58.com Inc. Reports Second Quarter Financial Results

58.com Inc. (NYSE: WUBA) reported better than expected second quarter results for the 2017 fiscal year and sent shares jumping over 16 percent on Monday.

The company reported a revenue of $382.8 million, a 33.3 percent increase year over year, surpassing the company’s expectations of $352.3 million. Income from operations was $105.7 million. Non-GAAP net income was reported to be $97.7 million. Non-GAAP earnings were reported at $0.77.

Membership revenues were $142.3 million, an increase of 28.2 percent year over year. The company said that membership revenues increased mainly due to an increase in the number of subscription based paying membership accounts. The total number of subscribed paying accounts across all of 58.com’s platforms (58.com, Ganji.com, Anjuke.com) was roughly 2.5 million during the second quarter, an increase from 2 million, and a 24.8 percent increase year over year.

Online market services revenue was $226.8 million, a 36.6 percent increase year over year. The company says that revenue increase was driven by the increasing adoption and effectiveness of the Company’s various online marketing services, primarily such as real time bidding and priority listings.

Hao Zhou, Chief Financial Officer of 58.com added, "We continued to see strong growth in revenue, traffic and margins during the quarter. We also recorded our highest ever quarterly operating margin, net margin and cash flow. This is directly attributable to our continuing focus on improving operational and marketing efficiencies. We continue to create new synergies as Ganji is further integrated and expect to see further opportunities to improve efficiency emerge as these synergies take hold."

"We are excited to report that revenues significantly exceeded the higher end of our guidance during the quarter," commented Michael Yao, Chairman and Chief Executive Officer of 58.com. "Among all our categories, jobs continued to deliver the fastest year-over-year growth and increasingly accounts for a larger proportion of total revenues. While the housing market in tier one and two cities remains relatively soft, revenues from our housing category continue to show resilience by performing better than expected. We are making solid progress in developing new and innovative products across various categories. Our mobile app traffic continues to grow rapidly and is accounting for a larger portion of our total traffic."

Shares closed on Friday at $53.26 and opened on Monday at $57.49, marking the highest they’ve been the 2017 fiscal year. Shares were up over $62, over 16 percent increase, during trading hours.

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