0001104659-20-052748 | 20-F | XBRL Viewer

Document and Entity Information	12 Months Ended
Document and Entity Information	Dec. 31, 2019 $ / shares shares
Document Information [Line Items]
Entity Registrant Name	WEIBO CORPORATION
Document Registration Statement	false
Document Annual Report	true
Document Transition Report	false
Document Shell Company Report	false
Entity File Number	001-36397
Entity Central Index Key	0001595761
Document Type	20-F
Entity Incorporation, State or Country Code	E9
Entity Address, Address Line One	8/F, QIHAO Plaza
Entity Address, Address Line Two	No. 8 Xinyuan S. Road
Entity Address, Address Line Three	Chaoyang District
Entity Address, City or Town	Beijing
Entity Address, Country	CN
Entity Address, Postal Zip Code	100027
Document Period End Date	Dec. 31, 2019
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Emerging Growth Company	false
Entity Shell Company	false
Document Accounting Standard	U.S. GAAP
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Amendment Flag	false
Business Contact [Member]
Document Information [Line Items]
Entity Address, Address Line One	8/F, QIHAO Plaza
Entity Address, Address Line Two	No. 8 Xinyuan S. Road
Entity Address, Address Line Three	Chaoyang District
Entity Address, City or Town	Beijing
Entity Address, Country	CN
Entity Address, Postal Zip Code	100027
Country Region	+86
City Area Code	10
Local Phone Number	5898-3095
Contact Personnel Fax Number	+86 10 8260-8888
Contact Personnel Name	Fei Cao
ADS
Document Information [Line Items]
Title of 12(b) Security	American depositary shares, each representing one Class A ordinary shares
Entity Listing, Depository Receipt Ratio	1
Trading Symbol	WB
Security Exchange Name	NASDAQ
Ordinary Shares
Document Information [Line Items]
Entity Common Stock, Shares Outstanding	226,309,878
Class A ordinary shares
Document Information [Line Items]
Title of 12(b) Security	Class A ordinary Shares, par value $0.00025 per share*
Entity Listing, Par Value Per Share \| $ / shares	$ 0.00025
No Trading Symbol Flag	true
Entity Common Stock, Shares Outstanding	124,530,920
Class B ordinary shares
Document Information [Line Items]
Entity Common Stock, Shares Outstanding	101,778,958

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 1,452,985	$ 1,234,596
Short-term investments	951,235	591,269
Accounts receivable,net allowances for doubtful amounts	422,225	369,093
Prepaid expenses and other current assets (including loans to and interest receivables from other related parties of $43,695 and $301,526 as of December 31, 2018 and 2019, respectively)	424,905	168,821
Amount due from SINA (Note 10)	384,828	105,319
Total current assets	3,636,178	2,469,098
Property and equipment, net	46,729	45,623
Operating lease assets	9,730
Intangible assets, net	17,524	21,103
Goodwill	28,989	29,346
Long-term investments	1,027,459	694,586
Other assets	37,577	14,926
Total assets	4,804,186	3,274,682
Current liabilities (including amounts of the consolidated VIEs without recourse to the primary beneficiary of $347,770 and $436,705 as of December 31, 2018 and 2019, respectively.)
Accounts payable	126,247	123,730
Accrued and other liabilities	460,872	317,437
Operating lease liability, short-term	4,708
Income taxes payable	100,245	88,683
Deferred revenues	108,783	99,994
Total current liabilities	800,855	629,844
Long-term liabilities
Convertible debt	888,266	884,123
Unsecured senior notes	793,985
Deferred tax liability	33,972	12,577
Operating lease liability, long-term	5,289
Total long-term liabilities	1,721,512	896,700
Total liabilities	2,522,367	1,526,544
Commitments and contingencies (Note 17)
Shareholders' equity:
Ordinary shares: $0.00025 par value; 2,400,000 and 2,400,000 shares (including 1,800,000 Class A ordinary shares, 200,000 Class B ordinary shares and 400,000 shares to be designated) authorized; 224,838 shares (including 123,059 Class A ordinary shares and 101,779 Class B ordinary shares) and 226,310 shares (including 124,531 Class A ordinary shares and 101,779 Class B ordinary shares) issued and outstanding as of December 31, 2018 and 2019, respectively.	57	57
Additional paid-in capital	1,133,913	1,071,836
Accumulated other comprehensive loss	(68,559)	(49,615)
Retained earnings	1,217,856	723,181
Total Weibo shareholders' equity	2,283,267	1,745,459
Non-controlling interests	(1,448)	2,679
Total shareholders' equity	2,281,819	1,748,138
Total liabilities and shareholders' equity	4,804,186	3,274,682
Third parties
Current assets:
Accounts receivable,net allowances for doubtful amounts	262,158	190,036
Alibaba
Current assets:
Accounts receivable,net allowances for doubtful amounts	60,392	48,222
Other related parties
Current assets:
Accounts receivable,net allowances for doubtful amounts	$ 99,675	$ 130,835

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues:
Revenues	$ 1,766,914	$ 1,718,518	$ 1,150,054
Costs and Expenses
Cost of revenues	328,826	277,648	231,255
Sales and marketing	465,339	527,424	275,537
Product development	284,444	249,873	193,393
General and administrative	90,721	43,755	42,315
Goodwill and acquired intangibles impairment		10,554
Total costs and expenses	1,169,330	1,109,254	742,500
Income from operations	597,584	609,264	407,554
Income (loss) from equity method investments	(13,198)	57	1,030
Realized gain (loss) from investments	612	(287)	14
Fair value changes through earnings on investments, net	207,438	40,074
Investment related impairment	(249,935)	(24,074)	(4,747)
Interest and other income, net	59,896	43,808	13,260
Income before income tax expenses	602,397	668,842	417,111
Provision of income taxes	109,564	96,222	66,746
Net income	492,833	572,620	350,365
Less: Net income (loss) attributable to non-controlling interests	(1,842)	797	(2,225)
Net income attributable to Weibo	494,675	571,823	352,590
Other comprehensive income (loss)
Currency translation adjustments (net of tax of nil, nil, and nil for 2017, 2018 and 2019, respectively)	(19,029)	(60,273)	37,822
Available-for-Sale securities
Change in unrealized loss from available-for-sale securities (net of tax of nil, nil, and nil for 2017, 2018, and 2019, respectively)			(995)
Total comprehensive income	473,804	512,347	387,192
Less: Comprehensive income (loss) attributable to non-controlling interests	(1,927)	668	(1,926)
Comprehensive income attributable to Weibo	$ 475,731	$ 511,679	$ 389,118
Shares used in computing net income per share attributable to Weibo:
Basic (in shares)	225,452	223,751	220,555
Diluted (in shares)	226,412	232,683	225,363
Income per share:
Basic (in dollars per share)	$ 2.19	$ 2.56	$ 1.60
Diluted (in dollars per share)	$ 2.18	$ 2.52	$ 1.56
Advertising & Marketing
Revenues:
Revenues	$ 1,530,211	$ 1,499,180	$ 996,745
Value-added services
Revenues:
Revenues	236,703	219,338	153,309
Alibaba \| Advertising & Marketing
Revenues:
Revenues	97,772	117,696	84,688
SINA and other related parties \| Advertising & Marketing
Revenues:
Revenues	230,002	209,348	131,512
Third parties \| Advertising & Marketing
Revenues:
Revenues	$ 1,202,437	$ 1,172,136	$ 780,545

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Ordinary Shares	Additional Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings (Accumulated Deficit)	Non-controlling Interests	Total
Balance at Dec. 31, 2016	$ 55	$ 979,805	$ (26,994)	$ (199,641)	$ 4,133	$ 757,358
Balance (in shares) at Dec. 31, 2016	218,076
Increase (Decrease) in Shareholders' Equity
Issuance of ordinary shares pursuant to stock plan	$ 1	2,206				2,207
Issuance of ordinary shares pursuant to stock plan (in shares)	4,630
Non-cash stock-based compensation		48,037				48,037
Net income (loss)				352,590	(2,225)	350,365
Currency translation adjustments			37,523		299	37,822
Unrealized loss from available-for-sale securities			(995)			(995)
Balance at Dec. 31, 2017	$ 56	1,030,048	9,534	152,949	2,207	1,194,794
Balance (in shares) at Dec. 31, 2017	222,706
Increase (Decrease) in Shareholders' Equity
Issuance of ordinary shares pursuant to stock plan	$ 1	777				778
Issuance of ordinary shares pursuant to stock plan (in shares)	2,132
Non-cash stock-based compensation		41,011				41,011
Net income (loss)				571,823	797	572,620
Currency translation adjustments			(60,144)		(129)	(60,273)
Purchase of subsidiaries' shares from non-controlling shareholders					(196)	(196)
Balance at Dec. 31, 2018	$ 57	1,071,836	(49,615)	723,181	2,679	$ 1,748,138
Balance (in shares) at Dec. 31, 2018	224,838					224,838
Increase (Decrease) in Shareholders' Equity
Impact of adoption of new accounting guidance (Note 2) \| Impact of adoption of new revenue guidance				(596)		$ (596)
Impact of adoption of new accounting guidance (Note 2) \| Impact of adoption of new guidance for investments in equity securities			995	(995)
Issuance of ordinary shares pursuant to stock plan		319				319
Issuance of ordinary shares pursuant to stock plan (in shares)	1,472
Non-cash stock-based compensation		61,289				61,289
Net income (loss)				494,675	(1,842)	492,833
Currency translation adjustments			(18,944)		(85)	(19,029)
Purchase of subsidiaries' shares from non-controlling shareholders		469			(2,200)	(1,731)
Balance at Dec. 31, 2019	$ 57	$ 1,133,913	$ (68,559)	$ 1,217,856	$ (1,448)	$ 2,281,819
Balance (in shares) at Dec. 31, 2019	226,310					226,310

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net income	$ 492,833	$ 572,620	$ 350,365
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	25,772	19,847	15,328
Stock-based compensation	61,289	41,011	48,037
Amortization of operating lease - right of use assets	3,793
Provision for allowance for doubtful accounts	38,561	6,226	5,478
Deferred income taxes	16,839	4,438	(1,503)
(Income) Loss from equity method investments	13,198	(57)	(1,030)
Dividend received from equity method investments	932	657	267
(Gain) Loss on sale of investments	(612)	287	(14)
Fair value changes through earnings on investment	(207,438)	(40,074)
Investment related impairment	249,935	24,074	4,747
Goodwill and acquired intangibles impairment		10,554
Gain on disposal of property and equipment	(120)	(120)	(85)
Amortization of convertible debt and unsecured senior notes issuance cost	4,803	4,140	690
Changes in assets and liabilities, net of acquisition:
Prepaid expenses and other current assets	(20,128)	(49,381)	(28,050)
Other assets	(101)	(1,044)	(649)
Accounts payable	5,161	64,277	22,121
Accrued and other liabilities	117,606	55,560	88,474
Deferred revenues	11,254	24,375	31,967
Operating lease liabilities	(3,502)
Income taxes payable	11,463	20,968	62,323
Net cash provided by operating activities	631,653	488,007	539,151
Cash flows from investing activities:
Purchases of short-term investments	(1,230,596)	(1,792,481)	(1,439,558)
Maturities of short-term investments	869,792	1,989,055	696,245
Cash paid (including prepayment) on long-term investments	(688,920)	(419,126)	(54,640)
Proceeds from disposal of/refund of prepayment on long-term investments	60,307	85,134	2,458
Proceeds from disposal of property and equipment	122	136	107
Purchases of property and equipment	(21,746)	(28,350)	(20,454)
Cash paid for business acquisition, net of cash acquired		(40,000)	(2,298)
Net cash used in investing activities	(1,201,358)	(254,032)	(815,422)
Cash flows from financing activities:
Proceeds from employee options exercised	275	781	2,285
Proceeds from unsecured senior notes, net of debt issuance costs	793,325
Payments to non-controlling shareholders	(1,731)	(196)
Net cash provided by (used in) financing activities	791,869	(1,415)	883,578
Effect of exchange rate changes on cash and cash equivalents	(3,775)	1,083	28,880
Net increase in cash and cash equivalents	218,389	233,643	636,187
Cash and cash equivalents at the beginning of the year	1,234,596	1,000,953	364,766
Cash and cash equivalents at the end of the year	1,452,985	1,234,596	1,000,953
Supplemental disclosure of cash flow information
Cash paid for income tax	(80,666)	(70,060)	(8,168)
Supplemental schedule of non-cash investing and financing activities
Property and equipment in accounts payable	4,693	5,258	3,667
Unpaid consideration for acquisitions		10,000
Consideration settled for acquisition (Note 10)	(10,000)
2022 Notes
Cash flows from financing activities:
Proceeds from convertible notes, net of debt issuance costs	879,300		879,293
Supplemental disclosure of cash flow information
Cash paid for interest expenses	(11,250)	(11,719)
Alibaba
Changes in assets and liabilities, net of acquisition:
Accounts receivable due	(13,032)	(8,028)	(18,539)
Other related parties
Changes in assets and liabilities, net of acquisition:
Accounts receivable due	28,362	(103,982)	410
SINA
Changes in assets and liabilities, net of acquisition:
Amount due to (from) SINA	(90,129)	(48,687)	209
Cash flows from investing activities:
Loan to SINA	(233,884)	(149,460)	(59,534)
Repayment of loan by SINA	43,567	101,060	62,252
Cash flows from financing activities:
Loan from SINA			62,000
Repayment of loan from SINA		(2,000)	(60,000)
Supplemental disclosure of cash flow information
Cash paid for interest expenses			(1,537)
Third parties
Changes in assets and liabilities, net of acquisition:
Accounts receivable due	$ (115,086)	$ (109,654)	$ (41,395)

Operations

12 Months Ended

Dec. 31, 2019

Operations

Operations

1. Operations

Weibo Corporation (“Weibo” or the “Company”) is a leading social media for people to create, share and discover content. It provides an unprecedented and simple way for people and organizations to publicly express themselves in real time, interact with others on a massive global platform and stay connected with the world. As a microcosm of the Chinese society and a cultural phenomenon in China, Weibo allows people to be heard publicly and exposed to the rich ideas, cultures and experiences of the broader world. Media outlets use Weibo as a source of news and a distribution channel for their headline news. Government agencies and officials use Weibo as an official communication channel for disseminating information timely and gauging public opinion to improve public services. Charities use Weibo to make the world a better place by launching charitable projects, seeking donations and volunteers and leveraging celebrities and organizations on Weibo to amplify their impact to society. Weibo generates its revenues mostly from advertising and marketing services, as well as from value-added services, including VIP membership, live streaming, and game-related services.

Incorporated in the Cayman Islands, Weibo Corporation is a controlled subsidiary of Sina Corporation (the “Parent” or “SINA”). In April 2014, the Company completed an initial public offering (the “IPO”) and received $306.5 million in net proceeds. Immediately prior to the completion of the IPO, all the ordinary shares held by SINA was converted into an equal number of the Class B ordinary shares, all the ordinary shares held by other shareholders was converted into an equal number of the Class A ordinary shares, and all of its outstanding preferred shares were automatically converted into Class A ordinary shares. The call option held by a subsidiary of Alibaba Group was exercised to purchase Class A ordinary shares from SINA and the Company. Each Class A ordinary share is entitled to one vote per share and each Class B ordinary share is entitled to three votes per share. Each Class B ordinary share can be converted into one Class A ordinary share at any time, while Class A ordinary shares cannot be converted into Class B ordinary shares.

Weibo Corporation, an exempted company with limited liability, is the holding company for the Weibo business. Weibo HK is a wholly owned subsidiary of Weibo, and Weibo Technology, a wholly foreign-owned enterprise, (“the WFOE”), is a subsidiary of Weibo HK. The operation of Weibo business is carried out by various subsidiaries and variable interest entities (“VIE”) of the Company. The Company’s VIEs and VIEs’ subsidiaries are controlled by the WFOE through a series of contractual agreements. Weibo Corporation, its subsidiaries, VIEs and VIEs’ subsidiaries together are referred to as “the Group.”

The following sets forth the Company’s major subsidiaries, major VIE and major VIE’s subsidiary:


			Percentage of
			Direct/
			Indirect
	Date of	Place of	Economic
Company	Incorporation	Incorporation	Interest
Major Subsidiaries
Weibo Hong Kong Limited (“Weibo HK”)	July 19, 2010	Hong Kong	100	%

Weibo Internet Technology (China) Co., Ltd. (“Weibo Technology” or "the WFOE”)	October 11, 2010	PRC	100	%

Major VIE and major VIE's subsidiary
Beijing Weimeng Technology Co., Ltd (“Weimeng")	August 9, 2010	PRC	100	%

Beijing Weibo Interactive Internet Technology Co., Ltd. (“Weibo Interactive”)	Acquired in May 2013	PRC	100	%

Intellectual Property License Agreement

The intellectual property license agreement was entered into by and between SINA and the Company in April 2013. Under this agreement, SINA granted the Company and its subsidiaries a perpetual, worldwide, royalty-free, fully paid-up, non-sub licensable, non-transferable, limited, exclusive license of certain trademarks and a non-exclusive license of certain other intellectual property owned by SINA to make, sell, offer to sell and distribute products, services and applications on a microblogging and social networking platform. The Company granted SINA and its affiliates a non-exclusive, perpetual, worldwide, non-sub licensable, non-transferable limited license of certain of the Company’s intellectual property to use, reproduce, modify, prepare derivative works of, perform, display or otherwise exploit such intellectual property. This agreement commenced on April 29, 2013 and will continue to be in effect unless terminated by SINA should the Company breach the terms as provided in the agreement.

Transactions between SINA and Weibo

Accounts receivable directly related to Weibo but for which SINA will receive payments and remit payments to the Group, as well as accounts receivable directly from SINA, are included in the amount due from SINA. Liabilities directly related to Weibo but for which SINA will make payments and receive reimbursements from the Group, as well as liabilities directly to SINA, are included in the amount due to SINA. Loans from SINA are presented under cash flow from financing activities, whereas loans to SINA are presented under investing activities in the consolidated statements of cash flows. Cash payment for billings from SINA for costs and expenses allocated is presented under operating activities in the consolidated statements of cash flows. The Group’s consolidated statements of comprehensive income contains all the related costs and expenses of the Weibo business, including allocation to the cost of revenues, sales and marketing expenses, product development expenses, and general and administrative expenses, which are incurred by SINA but related to the Weibo business. These allocations were based on proportional cost allocation by considering proportion of the revenues, infrastructure usage metrics and labor usage metrics, among other things, attributable to the Group and are made on a basis considered reasonable by management.

Total cost and expenses allocated from SINA were as follows:


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Cost of revenues	$	13,699	$	16,824	$	22,246
Sales and marketing		9,732		11,558		9,770
Product development		11,312		11,688		13,141
General and administrative		6,393		7,264		6,691
	$	41,136	$	47,334	$	51,848

While the costs and expenses allocated to the Group for these items are not necessarily indicative of the costs and expenses that would have been incurred if the Group had been a separate and independent entity, the Company does not believe that there is any significant difference between the nature and amount of these allocated costs and expenses and the ones that would have been incurred if the Group had been a separate and stand-alone entity.

Consolidation

The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, VIEs, of which the Company is the primary beneficiary, and VIEs' subsidiaries. All significant intercompany balances and transactions have been eliminated.

To comply with PRC laws and regulations, the Group provides a substantial amount of its services in China via the VIEs, which holds critical operating licenses that enable the Group to do business in China. Most of the Group’s revenues, costs and expense, and net income in China were generated directly or indirectly through the VIEs. The Company, through the WFOE, has signed various agreements with the VIEs to allow the transfer of economic benefits from the VIEs to the Company. The Group has determined that it is the primary beneficiary of the VIEs through Weibo Technology’s contractual arrangements with the VIEs. Accordingly, the Company has consolidated the VIEs’ results of operations and assets and liabilities in the Group’s financial statements pursuant to the United States Generally Accepted Accounting Principles (“US GAAP”) for all the periods presented.

Shareholders of the VIEs are certain nominee shareholders from the Company or SINA. The capital for their investments in the VIEs is funded by the Company and recorded as interest-free loans to these individuals. These loans were eliminated with the capital of the VIEs during consolidation. Each shareholder of the VIEs has agreed to transfer their equity interest in the VIEs to Weibo Technology when permitted by PRC laws and regulations or to designees of the Company at any time for the amount of loans outstanding. All voting rights of the VIEs, including without limitation the right to appoint all directors of the VIEs, has been assigned to Weibo Technology. Weibo Technology has also entered into exclusive technical service agreements with the VIEs under which Weibo Technology provides technical and other services to the VIEs in exchange for substantially all net income of the VIEs. In addition, the shareholders of the VIEs have pledged their shares in the VIEs as collateral for the non-payment of loans or for the technical and other services fees due to Weibo Technology. As of December 31, 2018 and 2019, the total amount of interest-free loans to the VIEs’ shareholders was $82.1 million and $81.1 million, respectively. The aggregate accumulated income of the VIEs and VIEs’ subsidiaries was $23.2 million and $33.1 million as of December 31, 2018 and 2019, which were included in the Group’s consolidated financial statements.

The following table sets forth the assets, liabilities, results of operations and cash flows of the VIEs and VIEs’ subsidiaries taken as a whole, which are included in the Group’s consolidated balance sheets, consolidated statements of comprehensive income and consolidated statements of cash flows:


	As of December 31,
	2018		2019
	(In thousands)
Cash, cash equivalents and short-term investments	$	55,506	$	99,465
Accounts receivable		366,128		420,686
Prepaid expenses and other current assets		121,210		101,363
Amount due from SINA		31,787		116,535
Property and equipment, net		449		243
Operating lease assets		—		686
Intangible assets, net		21,103		17,524
Goodwill		29,346		28,989
Long-term investments		275,819		380,420
Deferred tax assets		5,778		10,608
Others		1,464		8,625
Total assets	$	908,590	$	1,185,144

Accounts payable	$	79,881	$	86,417
Accrued and other liabilities		181,188		254,564
Deferred revenues		65,531		66,533
Income taxes payable		21,170		28,970
Amount due to the subsidiaries of the Group		440,563		632,900
Operating lease liability		—		586
Deferred tax liability		11,875		11,453
Total liabilities	$	800,208	$	1,081,423


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Net revenues	$	906,129	$	1,416,367	$	1,472,867
Net income after intercompany service fee charge	$	21,252	$	56,466	$	9,874


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Net cash provided by (used in) operating activities	$	(66,972)	$	46,738	$	(100,987)
Net cash used in investing activities	$	(34,720)	$	(331,243)	$	(280,404)
Net cash provided by financing activities	$	76,232	$	292,151	$	441,952
Net increase (decrease) in cash and cash equivalents	$	(25,460)	$	7,646	$	60,561

Under the contractual arrangements with the VIEs, the Company has the power to direct activities of the VIEs through Weibo Technology and can have assets transferred freely out of the VIEs without restrictions. Therefore, the Company considers that there is no asset of the VIEs that can only be used to settle obligations of the VIEs and VIEs’ subsidiaries, except for the registered capital and non-distributable reserve funds of the VIEs and VIEs’ subsidiaries, amounting to $144.1 million and $152.0 million as of December 31, 2018 and 2019, respectively. Since the VIEs are incorporated as limited liability companies under the PRC Company Law, creditors of the VIEs do not have recourse to the general credit of the Company. There is currently no contractual arrangement that would require the Company to provide additional financial support to the VIEs. As the Company is conducting certain businesses mainly through the VIEs, the Company may provide such support on a discretionary basis in the future, which could expose the Company to a loss. The total amount of costs and expenses allocated from SINA to the VIEs was $21.4 million, $25.6 million and $27.6 million for the years ended December 31, 2017, 2018 and 2019, respectively.

Unrecognized revenue-producing assets held by the VIEs include the Internet Content Provision License, the Online Culture Operating Permit, the domain names of Weibo.com, Weibo.cn and Weibo.com.cn and so on. Recognized revenue-producing assets held by the VIEs include live streaming platform technology, supplier-relationship contracts, and trademark and domain names, which were acquired through the previous acquisitions. Unrecognized revenue-producing assets, including customer lists relating to advertising and marketing services, VIP membership, and game-related services, as well as trademarks, are also held by Weibo Technology.

The following is a summary of the VIEs agreements:

Loan Agreements. The Company’s wholly owned subsidiary Weibo Technology has granted interest-free loans to each shareholder of the VIEs with the sole purpose of providing funds necessary for capital injection into the VIEs. The terms of the loans are for 10 years, and Weibo Technology has the right to, at its own discretion, shorten or extend the terms of the loans, if necessary. These loans were eliminated with the capital of the VIEs during consolidation.

Share Transfer Agreements. Each shareholder of the VIEs has granted Weibo Technology an option to purchase his shares in the VIEs at a purchase price equal to the amount of the capital injection. Weibo Technology may exercise such option at any time until it has acquired all of the shares of the VIEs, subject to applicable PRC laws. The option will be effective until the earlier of (i) the shareholders of the VIEs and Weibo Technology have fully performed their obligations under this agreement, and (ii) the respective shareholders of the VIEs and Weibo Technology agree to terminate the share transfer agreement in writing.

Loan Repayment Agreements. Each shareholder of the VIEs has agreed with Weibo Technology that the interest-free loans under the loan agreements shall only be repaid through share transfer. Once the share transfers are completed, the purchase price for the share transfer will be set off against the loan repayment. These agreements will be effective until the earlier of (i) Weibo Technology and the shareholders of the VIEs have fully performed their obligations under these agreements, and (ii) Weibo Technology and the shareholders of the VIEs agree in writing to terminate these agreements.

Agreements on Authorization to Exercise Shareholder’s Voting Power. Each shareholder of the VIEs has authorized Weibo Technology to exercise all his voting power as a shareholder of the VIEs on all matters requiring shareholders’ approval under PRC laws and regulations and the articles of association of the VIEs, including without limitation to the appointment of directors, transfer, mortgage or dispose of the VIEs’ assets, transfer of any equity interest in the VIEs, and merger, split, dissolution and liquidation of the VIEs. The authorizations are irrevocable and will not expire until the VIEs dissolve.

Share Pledge Agreements. Each shareholder of the VIEs has pledged all of his shares in the VIEs and all other rights relevant to the share rights to Weibo Technology, as a collateral security for his obligations to pay off all debts to Weibo Technology, under the loan agreement and for the payment obligations of the VIEs under the trademark license agreement and the technical services agreement. In the event of default of any payment obligations, Weibo Technology will be entitled to certain rights, including transferring the pledged shares to itself and disposing the pledged shares through sale or auction. During the term of each agreement, Weibo Technology is entitled to receive all dividends and distributions paid on the pledged shares. The pledges will be effective until the earlier of (i) the third anniversary of the due date of the last guaranteed debt, (ii) the VIEs and the shareholders of the VIEs have fully performed their obligations under the above-referred agreements, and (iii) Weibo Technology unilaterally consents to terminate the respective share pledge agreement.

Exclusive Technical Services Agreement, Exclusive Sales Agency Agreement and Trademark License Agreement. The VIEs have entered into an exclusive technical services agreement, an exclusive sales agency agreement and a trademark license agreement with Weibo Technology. Under the exclusive technical services agreement, Weibo Technology is engaged to provide technical services for the VIEs’ online advertising and other related businesses. Under the exclusive sales agency agreement, the VIEs have granted Weibo Technology the exclusive right to distribute, sell and provide agency services for all the products and services provided by the VIEs. The term of the technical service agreement and the sales agency agreement will not expire until the VIEs dissolve.

Due to its control over the VIEs, Weibo Technology has the right to determine the service fees to be charged to the VIEs under these agreements. By considering, among other things, the technical complexity of the service, the actual cost that may be incurred for providing such service, the operations of the VIEs, applicable tax rates, planned capital expenditure and business strategies, Weibo Technology charged an amount of $618.1 million, $842.6 million and $834.8 million in service fees from the VIEs under these agreements for the years ended December 31, 2017, 2018 and 2019, respectively, which was determined based on the actual cost incurred for providing such service and the cash position and operation of the VIEs.

Under the trademark license agreement, Weibo Technology has granted the VIEs trademark licenses to use its trademarks for specific areas, and the VIEs are obligated to pay license fees to Weibo Technology. The term of the agreement is for one year and is automatically renewed provided that there is no objection from Weibo Technology.

The Company believes that the contractual arrangements among the WFOE, VIEs and VIEs’ shareholders are in compliance with the current PRC laws and legally enforceable. However, uncertainties in the interpretation and enforcement of the PRC laws, regulations and policies could limit the Company’s ability to enforce these contractual arrangements. As a result, the Company may be unable to consolidate the VIEs and VIEs’ subsidiaries in the consolidated financial statements. The Company’s ability to control the VIEs also depends on the authorization by the shareholders of the VIEs to exercise voting rights on all matters requiring shareholder approval in the VIEs. The Company believes that the agreements on authorization to exercise shareholder’s voting power are legally enforceable. In addition, if the legal structure and contractual arrangements with the VIEs were found to be in violation of any future PRC laws and regulations, the Company may be subject to fines or other actions. The Company believes the possibility that it will no longer be able to control and consolidate the VIEs as a result of the aforementioned risks and uncertainties is remote.

Significant Accounting Policies

12 Months Ended

Dec. 31, 2019

Significant Accounting Policies

Significant Accounting Policies

2. Significant Accounting Policies

Basis of presentation

The preparation of the Group’s consolidated financial statements is in conformity with U.S. GAAP. The consolidated financial statements include the accounts of Weibo, its wholly owned subsidiaries, VIEs, and VIEs’ subsidiaries. All significant intercompany balances and transactions have been eliminated.

Use of estimates

Conformity with U.S. GAAP requires the use of estimates and judgments that affect the reported amounts in the consolidated financial statements and accompanying notes. These estimates form the basis for judgments the management makes about the carrying values of the assets and liabilities, which are not readily apparent from other sources. U.S. GAAP requires making estimates and judgments in several areas, including, but not limited to, the basis of consolidation, revenue recognition, fair value accounting, income taxes, goodwill and other long-lived assets, allowances for doubtful accounts, stock-based compensation, the estimated useful lives of assets, convertible debt, business combination, and foreign currency. The management bases the estimates and judgments on historical information and on various other assumptions that management believes are reasonable under the circumstances. Actual results could differ materially from such estimates.

Revenue recognition

In May 2014, the Financial Accounting Standards Board ("FASB") issued, ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)”. The Group adopted the new revenue guidance since January 1, 2018, using the modified retrospective method. Results for reporting periods beginning on or after January 1, 2018 are presented under ASC 606, while prior periods amounts are not adjusted and continue to be reported in accordance with the Group’s historic accounting method under ASC 605. The main impacts are a) the presentation of value added tax recognized in revenue from "gross" to "net", which results in equal decrease of revenues and cost of revenues, and b) the recognition of revenues and expenses at fair value for advertising barter transactions, which mainly results in the increase of revenue and advertising expenses. The cumulative-effect adjustment on the retained earnings as of January 1, 2018 related to the initial application of the new revenue standard was a decrease of $0.6 million, which resulted from advertising barter transactions.

Under ASC 606, revenues are recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those goods or services. The Group identifies its contracts with customers and all performance obligations within those contracts. The Group then determines the transaction price and allocates the transaction price to the performance obligations within the Group's contracts with customers, recognizing revenue when, or as, the Group satisfies its performance obligations.

The Group does not believe that significant management judgments are involved in revenue recognition, but the amount and timing of the Group’s revenues could be different for any period if management made different judgments. Certain customers may receive sales rebates, which are accounted for as variable consideration. The Group estimates annual expected revenue volume of each individual agent with reference to their historical results. The Group recognizes revenue for the amount of fees it receives from its advertisers, after deducting estimated sales rebates and net of value-added tax (“VAT”) under ASC 606. The Group believes that there will not be significant changes to its estimates of variable consideration.

Revenue disaggregated by revenue source for the years ended December 31, 2017, 2018 and 2019 consists of the following:


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Advertising and marketing revenues	$	996,745	$	1,499,180	$	1,530,211
Value-added services revenues		153,309		219,338		236,703
Total revenues	$	1,150,054	$	1,718,518	$	1,766,914

The Group enters into contracts with its customers, which may give rise to contract assets (unbilled revenue) or contract liabilities (deferred revenue). The payment terms and conditions within the Group’s contracts vary by the type and location of its customers and products or services purchased, the substantial majority of which are due in less than one year. No material impact on the contract assets arose from the new guidance of revenue recognition. Deferred revenue related to unsatisfied performance obligations at the end of the period mainly consists of the unamortized balance of customer advance of advertising and marketing services. The deferred revenues are recognized based on customers' consumption or amortized on a straight-line basis through the service period for different products/services. Due to the generally short-term duration of the contracts, the majority of the performance obligations are satisfied in the following reporting period. The amount of revenue recognized that was included in the deferred revenue balance at the beginning of the periods was $67.2 million and $88.3 million for the years ended December 31, 2018 and 2019, respectively.

Practical Expedients and Exemptions

The Group generally expenses sales commissions when incurred because the amortization period is generally one year or less. These costs are recorded within sales and marketing expenses.

Advertising and marketing revenues

Advertising and marketing revenues are derived principally from online advertising, including social display ads and promoted marketing. Social display ad arrangements allow customers to place advertisements on particular areas of the Group’s platform or website in particular formats and over particular periods of time, which is typically no more than three months. The Group enters into cost per mille (“CPM”), or cost per thousand impressions, advertising arrangements with the customers, under which the Group recognizes revenues based on the number of times that the advertisement has been displayed. The Group also enters into cost per day (“CPD”) advertising arrangements with customers, under which the Group recognizes revenues ratably over the contract periods. Promoted marketing arrangements are primarily priced based on CPM. Under the CPM model, customers are obligated to pay when the advertisement is displayed.

The Group’s majority revenue transactions are based on standard business terms and conditions, which are recognized net of agency rebates. The agency rebates are accounted for as variable consideration and are estimated during interim periods based on estimated annual revenue volume of each individual agent with reference to their historical results, which involves accounting judgment. The Group believes its estimation approach in variable consideration results in revenue recognition in a manner consistent with the underlying economics of the transaction.

The Group’s contracts with customers may include multiple performance obligations, which primarily consist of combination of service to allow customers to place advertisements on different areas of its platform or website. For such arrangements, advertising arrangements involving multiple deliverables are broken down into single-element arrangements based on their stand-alone selling price for revenue recognition purposes. The estimation of stand-alone selling price involves significant judgment, especially for the deliverables that have not been sold separately. For those deliverables, the Group determines best estimate of the stand-alone selling price by taking into consideration of the pricing of advertising areas of the Group’s platform or website with similar popularities and advertisements with similar formats and quoted prices from competitors and other market conditions. The Group believes the estimation approach in stand-alone selling price and allocation of the transaction price on a relative stand-alone selling price to each performance obligation results in revenue recognition in a manner consistent with the underlying economics of the transaction and the allocation principle included in ASC 606. Revenues recognized with reference to best estimation of selling price were immaterial for all periods presented. Most of such contracts have all performance obligations completed within one year. Changes in judgments on these assumptions and estimates could materially impact the timing or amount of revenue recognition. Contracts with customers of online advertising may require cooperation from third parties. The Group pays a predetermined portion of revenues it earned from advertising contracts to the third parties such as key opinion leaders who participate in advertising and promotion activities by monetizing their social assets. The Group has determined that it is the principal in these transactions, as it is primarily responsible for fulfilling all the obligations related to advertising contracts. The Group has discretion in establishing pricing of the contracts and controls the advertising inventory before the delivery to customers. The Group records revenues derived from such contracts on a gross basis and the portion paid to the third parties is recognized as cost of revenues.

Revenues from barter transactions are recognized during the period in which the advertisements are displayed on the Group’s properties. Barter transactions in which physical goods or services are received in exchange for advertising services are recorded based on the fair values of the goods or services received.

Value-added services revenues

The Group generates value-added services revenues principally from fee-based services, mainly including VIP membership, live streaming, and game-related services. Revenues from these services are recognized when control of the promised services is transferred to customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those services.

VIP membership. VIP membership is a service package consisting of one performance obligation of providing user certification and preferential benefits, such as daily priority listings and higher quota for following user accounts. Prepaid VIP membership fees are recorded as deferred revenue and recognized as revenue ratably over the contract period of the membership service.

Live streaming. Live streaming generates revenue from sales of virtual items on the live-streaming platform (“Yizhibo”). Users can access the platform and view the live streaming content and interact with the broadcasters for free.

The Group designs, creates and offers various virtual items for sales to users with pre-determined selling price. Each virtual item is considered as a distinctive performance obligation. Sales proceeds are recorded as deferred revenue and recognized as revenue based on the consumption of the virtual items. Users can purchase and present virtual items to broadcasters to show support for their favorite ones. Under the arrangements with broadcasters or broadcaster agencies, the Group shares with them a portion of the revenues derived from the consumption of virtual items. Revenues derived from the sale of virtual items are recorded on a gross basis as the Group has determined that it acts as the principal to fulfill all obligations related to the live streaming services. The portion paid to broadcasters and/or broadcaster agencies is recognized as cost of revenues. The Group does not have further obligations to the user after the virtual items are consumed.

Game-related services. Game-related service revenues are mostly generated from the purchase of virtual items by game players through the Group’s platform. Each virtual item is considered as a distinctive performance obligation. The Group collects payments from the game players in connection with the sale of virtual currency, which can be used to purchase virtual items in online games. Revenue is recorded on a gross basis for games that the Group is acting as the principal in fulfilling all obligations related to the games and revenue is recorded net of predetermined revenue sharing with the game developers for games in which the Group is not acting as the principal in fulfilling all obligations. Sales of virtual currencies are recognized as revenues over the estimated consumption period of in-game virtual items, which is typically from a few days to one month. Virtual currency sold for game-related services in excess of recognized revenues is recorded as deferred revenues.

Cost of revenues

Cost of revenues consists mainly of costs associated with the maintenance of platform, which primarily include bandwidth and other infrastructure costs, labor cost and turnover taxes levied on the revenues, part of which were allocated from SINA. Prior to the adoption of ASC606, the Group presents taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction on a gross basis in the financial statements. The Group is subject to 6.7% Value-Added Tax ("VAT") and surcharges for its revenues and an additional 3% cultural business construction fees for its advertising and marketing revenues. Pursuant to the adoption of ASC 606 effectively beginning January 1, 2018, the new guidance of revenue recognition requires the presentation of Value-Added Tax (“VAT”) recognized in revenue from "gross" to "net", which results in equal decrease of revenues and cost of revenues. Moreover, the 3% cultural business construction fees was reduced to 1.5% since July 1, 2019. The total amount of such taxes on its advertising and marketing revenues for the years ended December 31, 2017, 2018 and 2019 were $90.6 million, $52.9 million and $40.7 million, respectively, with VAT not included in the cost of revenues for the years ended December 31, 2018 and 2019.

Sales and Marketing Expenses

Sales and marketing expenses consist mainly of online and offline advertising and promotional expenses, salary, benefits and commission expenses, and facility expenses. Advertising and promotional expenses generally represent the expenses of promotions of corporate image and product marketing. The Group expenses all advertising and promotional expenses as incurred and classifies these expenses under sales and marketing expenses. Pursuant to the adoption of ASC 606 effectively beginning January 1, 2018, the new guidance of revenue recognition requires the recognition of revenues and expenses at fair value for advertising barter transactions, which mainly results in the increase of revenue and advertising expenses. For the years ended December 31, 2017, 2018 and 2019, the advertising and promotional expenses were $200.6 million, $428.8 million and $352.3 million, respectively.

Product development expenses

Product development expenses consist mainly of payroll-related expenses and infrastructure costs incurred for enhancement to and maintenance of the Group’s platform, as well as costs associated with new product development and product enhancements, part of which were allocated from SINA. The Group expenses all costs incurred for the planning and post implementation phases of development and costs associated with repair or maintenance of the existing site or the development of platform content. Since inception, the amount of costs qualifying for capitalization has been immaterial and, as a result, all product development costs have been expensed as incurred.

Stock-based compensation

All stock-based awards to employees and directors, such as stock options and restricted share units (“RSUs”), are measured at the grant date based on the fair value of the awards. Stock-based compensation, net of forfeitures, is recognized as expenses on a straight-line basis over the requisite service period, which is the vesting period.

The Group uses the Black-Scholes option pricing model to estimate the fair value of stock options. The determination of estimated fair value of stock-based payment awards on the grant date using an option pricing model is affected by the fair value of the Company’s ordinary shares as well as assumptions regarding a number of complex and subjective variables. These variables include the expected value volatility of the Company over the expected term of the awards, actual and projected employee stock option exercise behaviors, a risk-free interest rate and expected dividends, if any. Options granted generally vest over four years.

The Group recognizes the estimated compensation cost of restricted share units based on the fair value of its ordinary shares on the date of the grant. The Group recognizes the compensation cost, net of estimated forfeitures, over a vesting term of generally four years for service-based restricted share units. The Group also recognizes the compensation cost of performance-based restricted share units, net of estimated forfeitures, if it is probable that the performance condition will be achieved at the end of each reporting period.

Forfeitures are estimated at the time of grant and revised in subsequent periods if actual forfeitures differ from those estimates. The Group uses historical data to estimate pre-vesting option and records stock-based compensation expense only for those awards that are expected to vest. See Note 7 Stock-based Compensation for further discussion on stock-based compensation.

Taxation

Income taxes

Income taxes are accounted for using the asset and liability approach. Under this approach, income tax expense is recognized for the amount of taxes payable or refundable for the current year. In addition, deferred tax assets and liabilities are recognized for expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carry forwards. The Group records a valuation allowance to reduce deferred tax assets to an amount for which realization is more likely than not.

Uncertain tax positions. To assess uncertain tax positions, the Group applies a more likely than not threshold and a two-step approach for the tax position measurement and financial statement recognition. Under the two-step approach, the first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement.

Cash equivalents

The Group considers all highly liquid investments with original maturities of three months or less as cash equivalents. Cash equivalents are comprised of investments in time deposits that mature within three months stated at cost plus accrued interest.

Accounts receivable and allowances for doubtful accounts

Accounts receivable are recorded and carried at the original invoiced amount less an allowance for any potential uncollectible amounts. The Group maintains an allowance for doubtful accounts which reflects its best estimate of amounts that will not be collected. The Group determines the allowance for doubtful accounts based on a historical, rolling average, bad debt rate in the prior period and other factors, such as credit-worthiness of the customers and the age of the receivable balances. The Group also provides specific provisions for bad debts when facts and circumstances indicate that the receivable is unlikely to be collected. If the financial condition of the Group’s customers were to deteriorate, resulting in impairment of their ability to make payments, more bad debt allowances may be required.

Fair value measurements

Financial instruments

All financial assets and liabilities are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis. Accounting guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability.

The Group measures the equity method investments at fair value on a non-recurring basis only if an impairment charge were to be recognized. For those investments without readily determinable fair value, the Group measures them at fair value when observable price changes are identified or impairment charge was recognized. The fair values of the Group’s privately held investments as disclosed are determined based on the discounted cash flow model using the discount curve of market interest rates or based on the similar transaction price in the market directly. The fair values of the Group’s long-term investments in the equity securities of publicly listed companies are measured using quoted market prices. The Group’s non-financial assets, such as intangible assets, goodwill, fixed assets and operating lease assets, would be measured at fair value only if they were determined to be impaired.

Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value:

●

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

●

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical asset or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

●

Level 3 applies to asset or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The carrying amount of cash and cash equivalents, short-term investments, accounts receivable due from third parties, accounts receivable due from Alibaba, accounts receivable due from other related parties, amount due from/to SINA, accounts payable, accrued and other liabilities approximates fair value because of their short-term nature. See Note 15 Fair Value Measurement for additional information.

Long-term investments

Long-term investments are comprised of investments in publicly traded companies, privately held companies, and limited partnerships. The Group uses the equity method to account for ordinary-share-equivalent equity investments on which it has significant influence but does not own a majority equity interest or otherwise control.

Adoption of ASU 2016-01 and Its Implication

Before the adoption of ASU 2016-01 in 2018, the Group used cost method to account for equity investments on which the Group does not have significant influence, or the investments in which the Group holds equity shares that are not common shares/in-substance common share without readily determinable fair value. For marketable equity securities, the Group reported them at fair value and accounted for them as available-for-sale (“AFS”) securities under long-term investments.

After adopting ASU 2016-01 on January 1, 2018, the Group measures investments in equity securities, other than equity method investments, at fair value through earnings. For those investments without readily determinable fair values, the Group elects to record these investments at cost, less impairment, plus or minus subsequent adjustments for observable price changes. Under this measurement alternative, changes in the carrying value of the investments will be recognized in consolidated statement of comprehensive income, whenever there are observable price changes in orderly transactions for the identical or similar investment of the same issuer.

The marketable equity securities were reclassified as investments with readily determinable fair values under the ASU 2016-01. There will no longer be an available-for-sale classification for equity securities. The cumulative effects of applying the guidance to the Group’s consolidated balance sheets were the reclassification of unrealized loss of $1.0 million from accumulated other comprehensive income to retained earnings as of January 1, 2018.

Pursuant to ASC 321, for equity investments measured at fair value with changes in fair value recorded in earnings, the Group does not assess whether those securities are impaired. For equity investments without readily determinable fair value for which the Group has elected to use the measurement alternative, the Group makes a qualitative assessment of whether the investment is impaired at each reporting date, applying significant judgement in considering various factors and events including a) adverse performance of investees; b) adverse industry developments affecting investees; and c) adverse regulatory, social, economic or other developments affecting investees. If a qualitative assessment indicates that the investment is impaired, the Group estimates the investment’s fair value in accordance with the principles of ASC 820. If the fair value is less than the investment’s carrying value, the Group recognizes an impairment loss in net income equal to the difference between the carrying value and fair value. Significant judgement is applied by the Group in estimating the fair value to determine if an impairment exists, and if so, to measure the impairment losses for these equity security investments. These judgements include the selection of valuation methods in estimating fair value and the determination of key valuation assumptions used, including cash flow forecasts and critical assumptions used in cash flow forecasts. Prior to 2018, these securities were classified as available-for-sale securities and measured and recorded at fair value with unrealized changes in fair value recorded through other comprehensive income.

Investments in entities which the Group can exercise significant influence and holds an investment in voting common shares or in-substance common shares (or both) of the investee but does not own a majority equity interest or control are accounted for using the equity method of accounting in accordance with ASC topic 323 (“ASC 323”), Investment -— Equity Method and Joint Ventures. Under the equity method, the Group initially records its investments at cost and the difference between the cost of the equity investee and the fair value of the underlying equity in the net assets of the equity investee is recognized as equity method goodwill, which is included in the equity method investment on the consolidated balance sheets. The Group subsequently adjusts the carrying amount of the investments to recognize the Group’s proportionate share of each equity investee’s net income or loss into earnings after the date of investment. The Group evaluates the equity method investments for impairment under ASC 323. An impairment loss on the equity method investments is recognized in earnings when the decline in value is determined to be other-than-temporary.

Business combination

Business combinations are recorded using the purchase method of accounting, and the cost of an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued as well as the contingent considerations and all contractual contingencies as of the acquisition date. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of the (i) the total of consideration paid, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the subsidiary acquired over (ii) the fair value of the identifiable net assets of the subsidiary acquired is recorded as goodwill. If the consideration of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated statements of comprehensive income.

Leases

In February 2016, the FASB issued a new standard on leases, ASU 2016-02, “Leases (Topic 842)”, which requires a lessee to recognize assets and liabilities arising from operating leases. A lessee should recognize a liability to make lease payments (the Lease Liability) and a right-of-use asset (the Operating Lease Assets) representing its right to use the underlying asset for the lease term. For leases with a term of twelve months or less, a lessee is permitted to make an accounting policy choice not to recognize lease assets and lease liabilities. In July 2018, the FASB issued an amendment, ASU 2018-11, which provides another transition method in addition to the existing transition methods by allowing entities to initially apply the new leases standard at the effective date and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption and to not retrospectively adjust prior periods financial statements.

On January 1, 2019, the Group adopted the new lease standard using the transition method by applying the standard to all leases existing at the date of initial application. The Group chose to not recognize lease assets and lease liabilities for leases with a term of twelve months or less, to not separate non-lease components from lease components, and to not reassess lease classification, treatment of initial direct costs or whether an existing or expired contract contains a lease according to the practical expedients permitted under the transition method.

The Group did not retrospectively adjust the prior comparative periods. Under the new lease standard, the Group determines if an arrangement is or contains a lease at inception. Right-of-use assets and liabilities are recognized at lease commencement date based on the present value of remaining lease payments over the lease terms. The Group considers only payments that are fixed and determinable at the time of lease commencement. The adoption of new leasing guidance resulted in recognition of $14.4 million of right-of-use asset and $14.9 million of leasing liability as of January 1, 2019, respectively, and no impact to the beginning retained earnings of the year.

Long-lived assets

Property and equipment

Property and equipment are stated at cost less accumulated depreciation, amortization and impairment, if any. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally from three to four years for computers and equipment and five years for furniture and fixtures. Leasehold improvements are amortized over the shorter of the estimated useful lives of the assets or the remaining lease term. Depreciation expenses were $14.7 million, $18.5 million and $22.4 million for the years ended December 31, 2017, 2018 and 2019, respectively.

Goodwill

Goodwill represents the excess of the purchase price over the fair value of the identifiable assets and liabilities acquired as a result of the Group’s acquisitions of interests in its subsidiaries and consolidated VIE. The Group assesses goodwill for impairment in accordance with ASC Subtopic 350-20 (“ASC 350-20”), Intangibles - Goodwill and Other: Goodwill, which requires that goodwill be tested for impairment at the reporting unit level at least annually and more frequently upon the occurrence of certain events, as defined by ASC 350-20. U.S. GAAP provides the option to apply the qualitative assessment first and then the quantitative assessment, if necessary, or to apply the quantitative assessment directly. The qualitative approach starts the goodwill impairment test by assessing qualitative factors, which by taking into consideration of macroeconomics, overall financial performance, industry and market conditions and the share price of the Group, to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If so, the quantitative impairment test is performed; otherwise, no further testing is required. When the Group performs the quantitative impairment test, the Group firstly determines whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. For those reporting units where it is determined that it is more likely than not that their fair values are less than the units’ carrying amounts, the Group performs the second step of a two-step quantitative goodwill impairment test to allocate the fair value of reporting units to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination. Application of a goodwill impairment test requires significant management judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value of each reporting unit. Judgment in estimating the fair value of reporting units includes estimating future cash flows, determining appropriate discount rates and making other assumptions. Changes in these estimates and assumptions could materially affect the determination of fair value for each reporting unit.

Intangible assets other than goodwill

Intangible assets arising from acquisitions are recognized at fair value upon acquisition and amortized on a straight-line basis over their estimated useful lives, generally from five to ten years. Long-lived assets and certain identifiable intangible assets other than goodwill to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of any impairment loss for long-lived assets and certain identifiable intangible assets that management expects to hold or use is based on the amount by which the carrying value exceeds the fair value of the asset. Judgment is used in estimating future cash flows, determining appropriate discount rates and making other assumptions. Changes in these estimates and assumptions could materially affect the determination of the asset’s fair value.

Convertible debt and unsecured senior notes

The Group determines the appropriate accounting treatment of its convertible debt in accordance with the terms in relation to the conversion feature. After considering the impact of such features, the Group may account for such instrument as a liability in its entirety, or separate the instrument into debt and equity components following the respective guidance described under ASC 815 Derivatives and Hedging and ASC 470 Debt.

The debt discount, if any, together with related issuance cost are subsequently amortized as interest expense over the contractual life. The Group presented the issuance costs of debt as a direct deduction from the related debt during the periods presented.

The unsecured senior notes are recognized initially at fair value, net of debt discounts or premiums, if any, issuance costs and other incidental fees, all of which are recorded as a direct deduction of the proceeds received from issuing the unsecured senior notes and the related accretion is recorded as interest expense in the consolidated statement of comprehensive income over the estimated term using the effective interest method.

Deferred revenues

Deferred revenues consist of contractual billings in excess of recognized revenue and payments received in advance of revenue recognition, which are mainly from the customer advance of the advertising and marketing services and the sales of the fee-based services, such as VIP membership, live streaming, and virtual currency or in-game virtual items sold for game related services.

Non-controlling interests

For the Company’s majority-owned subsidiaries and VIE, non-controlling interests are recognized to reflect the portion of their equity that is not attributable, directly or indirectly, to the Company as the controlling shareholder. To reflect the economic interest held by non-controlling shareholders, net income/loss attributable to the non-controlling ordinary shareholders is recorded as non-controlling interests in the Company’s consolidated statements of comprehensive income. Non-controlling interests are classified as a separate line item in the equity section of the Company’s consolidated balance sheets and have been separately disclosed in the Company’s consolidated financial statements to distinguish the interests from that of the Company.

Foreign currency

The Company’s reporting currency and functional currency are the U.S. dollar. The Group’s operations in China and in international regions use their respective currencies as their functional currencies. The financial statements of these subsidiaries are translated into U.S. dollars using period-end rates of exchange for assets and liabilities and average rates of exchange in the period for revenues, costs and expenses. Translation gains and losses are recorded in accumulated other comprehensive income (loss) as a component of shareholders’ equity. Translation gains or losses are not released to net income unless the associated net investment has been sold, liquidated, or substantially liquidated.

Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the exchange rate prevailing on the transactions dates. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the applicable exchange rates at the balance sheet dates. Net gains and losses resulting from foreign exchange transactions are included in interest and other income, net.

Foreign currency translation adjustments included in the Group’s consolidated statements of comprehensive income for the years ended December 31, 2017, 2018, and 2019 were a gain of $37.8 million, a loss of $60.3 million and a loss of $19.0 million, respectively. Net foreign currency transaction gains or losses arise from transacting in a currency other than the functional currency of the entity and the amounts recorded were immaterial for each of the periods presented.

Net Income per share

Basic net income per share is computed using the weighted average number of ordinary shares outstanding during the period. Options and RSUs are not considered outstanding in computation of basic earnings per share. Diluted net income per share is computed using the weighted average number of ordinary shares and potential ordinary shares outstanding during the period, which include options to purchase ordinary shares, restricted share units and conversion of the convertible debt. The computation of diluted net income per share does not assume conversion, exercise, or contingent issuance of securities that would have an anti-dilutive effect (i.e. an increase in earnings per share amounts or a decrease in loss per share amounts) on net income per share. The Group uses the two-class method to calculate net income per share though both classes share the same rights in dividends. Therefore, basic and diluted earnings per share are the same for both classes of ordinary shares.

Segment reporting

In accordance with ASC 280, Segment Reporting, the Group’s chief operating decision maker (“CODM”), the Chief Executive Officer, reviews the consolidated results when making decisions about allocating resources and assessing performance of the Group as a whole. The Group currently operates and manages its business in two principal business segments globally—advertising and marketing services and value-added services. Information regarding the business segments provided to the Group’s CODM is at the revenue level and the Group currently does not allocate operating costs or assets to its segments, as its CODM does not use such information to allocate resources or evaluate the performance of the operating segments. As the Group’s long-lived assets are substantially all located in the PRC and substantially the Group’s revenues are derived from within the PRC, no geographical information is presented.

Concentration of risks

Concentration of credit risk. Financial instruments that potentially subject the Group to a concentration of credit risk consist primarily of cash and cash equivalents, short-term investments and accounts receivable. In addition, with the majority of its operations in China, the Group is subject to RMB currency risk and offshore remittance risk, both of which have been difficult to hedge and the Group has not done so. The Group limits its exposure to credit loss by depositing its cash and cash equivalents with financial institutions in the US, PRC and Hong Kong, which are among the largest and most respected with high ratings from internationally-recognized rating agencies, that management believes are of high credit quality. The Group periodically reviews these institutions’ reputations, track records and reported reserves.

As of December 31, 2018 and 2019, the Group had $1.73 billion and $2.21 billion, respectively, in cash and bank time deposits (with terms generally up to twelve months) with large domestic banks in China. China promulgated a Bankruptcy Law that came into effect on June 1, 2007, which contains a separate article expressly stating that the State Council may promulgate implementation measures for the bankruptcy of Chinese banks based on the Bankruptcy Law. Under the Bankruptcy Law, a Chinese bank may go bankrupt. In addition, since China’s concession to WTO, foreign banks have been gradually permitted to operate in China and have become significant competitors to Chinese banks in many aspects, especially since the opening of RMB business to foreign banks in late 2006. Therefore, the risk of bankruptcy on Chinese banks in which the Group holds cash and bank deposits has increased. In the event that a Chinese bank that holds the Group’s deposits goes bankrupt, the Group is unlikely to claim its deposits back in full, since it is unlikely to be classified as a secured creditor to the bank under the PRC laws.

Alibaba accounted for 7%, 7% and 6% of the Group’s revenues for the years ended December 31, 2017, 2018 and 2019, respectively. No other customer nor advertising agency accounted for 10% or more of the Group’s revenues. The Group’s top 10 advertising agencies contributed to 23%, 26%, and 28% of the Group’s revenues for the years ended December 31, 2017, 2018, and 2019, respectively.

As of December 31, 2018 and 2019, substantially all accounts receivable were derived from the Group’s China operations. Excluding accounts receivable due from Alibaba and other related parties, accounts receivable primarily consists of amounts due from advertising agencies and direct customers. Alibaba accounted for 13% and 14%, respectively, of the Group's net accounts receivables as of December 31, 2018 and 2019, while one customer accounted for 22% and 8% at the same dates.

Concentration of foreign currency risks. The majority of the Group’s operations were in RMB. As of December 31, 2018 and 2019, the Group’s cash, cash equivalents and short-term investments balance denominated in RMB was $950.8 million and $936.9 million, accounting for 52% and 39% of the Group’s total cash, cash equivalents and short-term investments balance. As of December 31, 2018 and 2019, the Group’s aggregate net accounts receivable balance (including accounts receivable due from third parties, Alibaba and other related parties) denominated in RMB was $368.8 million and $422.2 million, respectively, accounting for almost all of its net accounts receivable balance. As of December 31, 2018 and 2019, the Group’s current liabilities balance denominated in RMB was $620.4 million and $744.2 million, accounting for 99% and 93% of its total current liabilities balance. Accordingly, the Group may experience economic losses and negative impacts on earnings and equity as a result of exchange rate fluctuations of the RMB. Moreover, the Chinese government imposes controls on the convertibility of the RMB into foreign currencies and, in certain cases, the remittance of currency out of the PRC. The Group may experience difficulties in completing the administrative procedures necessary to remit its RMB out of the PRC and convert it into foreign currency.

Recent accounting pronouncements

In June 2016, the FASB issued of ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments”, which will be effective for the Group in the fiscal year of 2020. The guidance replaces the incurred loss impairment methodology with an expected credit loss model for which an entity recognizes an allowance based on the estimate of expected credit loss. In November 2018, the FASB issued an amendment of Topic 326, ASU 2018-19, which clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20 and should be accounted for in accordance with Topic 842, Leases. The Group expects the initial impact of applying ASU 2016-13 on the consolidated financial statements to be immaterial to the retained earnings as of January 1, 2020.

Long-term Investments

12 Months Ended

Dec. 31, 2019

Long-term Investments

Long-term Investments

4. Long-term Investments

Long-term investments comprised of investments in publicly traded companies, privately held companies, and limited partnerships. The following sets forth the changes in the Group’s long-term investments:


	Cost Method/
	Equity Securities				Available-for-Sale
	Without Readily				Securities/Equity Securities With
	Determinable Fair				Readily Determinable
	Values		Equity Method		Fair Values		Total
	(In thousands)
Balance at December 31, 2016	$	390,330	$	4,329	$	5,274	$	399,933
Investments made/transferred from prepayments		31,776		22,307		—		54,083
Gain from equity method investment		—		1,030		—		1,030
Dividend received from equity method investment		—		(267)		—		(267)
Impairment on investments		(4,747)		—		—		(4,747)
Unrealized loss		—		—		(995)		(995)
Currency translation adjustment		2,997		303		—		3,300
Balance at December 31, 2017	$	420,356	$	27,702	$	4,279	$	452,337
Investments made/transferred from prepayments		134,797		97,337		—		232,134
Gain from equity method investment		—		57		—		57
Dividend received from equity method investment		—		(657)		—		(657)
Disposal of investments		—		(1,623)		—		(1,623)
Impairment on investments		(23,557)		—		—		(23,557)
Fair value change through earnings (including adjustment of subsequent price changes)		42,877		—		(2,803)		40,074
Currency translation adjustment		(3,854)		(325)		—		(4,179)
Balance at December 31, 2018	$	570,619	$	122,491	$	1,476	$	694,586
Investments made/transferred from prepayments		268,734		91,869		15,017		375,620
Loss from equity method investment		—		(13,198)		—		(13,198)
Dividend received from equity method investment		—		(932)		—		(932)
Disposal of investments		(1,724)		(165)		—		(1,889)
Reclassification of equity investment without readily determinable fair values to those with readily determinable fair values		(81,385)		—		81,385		—
Impairment on investments		(230,859)		—		—		(230,859)
Fair value change through earnings (including adjustment of subsequent price changes)		35,838		—		171,600		207,438
Currency translation adjustment		(2,621)		(686)		—		(3,307)
Balance at December 31, 2019	$	558,602	$	199,379	$	269,478	$	1,027,459

For the years ended December 31, 2018 and 2019, the Group invested in private high-tech companies totaling $134.8 million and $268.7 million, respectively, which were accounted for under equity investments without readily determinable fair values. These investments were to further expand and strengthen the Group’s ecosystem and included a follow-on investment of $100 million in Yixia Tech Co., Ltd. (“Yixia Tech”), a developer of mobile video apps. The follow-on investment in Yixia Tech resulted in an aggregate investment in the company of $290 million prior to the $214.7 million impairment recognized in 2019 as described below. The Group also invested $97.3 million and $91.9 million in companies, which were accounted for under equity method, in 2018 and 2019, respectively. These investments mainly included a $48.0 million and a $45.0 million investment in two investing funds in 2018 and a $57.4 million investment in a company providing consumer finance services in 2019.

The Group used measurement alternative for recording equity investments without readily determinable fair values at cost, less impairment, adjusted for subsequent observable price changes. Based on ASU 2016-01, entities that elect the measurement alternative will report changes in the carrying value of the equity investments in current earnings. If measurement alternative is used, changes in the carrying value of the equity investment will be recognized whenever there are observable price changes in orderly transactions for the identical or similar investment of the same issuer, and impairment charges will be recorded when any impairment indicators noted and the fair value is lower than the carrying value.

The following table summarizes the total carrying value of the equity investments accounted for under the measurement alternative as of December 31, 2018 and 2019, respectively, including cumulative upward and downward adjustments made to the initial cost basis of the securities (in thousands):


	Cumulative Results
Initial cost basis	$	555,153
Upward adjustments		42,877
Downward adjustments (impairment only)		(23,557)
Foreign currency translation		(3,854)
Total carrying value at December 31, 2018	$	570,619

Initial cost basis	$	738,035
Upward adjustments		81,458
Downward adjustments (impairment only)		(254,416)
Foreign currency translation		(6,475)
Total carrying value at December 31, 2019	$	558,602

The Group recorded $42.9 million and $38.6 million gains from investments (upward adjustments) and nil and $ 2.7 million loss from investment (downward adjustment) in 2018 and 2019, respectively, which were based on identified observable price changes, indicated by new issuance of identical securities of the same investee or transactions of identical securities by other existing shareholders. The Group classifies the valuation techniques on those investments that use similar identifiable transaction prices as Level 2 of fair value measurements. Except for the $2.7 million loss which was realized upon disposal of certain investment in 2019, the Group did not dispose any interests of these investments and all of the gains were unrealized as of December 31, 2018 and 2019, respectively. The Group also recognized $23.6 and $230.9 million impairment charges to investments without readily determinable fair value for the years ended December 31, 2018 and 2019, respectively. It mainly included a partial impairment charge of $214.7 million to Yixia Tech in 2019 due to its unsatisfied financial performance with no obvious upturn or potential financing solutions in the foreseeable future. The Group has engaged an independent valuation firm to help management assess the fair value of Yixia Tech as of December 31, 2019 using Level 3 of fair value measurement and concluded that the partial impairment was warranted at the yearend, resulting in a remaining carrying value of $75.3 million in Yixia Tech.

Due to the adoption of ASU 2016-01, the AFS was reclassified to investment with readily determinable fair values beginning January 1, 2018. Investments in marketable equity securities are valued using the market approach based on the quoted prices in active markets at the reporting date. The Group classifies the valuation techniques that use these inputs as Level 1 of fair value measurements. In December 2019, one of the Group’s investees, Beijing Showworld Technology Co., Ltd. (“Showworld”), a company providing social and new media marketing services, completed its listing on Shanghai Stock Exchange through an equity reconstruction with a then-listed company. Before its IPO, the Group accounted the investment under equity securities without readily determinable fair values and then reclassified it to investment with readily determinable fair values the moment it went public. The Group has recorded an unrealized gain of $176.2 million from fair value change of Showworld for the year ended December 31, 2019. The Group has several other investments in marketable equity securities with fair value of $11.9 million as of December 31, 2019.

The following table shows the carrying amount and fair value of the marketable security:


			Gross		Gross
	Cost		Unrealized		Unrealized		Fair
	Basis		Gains		Losses		Value
	(In thousands)
One marketable security	$	5,274	$	—	$	(3,798)	$	1,476
December 31, 2018	$	5,274	$	—	$	(3,798)	$	1,476
Showworld	$	81,385	$	176,169	$	—	$	257,554
Other marketable securities		20,292		513		(8,881)		11,924
December 31, 2019	$	101,677	$	176,682	$	(8,881)	$	269,478

The Group recorded impairment charges of $4.7 million, $24.1 million and $249.9 million on its long-term investments and prepayments for the years ended December 31, 2017, 2018 and 2019, respectively, as a result of the investees not performing to expectation or them becoming incapable of making repayments. The impairment charges in 2018 included an $11.9 million write-off on an online-reading business and a $9.7 million write-off on a company operating in game business, while that of 2019 included write-offs of prepayments of $19.1 million and the partial impairment charge of $214.7 million to the carrying value of Yixia Tech, as well as other impairments of $16.2 million.

Acquisitions, Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2019

Acquisitions, Goodwill and Intangible Assets

Acquisitions, Goodwill and Intangible Assets

6. Acquisitions, Goodwill and Intangible Assets

On October 1, 2018(“Acquisition Date”), the Group entered into a series of business and asset transfer agreements with Yixia Tech to acquire the whole of the live streaming business of Yizhibo, which was previously operated by Yixia Tech. The acquisition included the Yizhibo APP and related assets/technology, employees and business contracts with a cash consideration of US$50 million. The Group had paid $40 million consideration payable to Yixia Tech in 2018 and settled the rest $10 million in 2019 (Note 10). The Group engaged an independent valuation firm to help management determine the value of assets and liabilities from the acquisition. Total identifiable intangible assets acquired on acquisition date included supplier-relationship of $9.7 million with estimated useful life of five years, core technology of $6.6 million with estimated useful life of eight years, and trademark and domain name of $5.6 million with estimated useful life of ten years. In addition, the Group had one immaterial acquisition in 2017 and there was no acquisition in 2019.

The consideration of acquisition of Yizhibo was allocated based on their fair value of the assets acquired and the liabilities assumed as follows:


	As of Acquisition Date
	(In thousands)
Consideration	$	50,000

Property and equipment, net		466
Identifiable intangible assets acquired		21,942
Other tangible assets		2,874
Liabilities assumed		(2,434)
Goodwill		27,152
Total	$	50,000

The acquisition mentioned above resulted in an increase of $28.0 million to revenues and an immaterial impact to net income for 2018. It did not have a material impact on the Group’s consolidated financial statements; therefore, pro forma disclosures have not been presented.

The following sets forth the changes in the Group’s goodwill by segment:


	Advertising &		Value-added
	Marketing		services		Total
	(In thousands)
Balance as of December 31, 2017	$	2,318	$	11,102	$	13,420
Acquisition of Yizhibo		27,152		—		27,152
Impairment		—		(10,554)		(10,554)
Currency translation adjustment		(124)		(548)		(672)
Balance as of December 31, 2018	$	29,346	$	—	$	29,346
Currency translation adjustment		(357)		—		(357)
Balance as of December 31, 2019	$	28,989	$	—	$	28,989

The Group performs at least annually a qualitative analysis on the goodwill arising from acquisitions taking into consideration the events and circumstances listed in ASC350 Intangibles—Goodwill and Other , including consideration of macroeconomic factors, industry and market conditions, share price of the Group, and overall financial performance, in addition to other entity-specific factors. Based on the analysis, the Group recognized in 2018 an impairment charge of $10.6 million for the goodwill arising from certain acquisitions under value-added services segment due to the unsatisfied financial performance and not optimistic forecast of future revenues. No impairment provision was recorded for the years ended December 31, 2017 and 2019.

The following table summarizes the Group’s intangible assets arising from acquisitions:


	As of December 31, 2018						As of December 31, 2019
			Accumulated						Accumulated
	Cost		Amortization		Net		Cost		Amortization		Net
	(In thousand)						(In thousand)
Technology	$	8,978	$	(2,594)	$	6,384	$	8,869	$	(3,351)	$	5,518
Trademark and Domain name		5,623		(147)		5,476		5,555		(724)		4,831
Supplier-relationship		9,738		(495)		9,243		9,619		(2,444)		7,175
Others		2,326		(2,326)		—		2,298		(2,298)		—
Total	$	26,665	$	(5,562)	$	21,103	$	26,341	$	(8,817)	$	17,524

As of December 31, 2019, the Group’s intangible assets totaled $17.5 million, mainly consisted of technology, trademark and domain name, and supplier-relationship from the Yizhibo acquisition. The amortization expense for the years ended December 31, 2017, 2018 and 2019 was $0.6 million, $1.3 million and $3.4 million, respectively. As of December 31, 2019, estimated amortization expenses for future periods are expected as follows:


Year Ended December 31,	(In thousands)
2020	$	3,323
2021		3,323
2022		3,323
2023		2,677
2024 and thereafter		4,878
Total expected amortization expense	$	17,524

Stock-Based Compensation

12 Months Ended

Dec. 31, 2019

Stock-Based Compensation

Stock-Based Compensation

7. Stock-Based Compensation

In August 2010, the Company adopted the 2010 Share Incentive Plan (the “2010 Plan”), which has a term of ten years and permits the grant of options, share appreciation rights, restricted shares and restricted share units of the Company to employees, directors and consultants of the Company and its affiliates. Under the plan, a total of 35 million ordinary shares were initially reserved for issuance. The maximum number of ordinary shares available for issuance is reduced by one share for every one share issued pursuant to a share option or share appreciation right and by 1.75 share for every one share issued as restricted shares or pursuant to a restricted shares unit. In March 2014, the 2010 Plan was terminated and all remaining shares were forwarded to the 2014 Plan.

In March 2014, the Company adopted the 2014 Share Incentive Plan (the “2014 Plan”), which included the remaining 4.6 million shares from the 2010 Plan plus an additional 1.0 million shares. On January 1, 2015, shares in the 2014 Plan, which has a term life of ten years, were allowed a one-time increase in the amount equal to 10% of the total number of Weibo shares issued and outstanding on a fully-diluted basis as of December 31, 2014. Each share in the 2014 Plan pool allows for a grant of a restricted share unit or option share. The Company intends to use such share incentive plan to attract and retain employee talent. Stock based compensation related to the grants were amortized generally over four years on a straight-line basis (generally one year for performance-based restricted shares) with $48.0 million, $41.0 million and $61.3 million expensed for the years ended December 31, 2017, 2018 and 2019, respectively.

The following table sets forth the stock-based compensation included in each of the relevant accounts:


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Cost of revenues	$	3,716	$	3,522	$	5,251
Sales and marketing		8,264		6,837		9,828
Product development		21,879		21,187		28,628
General and administrative		14,178		9,465		17,582
	$	48,037	$	41,011	$	61,289

The following table sets forth a summary of the number of shares available for issuance:


		Shares Available
		(In thousands)
December 31, 2016		18,878
Addition		—
Granted*		(736)
Cancelled/expired/forfeited		398

December 31, 2017		18,540
Addition		—
Granted*		(1,597)
Cancelled/expired/forfeited		350

December 31, 2018		17,293
Addition		—
Granted*		(2,411)
Cancelled/expired/forfeited		222

December 31, 2019		15,104

*For the years ended December 31, 2017, 2018 and 2019, 0.7 million, 1.6 million and 2.4 million restricted share units were granted under the 2014 Plan, respectively. No options were granted for the three-year period ended December 31, 2019.

Stock Options

The following table sets forth a summary of option activities under the Company’s stock option program:


				Weighted Average
	Options	Weighted Average		Remaining	Aggregate
	Outstanding	Exercise Price		Contractual Life	Intrinsic Value
	(In thousands)			(In years)	(In thousands)
December 31, 2016	2,587	$	1.41	1.6	$	101,403
Granted	—	$	—
Exercised	(2,122)	$	1.04
Cancelled/expired/forfeited	(28)	$	0.68

December 31, 2017	437	$	3.24	2.0	$	43,800
Granted	—	$	—
Exercised	(248)	$	3.14
Cancelled/expired/forfeited	(5)	$	1.16

December 31, 2018	184	$	3.45	1.5	$	10,089
Granted	—	$
Exercised	(95)	$	3.41
Cancelled/expired/forfeited	—	$

December 31, 2019	89	$	3.49	0.7	$	3,799

Vested and expected to vest as of December 31, 2018	184	$	3.45	1.5	$	10,089
Exercisable as of December 31, 2018	184	$	3.45	1.5	$	10,089

Vested and expected to vest as of December 31, 2019	89	$	3.49	0.7	$	3,799
Exercisable as of December 31, 2019	89	$	3.49	0.7	$	3,799

The total intrinsic value of options exercised for the years ended December 31, 2017, 2018 and 2019 was $135.2 million, $25.6 million and $4.2 million, respectively. The intrinsic value is calculated as the difference between the market value on the date of exercise and the exercise price of the shares. As reported by the NASDAQ Global Selected Market, the Company’s ending stock price as of December 31, 2017, 2018 and 2019 was $103.46, $58.43 and $46.35, respectively. Cash received from the exercise of stock options during the years ended December 31, 2017, 2018 and 2019 was $2.3 million, $0.8 million and $0.3 million, respectively.

As all compensation cost related to stock options has been fully amortized in 2017, there is no remaining unrecognized compensation cost as of December 31, 2018 and 2019, respectively.

Information regarding stock options outstanding is summarized below:


		Weighted			Weighted		Weighted Average
	Options	Average		Options	Average		Remaining
Range of Exercise Prices	Outstanding	Exercise Price		Exercisable	Exercise Price		Contractual Life
	(In thousands)			(In thousands)			(In years)
As of December 31, 2018
$ 3.25 - $3.36	32	$	3.30	32	$	3.30	0.8
$ 3.43 - $3.50	152	$	3.48	152	$	3.48	1.7
	184	$	3.45	184	$	3.45	1.5

As of December 31, 2019
$ 3.43 - $3.50	89	$	3.49	89	$	3.49	0.7

Restricted Share Units

Summary of Performance-Based Restricted Share Units

The following table sets forth a summary of performance-based restricted share unit activities:


		Weighted-Average
		Grant Date
	Shares Granted	Fair Value
	(In thousands)
December 31, 2016	108	$	27.00
Awarded	155	$	50.45
Vested	(102)	$	27.00
Cancelled	(32)	$	46.42

December 31, 2017	129	$	50.32
Awarded	191	$	86.63
Vested	(126)	$	50.32
Cancelled	(190)	$	86.90

December 31, 2018	4	$	87.14
Awarded	98	$	64.33
Vested	(4)	$	87.14
Cancelled	(39)	$	69.14

December 31, 2019	59	$	61.17

As of December 31, 2018 and 2019, the unrecognized compensation cost (adjusted for estimated forfeitures) was $0.02 million and $0.4 million, respectively, which was related to performance-based restricted share units granted to the Company’s employees.

Summary of Service-Based Restricted Share Units

The following table sets forth a summary of service-based restricted share unit activities:


		Weighted-
		Average
	Shares	Grant Date
	Granted	Fair Value
	(In thousands)
December 31, 2016	5,458	$	17.23
Awarded	581	$	62.87
Vested	(2,406)	$	17.01
Cancelled	(366)	$	17.72

December 31, 2017	3,267	$	25.45
Awarded	1,406	$	68.18
Vested	(1,757)	$	21.59
Cancelled	(160)	$	44.00

December 31, 2018	2,756	$	48.62
Awarded	2,313	$	45.49
Vested	(1,374)	$	37.60
Cancelled	(183)	$	48.48

December 31, 2019	3,512	$	50.89

As of December 31, 2019, unrecognized compensation cost (adjusted for estimated forfeitures) was $150.7 million, which was related to non-vested service-based restricted share units granted to the Company’s employees and directors. This cost is expected to be recognized over a weighted-average period of 3.2 years. The total fair value based on the vesting date of the restricted share units vested was $40.9 million, $37.9 million and $51.7 million for the years ended December 31, 2017, 2018 and 2019, respectively.

Other Balance Sheet Components

12 Months Ended

Dec. 31, 2019

Other Balance Sheet Components

Other Balance Sheet Components

8. Other Balance Sheet Components


	As of December 31,
	2017	2018		2019
	(In thousands)
Accounts receivable, net:
Due from third parties		$	201,835	$	298,752
Due from Alibaba			48,222		60,392
Due from other related parties			131,465		99,675

Total gross amount		$	381,522	$	458,819
Allowance for doubtful accounts:
Balance at the beginning of the year	(6,529)		(8,114)		(12,429)
Additional provision charged to expenses, net	(5,478)		(6,226)		(38,561)
Write-off	3,893		1,911		14,396

Balance at the end of the year	(8,114)		(12,429)		(36,594)
		$	369,093	$	422,225

Prepaid expenses and other current assets:
Rental and other deposits		$	684	$	371
Deductable value-added taxes			4,539		652
Investment prepayments⁽¹⁾			62,561		47,069
Loans to and interest receivables from investees (Note 10)			43,695		301,526
Advertising prepayment			4,575		3,406
Prepayment to outsourced service providers			4,730		3,483
Amounts deposited by users⁽²⁾			30,631		34,912
Content fees			11,021		14,013
Others			6,385		19,473
		$	168,821	$	424,905

Property and equipment, net:
Computers and equipment		$	124,241	$	132,477
Leasehold improvements			5,008		5,732
Furniture and fixtures			1,677		1,725
Others			2,696		3,696

Property and equipment, gross			133,622		143,630
Less: Accumulated depreciation			(87,999)		(96,901)
		$	45,623	$	46,729

Accrued and other liabilities⁽³⁾:
Payroll and welfare		$	56,349	$	74,723
Marketing expenses			49,998		77,046
Payroll withholding taxes			3,547		3,547
Sales rebates			95,121		140,629
Professional fees			8,249		13,437
VAT and other tax payable			48,651		56,786
Payable to other service providers			1,266		578
Amounts due to users⁽²⁾			30,631		34,912
Unpaid consideration for acquisition			10,000		—
Unpaid consideration for investment			—		30,000
Interest payable for convertible debt and unsecured senior notes			1,500		15,344
Others			12,125		13,870
		$	317,437	$	460,872

(1)

Investment prepayments as of December 31, 2019 included a $40.5 million refund to be collected from a third-party due to mutual agreement to terminate the investment contract. For the years ended December 31, 2017, 2018 and 2019, the Group recognized nil, $0.5million, and $19.1 million of impairment charges on investment prepayments (all fully impaired), respectively, due to the deterioration of the investees' operation resulting in their inability to refund the prepayments.

(2)

Weibo wallet enables users to conduct interest-generation activities on Weibo, such as handing out "red envelopes" and coupons to users and purchase different types of products and services on Weibo, including those offered by the Group, such as marketing services and VIP membership, and those offered by Weibo’s platform partners, such as e-commerce merchandises, financial products and virtual gifts. Amounts deposited by users primarily represent the receivables temporarily held in Weibo’s account on a third party online payment platform for Weibo wallet users. Amounts due to users represent the balances that are payable on demand to Weibo wallet users and therefore are reflected as current liability on the consolidated balance sheets.

(3)	Include amounts due to third parties, employees, related parties (Note 10) and Weibo wallet users.

Income Taxes

12 Months Ended

Dec. 31, 2019

Income Taxes

Income Taxes

9. Income Taxes

The Company is registered in the Cayman Islands and mainly operates in two taxable jurisdictions—the PRC and Hong Kong.

The Group’s income before income taxes is as follows:


	Year Ended December 31,
	2017			2018			2019
	(In thousands, except percentage)
Income before income tax expenses	$	417,111		$	668,842		$	602,397
Add: loss from non-China operations	$	52,261		$	43,266		$	106,256
Income from China operations	$	469,372		$	712,108		$	708,653
Income tax expense applicable to China operations	$	66,746		$	96,222		$	88,091
Income tax expense applicable to non-China operations	$	—		$	—		$	21,473
Total income tax expenses	$	66,746		$	96,222		$	109,564
Effective tax rate for China operations		14.2	%		13.5	%		12.4	%

The Company generated the majority of its operating income from PRC operations and has recorded income tax provision for the periods presented. Stock-based compensation was recorded in the Company’s loss from non-China operations. In 2019, the Group’s non-China operations has recognized a $21.5 million deferred tax charges from fair value change of investments.

Cayman Islands

Under the current tax laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. In addition, upon payments of dividends by the Company to its shareholders, no Cayman Islands withholding tax is required.

Hong Kong

Weibo HK is subject to 16.5% Hong Kong profit tax on its taxable income generated from operations in Hong Kong for the years of assessment 2016/2017, 2017/2018 and 2018/2019. Commencing from the year of assessment 2018/2019, the first HK$ 2 million of profits earned by entities incorporated in Hong Kong will be taxed at half the current tax rate (i.e., 8.25%) while the remaining profits will continue to be taxed at the existing 16.5% tax rate. As of December 31, 2019, the Company’s Hong Kong subsidiary had a net operating loss of $8.9 million, which can be carried forward indefinitely to offset future taxable income. Also as of December 31, 2019, deferred tax assets of Weibo HK consist mainly of net operating loss carried forward, for which a full valuation allowance was provided. Management believes it is more likely than not that these assets will not be realized in the future.

China

Effective January 1, 2008, the Enterprise Income Tax Law (the “EIT Law”) in China unifies the enterprise income tax rate for the entities incorporated in China at 25%, unless they are eligible for preferential tax treatment. On February 22, 2008, relevant governmental regulatory authorities released the qualification criteria, application procedures and assessment processes for “software enterprise,” which can enjoy an income tax exemption for two years beginning with its first profitable year and a 50% tax reduction, at a rate of 12.5% for the subsequent three years. The Group’s WFOE qualifies as a software enterprise and, thus, enjoyed an income tax exemption in 2015 and 2016, and a reduced enterprise income tax rate of 12.5% for the three-year period ended December 31, 2019. In late 2018 and 2019, Weibo Technology was approved to be qualified as a “key software enterprise” for 2017 and 2018, respectively. The "key software enterprise" status entitled Weibo Technology to enjoy a further reduced preferential tax rate of 10% for 2017 and 2018. Thus, the Group's WFOE used the preferential tax treatment of its “key software enterprise” status of 2017 in 2018 , and 2018 in 2019. The qualification as a “key software enterprise” is subject to annual evaluation and approval by the relevant authorities in China and the Group will only recognize the preferential tax treatment of “key software enterprise” status when approval from the relevant authorities is obtained.

The EIT Law also provides that an enterprise established under the laws of a foreign country or region but whose “de facto management body” is located in the PRC be treated as a resident enterprise for PRC tax purposes and consequently be subject to the PRC income tax at the rate of 25% for its global income. The Implementing Rules of the EIT Law merely define the location of the “de facto management body” as “the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, properties, etc., of a non-PRC company is located.” Based on a review of surrounding facts and circumstances, the Group does not believe that it is likely that its operations outside of the PRC be considered a resident enterprise for PRC tax purposes. However, due to limited guidance and implementation history of the EIT Law, should Weibo be treated as a resident enterprise for PRC tax purposes, the Company will be subject to PRC tax on worldwide income at a uniform tax rate of 25% retroactive to January 1, 2008.

The EIT Law also imposes a withholding income tax rate of 10% on dividends distributed by a WFOE to its immediate holding company outside of China, if such immediate holding company is considered as a non-resident enterprise without any establishment or place within China or if the received dividends have no connection with the establishment or place of such immediate holding company within China, unless such immediate holding company’s jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. The Cayman Islands, where the Company incorporated, does not have such tax treaty with China. According to the arrangement between Mainland China and Hong Kong Special Administrative Region on the Avoidance of Double Taxation and Prevention of Fiscal Evasion in August 2006, dividends paid by a WFOE in China to its immediate holding company in Hong Kong will be subject to withholding tax at a rate of no more than 5% (if the foreign investor owns directly at least 25% of the shares of the WFOE). The State Administration of Taxation further promulgated Circular 601 on October 27, 2009, which provides that tax treaty benefits will be denied to “conduit” or shell companies without business substance and that a beneficial ownership analysis will be used based on a “substance-over-form” principle to determine whether or not to grant the tax treaty benefits.

The operations of the Group’s WFOE in China is invested and held by Weibo HK. If the Company is regarded as a non-resident enterprise and Weibo HK is regarded as a resident enterprise, then Weibo HK may be required to pay a 10% withholding tax on any dividends payable to the Company. If Weibo HK is regarded as a non-resident enterprise, then Weibo Technology may be required to pay a 5% withholding tax for any dividends payable to Weibo HK. However, it is still unclear at this stage whether Circular 601 applies to dividends from Weibo Technology paid to Weibo HK. If Weibo HK were not considered as “beneficial owners” of any dividends from Weibo Technology, the dividends payable to Weibo HK would be subject to a withholding tax of 10%. In accordance with accounting guidance, all undistributed earnings are presumed to be transferred to Weibo Corporation and are subject to the withholding taxes. The current policy approved by the Company’s board of directors allows the Group to distribute PRC earnings offshore only if the Group does not have to pay a dividend tax. As of December 31, 2019, the Group did not record any withholding tax for its PRC subsidiaries.

Composition of income tax expenses

The following table sets forth current and deferred portion of income tax expenses of the Group:


	Years Ended December 31,
	2017		2018		2019
		(In thousands)
Deferred tax (benefits)/provisions	$	(1,503)	$	4,438	$	16,839
Current income tax expenses		68,249		91,784		92,725

Income tax expenses	$	66,746	$	96,222	$	109,564

Reconciliation of the statutory tax rate to the effective tax rate for China operations

The following table sets forth reconciliation between the statutory EIT rate and the effective tax rate for China operations:


	Year Ended December 31,
	2017		2018		2019
Statutory EIT rate	25.0	%	25.0	%	25.0	%
Effect on tax holiday and preferential tax treatment⁽¹⁾	(11.6)	%	(12.1)	%	(13.7)	%
Permanent differences	0.2	%	0.6	%	(0.9)	%
Change in valuation allowance	0.6	%	0.0	%	2.0	%

Effective tax rate for China operations	14.2	%	13.5	%	12.4	%

(1)	Included the impact of Weibo Technology’s preferential tax treatment of “key software enterprise” status of 2017 in 2018, and 2018 in 2019, respectively.

The provision for income taxes for China operations for the years ended December 31, 2017, 2018 and 2019 differs from the amounts computed by applying the statutory EIT rate primarily due to the preferential tax treatment of the WFOE, Weibo Technology, as a qualified software enterprise for the periods presented, as well as the " key software enterprise” status for 2017 and 2018.For the years ended December 31, 2017, 2018 and 2019, Weibo Technology enjoyed a tax reduction of $52.6 million, $77.2 million and $83.2 million, respectively, due to the preferential tax treatment of being a qualified software enterprise. It also recognized the preferential tax treatment of “key software enterprise” status of $10.8 million for 2017 in 2018, and $13.0 million for 2018 in 2019. The preferential tax treatment (including benefits from "key software enterprise" status) in the three-year period ended December 31, 2019 resulted in an effect of $0.25, $0.39 and $0.43 on basic net income per share in 2017, 2018 and 2019, respectively.

Deferred tax assets and liabilities

The following table sets forth the significant components of deferred tax assets and liabilities for the Group:


	As of December 31,
	2018		2019
	(In thousands)
Deferred tax assets:
Net operating loss carry forwards	$	4,180	$	5,515
Less: valuation allowance		(4,180)		(5,515)
Depreciation, accounts receivable, accrued and other liabilities		25,327		42,932
Less: valuation allowance		(13,419)		(26,472)

Net deferred tax assets (included in other assets)	$	11,908	$	16,460

Deferred tax liabilities:
Acquired intangible assets	$	2,310	$	1,793
Depreciation		702		1,044
Investment gain		9,565		31,135

Total deferred tax liabilities	$	12,577	$	33,972

Valuation allowance is provided against deferred tax assets when the Group determines that it is more likely than not that the deferred tax assets will not be utilized in the future. In making such determination, the Group considered factors including (i) future reversals of existing taxable temporary differences; (ii) future taxable income exclusive of reversing temporary differences and carry forwards; and (iii) tax planning strategies. The valuation allowance on deferred tax assets as of December 31, 2018 and 2019 was $17.6 million and $32.0 million, respectively. The change in valuation allowance was primarily due to bad debt expenses and investment impairment charges/fair value change of investments. Historically, deferred tax assets were valued using the statutory rate of 25%. As of December 31, 2018 and 2019, the Group had net operating loss carry forwards for China operations totaling $16.7 million and $22.1 million, respectively, for which full valuation allowance was provided as the Group anticipates that it is more likely than not that these net operating losses may not be utilized based on its estimate of the operation performance of these PRC entities. Net operating loss carry forwards for China operations as of December 31, 2019 will expire, if unused, in the years ending December 31, 2020 through December 31, 2024.

Related Party Transactions

12 Months Ended

Dec. 31, 2019

Related Party Transactions

Related Party Transactions

10. Related Party Transactions

The following sets forth significant related parties and their relationships with the Company:


Company Name		Relationship with the Company
SINA		Parent and affiliates under common control.

Alibaba		Strategic partner and significant shareholder of the Company.

Matching loans between Weibo and SINA.

In January 2017, the Company and its certain subsidiary entered into one-year loan agreements with SINA and one of SINA's subsidiaries, pursuant to which the Company is entitled to draw down U.S. dollar-denominated loan from SINA and the SINA's subsidiary is entitled to draw down equivalent RMB-denominated loan from the Company's subsidiary, to facilitate each other's business operations. All of the loans carried a fixed rate of interest equal to then current market interest rate as of the dates when the principal was drawn down.

For the year ended December 31, 2017, interest income that the Group earned from such RMB-denominated loans to SINA was $1.7 million, and interest expense that the Group paid for such U.S. dollar-denominated loans from SINA was $1.5 million, respectively. As of December 31, 2017, the Company and its subsidiary has settled both loans with SINA and the SINA's subsidiary with payment of U.S. dollar-denominated principal and interest expense of $61.5 million and receipt of RMB-denominated principal and interest income of $64.0 million, respectively.

Besides the matching loans, SINA lent an additional $2.0 million to Weibo in 2017, which was repaid to SINA in 2018. During 2018 and 2019, the Group entered in to a series of one-year loan agreements with SINA pursuant to which SINA is entitled to borrow from the Group to facilitate SINA's business operations. SINA has withdrawn a total of $149.5 million and $233.9 million from the Group and repaid $101.1 million and $43.6 million to the Group during 2018 and 2019, respectively. As of December 31, 2018 and 2019, the loans to and interest receivable from SINA were $43.6 million and $236.6 million, respectively.

The following sets forth significant related party transactions with the Company:


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Transactions with SINA
Revenue billed through/for service provided to SINA⁽¹⁾	$	64,093	$	90,645	$	137,223
Costs and expenses allocated from SINA⁽²⁾	$	41,136	$	47,334	$	51,848
Interest income on matching loan to SINA	$	1,735	$	—	$	—
Interest expense on matching loan from SINA	$	1,537	$	—	$	—
Interest income on loans to SINA	$	—	$	2,425	$	9,295

(1)	For the years ended December 31, 2017, 2018 and 2019, the Group charged $64.1 million, $90.6 million and $137.2 million for services provided to SINA or to third parties billed through SINA, respectively.

(2)

Costs and expenses allocated from SINA represented the charges for certain services provided by SINA’s affiliates and charged to the Group using actual cost allocation based on proportional utilization (Note 1). In addition to the allocated costs and expenses, SINA also billed $22.9 million, $23.4 million, and $37.5 million for other costs and expenses incurred by Weibo but paid by SINA in 2017, 2018 and 2019, respectively.


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Transactions with Alibaba
Advertising and marketing services provided to Alibaba	$	84,688	$	117,696	$	97,772
Services provided by Alibaba	$	32,734	$	47,642	$	50,205

The following sets forth related party outstanding balance:


	As of December 31,
	2018		2019
		(In thousands)
Amount due from SINA⁽³⁾	$	105,319	$	384,828
Accounts receivable due from Alibaba	$	48,222	$	60,392
Loan to and interest receivables⁽⁴⁾	$	43,695	$	301,526
-Company A (an investee in e-commerce business)	$	43,695	$	160,010
-Company B (an investee providing social and new media marketing services)	$	—	$	60,602
-Company C (an investee providing online brokerage services)	$	—	$	40,982
-others	$	—	$	39,932

(3)

The Group uses amount due from/to SINA to settle balances arising from cost and expenses allocated from SINA based on proportional utilization, other expenditures incurred by Weibo business but paid by SINA, transactions with third-party customers and suppliers settled through SINA, as well as business transactions between Weibo and SINA. As of December 31, 2018 and 2019, the amount due from SINA also included loans to and interest receivables from SINA of $43.6 million at an annual interest rate of 4.8% and $236.6 million at an annual interest rate of 4.5% of maturity within one year, respectively.

(4)

The Group recorded loans to and interest receivables from other related parties of $43.7 million and $301.5 million at December 31, 2018 and 2019, respectively. The annual interest rates of the loans were ranging from 4% to 10.5% (interest free for Company B) and the maturities of all loans were within one year at both dates.

Other related parties mainly include investee companies on which SINA or Weibo has significant influence. These investees are generally high-tech companies operating in different internet-related business, such as short video applications, e-commerce and so on. For the years ended December 31, 2017, 2018 and 2019, advertising and marketing revenues generated from other related parties were $71.6 million, $130.2 million and $117.0 million, while value-added services revenues were $21.4 million, $24.1 million and $5.4 million, and cost and expenses were $18.2 million, $19.0 million and $31.2 million, respectively. As of December 31, 2018 and 2019, net accounts receivable due from other related parties were $130.8 million and $99.7 million (allowances for doubtful accounts of $0.63 million written off in 2019), accounts payable due to other related parties were $31.2 million and $10.7 million, and accrued and other liabilities due to other related parties were $14.4 million and $34.4 million, respectively. One related party that is an equity investee in the short video business contributed $53.9 million and $10.9 million of advertising and marketing revenues in 2018 and 2019, and represented $80.9 million and $34.7 million of accounts receivable due from other related parties at December 31, 2018 and 2019 respectively. In 2019, the Group has signed an agreement with the related party to settle partial transaction amounts between the two parties, resulting in $38.7 million accounts receivable due from the related party offset by $28.7 million accounts payable and $10 million accrued and other liabilities due to the related party on the consolidated balance sheet, where a legally enforceable right of setoff exists.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2019

Commitments and Contingencies

Commitments and Contingencies

17. Commitments and Contingencies

Operating lease commitments include the commitments under the lease agreements for the Group’s office premises. The Group leases its office facilities under non-cancelable operating leases with various expiration dates. For the years ended December 31, 2017, 2018 and 2019, lease expense was $9.2 million, $11.2 million and $11.5 million, respectively. Based on the current rental lease agreements, future minimum lease payments commitments as of December 31, 2019 were as follows:


			Less than One		One to		Three to		More than
Operating lease commitments	Total		Year		Three Years		Five Years		Five Years
	(In thousands)
As of December 31, 2019:	$	10,659	$	5,196	$	5,463	$	—	$	—

Purchase commitments mainly include minimum commitments for marketing activities and internet connection.

Purchase commitments as of December 31, 2019 were as follows:


			Less than One		One to		Three to		More than
Purchase commitments	Total		Year		Three Years		Five Years		Five Years
	(In thousands)
As of December 31, 2019:	$	559,975	$	544,579	$	15,357	$	39	$	—

2022 Notes represent the future maximum commitments relating to the principal amount and interests in connection with the issuance of $900 million in aggregate principal amount of 1.25% coupon interest convertible senior notes, which will mature on November 15, 2022. 2024 Notes represent future maximum commitment relating to the principal amount and interests in connection with the issuance of $800 million in aggregate principal amount of unsecured senior notes bearing an annual interest rate of 3.50%, which will mature on July 5, 2024.


			Less than One		One to		Three to		More than
2022 Notes	Total		Year		Three Years		Five Years		Five Years
	(In thousands)
As of December 31, 2019:	$	933,750	$	11,250	$	922,500	$	—	$	—


			Less than One		One to		Three to		More than
2024 Notes	Total		Year		Three Years		Five Years		Five Years
	(In thousands)
As of December 31, 2019:	$	940,000	$	28,000	$	56,000	$	856,000	$	—

There are uncertainties regarding the legal basis of the Group’s ability to operate an Internet business in China. Although China has implemented a wide range of market-oriented economic reforms, the telecommunication, information and media industries remain highly regulated. Not only are such restrictions currently in place, the existing regulations are unclear as to which specific segments of these industries companies with foreign investors, including the Company, may operate. Therefore, the Group may be required to limit the scope of its operations in China, and this could have a material adverse effect on its financial position, results of operations and cash flows.

There are no claims, lawsuits, investigations or proceedings, including unasserted claims that are probable to be assessed, that have in the recent past had, or to the Group’s knowledge, are reasonably possible to have, a material impact on the Group’s financial statements.

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2019

Significant Accounting Policies

Basis of presentation

Use of estimates

Revenue recognition

Revenue disaggregated by revenue source for the years ended December 31, 2017, 2018 and 2019 consists of the following:


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Advertising and marketing revenues	$	996,745	$	1,499,180	$	1,530,211
Value-added services revenues		153,309		219,338		236,703
Total revenues	$	1,150,054	$	1,718,518	$	1,766,914

Practical Expedients and Exemptions

The Group generally expenses sales commissions when incurred because the amortization period is generally one year or less. These costs are recorded within sales and marketing expenses.

Advertising and marketing revenues

Value-added services revenues

Cost of revenues

Sales and Marketing Expenses

Product development expenses

Stock-based compensation

Taxation

Income taxes

Cash equivalents

Accounts receivable and allowances for doubtful accounts

Fair value measurements

Financial instruments

●

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

●

Level 3 applies to asset or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

Long-term investments

Adoption of ASU 2016-01 and Its Implication

Business combination

Leases

Long-lived assets

Property and equipment

Goodwill

Intangible assets other than goodwill

Convertible debt and unsecured senior notes

Deferred revenues

Non-controlling interests

Foreign currency

Net Income per share

Segment reporting

Concentration of risks

Recent accounting pronouncements

Operations (Tables)

12 Months Ended

Dec. 31, 2019

Operations

Schedule of the Company's major subsidiaries, major VIE and major VIE's subsidiary


			Percentage of
			Direct/
			Indirect
	Date of	Place of	Economic
Company	Incorporation	Incorporation	Interest
Major Subsidiaries
Weibo Hong Kong Limited (“Weibo HK”)	July 19, 2010	Hong Kong	100	%

Weibo Internet Technology (China) Co., Ltd. (“Weibo Technology” or "the WFOE”)	October 11, 2010	PRC	100	%

Major VIE and major VIE's subsidiary
Beijing Weimeng Technology Co., Ltd (“Weimeng")	August 9, 2010	PRC	100	%

Beijing Weibo Interactive Internet Technology Co., Ltd. (“Weibo Interactive”)	Acquired in May 2013	PRC	100	%

Schedule of total cost and expenses allocated from SINA


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Cost of revenues	$	13,699	$	16,824	$	22,246
Sales and marketing		9,732		11,558		9,770
Product development		11,312		11,688		13,141
General and administrative		6,393		7,264		6,691
	$	41,136	$	47,334	$	51,848

Schedule of assets, liabilities, results of operations and cash flows of the VIE and the VIE's subsidiaries taken as a whole.


	As of December 31,
	2018		2019
	(In thousands)
Cash, cash equivalents and short-term investments	$	55,506	$	99,465
Accounts receivable		366,128		420,686
Prepaid expenses and other current assets		121,210		101,363
Amount due from SINA		31,787		116,535
Property and equipment, net		449		243
Operating lease assets		—		686
Intangible assets, net		21,103		17,524
Goodwill		29,346		28,989
Long-term investments		275,819		380,420
Deferred tax assets		5,778		10,608
Others		1,464		8,625
Total assets	$	908,590	$	1,185,144

Accounts payable	$	79,881	$	86,417
Accrued and other liabilities		181,188		254,564
Deferred revenues		65,531		66,533
Income taxes payable		21,170		28,970
Amount due to the subsidiaries of the Group		440,563		632,900
Operating lease liability		—		586
Deferred tax liability		11,875		11,453
Total liabilities	$	800,208	$	1,081,423


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Net revenues	$	906,129	$	1,416,367	$	1,472,867
Net income after intercompany service fee charge	$	21,252	$	56,466	$	9,874


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Net cash provided by (used in) operating activities	$	(66,972)	$	46,738	$	(100,987)
Net cash used in investing activities	$	(34,720)	$	(331,243)	$	(280,404)
Net cash provided by financing activities	$	76,232	$	292,151	$	441,952
Net increase (decrease) in cash and cash equivalents	$	(25,460)	$	7,646	$	60,561

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

+ References + Details

Long-term Investments (Tables)

12 Months Ended

Dec. 31, 2019

Long-term Investments

Schedule of changes in the Group's long-term investments


	Cost Method/
	Equity Securities				Available-for-Sale
	Without Readily				Securities/Equity Securities With
	Determinable Fair				Readily Determinable
	Values		Equity Method		Fair Values		Total
	(In thousands)
Balance at December 31, 2016	$	390,330	$	4,329	$	5,274	$	399,933
Investments made/transferred from prepayments		31,776		22,307		—		54,083
Gain from equity method investment		—		1,030		—		1,030
Dividend received from equity method investment		—		(267)		—		(267)
Impairment on investments		(4,747)		—		—		(4,747)
Unrealized loss		—		—		(995)		(995)
Currency translation adjustment		2,997		303		—		3,300
Balance at December 31, 2017	$	420,356	$	27,702	$	4,279	$	452,337
Investments made/transferred from prepayments		134,797		97,337		—		232,134
Gain from equity method investment		—		57		—		57
Dividend received from equity method investment		—		(657)		—		(657)
Disposal of investments		—		(1,623)		—		(1,623)
Impairment on investments		(23,557)		—		—		(23,557)
Fair value change through earnings (including adjustment of subsequent price changes)		42,877		—		(2,803)		40,074
Currency translation adjustment		(3,854)		(325)		—		(4,179)
Balance at December 31, 2018	$	570,619	$	122,491	$	1,476	$	694,586
Investments made/transferred from prepayments		268,734		91,869		15,017		375,620
Loss from equity method investment		—		(13,198)		—		(13,198)
Dividend received from equity method investment		—		(932)		—		(932)
Disposal of investments		(1,724)		(165)		—		(1,889)
Reclassification of equity investment without readily determinable fair values to those with readily determinable fair values		(81,385)		—		81,385		—
Impairment on investments		(230,859)		—		—		(230,859)
Fair value change through earnings (including adjustment of subsequent price changes)		35,838		—		171,600		207,438
Currency translation adjustment		(2,621)		(686)		—		(3,307)
Balance at December 31, 2019	$	558,602	$	199,379	$	269,478	$	1,027,459

Schedule of the total carrying value of the equity securities accounted for measurement alternative


	Cumulative Results
Initial cost basis	$	555,153
Upward adjustments		42,877
Downward adjustments (impairment only)		(23,557)
Foreign currency translation		(3,854)
Total carrying value at December 31, 2018	$	570,619

Initial cost basis	$	738,035
Upward adjustments		81,458
Downward adjustments (impairment only)		(254,416)
Foreign currency translation		(6,475)
Total carrying value at December 31, 2019	$	558,602

Schedule of the carrying amount and fair value of the marketable security


			Gross		Gross
	Cost		Unrealized		Unrealized		Fair
	Basis		Gains		Losses		Value
	(In thousands)
One marketable security	$	5,274	$	—	$	(3,798)	$	1,476
December 31, 2018	$	5,274	$	—	$	(3,798)	$	1,476
Showworld	$	81,385	$	176,169	$	—	$	257,554
Other marketable securities		20,292		513		(8,881)		11,924
December 31, 2019	$	101,677	$	176,682	$	(8,881)	$	269,478

Acquisitions, Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2019

Acquisitions, Goodwill and Intangible Assets

Schedule of Consideration of acquisition of Yizhibo was allocated based on their fair value of the assets acquired and the liabilities assumed


	As of Acquisition Date
	(In thousands)
Consideration	$	50,000

Property and equipment, net		466
Identifiable intangible assets acquired		21,942
Other tangible assets		2,874
Liabilities assumed		(2,434)
Goodwill		27,152
Total	$	50,000

Schedule of the changes in the Group's goodwill by segment


	Advertising &		Value-added
	Marketing		services		Total
	(In thousands)
Balance as of December 31, 2017	$	2,318	$	11,102	$	13,420
Acquisition of Yizhibo		27,152		—		27,152
Impairment		—		(10,554)		(10,554)
Currency translation adjustment		(124)		(548)		(672)
Balance as of December 31, 2018	$	29,346	$	—	$	29,346
Currency translation adjustment		(357)		—		(357)
Balance as of December 31, 2019	$	28,989	$	—	$	28,989

Table summarizes the Group's intangible assets arising from acquisitions


	As of December 31, 2018						As of December 31, 2019
			Accumulated						Accumulated
	Cost		Amortization		Net		Cost		Amortization		Net
	(In thousand)						(In thousand)
Technology	$	8,978	$	(2,594)	$	6,384	$	8,869	$	(3,351)	$	5,518
Trademark and Domain name		5,623		(147)		5,476		5,555		(724)		4,831
Supplier-relationship		9,738		(495)		9,243		9,619		(2,444)		7,175
Others		2,326		(2,326)		—		2,298		(2,298)		—
Total	$	26,665	$	(5,562)	$	21,103	$	26,341	$	(8,817)	$	17,524

Schedule of estimated amortization expenses


Year Ended December 31,	(In thousands)
2020	$	3,323
2021		3,323
2022		3,323
2023		2,677
2024 and thereafter		4,878
Total expected amortization expense	$	17,524

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2019

Stock-Based Compensation

Schedule of the stock-based compensation


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Cost of revenues	$	3,716	$	3,522	$	5,251
Sales and marketing		8,264		6,837		9,828
Product development		21,879		21,187		28,628
General and administrative		14,178		9,465		17,582
	$	48,037	$	41,011	$	61,289

Summary of the number of shares available for issuance


		Shares Available
		(In thousands)
December 31, 2016		18,878
Addition		—
Granted*		(736)
Cancelled/expired/forfeited		398

December 31, 2017		18,540
Addition		—
Granted*		(1,597)
Cancelled/expired/forfeited		350

December 31, 2018		17,293
Addition		—
Granted*		(2,411)
Cancelled/expired/forfeited		222

December 31, 2019		15,104

Summary of option activities under the Company's stock option program


				Weighted Average
	Options	Weighted Average		Remaining	Aggregate
	Outstanding	Exercise Price		Contractual Life	Intrinsic Value
	(In thousands)			(In years)	(In thousands)
December 31, 2016	2,587	$	1.41	1.6	$	101,403
Granted	—	$	—
Exercised	(2,122)	$	1.04
Cancelled/expired/forfeited	(28)	$	0.68

December 31, 2017	437	$	3.24	2.0	$	43,800
Granted	—	$	—
Exercised	(248)	$	3.14
Cancelled/expired/forfeited	(5)	$	1.16

December 31, 2018	184	$	3.45	1.5	$	10,089
Granted	—	$
Exercised	(95)	$	3.41
Cancelled/expired/forfeited	—	$

December 31, 2019	89	$	3.49	0.7	$	3,799

Vested and expected to vest as of December 31, 2018	184	$	3.45	1.5	$	10,089
Exercisable as of December 31, 2018	184	$	3.45	1.5	$	10,089

Vested and expected to vest as of December 31, 2019	89	$	3.49	0.7	$	3,799
Exercisable as of December 31, 2019	89	$	3.49	0.7	$	3,799

Schedule of stock options outstanding


		Weighted			Weighted		Weighted Average
	Options	Average		Options	Average		Remaining
Range of Exercise Prices	Outstanding	Exercise Price		Exercisable	Exercise Price		Contractual Life
	(In thousands)			(In thousands)			(In years)
As of December 31, 2018
$ 3.25 - $3.36	32	$	3.30	32	$	3.30	0.8
$ 3.43 - $3.50	152	$	3.48	152	$	3.48	1.7
	184	$	3.45	184	$	3.45	1.5

As of December 31, 2019
$ 3.43 - $3.50	89	$	3.49	89	$	3.49	0.7

Performance-Based Restricted Share Units

Stock-Based Compensation

Summary of restricted share unit activities


		Weighted-Average
		Grant Date
	Shares Granted	Fair Value
	(In thousands)
December 31, 2016	108	$	27.00
Awarded	155	$	50.45
Vested	(102)	$	27.00
Cancelled	(32)	$	46.42

December 31, 2017	129	$	50.32
Awarded	191	$	86.63
Vested	(126)	$	50.32
Cancelled	(190)	$	86.90

December 31, 2018	4	$	87.14
Awarded	98	$	64.33
Vested	(4)	$	87.14
Cancelled	(39)	$	69.14

December 31, 2019	59	$	61.17

Service-Based Restricted Share Units

Stock-Based Compensation

Summary of restricted share unit activities


		Weighted-
		Average
	Shares	Grant Date
	Granted	Fair Value
	(In thousands)
December 31, 2016	5,458	$	17.23
Awarded	581	$	62.87
Vested	(2,406)	$	17.01
Cancelled	(366)	$	17.72

December 31, 2017	3,267	$	25.45
Awarded	1,406	$	68.18
Vested	(1,757)	$	21.59
Cancelled	(160)	$	44.00

December 31, 2018	2,756	$	48.62
Awarded	2,313	$	45.49
Vested	(1,374)	$	37.60
Cancelled	(183)	$	48.48

December 31, 2019	3,512	$	50.89

Other Balance Sheet Components (Tables)

12 Months Ended

Dec. 31, 2019

Other Balance Sheet Components

Schedule of other balance sheet components


	As of December 31,
	2017	2018		2019
	(In thousands)
Accounts receivable, net:
Due from third parties		$	201,835	$	298,752
Due from Alibaba			48,222		60,392
Due from other related parties			131,465		99,675

Total gross amount		$	381,522	$	458,819
Allowance for doubtful accounts:
Balance at the beginning of the year	(6,529)		(8,114)		(12,429)
Additional provision charged to expenses, net	(5,478)		(6,226)		(38,561)
Write-off	3,893		1,911		14,396

Balance at the end of the year	(8,114)		(12,429)		(36,594)
		$	369,093	$	422,225

Prepaid expenses and other current assets:
Rental and other deposits		$	684	$	371
Deductable value-added taxes			4,539		652
Investment prepayments⁽¹⁾			62,561		47,069
Loans to and interest receivables from investees (Note 10)			43,695		301,526
Advertising prepayment			4,575		3,406
Prepayment to outsourced service providers			4,730		3,483
Amounts deposited by users⁽²⁾			30,631		34,912
Content fees			11,021		14,013
Others			6,385		19,473
		$	168,821	$	424,905

Property and equipment, net:
Computers and equipment		$	124,241	$	132,477
Leasehold improvements			5,008		5,732
Furniture and fixtures			1,677		1,725
Others			2,696		3,696

Property and equipment, gross			133,622		143,630
Less: Accumulated depreciation			(87,999)		(96,901)
		$	45,623	$	46,729

Accrued and other liabilities⁽³⁾:
Payroll and welfare		$	56,349	$	74,723
Marketing expenses			49,998		77,046
Payroll withholding taxes			3,547		3,547
Sales rebates			95,121		140,629
Professional fees			8,249		13,437
VAT and other tax payable			48,651		56,786
Payable to other service providers			1,266		578
Amounts due to users⁽²⁾			30,631		34,912
Unpaid consideration for acquisition			10,000		—
Unpaid consideration for investment			—		30,000
Interest payable for convertible debt and unsecured senior notes			1,500		15,344
Others			12,125		13,870
		$	317,437	$	460,872

(1)

(2)

(3)	Include amounts due to third parties, employees, related parties (Note 10) and Weibo wallet users.

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Taxes

Schedule of income before income taxes


	Year Ended December 31,
	2017			2018			2019
	(In thousands, except percentage)
Income before income tax expenses	$	417,111		$	668,842		$	602,397
Add: loss from non-China operations	$	52,261		$	43,266		$	106,256
Income from China operations	$	469,372		$	712,108		$	708,653
Income tax expense applicable to China operations	$	66,746		$	96,222		$	88,091
Income tax expense applicable to non-China operations	$	—		$	—		$	21,473
Total income tax expenses	$	66,746		$	96,222		$	109,564
Effective tax rate for China operations		14.2	%		13.5	%		12.4	%

Schedule of current and deferred portion of income tax expenses


	Years Ended December 31,
	2017		2018		2019
		(In thousands)
Deferred tax (benefits)/provisions	$	(1,503)	$	4,438	$	16,839
Current income tax expenses		68,249		91,784		92,725

Income tax expenses	$	66,746	$	96,222	$	109,564

Schedule of reconciliation between the statutory EIT rate and the effective tax rate for China operations


	Year Ended December 31,
	2017		2018		2019
Statutory EIT rate	25.0	%	25.0	%	25.0	%
Effect on tax holiday and preferential tax treatment⁽¹⁾	(11.6)	%	(12.1)	%	(13.7)	%
Permanent differences	0.2	%	0.6	%	(0.9)	%
Change in valuation allowance	0.6	%	0.0	%	2.0	%

Effective tax rate for China operations	14.2	%	13.5	%	12.4	%

(1)	Included the impact of Weibo Technology’s preferential tax treatment of “key software enterprise” status of 2017 in 2018, and 2018 in 2019, respectively.

Schedule of significant components of deferred tax assets and liabilities for China operations


	As of December 31,
	2018		2019
	(In thousands)
Deferred tax assets:
Net operating loss carry forwards	$	4,180	$	5,515
Less: valuation allowance		(4,180)		(5,515)
Depreciation, accounts receivable, accrued and other liabilities		25,327		42,932
Less: valuation allowance		(13,419)		(26,472)

Net deferred tax assets (included in other assets)	$	11,908	$	16,460

Deferred tax liabilities:
Acquired intangible assets	$	2,310	$	1,793
Depreciation		702		1,044
Investment gain		9,565		31,135

Total deferred tax liabilities	$	12,577	$	33,972

Related Party Transactions (Tables)

12 Months Ended

Dec. 31, 2019

Related Party Transactions

Schedule of significant related parties and their relationships with the Company


Company Name		Relationship with the Company
SINA		Parent and affiliates under common control.

Alibaba		Strategic partner and significant shareholder of the Company.

Schedule of significant related party transactions with the Company


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Transactions with SINA
Revenue billed through/for service provided to SINA⁽¹⁾	$	64,093	$	90,645	$	137,223
Costs and expenses allocated from SINA⁽²⁾	$	41,136	$	47,334	$	51,848
Interest income on matching loan to SINA	$	1,735	$	—	$	—
Interest expense on matching loan from SINA	$	1,537	$	—	$	—
Interest income on loans to SINA	$	—	$	2,425	$	9,295

(1)	For the years ended December 31, 2017, 2018 and 2019, the Group charged $64.1 million, $90.6 million and $137.2 million for services provided to SINA or to third parties billed through SINA, respectively.

(2)


	Year Ended December 31,
	2017		2018		2019
	(In thousands)
Transactions with Alibaba
Advertising and marketing services provided to Alibaba	$	84,688	$	117,696	$	97,772
Services provided by Alibaba	$	32,734	$	47,642	$	50,205


	As of December 31,
	2018		2019
		(In thousands)
Amount due from SINA⁽³⁾	$	105,319	$	384,828
Accounts receivable due from Alibaba	$	48,222	$	60,392
Loan to and interest receivables⁽⁴⁾	$	43,695	$	301,526
-Company A (an investee in e-commerce business)	$	43,695	$	160,010
-Company B (an investee providing social and new media marketing services)	$	—	$	60,602
-Company C (an investee providing online brokerage services)	$	—	$	40,982
-others	$	—	$	39,932

(3)

(4)

Operations - Assets, Liabilities, Statement of Operations and Cash Flows (Details) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Oct. 01, 2018	Dec. 31, 2016
Operations
Allocated expenses from SINA	$ 51,848,000	$ 47,334,000	$ 41,136,000
Interest-free loans to the VIE's shareholders	81,100,000	82,100,000
Aggregate accumulated income (loss)	33,100,000	23,200,000
Assets and liabilities of the VIEs and their subsidiaries
Cash, cash equivalents and short-term Investments	2,404,220,000	1,825,865,000
Prepaid expenses and other current assets	424,905,000	168,821,000
Property and equipment, net	46,729,000	45,623,000
Operating lease assets	9,730,000
Intangible assets, net	17,524,000	21,103,000
Goodwill	28,989,000	29,346,000	13,420,000	$ 27,152,000
Long-term investments	1,027,459,000	694,586,000	452,337,000		$ 399,933,000
Total assets	4,804,186,000	3,274,682,000
Accounts payable	126,247,000	123,730,000
Accrued and other liabilities	460,872,000	317,437,000
Deferred revenues	108,783,000	99,994,000
Income taxes payable	100,245,000	88,683,000
Operating lease liability	9,997,000
Deferred tax liability	33,972,000	12,577,000
Total liabilities	2,522,367,000	1,526,544,000
Results of operations of the VIEs and their subsidiaries
Net revenues	1,766,914,000	1,718,518,000	1,150,054,000
Net income (loss)	494,675,000	571,823,000	352,590,000
Cash flows of the VIE and its subsidiary
Net cash provided by (used in) operating activities	631,653,000	488,007,000	539,151,000
Net cash used in investing activities	(1,201,358,000)	(254,032,000)	(815,422,000)
Net cash provided by financing activities	791,869,000	(1,415,000)	883,578,000
Contractual Arrangements with the VIE
Assets, except for registered capital of VIEs, that can only be used to settle obligations of the respective VIEs	0	0
Registered capital and non-distributable reserve funds of VIE and its subsidiaries	$ 152,000,000.0	144,100,000
Term of loan agreements	10 years
Service fees revenue charged to VIE	$ 834,800,000	842,600,000	618,100,000
Term of trademark license agreements	1 year
Consolidated VIEs
Operations
Allocated expenses from SINA	$ 27,600,000	25,600,000	21,400,000
Assets and liabilities of the VIEs and their subsidiaries
Cash, cash equivalents and short-term Investments	99,465,000	55,506,000
Accounts receivable	420,686,000	366,128,000
Prepaid expenses and other current assets	101,363,000	121,210,000
Amount due from SINA	116,535,000	31,787,000
Property and equipment, net	243,000	449,000
Operating lease assets	686,000
Intangible assets, net	17,524,000	21,103,000
Goodwill	28,989,000	29,346,000
Long-term investments	380,420,000	275,819,000
Deferred tax assets	10,608,000	5,778,000
Others	8,625,000	1,464,000
Total assets	1,185,144,000	908,590,000
Accounts payable	86,417,000	79,881,000
Accrued and other liabilities	254,564,000	181,188,000
Deferred revenues	66,533,000	65,531,000
Income taxes payable	28,970,000	21,170,000
Amount due to the subsidiaries of the Group	632,900,000	440,563,000
Operating lease liability	586,000
Deferred tax liability	11,453,000	11,875,000
Total liabilities	1,081,423,000	800,208,000
Results of operations of the VIEs and their subsidiaries
Net revenues	1,472,867,000	1,416,367,000	906,129,000
Net income (loss)	9,874,000	56,466,000	21,252,000
Cash flows of the VIE and its subsidiary
Net cash provided by (used in) operating activities	(100,987,000)	46,738,000	(66,972,000)
Net cash used in investing activities	(280,404,000)	(331,243,000)	(34,720,000)
Net cash provided by financing activities	441,952,000	292,151,000	76,232,000
Net increase (decrease) in cash and cash equivalents	60,561,000	7,646,000	(25,460,000)
Cost of revenues
Operations
Allocated expenses from SINA	22,246,000	16,824,000	13,699,000
Sales and marketing
Operations
Allocated expenses from SINA	9,770,000	11,558,000	9,732,000
Product development
Operations
Allocated expenses from SINA	13,141,000	11,688,000	11,312,000
General and administrative
Operations
Allocated expenses from SINA	$ 6,691,000	$ 7,264,000	$ 6,393,000

Stock-Based Compensation - Number of Shares Available for Issuance (Details) - USD ($)

1 Months Ended

12 Months Ended

Mar. 31, 2014

Dec. 31, 2019

Dec. 31, 2018

Dec. 31, 2017

Dec. 31, 2016

Number of shares available for issuance

Outstanding number of shares available for issuance at the beginning of the year (in shares)

17,293,000

18,540,000

18,878,000

Granted (in shares)

^[1]

(2,411,000)

(1,597,000)

(736,000)

Cancelled/expired/forfeited (in shares)

222,000

350,000

398,000

Outstanding number of shares available for issuance at the end of the year (in shares)

15,104,000

17,293,000

18,540,000

18,878,000

Aggregate Intrinsic Value

Fair value per ordinary share (in dollars per share)

$ 46.35

$ 58.43

$ 103.46

Cash received from the exercise of stock option

$ 275,000

$ 781,000

$ 2,285,000

2014 Plan

Number of shares available for issuance

Addition (in shares)

1,000,000.0

Stock options

Options Outstanding

Outstanding at the beginning of the year (in shares)

184,000

437,000

2,587,000

Exercised (in shares)

(95,000)

(248,000)

(2,122,000)

Cancelled/expired/forfeited (in shares)

(5,000)

(28,000)

Outstanding at the end of the year (in shares)

89,000

184,000

437,000

2,587,000

Vested and expected to vest at the end of the year (in shares)

89,000

184,000

Exercisable at the end of the year (in shares)

89,000

184,000

Weighted Average Exercise Price

Outstanding at the beginning of the year (in dollars per share)

$ 3.45

$ 3.24

$ 1.41

Exercised (in dollars per share)

3.41

3.14

1.04

Cancelled/expired/forfeited (in dollars per share)

1.16

0.68

Outstanding at the end of the year (in dollars per share)

3.49

3.45

$ 3.24

$ 1.41

Vested and expected to vest at the end of the year (in dollars per share)

3.49

3.45

Exercisable at the end of the year (in dollars per share)

$ 3.49

$ 3.45

Weighted Average Remaining Contractual Life (In years)

Outstanding at the end of the year

8 months 12 days

1 year 6 months

2 years

1 year 7 months 6 days

Vested and expected to vest at the end of the year

8 months 12 days

1 year 6 months

Exercisable at the end of the year

8 months 12 days

1 year 6 months

Aggregate Intrinsic Value

Outstanding at the end of the year

$ 3,799,000

$ 10,089,000

$ 43,800,000

$ 101,403,000

Vested and expected to vest at the end of the year

3,799,000

10,089,000

Exercisable at the end of the year

3,799,000

10,089,000

Total intrinsic value of options exercised

4,200,000

25,600,000

135,200,000

Cash received from the exercise of stock option

300,000

$ 800,000

$ 2,300,000

Unrecognized compensation cost

$ 0

Stock options | 2014 Plan

Number of shares available for issuance

Granted (in shares)

Restricted share units | 2014 Plan

Number of shares available for issuance

Restricted shares units granted (in shares)

2,400,000

1,600,000

700,000

[1]	For the years ended December 31, 2017, 2018 and 2019, 0.7 million, 1.6 million and 2.4 million restricted share units were granted under the 2014 Plan, respectively. No options were granted for the three-year period ended December 31, 2019.

Income Taxes (Details) $ / shares in Units, $ in Thousands, $ in Millions		12 Months Ended
	Feb. 22, 2008	Dec. 31, 2019 HKD ($) jurisdiction	Dec. 31, 2019 USD ($) jurisdiction $ / shares	Dec. 31, 2018 USD ($) $ / shares	Dec. 31, 2017 USD ($) $ / shares	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010	Dec. 31, 2009	Dec. 31, 2008
Income taxes
Number of taxable jurisdictions \| jurisdiction		2	2
Components of income before income taxes
Income before income tax expenses			$ 602,397	$ 668,842	$ 417,111
Add: loss from non-China operations			106,256	43,266	52,261
Income from China operations			708,653	712,108	469,372
Income tax expense			$ 109,564	$ 96,222	$ 66,746
Effective tax rate for China operations (as a percent)		12.40%	12.40%	13.50%	14.20%
Income tax rate (as a percent)		25.00%	25.00%	25.00%	25.00%
Composition of income tax expenses for China operations
Deferred tax (benefits)/provisions			$ 16,839	$ 4,438	$ (1,503)
Current income tax expenses			92,725	91,784	68,249
Income tax expenses			$ 109,564	$ 96,222	$ 66,746
Reconciliation of the statutory tax rate to the effective tax rate for China operations
Statutory EIT rate (as a percent)		25.00%	25.00%	25.00%	25.00%
Effect on tax holiday and preferential tax treatment (as a percent)		(13.70%)	(13.70%)	(12.10%)	(11.60%)
Permanent differences (as a percent)		(0.90%)	(0.90%)	0.60%	0.20%
Change in valuation allowance (as a percent)		2.00%	2.00%	0.00%	0.60%
Effective tax rate for China operations (as a percent)		12.40%	12.40%	13.50%	14.20%
Deferred tax assets:
Net operating loss carry forwards			$ 5,515	$ 4,180
Less: valuation allowance			(5,515)	(4,180)
Depreciation, accounts receivable, accrued and other liabilities			42,932	25,327
Less: valuation allowance			(26,472)	(13,419)
Net deferred tax assets (included in other assets)			16,460	11,908
Deferred tax liabilities:
Acquired intangible assets			1,793	2,310
Depreciation			1,044	702
Investment gain			31,135	9,565
Total deferred tax liabilities			33,972	12,577
Valuation allowance on deferred tax assets			$ 32,000	17,600
Historical rate for valuing deferred tax assets (as a percent)		25.00%	25.00%
Weibo Technology
Reconciliation of the statutory tax rate to the effective tax rate for China operations
Effect of preferential tax treatment			$ 83,200	$ 77,200	$ 52,600
Effect of tax exemption and preferential tax on basic net income per share (USD per share) \| $ / shares			$ 0.43	$ 0.39	$ 0.25
Weibo Technology \| key software enterprise
Reconciliation of the statutory tax rate to the effective tax rate for China operations
Preferential tax treatment recognized			$ 13,000	$ 10,800
Non-China
Components of income before income taxes
Income tax expense			21,473
Deferred tax charges from fair value change of investments			21,500
Composition of income tax expenses for China operations
Income tax expenses			$ 21,473
Cayman Islands
Components of income before income taxes
Withholding income tax on dividends distributed by subsidiaries to its immediate holding entity outside China (as a percent)		0.00%	0.00%
Hong Kong
Components of income before income taxes
Withholding profits earned		$ 2
Income tax rate (as a percent)		16.50%	16.50%	16.50%	16.50%
Withholding income tax rate for dividend paid to foreign tax resident investors (as a percentage)		8.25%	8.25%
Net operating loss carry forwards			$ 8,900
Reconciliation of the statutory tax rate to the effective tax rate for China operations
Statutory EIT rate (as a percent)		16.50%	16.50%	16.50%	16.50%
China
Components of income before income taxes
Income tax expense			$ 88,091	$ 96,222	$ 66,746
Withholding income tax on dividends distributed by subsidiaries to its immediate holding entity outside China (as a percent)		10.00%	10.00%
Income tax rate (as a percent)		25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%
Net operating loss carry forwards			$ 22,100	$ 16,700
Maximum percentage of withholding income tax on dividends distributed by subsidiaries to its immediate holding entity in Hong Kong		5.00%	5.00%
Percentage of ownership interests held by foreign investors			25.00%
Percentage of withholding income tax on dividends distributed by PRC subsidiaries to its immediate holding company in Hong Kong		5.00%	5.00%
Composition of income tax expenses for China operations
Income tax expenses			$ 88,091	$ 96,222	$ 66,746
Reconciliation of the statutory tax rate to the effective tax rate for China operations
Statutory EIT rate (as a percent)		25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%	25.00%
China \| Software enterprise
Components of income before income taxes
Period of income tax exemption	2 years
Reduction in preferential tax rate (as a percent)	50.00%
Preferential statutory rate (as a percent)	12.50%	12.50%	12.50%	12.50%	12.50%
Period of reduced preferential income tax rate	3 years
China \| key software enterprise
Components of income before income taxes
Preferential statutory rate (as a percent)				10.00%	10.00%

Related Party Transactions (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2017	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Related party transactions
Loans to and interest receivable from SINA		$ 301,526	$ 43,695
Costs and expenses allocated from SINA(2)		51,848	47,334	$ 41,136
Related party outstanding balance:
Amount due from SINA		384,828	105,319
Accounts receivable due from Alibaba		422,225	369,093
Loans to and interest receivables from investees (Note 10)		301,526	43,695
Due from related parties		301,500	$ 43,700
Accounts receivable due from related party offset		38,700
Accounts payable due to related party offset		28,700
Accrued and other liabilities due to related party offset		10,000
SINA
Related party transactions
Loan agreement term			1 year
Principal and interest expense of loan from SINA			$ 2,000	60,000
Principal and interest income of loan to SINA's subsidiary				62,000
Loan to SINA		233,884	149,460	59,534
Loan repaid by SINA		43,567	101,060	62,252
Loans to and interest receivable from SINA		236,600	43,600
Revenue billed through/for service provided to SINA(1)		137,223	90,645	64,093
Costs and expenses allocated from SINA(2)		51,848	47,334	41,136
Other costs and expenses billed by SINA		37,500	23,400	22,900
Related party outstanding balance:
Amount due from SINA		$ 384,828	$ 105,319
Annual interest rate on loan to SINA		4.50%	4.80%
Annual interest rate		4.50%	4.80%
SINA \| U.S. dollar-denominated Matching Loan from SINA
Related party transactions
Loan agreement term	1 year
Principal and interest expense of loan from SINA				61,500
Interest expense on matching loan from SINA				1,537
SINA \| RMB-denominated Matching Loan to SINA's Subsidiary
Related party transactions
Loan agreement term	1 year
Principal and interest income of loan to SINA's subsidiary				64,000
Interest income on matching loan to SINA				1,735
SINA \| Short-term Loan
Related party transactions
Amount of loan				2,000
Interest income on matching loan to SINA		$ 9,295	$ 2,425
Alibaba
Related party transactions
Services provided by Alibaba		50,205	47,642	32,734
Related party outstanding balance:
Accounts receivable due from Alibaba		60,392	48,222
Advertising and marketing revenues from related party		97,772	117,696	84,688
Company A
Related party transactions
Loans to and interest receivable from SINA		160,010	43,695
Company B
Related party transactions
Loans to and interest receivable from SINA		$ 60,602
Company B \| Minimum
Related party outstanding balance:
Annual interest rate on loan to SINA		4.00%
Annual interest rate		4.00%
Company B \| Maximum
Related party outstanding balance:
Annual interest rate on loan to SINA		10.50%
Annual interest rate		10.50%
Company C
Related party transactions
Loans to and interest receivable from SINA		$ 40,982
Other related parties
Related party outstanding balance:
Accounts receivable due from Alibaba		99,675	130,835
Value-added services revenues		5,400	24,100	21,400
Advertising and marketing revenues from related party		117,000	130,200	71,600
Cost and expenses recognized from transactions with other related parties		31,200	19,000	$ 18,200
Accounts receivable due from other related parties		99,700	130,800
Allowances for doubtful accounts written off		630
Accounts payable due to other related parties		10,700	31,200
Accrued and other liabilities due to other related parties		34,400	14,400
Equity investee in the short video business
Related party outstanding balance:
Advertising and marketing revenues from related party		10,900	53,900
Accounts receivable due from other related parties		34,700	$ 80,900
Others
Related party transactions
Loans to and interest receivable from SINA		$ 39,932

Net Income per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Numerator:
Net income attributable to Weibo	$ 494,675	$ 571,823	$ 352,590
Denominator:
Weighted average ordinary shares outstanding (in shares)	225,452,000	223,751,000	220,555,000
Basic net income per share attributable to Weibo (in dollars per share)	$ 2.19	$ 2.56	$ 1.60
Numerator:
Net income attributable to Weibo	$ 494,675	$ 571,823	$ 352,590
Add: Effect on interest expenses and amortized issuance cost of convertible debt		15,390
Net income attributable to Weibo for calculating diluted net income per share	$ 494,675	$ 587,213	$ 352,590
Denominator:
Weighted average ordinary shares outstanding (in shares)	225,452,000	223,751,000	220,555,000
Weighted average ordinary shares equivalents:
Effects of dilutive securities for convertible debt (in shares)	6,800,000
Shares used in computing diluted net income per share attributable to Weibo (in shares)	226,412,000	232,683,000	225,363,000
Diluted net income per share attributable to Weibo (in dollars per share)	$ 2.18	$ 2.52	$ 1.56
Options and RSUs
Anti-dilutive share
Anti-dilutive share excluded from the calculation of diluted net income per share	440,000	60,000.00	0
Weighted average ordinary shares equivalents:
Effects of dilutive securities (in shares)	1,000,000.0	2,200,000	4,800,000
Stock options
Weighted average ordinary shares equivalents:
Effects of dilutive securities (in shares)	153,000	283,000	1,213,000
Restricted share units
Weighted average ordinary shares equivalents:
Effects of dilutive securities (in shares)	807,000	1,896,000	3,595,000
2022 Notes
Anti-dilutive share
Anti-dilutive share excluded from the calculation of diluted net income per share	6,800,000		1,200,000
Weighted average ordinary shares equivalents:
Effects of dilutive securities for convertible debt (in shares)		6,753,000

Operations - Narrative Information (Details) $ in Millions	1 Months Ended	12 Months Ended
Operations - Narrative Information (Details) $ in Millions	Apr. 30, 2014 USD ($)	Dec. 31, 2019 Vote
Class A ordinary shares
Operations
Number of votes each share is entitled to		1
Number of Class A shares converted from Class B shares		1
Class B ordinary shares
Operations
Number of votes each share is entitled to		3
IPO \| Class A ordinary shares
Operations
Proceeds from IPO \| $	$ 306.5
Weimeng
Operations
Percentage of Direct/Indirect Economic Interest in VIEs		100.00%
Weibo Interactive
Operations
Percentage of Direct/Indirect Economic Interest in VIEs		100.00%
Weibo HK
Operations
Percentage of Direct/Indirect Economic Interest		100.00%
Weibo Technology
Operations
Percentage of Direct/Indirect Economic Interest		100.00%

Significant Accounting Policies (Details) - USD ($) $ in Thousands		6 Months Ended		12 Months Ended
	Jan. 01, 2018	Dec. 31, 2019	Jun. 30, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues:
Revenues				$ 1,766,914	$ 1,718,518	$ 1,150,054
Revenue recognized that was included in the deferred revenue				$ 88,300	67,200
Costs and Expenses
VAT and surcharges (as a percent)				6.70%
Sales and Marketing Expenses
Advertising and promotional expenses				$ 352,300	428,800	200,600
Long-term investments
Available-for-sale of marketable securities	$ 0
Unrealized loss on accumulated other comprehensive income to retained earnings	1,000					(995)
Stock options
Stock-based compensation
Vesting period				4 years
Service-Based Restricted Share Units
Stock-based compensation
Vesting period				4 years
Impact of adoption of new revenue guidance
Revenues:
Cumulative-effect adjustment on the retained earnings	$ (600)
Advertising & Marketing
Revenues:
Revenues				$ 1,530,211	1,499,180	996,745
Costs and Expenses
Cultural business construction fees (as a percent)		1.50%	3.00%	3.00%
Taxes on advertising and marketing revenues				$ 40,700	52,900	90,600
Advertising & Marketing \| Maximum
Revenues:
Period over social display ad arrangements allow customers to place advertisements on particular areas of the Group's platform in particular formats				3 months
Value-added services
Revenues:
Revenues				$ 236,703	$ 219,338	$ 153,309
Game-related service
Maximum period for recognition of revenues after purchase of in-game credits				1 month

Significant Accounting Policies - Lease (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jan. 01, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use asset	$ 9,730
Operating lease liability	$ 9,997
Restatement adjustment \| ASU 2016-02, "Leases (Topic 842)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Right-of-use asset		$ 14,400
Operating lease liability		$ 14,900

Significant Accounting Policies - Property and Equipment (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Property and equipment
Depreciation expenses	$ 22.4	$ 18.5	$ 14.7
Computers and equipment \| Minimum
Property and equipment
Estimated useful lives of assets	3 years
Computers and equipment \| Maximum
Property and equipment
Estimated useful lives of assets	4 years
Furniture and fixtures
Property and equipment
Estimated useful lives of assets	5 years

Significant Accounting Policies - Intangible Assets Other Than Goodwill, Foreign Currency and Segment Reporting (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Foreign currency
Currency translation adjustments \| $	$ (19,029)	$ (60,273)	$ 37,822
Segment reporting
Number of principal business segments \| segment	2
Minimum
Intangible assets other than goodwill
Estimated useful lives of intangible assets	5 years
Maximum
Intangible assets other than goodwill
Estimated useful lives of intangible assets	10 years

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands	Dec. 31, 2019	Dec. 31, 2018
Allowance for doubtful accounts	$ 36,594,000	$ 12,429,000
Related Party Transaction, Due from (to) Related Party, Current	301,526,000	43,695,000
Current liabilities	$ 800,855,000	$ 629,844,000
Ordinary shares, par value (in dollars per share)	$ 0.00025	$ 0.00025
Ordinary shares, shares authorized	2,400,000	2,400,000
Ordinary shares, shares issued	226,310	224,838
Ordinary shares, shares outstanding	226,310	224,838
Class A ordinary shares
Ordinary shares, shares authorized	1,800,000	1,800,000
Ordinary shares, shares issued	124,531	123,059
Class B ordinary shares
Ordinary shares, shares authorized	200,000	200,000
Ordinary shares, shares issued	101,779	101,779
Ordinary shares to be designated
Ordinary shares, shares authorized	400,000	400,000
Consolidated VIEs without recourse to the primary beneficiaries
Current liabilities	$ 436,705,000	$ 347,770,000
Alibaba
Allowance for doubtful accounts	0	0
Other related parties
Allowance for doubtful accounts	0	630,000
Third parties
Allowance for doubtful accounts	$ 36,594,000	$ 11,799,000

Significant Accounting Policies - Concentration of Risks (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($) customer Agency	Dec. 31, 2018 USD ($) customer Agency	Dec. 31, 2017 Agency
Concentration of risks
Cash, cash equivalents and short-term investments	$ 2,404,220	$ 1,825,865
Current liabilities denominated in RMB	800,855	629,844
Cash, cash equivalents and short-term investments \| Concentration of credit risk \| China
Concentration of risks
Cash, cash equivalents and short-term investments	$ 2,210,000	1,730,000
Maximum term of original maturity of time deposits	12 months
Cash, cash equivalents and short-term investments \| Concentration of foreign currency risks \| RMB
Concentration of risks
Cash, cash equivalents and short-term investments	$ 936,900	$ 950,800
Percentage of benchmark derived from specified source	39.00%	52.00%
Consolidated net revenues benchmark \| Customer concentration risk
Concentration of risks
Other customers or advertising agencies accounting for 10% or more of the Group's revenues \| customer	0
Consolidated net revenues benchmark \| Customer concentration risk \| Alibaba
Concentration of risks
Percentage of benchmark derived from specified source	6.00%	7.00%	7.00%
Consolidated net accounts receivables benchmark \| Concentration of credit risk \| Alibaba
Concentration of risks
Percentage of benchmark derived from specified source	14.00%	13.00%
Consolidated net accounts receivables benchmark \| Concentration of credit risk \| Customer 1
Concentration of risks
Number of customers \| customer	1	1
Percentage of benchmark derived from specified source	8.00%	22.00%
Consolidated net accounts receivables benchmark \| Concentration of foreign currency risks \| RMB
Concentration of risks
Accounts receivable denominated in RMB	$ 422,200	$ 368,800
Current liabilities \| Concentration of foreign currency risks \| RMB
Concentration of risks
Current liabilities denominated in RMB	$ 744,200	$ 620,400
Percentage of benchmark derived from specified source	93.00%	99.00%
Advertising & Marketing \| Consolidated net revenues benchmark \| Customer concentration risk \| Top 10 advertising agencies \| China
Concentration of risks
Number of advertising agencies \| Agency	10	10	10
Percentage of benchmark derived from specified source	28.00%	26.00%	23.00%

Long-term Investments - Carrying Value of Equity Investments (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Total carrying value of the equity securities
Initial cost basis	$ 738,035	$ 555,153
Upward adjustments	81,458	42,877
Downward adjustments (impairment only)	(254,416)	(23,557)
Foreign currency translation	(6,475)	(3,854)
Total carrying value at the end of the period	$ 558,602	$ 570,619

Long-term Investments - Carrying Amount and Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Carrying amount and fair value of the marketable security
Cost Basis	$ 101,677	$ 5,274
Gross Unrealized Gains	176,682
Gross Unrealized Losses	(8,881)	(3,798)
Fair value of Investments	269,478	1,476
One marketable security
Carrying amount and fair value of the marketable security
Cost Basis		5,274
Gross Unrealized Losses		(3,798)
Fair value of Investments		$ 1,476
Showworld
Carrying amount and fair value of the marketable security
Cost Basis	81,385
Gross Unrealized Gains	176,169
Fair value of Investments	257,554
Other marketable securities
Carrying amount and fair value of the marketable security
Cost Basis	20,292
Gross Unrealized Gains	513
Gross Unrealized Losses	(8,881)
Fair value of Investments	$ 11,924

Long-term Investments - Impairment (Details) - USD ($)	12 Months Ended
Long-term Investments - Impairment (Details) - USD ($)	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Long-term Investments
Impairment charge	$ 249,935,000	$ 24,074,000	$ 4,747,000
Write-offs of prepayments	19,100,000	$ 500,000	$ 0
Equity Method
Long-term Investments
Write-offs of prepayments	19,100,000
Other impairments	16,200,000
Online-reading business
Long-term Investments
Impairment charge	11,900,000
A Company operating in game business
Long-term Investments
Impairment charge	9,700,000
Yixia Tech \| Cost Method/Equity Securities Without Readily Determinable Fair Values
Long-term Investments
Impairment charge	$ 214,700,000

Leases (Details)	12 Months Ended
Leases (Details)	Dec. 31, 2019 USD ($)
Components of lease cost
Operating lease cost	$ 4,693,000
Short term lease cost	2,663,000
Variable lease cost	4,172,000
Total lease cost	11,528,000
Cash paid for amounts included in the measurement of lease liabilities:
Cash paid for operating leases	4,683,000
Operating lease assets obtained in exchange for operating lease liabilities	944,000
Maturities of lease liabilities under operating leases
2020	5,196,000
2021	4,528,000
2022	935,000
2023	0
2024	0
2025 and thereafter	0
Total future payments for recognized leasing assets	10,659,000
Less: imputed interest	(662,000)
Total lease liabilities	$ 9,997,000
Average remaining lease term	2 years 2 months 12 days
Weighted-average discount rate (as a percent)	5.00%
Lease contracts that has been entered into but not yet commenced	$ 0

Acquisitions, Goodwill and Intangible Assets - Allocation of Consideration (Details) $ in Thousands			12 Months Ended
	Oct. 01, 2019 USD ($)	Oct. 01, 2018 USD ($)	Dec. 31, 2019 USD ($) item	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($) item
Acquisitions, Goodwill and Intangible Assets
Number of immaterial acquisitions \| item					1
Number of new acquisitions \| item			0
Business combination allocated based on fair value of the assets and the liabilities
Consideration		$ 50,000
Property and equipment, net		466
Identifiable intangible assets acquired		21,942	$ 17,500
Other tangible assets		2,874
Liabilities assumed		(2,434)
Goodwill		27,152	$ 28,989	$ 29,346	$ 13,420
Total consideration		50,000
Yizhibo
Acquisitions, Goodwill and Intangible Assets
Cash consideration	$ 10,000	40,000
Business combination allocated based on fair value of the assets and the liabilities
Consideration		$ 50,000
Revenue increase due to acquisition				$ 28,000
Yizhibo \| Supplier-relationship
Acquisitions, Goodwill and Intangible Assets
Estimated useful lives of intangible assets		5 years
Business combination allocated based on fair value of the assets and the liabilities
Identifiable intangible assets acquired		$ 9,700
Yizhibo \| Core Technology
Acquisitions, Goodwill and Intangible Assets
Estimated useful lives of intangible assets		8 years
Business combination allocated based on fair value of the assets and the liabilities
Identifiable intangible assets acquired		$ 6,600
Yizhibo \| Trademark and Domain name
Acquisitions, Goodwill and Intangible Assets
Estimated useful lives of intangible assets		10 years
Business combination allocated based on fair value of the assets and the liabilities
Identifiable intangible assets acquired		$ 5,600

Acquisitions, Goodwill and Intangible Assets - Intangible assets arising from acquisitions (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Acquired finite-lived intangible assets
Cost	$ 26,341	$ 26,665
Accumulated Amortization	(8,817)	(5,562)
Intangible assets, net	17,524	21,103
Technology
Acquired finite-lived intangible assets
Cost	8,869	8,978
Accumulated Amortization	(3,351)	(2,594)
Intangible assets, net	5,518	6,384
Trademark and Domain name
Acquired finite-lived intangible assets
Cost	5,555	5,623
Accumulated Amortization	(724)	(147)
Intangible assets, net	4,831	5,476
Supplier-relationship
Acquired finite-lived intangible assets
Cost	9,619	9,738
Accumulated Amortization	(2,444)	(495)
Intangible assets, net	7,175	9,243
Others
Acquired finite-lived intangible assets
Cost	2,298	2,326
Accumulated Amortization	$ (2,298)	$ (2,326)

Stock-Based Compensation - Incentive Plan Details (Details) - USD ($) $ in Thousands		1 Months Ended		12 Months Ended
	Jan. 01, 2015	Mar. 31, 2014	Aug. 31, 2010	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Stock-Based Compensation
Stock based compensation, amortization period				4 years
Stock-based compensation expense				$ 61,289	$ 41,011	$ 48,037
Performance-based restricted shares
Stock-Based Compensation
Stock based compensation, amortization period				1 year
2010 Plan
Stock-Based Compensation
Term of share incentive plan			10 years
Ordinary shares reserved for issuance			35,000,000
Amount that maximum number of ordinary shares available for issuance is reduced for every share issued pursuant to share option or share appreciation right			1
Amount that maximum number of ordinary shares available for issuance is reduced for every share issued as restricted shares or pursuant to restricted share units			1.75
2014 Plan
Stock-Based Compensation
Term of share incentive plan	10 years
Ordinary shares reserved for issuance		4,600,000
Number of additional shares for the plan		1,000,000.0
One-time percentage increase on January 1, 2015 for maximum aggregate number of shares which may be issued (as a percent)	10.00%

Other Balance Sheet Components - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Prepaid expenses and other current assets:
Rental and other deposits	$ 371	$ 684
Deductible value-added taxes	652	4,539
Investment prepayments	47,069	62,561
Loans to and interest receivables from investees (Note 10)	301,526	43,695
Advertising prepayment	3,406	4,575
Prepayment to outsourced service providers	3,483	4,730
Amounts deposited by users	34,912	30,631
Content fees	14,013	11,021
Others	19,473	6,385
Prepaid expenses and other current assets	$ 424,905	$ 168,821

Other Balance Sheet Components - Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Property and equipment, net:
Property and equipment, gross	$ 143,630	$ 133,622
Less: Accumulated depreciation	(96,901)	(87,999)
Property and equipment, net	46,729	45,623
Computers and equipment
Property and equipment, net:
Property and equipment, gross	132,477	124,241
Leasehold improvements
Property and equipment, net:
Property and equipment, gross	5,732	5,008
Furniture and fixtures
Property and equipment, net:
Property and equipment, gross	1,725	1,677
Others
Property and equipment, net:
Property and equipment, gross	$ 3,696	$ 2,696

Employee Benefit Plans (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plans (Details) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
China Contribution Plan
Employee Benefit Plans
Employer contribution under China Contribution Plan	$ 53.3	$ 53.7	$ 38.0

Segment Information (Details) $ in Thousands	12 Months Ended
Segment Information (Details) $ in Thousands	Dec. 31, 2019 USD ($) segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Summary information by segment
Number of principal business segments \| segment	2
Revenues	$ 1,766,914	$ 1,718,518	$ 1,150,054
Advertising & Marketing
Summary information by segment
Revenues	1,530,211	1,499,180	996,745
Value-added services
Summary information by segment
Revenues	$ 236,703	$ 219,338	$ 153,309

Profit Appropriation and Restricted Net Assets (Details) $ in Millions	12 Months Ended
	Dec. 31, 2019 USD ($) fund	Dec. 31, 2018 USD ($)
Profit Appropriation and Restricted Net Assets
Minimum percentage of after-tax profit transferred by Chinese subsidiaries to general reserve fund	10.00%
Maximum percentage criteria for appropriation of after-tax profit of Chinese subsidiaries to general reserve fund	50.00%
Number of reserve funds except general reserve fund, appropriation at the entity's discretion \| fund	2
Minimum percentage of after-tax profit transferred by VIEs to statutory reserve fund	10.00%
Maximum percentage criteria for in appropriation of after-tax profit by VIEs to certain statutory reserve funds	50.00%
Reserves made to non-distributable reserve fund (in dollars)	$ 105.8	$ 98.7
Net assets subject to restriction for the Group (in dollars)	$ 394.7
Percent of restricted net assets of total consolidated net assets	17.00%

Fair Value Measurement - Fair Value Hierarchy (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Fair Value of Financial Instruments
Bank time deposits	$ 951,235	$ 591,269
Equity securities with readily determinable fair value	269,478	1,476
Financial instruments measured on a recurring basis
Fair Value of Financial Instruments
Bank time deposits	951,235	591,269
Equity securities with readily determinable fair value	269,478	1,476
Total	1,220,713	592,745
Financial instruments measured on a recurring basis \| Quoted Prices in Active Market for Identical Assets (Level 1)
Fair Value of Financial Instruments
Bank time deposits		0
Equity securities with readily determinable fair value	269,478	1,476
Total	269,478	1,476
Financial instruments measured on a recurring basis \| Significant Other Observable Inputs (Level 2)
Fair Value of Financial Instruments
Bank time deposits	951,235	591,269
Equity securities with readily determinable fair value		0
Total	$ 951,235	591,269
Financial instruments measured on a recurring basis \| Significant Unobservable Inputs (Level 3)
Fair Value of Financial Instruments
Bank time deposits		0
Equity securities with readily determinable fair value		$ 0

Fair Value Measurement - Non-recurring Basis (Details)	12 Months Ended
Fair Value Measurement - Non-recurring Basis (Details)	Dec. 31, 2019 USD ($) item	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Reconciliation of the fair value measurements using significant unobservable inputs
Impairment charge	$ 249,935,000	$ 24,074,000	$ 4,747,000
Write-down of goodwill	0	10,600,000	0
Non-recurring
Reconciliation of the fair value measurements using significant unobservable inputs
Write-down of goodwill	$ 0	10,600,000	0
Significant Unobservable Inputs (Level 3)
Reconciliation of the fair value measurements using significant unobservable inputs
Valuation technique	us-gaap:ValuationTechniqueDiscountedCashFlowMember
Measurement input	us-gaap:MeasurementInputMarketInterestRatesMember
Significant Unobservable Inputs (Level 3) \| Non-recurring \| Minimum
Reconciliation of the fair value measurements using significant unobservable inputs
Discount rate (as a percent) \| item	0.12
Significant Unobservable Inputs (Level 3) \| Non-recurring \| Maximum
Reconciliation of the fair value measurements using significant unobservable inputs
Discount rate (as a percent) \| item	0.23
Significant Unobservable Inputs (Level 3) \| Non-recurring \| Certain investments under cost method and equity method were measured using significant unobservable inputs
Reconciliation of the fair value measurements using significant unobservable inputs
Impairment charge			$ 4,700,000
Impairment charge	$ 230,900,000	23,600,000
Carrying value of impaired investments	$ 77,500,000	$ 2,500,000

Convertible Debt and Unsecured Senior Notes (Details) $ / shares in Units, $ in Thousands	1 Months Ended		12 Months Ended
	Jul. 31, 2019 USD ($)	Oct. 31, 2017 USD ($) $ / shares	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
2022 Notes
Convertible Debt
Aggregate principal amount		$ 900,000	$ 900,000
Coupon interest (as a percent)		1.25%	1.25%
Due date of the Notes		Nov. 15, 2022
Initial conversion price (in dollars per ADS) \| $ / shares		$ 133.27
Net proceeds from issuance of the Notes			$ 879,300		$ 879,293
Issuance cost			20,700
Interest expense			15,400	$ 15,400
2024 Notes
Convertible Debt
Aggregate principal amount	$ 800,000		$ 800,000
Coupon interest (as a percent)	3.50%		3.50%
Net proceeds from issuance of the Notes	$ 793,300
Issuance cost	6,700
Interest expense	$ 14,500
Class A ordinary shares \| 2022 Notes
Convertible Debt
Conversion ratio per ADS		1