsolidation of LiveMe.
NET INCOME ATTRIBUTABLE TO CHEETAH MOBILE
SHAREHOLDERS
Net income attributable to Cheetah Mobile shareholders
was RMB451.5 million (US$63.2 million) in the third quarter of 2019.
Non-GAAP net income attributable to Cheetah Mobile
shareholders was RMB487.1 million
(US$68.1 million) in the third
quarter of 2019.
NET INCOME PER ADS
Diluted earnings per ADS was RMB3.21 (US$0.45)
in the third quarter of 2019. Non-GAAP diluted earnings per ADS was
RMB3.47 (US$0.48) in the third quarter of 2019.
BALANCE SHEET
As of September 30, 2019, the
Company had cash and cash equivalents, restricted cash, and
short-term investments of RMB2,406.1
million (US$336.6
million).
SHARES ISSUED AND OUTSTANDING
As of September 30, 2019, the
Company had a total of 1,393,070,159 Class A and Class B ordinary
shares issued and outstanding. One ADS represents 10 Class A
ordinary shares.
RECENT UPDATES
LiveMe's Amendment of its Share Incentive Plan
On September 30, 2019, LiveMe
amended its share incentive plan to (i) increase the number of
shares to be issued under the current plan and (ii) issue a certain
number of new shares into a trust under the plan for the benefit of
current and future recipients of LiveMe's share incentive awards.
Consequently, Cheetah Mobile was no longer a majority shareholder
of LiveMe and deconsolidated LiveMe's financial results from the
Company's financial statements from September 30, 2019. Meanwhile, LiveMe's Chief
Executive Officer, Ms. Yuki Yandan
He, resigned from her position as the Senior Vice President
of Cheetah Mobile, effective September 30,
2019.
Business Outlook
For the fourth quarter of 2019, the Company expects its total
revenues to be between RMB610 million
(US$85 million) and RMB650 million (US$91
million). This amount has reflected the fact that LiveMe's
revenues will no longer be included in the Company's revenues. This
estimate represents management's preliminary view as of the date of
this release, which is subject to change.
Conference Call Information
The Company will hold a conference call on Wednesday, November 13, 2019 at 8:00 a.m. Eastern Time or 9:00 p.m. Beijing Time to discuss the financial
results. Listeners may access the call by dialing the following
numbers:
International: +1-412-902-4272
United States Toll Free: +1-888-346-8982
China Toll Free: 4001-201-203
Hong Kong Toll Free: 800-905-945
Conference ID: Cheetah Mobile
The replay will be accessible November
20, 2019 by dialing the following numbers:
International: +1-412-317-0088
United States Toll Free: +1-877-344-7529
Access Code: 10136438
A live and archived webcast of the conference call will also be
available at the Company's investor relations website at
http://ir.cmcm.com.
Exchange Rate
This press release contains translations of certain Renminbi
amounts into U.S. dollars at specified rates solely for the
convenience of readers. Unless otherwise noted, all translations
from Renminbi to U.S. dollars in this press release were made at a
rate of RMB7.1477 to US$1.00, the exchange rate in effect as of
September 30, 2019, as set forth in
the H.10 statistical release of the Federal Reserve Board. Such
translations should not be construed as representations that RMB
amounts could be converted into U.S. dollars at that rate or any
other rate, or to be the amounts that would have been reported
under accounting principles generally accepted in the United States of America ("U.S.
GAAP").
About Cheetah Mobile Inc.
Cheetah Mobile is a leading mobile Internet company with global
market coverage. It has attracted hundreds of millions of monthly
active users through its mobile utility products such as Clean
Master and Cheetah Keyboard, casual games such as Piano Tiles 2,
Bricks n Balls, and live streaming product LiveMe. The Company
provides its advertising customers, which include direct
advertisers and mobile advertising networks through which
advertisers place their advertisements, with direct access to
highly targeted mobile users and global promotional channels. The
Company also provides value-added services to its mobile
application users through the sale of in-app virtual items on
selected mobile products and games. Cheetah Mobile is committed to
leveraging its cutting-edge artificial intelligence technologies to
power its products and make the world smarter. It has been listed
on the New York Stock Exchange since May 2014.
Safe Harbor Statement
This press release contains forward-looking statements. These
statements, including management quotes and business outlook,
constitute forward-looking statements under the U.S. Private
Securities Litigation Reform Act of 1995. These forward-looking
statements can be identified by terminology such as "will,"
"expects," "anticipates," "future," "intends," "plans," "believes,"
"estimates" and similar statements. Such statements involve
inherent risks and uncertainties. A number of factors could cause
actual results to differ materially from those contained in the
forward-looking statements, including but are not limited to the
following: Cheetah Mobile's growth strategies; Cheetah Mobile's
ability to retain and increase its user base and expand its product
and service offerings; Cheetah Mobile's ability to monetize its
platform; Cheetah Mobile's future business development, financial
condition and results of operations; competition with companies in
a number of industries including internet companies that provide
online marketing services and internet value-added services;
expected changes in Cheetah Mobile's revenues and certain cost or
expense items; and general economic and business condition globally
and in China. Further information
regarding these and other risks is included in Cheetah Mobile's
filings with the U.S. Securities and Exchange Commission. Cheetah
Mobile does not undertake any obligation to update any
forward-looking statement as a result of new information, future
events or otherwise, except as required under applicable law.
Use of Non-GAAP Financial Measures
To supplement Cheetah Mobile's consolidated financial
information presented in accordance with U.S. GAAP, Cheetah Mobile
uses the following non-GAAP financial measures:
Non-GAAP cost of revenues reflects cost of revenues excluding
the portion of share-based compensation expenses allocated to cost
of revenues.
Non-GAAP gross profit reflects gross profit excluding the
portion of share-based compensation expenses allocated to gross
profit.
Non-GAAP operating income and expenses reflect operating income
and expenses excluding the portion of share-based compensation
expenses allocated to operating expenses.
Non-GAAP operating profit reflects operating profit excluding
share-based compensation expenses.
Non-GAAP net income attributable to Cheetah Mobile shareholders
is net income attributable to Cheetah Mobile shareholders excluding
share-based compensation expenses.
Non-GAAP diluted earnings per ADS is non-GAAP net income
attributable to Cheetah Mobile shareholders excluding net income
attributable to redeemable non-controlling interests, divided by
weighted average number of diluted ADSs.
Adjusted EBITDA is earnings before interest, taxes,
depreciation, amortization, other non-operating income and
share-based compensation expenses.
Free cash flow is net cash generated by operating activities
less capital expenditure.
The Company believes that separate analysis and exclusion of
share-based compensation expenses and the use of Adjusted EBITDA
add clarity to the constituent parts of its performance from the
cash perspective. The Company reviews these non-GAAP financial
measures together with GAAP financial measures to obtain a better
understanding of its operating performance. It uses the non-GAAP
financial measures for planning, forecasting and measuring results
against the forecast. The Company believes that non-GAAP financial
measures are useful supplemental information for investors and
analysts to assess its operating performance without the effect of
share-based compensation expenses, which have been and will
continue to be significant recurring expenses in its business.
However, the use of non-GAAP financial measures has material
limitations as an analytical tool. One of the limitations of using
non-GAAP financial measures is that they do not include all items
that impact the Company's net income for the period. In addition,
because non-GAAP financial measures are not measured in the same
manner by all companies, they may not be comparable to other
similarly titled measures used by other companies. In light of the
foregoing limitations, you should not consider non-GAAP financial
measure in isolation from or as an alternative to the financial
measure prepared in accordance with U.S. GAAP. For more information
on these non-GAAP financial measures, please see the tables
captioned "Cheetah Mobile Inc. Reconciliations of GAAP and Non-GAAP
Results" and "Cheetah Mobile Inc. Reconciliation of Net Income
Attributable to Cheetah Mobile Shareholders to Adjusted EBITDA
(Non-GAAP)" at the end of this release.
Investor Relations Contact
Cheetah Mobile Inc.
Helen Jing Zhu
Tel: +86 10 6292 7779 ext. 1600
Email: helenjingzhu@cmcm.com
ICR Inc.
Jack Wang
Tel: +1 (646) 417-5395
Email: IR@cmcm.com
CHEETAH MOBILE
INC.
|
Condensed
Consolidated Balance Sheets
|
(Unaudited,
amounts in thousands of Renminbi ("RMB") and US dollars
("US$")
|
|
|
As
of
|
|
December 31,
2018
|
|
September 30,
2019
|
|
September 30,
2019
|
|
RMB
|
|
RMB
|
|
USD
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
2,783,843
|
|
1,001,296
|
|
140,086
|
Restricted
cash
|
6,133
|
|
2,720
|
|
381
|
Short-term
investments
|
930,610
|
|
1,402,129
|
|
196,165
|
Accounts
receivable
|
655,261
|
|
496,273
|
|
69,431
|
Prepayments and other
current assets
|
1,064,714
|
|
1,015,290
|
|
142,044
|
Due from related
parties
|
126,990
|
|
416,162
|
|
58,223
|
Total current
assets
|
5,567,551
|
|
4,333,870
|
|
606,330
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
Property and
equipment, net
|
63,919
|
|
80,074
|
|
11,203
|
Right-of-use assets,
net*
|
-
|
|
197,562
|
|
27,640
|
Intangible assets,
net
|
48,421
|
|
55,336
|
|
7,742
|
Goodwill
|
617,837
|
|
549,303
|
|
76,850
|
Investment in equity investees
|
151,533
|
|
698,140
|
|
97,673
|
Other long term investments
|
1,697,510
|
|
1,792,524
|
|
250,783
|
Due from related
parties
|
21,139
|
|
25,887
|
|
3,622
|
Deferred tax
assets
|
88,896
|
|
82,752
|
|
11,577
|
Other non-current
assets
|
35,830
|
|
33,815
|
|
4,731
|
Total non-current
assets
|
2,725,085
|
|
3,515,393
|
|
491,821
|
|
|
|
|
|
|
Total
assets
|
8,292,636
|
|
7,849,263
|
|
1,098,151
|
|
|
|
|
|
|
LIABILITIES,
MEZZANINE EQUITY AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts
payable
|
171,055
|
|
77,749
|
|
10,877
|
Accrued expenses and
other current liabilities
|
1,514,642
|
|
1,307,412
|
|
182,914
|
Due to related
parties
|
37,298
|
|
72,876
|
|
10,196
|
Income tax
payable
|
112,770
|
|
84,324
|
|
11,797
|
Total current
liabilities
|
1,835,765
|
|
1,542,361
|
|
215,784
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
Deferred tax
liabilities
|
110,291
|
|
148,188
|
|
20,732
|
Other non-current
liabilities*
|
64,185
|
|
269,219
|
|
37,666
|
Total non-current
liabilities
|
174,476
|
|
417,407
|
|
58,398
|
|
|
|
|
|
|
Total
liabilities
|
2,010,241
|
|
1,959,768
|
|
274,182
|
|
|
|
|
|
|
Mezzanine
equity:
|
|
|
|
|
|
Redeemable
noncontrolling interests
|
687,847
|
|
-
|
|
-
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
Ordinary
shares
|
230
|
|
224
|
|
31
|
Treasury
stock
|
(221,932)
|
|
-
|
|
-
|
Additional paid-in
capital
|
2,742,893
|
|
2,616,181
|
|
366,017
|
Retained
earnings
|
2,705,970
|
|
2,766,463
|
|
387,042
|
Accumulated other
comprehensive income
|
249,304
|
|
392,433
|
|
54,903
|
Total Cheetah
Mobile shareholders' equity
|
5,476,465
|
|
5,775,301
|
|
807,993
|
Noncontrolling
interests
|
118,083
|
|
114,194
|
|
15,976
|
|
|
|
|
|
|
Total
equity
|
5,594,548
|
|
5,889,495
|
|
823,969
|
|
|
|
|
|
|
Total liabilities,
mezzanine equity and equity
|
8,292,636
|
|
7,849,263
|
|
1,098,151
|
|
|
|
|
|
|
|
|
|
|
|
|
* On January 1, 2019,
the company adopted ASC 842, the new lease standard, using the
modified retrospective basis and did not
restate comparative periods.
|
CHEETAH MOBILE
INC.
|
Condensed
Consolidated Statements of Comprehensive Income
(Loss)
|
(Unaudited,
amounts in thousands of Renminbi ("RMB") and US dollars ("US$"),
except for number of shares and per share (or ADS)
data)
|
|
|
For The Three
Months Ended
|
|
September 30,
2018
|
|
June 30,
2019
|
|
September 30,
2019
|
|
September 30,
2019
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
Revenues
|
1,351,979
|
|
970,145
|
|
919,919
|
|
128,701
|
Utility products and
related services
|
835,606
|
|
423,524
|
|
352,932
|
|
49,377
|
Mobile
entertainment
|
497,911
|
|
498,021
|
|
532,234
|
|
74,462
|
AI and
others
|
18,462
|
|
48,600
|
|
34,753
|
|
4,862
|
|
|
|
|
|
|
|
|
Cost of revenues
(a)
|
(381,692)
|
|
(326,982)
|
|
(365,748)
|
|
(51,170)
|
Gross
profit
|
970,287
|
|
643,163
|
|
554,171
|
|
77,531
|
|
|
|
|
|
|
|
|
Operating income
and expenses:
|
|
|
|
|
|
|
|
Research and
development (a)
|
(175,303)
|
|
(211,369)
|
|
(225,492)
|
|
(31,547)
|
Selling and marketing
(a)
|
(568,445)
|
|
(381,818)
|
|
(395,875)
|
|
(55,385)
|
General and
administrative (a)
|
(108,270)
|
|
(117,644)
|
|
(189,085)
|
|
(26,454)
|
Impairment of
goodwill and intangible assets
|
-
|
|
-
|
|
(2,380)
|
|
(333)
|
Other operating
income
|
9,595
|
|
11,957
|
|
1,602
|
|
224
|
Total operating
income and expenses
|
(842,423)
|
|
(698,874)
|
|
(811,230)
|
|
(113,495)
|
|
|
|
|
|
|
|
|
Operating profit
(loss)
|
127,864
|
|
(55,711)
|
|
(257,059)
|
|
(35,964)
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest income,
net
|
24,120
|
|
31,988
|
|
27,556
|
|
3,855
|
Foreign exchange gain
(loss) , net
|
10,532
|
|
1,280
|
|
(1,336)
|
|
(187)
|
Gain from equity
method investments, net
|
2,479
|
|
10,566
|
|
3,396
|
|
475
|
Other income,
net
|
1,242
|
|
33,766
|
|
732,852
|
|
102,530
|
|
|
|
|
|
|
|
|
Income before
taxes
|
166,237
|
|
21,889
|
|
505,409
|
|
70,709
|
Income tax (expenses)
benefits
|
(26,957)
|
|
24,422
|
|
(56,819)
|
|
(7,949)
|
Net
income
|
139,280
|
|
46,311
|
|
448,590
|
|
62,760
|
Less: net loss
attributable to noncontrolling interests
|
(27,757)
|
|
(2,220)
|
|
(2,946)
|
|
(412)
|
Net income
attributable to Cheetah Mobile shareholders
|
167,037
|
|
48,531
|
|
451,536
|
|
63,172
|
|
|
|
|
|
|
|
|
Earnings per
share
|
|
|
|
|
|
|
|
Basic
|
0.11
|
|
0.03
|
|
0.32
|
|
0.05
|
Diluted
|
0.11
|
|
0.03
|
|
0.32
|
|
0.04
|
|
|
|
|
|
|
|
|
Earnings per
ADS
|
|
|
|
|
|
|
|
Basic
|
1.12
|
|
0.28
|
|
3.22
|
|
0.45
|
Diluted
|
1.09
|
|
0.28
|
|
3.21
|
|
0.45
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding
|
|
|
|
|
|
|
|
Basic
|
1,408,570,797
|
|
1,367,557,150
|
|
1,368,904,228
|
|
1,368,904,228
|
Diluted
|
1,440,581,762
|
|
1,388,236,454
|
|
1,376,116,022
|
|
1,376,116,022
|
Weighted average
number of ADSs outstanding
|
|
|
|
|
|
|
|
Basic
|
140,857,080
|
|
136,755,715
|
|
136,890,423
|
|
136,890,423
|
Diluted
|
144,058,176
|
|
138,823,645
|
|
137,611,602
|
|
137,611,602
|
|
|
|
|
|
|
|
|
Other
comprehensive income, net of tax of nil
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
149,722
|
|
93,367
|
|
127,208
|
|
17,797
|
Unrealized (loss) gain on
available-for-sale securities, net
|
-
|
|
3,872
|
|
(698)
|
|
(98)
|
Other
comprehensive income
|
149,722
|
|
97,239
|
|
126,510
|
|
17,699
|
Total
comprehensive income
|
289,002
|
|
143,550
|
|
575,100
|
|
80,459
|
Less: Total
comprehensive loss attributable to
noncontrolling interests
|
(17,293)
|
|
(1,698)
|
|
(2,048)
|
|
(287)
|
Total
comprehensive income attributable to Cheetah
Mobile shareholders
|
306,295
|
|
145,248
|
|
577,148
|
|
80,746
|
Condensed
Consolidated Statements of Comprehensive Income (Loss)
|
(Unaudited,
amounts in thousands of Renminbi ("RMB") and US dollars ("US$"),
except for number of shares and per share(or ADS)
data)
|
|
|
For The Three
Months Ended
|
|
September 30,
2018
|
|
June 30,
2019
|
|
September 30,
2019
|
|
September 30,
2019
|
(a) Share-based
compensation expenses
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
Cost of
revenues
|
46
|
|
143
|
|
114
|
|
16
|
Research and
development
|
8,563
|
|
13,578
|
|
13,686
|
|
1,915
|
Selling and
marketing
|
3,317
|
|
593
|
|
(660)
|
|
(92)
|
General and
administrative
|
14,380
|
|
19,640
|
|
22,379
|
|
3,131
|
Total
|
26,306
|
|
33,954
|
|
35,519
|
|
4,970
|
CHEETAH MOBILE
INC.
|
Reconciliation of
GAAP and Non-GAAP Results
|
(Unaudited, in'000,
except for per share data and percentage)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended September 30, 2019
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
Non-GAAP
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
Result
($)
|
Revenues
|
919,919
|
|
|
|
|
|
|
|
919,919
|
|
|
|
128,701
|
Cost of
revenues
|
(365,748)
|
|
39.8%
|
|
114
|
|
0.0%
|
|
(365,634)
|
|
39.7%
|
|
(51,154)
|
Gross
profit
|
554,171
|
|
60.2%
|
|
114
|
|
0.0%
|
|
554,285
|
|
60.3%
|
|
77,547
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(225,492)
|
|
24.5%
|
|
13,686
|
|
1.5%
|
|
(211,806)
|
|
23.0%
|
|
(29,632)
|
Selling and
marketing
|
(395,875)
|
|
43.0%
|
|
(660)
|
|
0.1%
|
|
(396,535)
|
|
43.1%
|
|
(55,477)
|
General and
administrative
|
(189,085)
|
|
20.6%
|
|
22,379
|
|
2.4%
|
|
(166,706)
|
|
18.1%
|
|
(23,323)
|
Impairment of
goodwill and intangible assets
|
(2,380)
|
|
0.3%
|
|
-
|
|
0.0%
|
|
(2,380)
|
|
0.3%
|
|
(333)
|
Other operating
income
|
1,602
|
|
0.2%
|
|
-
|
|
0.0%
|
|
1,602
|
|
0.2%
|
|
224
|
Total operating
income and expenses
|
(811,230)
|
|
88.2%
|
|
35,405
|
|
3.8%
|
|
(775,825)
|
|
84.3%
|
|
(108,541)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
(257,059)
|
|
27.9%
|
|
35,519
|
|
3.9%
|
|
(221,540)
|
|
24.1%
|
|
(30,994)
|
Net income
attributable to Cheetah Mobile shareholders
|
451,536
|
|
49.1%
|
|
35,519
|
|
3.9%
|
|
487,055
|
|
52.9%
|
|
68,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.32
|
|
|
|
0.03
|
|
|
|
0.35
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
3.21
|
|
|
|
0.26
|
|
|
|
3.47
|
|
|
|
|
Diluted earnings per
ADS (USD)
|
0.45
|
|
|
|
0.03
|
|
|
|
0.48
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended June 30, 2019
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
|
Revenues
|
970,145
|
|
|
|
|
|
|
|
970,145
|
|
|
|
|
Cost of
revenues
|
(326,982)
|
|
33.7%
|
|
143
|
|
0.0%
|
|
(326,839)
|
|
33.7%
|
|
|
Gross
profit
|
643,163
|
|
66.3%
|
|
143
|
|
0.0%
|
|
643,306
|
|
66.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(211,369)
|
|
21.8%
|
|
13,578
|
|
1.4%
|
|
(197,791)
|
|
20.4%
|
|
|
Selling and
marketing
|
(381,818)
|
|
39.4%
|
|
593
|
|
0.1%
|
|
(381,225)
|
|
39.3%
|
|
|
General and
administrative
|
(117,644)
|
|
12.1%
|
|
19,640
|
|
2.0%
|
|
(98,004)
|
|
10.1%
|
|
|
Other operating
income
|
11,957
|
|
1.2%
|
|
-
|
|
0.0%
|
|
11,957
|
|
1.2%
|
|
|
Total operating
income and expenses
|
(698,874)
|
|
72.0%
|
|
33,811
|
|
3.5%
|
|
(665,063)
|
|
68.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
(55,711)
|
|
5.7%
|
|
33,954
|
|
3.5%
|
|
(21,757)
|
|
2.2%
|
|
|
Net income
attributable to Cheetah Mobile shareholders
|
48,531
|
|
5.0%
|
|
33,954
|
|
3.5%
|
|
82,485
|
|
8.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.03
|
|
|
|
0.02
|
|
|
|
0.05
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
0.28
|
|
|
|
0.24
|
|
|
|
0.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For The Three
Months Ended September 30, 2018
|
|
|
|
GAAP
|
|
% of
Net
|
|
Share-based
|
|
% of
Net
|
|
Non-GAAP
|
|
% of
Net
|
|
|
|
Result
|
|
Revenues
|
|
Compensation
|
|
Revenues
|
|
Result
|
|
Revenues
|
|
|
Revenues
|
1,351,979
|
|
|
|
|
|
|
|
1,351,979
|
|
|
|
|
Cost of
revenues
|
(381,692)
|
|
28.2%
|
|
46
|
|
0.0%
|
|
(381,646)
|
|
28.2%
|
|
|
Gross
profit
|
970,287
|
|
71.8%
|
|
46
|
|
0.0%
|
|
970,333
|
|
71.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
(175,303)
|
|
13.0%
|
|
8,563
|
|
0.6%
|
|
(166,740)
|
|
12.3%
|
|
|
Selling and
marketing
|
(568,445)
|
|
42.0%
|
|
3,317
|
|
0.2%
|
|
(565,128)
|
|
41.8%
|
|
|
General and
administrative
|
(108,270)
|
|
8.0%
|
|
14,380
|
|
1.1%
|
|
(93,890)
|
|
6.9%
|
|
|
Other operating
income
|
9,595
|
|
0.7%
|
|
-
|
|
0.0%
|
|
9,595
|
|
0.7%
|
|
|
Total operating
income and expenses
|
(842,423)
|
|
62.3%
|
|
26,260
|
|
1.9%
|
|
(816,163)
|
|
60.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
profit
|
127,864
|
|
9.5%
|
|
26,306
|
|
1.9%
|
|
154,170
|
|
11.4%
|
|
|
Net income
attributable to Cheetah Mobile shareholders
|
167,037
|
|
12.4%
|
|
26,306
|
|
1.9%
|
|
193,343
|
|
14.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
ordinary share (RMB)
|
0.11
|
|
|
|
0.02
|
|
|
|
0.13
|
|
|
|
|
Diluted earnings per
ADS (RMB)
|
1.09
|
|
|
|
0.18
|
|
|
|
1.27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHEETAH MOBILE
INC.
|
Information about
Segment
|
(Unaudited, in'000,
except for percentage)
|
|
|
For The Three
Months Ended September 30, 2019
|
|
|
Utility
Products
and
Related Services
|
|
Mobile
Entertainment
|
|
AI and
others
|
|
Unallocated*
|
|
Consolidated
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
USD
|
Revenue
|
352,932
|
|
532,234
|
|
34,753
|
|
-
|
|
919,919
|
128,701
|
Operating profit
(loss)
|
24,248
|
|
(142,423)
|
|
(103,365)
|
|
(35,519)
|
|
(257,059)
|
(35,964)
|
Operating
margin
|
6.9%
|
|
(26.8)%
|
|
(297.4)%
|
|
|
|
(27.9)%
|
(27.9)%
|
|
|
|
For The Three
Months Ended June 30, 2019
|
|
|
Utility
Products
and
Related Services
|
|
Mobile
Entertainment
|
|
AI and
others
|
|
Unallocated*
|
|
Consolidated
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
Revenue
|
423,524
|
|
498,021
|
|
48,600
|
|
-
|
|
970,145
|
|
Operating profit
(loss)
|
121,079
|
|
(68,398)
|
|
(74,438)
|
|
(33,954)
|
|
(55,711)
|
|
Operating
margin
|
28.6%
|
|
(13.7)%
|
|
(153.2)%
|
|
|
|
(5.7)%
|
|
|
|
|
For The Three
Months Ended September 30, 2018
|
|
|
Utility
Products
and
Related Services
|
|
Mobile
Entertainment
|
|
AI and
others
|
|
Unallocated*
|
|
Consolidated
|
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
RMB
|
|
Revenue
|
835,606
|
|
497,911
|
|
18,462
|
|
-
|
|
1,351,979
|
|
Operating profit
(loss)
|
264,139
|
|
(74,121)
|
|
(35,848)
|
|
(26,306)
|
|
127,864
|
|
Operating
margin
|
31.6%
|
|
(14.9)%
|
|
(194.2)%
|
|
|
|
9.5%
|
|
|
* Unallocated
expenses refer to SBC expenses that are not allocated to individual
segments.
|
CHEETAH MOBILE
INC.
|
Reconciliation
from Net Income Attributable to Cheetah Mobile Shareholders to
Adjusted EBITDA (Non-GAAP)
|
(Unaudited, in
'000)
|
|
For The Three
Months Ended
|
|
September 30,
2018
|
June 30,
2019
|
September 30,
2019
|
September 30,
2019
|
|
RMB
|
RMB
|
RMB
|
USD
|
Net income
attributable to Cheetah Mobile shareholders
|
167,037
|
48,531
|
451,536
|
63,172
|
Add:
|
|
|
|
|
Income tax expenses
(benefits)
|
26,957
|
(24,422)
|
56,819
|
7,949
|
Interest income,
net
|
(24,120)
|
(31,988)
|
(27,556)
|
(3,855)
|
Depreciation and
amortization
|
17,826
|
16,809
|
16,193
|
2,265
|
Net loss attributable
to noncontrolling interests
|
(27,757)
|
(2,220)
|
(2,946)
|
(412)
|
Other non-operating
income, net
|
(14,253)
|
(45,612)
|
(734,912)
|
(102,818)
|
Share-based
compensation
|
26,306
|
33,954
|
35,519
|
4,970
|
Adjusted
EBITDA
|
171,996
|
(4,948)
|
(205,347)
|
(28,729)
|
CHEETAH MOBILE
INC.
|
Revenues Generated
from PC-based and Mobile-based Applications and
Services
|
(Unaudited, in
'000)
|
|
For The Three
Months Ended
|
|
September 30,
2018
|
June 30,
2019
|
September 30,
2019
|
September 30,
2019
|
|
RMB
|
RMB
|
RMB
|
USD
|
PC
|
143,322
|
142,346
|
123,789
|
17,319
|
Mobile
|
1,208,657
|
827,799
|
796,130
|
111,382
|
Total
|
1,351,979
|
970,145
|
919,919
|
128,701
|
CHEETAH MOBILE
INC.
|
Revenues Generated
from Domestic and Overseas Markets
|
(Unaudited, in
'000)
|
|
For The Three
Months Ended
|
|
September 30,
2018
|
June 30,
2019
|
September 30,
2019
|
September 30,
2019
|
|
RMB
|
RMB
|
RMB
|
USD
|
Domestic
|
536,435
|
382,396
|
299,339
|
41,879
|
Overseas
|
815,544
|
587,749
|
620,580
|
86,822
|
Total
|
1,351,979
|
970,145
|
919,919
|
128,701
|
View original
content:http://www.prnewswire.com/news-releases/cheetah-mobile-announces-third-quarter-2019-unaudited-consolidated-financial-results-300957426.html
SOURCE Cheetah Mobile Inc