Shares of 58.com (NYSE: WUBA) jumped on Thursday following the Chinese internet company's second-quarter report. Both revenue and earnings came in ahead of analyst expectations, and 58.com's revenue guidance for the third quarter topped the consensus estimate. The stock was up about 12.1% at 12:00 p.m. EDT.
58.com reported second-quarter revenue of RMB3.43 billion, or $518.5 million. That's up 32.3% year over year in local currency, and about $46 million above the average analyst estimate. Membership revenue rose 21.1% to RMB1.17 billion, or $176.4 million, driven by an increase in subscription-based membership accounts. Across all the company's platforms, 58.com reached 2.93 million paying membership accounts in the second quarter.
Online marketing services revenue grew at a faster 42.3% rate, reaching RMB2.19 billion or $330.5 million. The company pointed to increasing adoption and effectiveness of its online marketing services as the main driver of the growth. Revenue from other sources, including e-commerce services, was minimal.
Non-GAAP earnings per ADS came in at $0.82, up 21.2% year over year in local currency and $0.14 higher than analysts were expecting.
58.com CEO Micael Yao went into more detail on some of the company's businesses:
Yao also gave an update on two small but promising new businesses:
58.com expects to produce third-quarter revenue between RMB3.45 billion and RMB3.55 billion, up 26.7% to 30.4% in local currency. That range works out to $497.4 million to $512.0 million, above analyst expectations of $486.4 million.
Shares of 58.com have tumbled since peaking in early May. The stock sits right around $65 per share after Thursday's rally, still far below its 52-week high of nearly $90 per share. 58.com may need to string together a series of positive reports before the stock fully recovers.
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