Sina.com, China's largest Internet portal, said on Thursday that its fourth-quarter profits through December 2006 fell 15 percent year on year due to higher expenses and a drop in revenues for mobile services.

Sina reported earnings of $11.7 million, or $0.20 per share, down from $13.8 million, or $0.24 per share, in the same quarter of 2005. It reported strong online advertising growth, with revenues in China up 44 percent from the year-earlier quarter.

The company said its online ads account for 63 percent of its total revenues. For full fiscal 2006, profits were $39.9 million, or $0.69 per share, down from 2005's $43.1 million, or $0.75 per share. CEO Charles Chao told analysts that sina.com sees great potential for online advertising growth in the next two years. He said Sina expects ad revenues to grow strongly as advertisers roll out campaigns for the 2008 Beijing Olympics.

Sina is China's most visited content-oriented Web site, offering extensive news (covering sports, business,  sci-tech and entertainment), games and other services. It has expanded into online video and a blog service. Chao said traffic for Sina's blogs jumped by 10 times last year to more than 120 million page views per day, though the company has yet to begin earning revenues from the service.

In mobile services, fourth-quarter revenues fell 28 percent from the same period of 2005 amid regulatory and billing changes that have hit all of China's mobile services. "We believe we will continue to experience further revenue decline in our mobile business in the first quarter of 2007," the chief financial officer, Herman Yu, said. He added that Sina plans to stay in wireless services but will watch expenses closely.

Sina's rival Sohu.com Inc., China's second largest Internet portal, said this week its fourth-quarter earnings fell 32 percent due to lower wireless revenues and higher advertising costs.

China has an exponentially growing population of Internet users, with 137 million people online by the end of 2006, second only to the United States, though it lags behinds the U.S., South Korean and other economies in e-commerce terms.