Sina Corporation (Nasdaq: SINA), a leading online media company and mobile value-added service (MVAS) provider for China and for the global Chinese communities, yesterday announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2006.

For the fourth quarter of 2006, Sina reported net revenues of $56.4 million, compared to $52.0 million in the same period in fiscal 2005 and $56.1 million for the third quarter of 2006. Advertising revenues for the fourth quarter of 2006 totaled $35.7 million, representing a 43% increase from the same period last year and a 9% increase from last quarter. The growth in advertising came mainly from China, which recorded advertising revenues of $35.0 million for the fourth quarter of 2006, representing an increase of 45% from the same period last year and 10% sequentially.

Non-advertising revenues for the fourth quarter of 2006 totaled $20.7 million, a 23% decrease from the same period in 2005 and a 12% decrease over the previous quarter. The decrease in non-advertising revenues came mostly from the decline in MVAS revenues, which recorded $19.3 million for the fourth quarter of 2006, representing a decline of 22% from the same period in 2005 and a decline of 11% from last quarter.

For fiscal 2006, Sina reported net revenues of $212.9 million, compared to $193.6 million in 2005. Advertising revenues for fiscal 2006 totaled $120.1 million, an increase of 41% from 2005. The growth in advertising came mostly from China, which generated $116.9 million in advertising revenues for fiscal 2006, representing a year-over-year growth of 44%. Non-advertising revenues for fiscal 2006 amounted to $92.8 million, a decrease of 15% from 2005.

Gross margin for the fourth quarter of 2006 was 62%, down from 66% in the same period last year and 64% in the last quarter. Gross margin for the fourth quarter of 2006 included a $1.1 million, or 2% of total revenues, write-off of prepaid license fees related to the iGame business, based on management's assessment of the game business during the quarter. Advertising gross margin for the fourth quarter of 2006 was 65%, compared to 69% in the same period last year and 65% in the previous quarter. Advertising gross margin in the fourth quarter of 2006 included stock-based compensation, which was equivalent to 1% of advertising revenues. Excluding this item, advertising gross margin in the fourth quarter of 2006 was 66%, compared to 69% in the same period last year.

Gross margin for fiscal 2006 was 63%, down from 67% from fiscal 2005. Advertising gross margin for fiscal 2006 was 65%, compared to 67% for fiscal 2005. Advertising gross margin in fiscal 2006 includes $1.7 million in stock-based compensation or 1% of advertising revenues. MVAS gross margin for fiscal 2006 was 60%, compared to 66% in the prior year. The decrease in gross margin was primarily related to higher transmission and content costs.

"This was another quarter of strong performance and further demonstrates Sina's position as the leading online advertising platform in China," said Charles Chao, CEO of Sina. "2006 represents a year of excellent execution for Sina. Our focus on the online media business has led to enhanced brand recognition, strong user and traffic growth, and an impressive 44% year-over-year increase in online advertising revenues in China. We begin 2007 with continuing momentum from our online advertising business, which makes up 63% of our total revenues as of this quarter."