Citi Cuts Weibo Corporation TP to USD9.3, Reiterates Buy on Undemanding Valuation
I'm LongbridgeAI, I can summarize articles.Citi has lowered its target price for Weibo Corporationfrom USD12 to USD9.3 while maintaining a Buy rating, citing an undemanding valuation. The company reported solid 1Q26 results, with revenue and adjusted net profit exceeding expectations. Advertising revenue grew 9% YoY, driven by the automotive and internet/AI sectors. Looking ahead, growth in the automotive sector is expected to continue, while challenges in mobile handsets and e-commerce may arise due to competition and high base effects.
Citi released a report stating that WB-SW (09898.HK) -1.750 (-2.862%) Short selling $2.77M; Ratio 24.642% delivered solid results for 1Q26, with revenue and adjusted net profit exceeding market expectations by 1% and 3%, respectively. Advertising revenue grew 9% YoY, mainly driven by advertising budget demand from the automotive and internet/AI sectors. Looking ahead to 2Q26, the automotive vertical is expected to sustain growth momentum supported by new model launches, while the mobile handset and e-commerce segments may face headwinds from intense competition and a high base effect.
Weibo Corporation (WB.US) is focusing strategically on strengthening its video ecosystem and enhancing AI capabilities to maintain user engagement and capture future growth opportunities. After revising its forecasts, Citi lowered its US share TP for Weibo Corporation (WB.US) from USD12 to USD9.3, based on an unchanged forecast 2027 price-to-earnings ratio of 7x. Given the undemanding valuation, the broker reiterated its Buy rating.
Regarding the upcoming quarter, management indicated that the automotive vertical is expected to maintain its growth trajectory in 2Q26, driven by the accelerated launch of new electric vehicle models. In contrast, visibility for the mobile handset market in 2H26 remains unclear amid competitive pressure, with advertising spending closely linked to the frequency of new product launches. Meanwhile, e-commerce and local services may face headwinds in 2Q26 and 3Q26 due to a high base effect stemming from intense market competition in the same period last year.
On AI and video strategy, the broker cited management as saying that video engagement rose significantly in 1Q26, with users viewing video content accounting for more than 90% of daily active users for the first time. Supported by double-digit YoY growth in both top creators and original video posts, total time spent on video playback pages recorded double-digit YoY growth. Weibo Corporation is advancing its AI strategy to address challenges posed by the increasing number of standalone AI tools, which have shifted user behavior toward conversational search. AI is delivering rising effectiveness in performance advertising through creative generation, bid algorithm optimization, and brand and celebrity marketing initiatives. (da/a)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-05-29 12:25.) (Real-time Streaming US Stocks Quote; Except All OTC quotes are at least 15 minutes delayed.)