Renren Announces Unaudited Second Quarter 2019 Financial Results

BEIJING,Nov. 26,2019 --Renren Inc. (NYSE: RENN) ("Renren" or the "Company"),which operates a leading premium used auto business in China through its subsidiary Kaixin Auto Holdings (NASDAQ: KXIN) as well as several U.S.-based SaaS businesses,today announced its unaudited financial results for the second quarter ended June 30,2019.

Second Quarter 2019 Highlights

Total net revenues were US$104.8 million,a 19.3% decrease from the corresponding period in 2018.

— Kaixin revenues (1) were US$100.0 million,an 8.1% decrease from the corresponding period in 2018.

Operating loss was US$15.3 million,improved from an operating loss of US$31.9 million in the corresponding period in 2018.

Net income attributable to the Company was US$95.7 million,compared to a net income attributable to the Company of US$166.1 million in the corresponding period in 2018.

Adjusted loss from continuing operations (2) (non-GAAP) was US$11.2 million,improved from an adjusted loss from continuing operations of US$18.3 million in the corresponding period in 2018.

Adjusted net loss (2) (non-GAAP) was US$8.0 million,compared to an adjusted net income of US$177.5 million in the corresponding period in 2018.

(1) Kaixin revenues are the net revenue from the Company's subsidiary Kaixin Auto Holdings,which are included in the Company's Auto Group segment. Please refer to the table of additional information for details.

(2) Adjusted loss from continuing operations and net income (loss) are non-GAAP measures,which are defined as loss from operations excluding share-based compensation expenses and amortization of intangible assets and net income (loss) excluding share-based compensation expenses,fair value change of contingent consideration and amortization of intangible assets,respectively. See "About Non-GAAP Financial Measures" below.

"Second quarter revenues remained under pressure from the intensified competition and challenging macroeconomic environment. On the positive side,we are excited that Kaixin successfully listed on Nasdaq in April. Kaixin's separate listing opened a new chapter for Renren. As our premium auto dealership business,Kaixin now enjoys higher brand recognition. Going forward,we will continue to power our dealers with capital,technological systems,and marketing capabilities," commented Mr. Joseph Chen,Chairman and Chief Executive Officer.

Second Quarter 2019 Results

Total net revenuesfor the second quarter of 2019 were US$104.8 million,representing a 19.3% decrease from the corresponding period in 2018.

Automobile sales revenuesfor the second quarter of 2019 were US$98.3 million,representing a 19.9% decrease from the corresponding period in 2018. The decrease was mainly due to our reduction in resources allocated to low-performing dealers,as we aim to reallocate resources to better performing dealers for our long-term growth and profitability.

Cost of revenueswas US$100.3 million,compared to US$125.5 million from the corresponding period of 2018. The decrease was in line with the decrease of revenue.

Operating expenseswere US$19.8 million,a 45.3% decrease from the corresponding period of 2018.

Selling and marketing expenseswere US$6.0 million,a 31.9% decrease from the corresponding period of 2018. The decrease was primarily due to the decrease in headcount and personnel-related expenses.

Research and development expenseswere US$6.5 million,a 5.7% increase from the corresponding period in 2018. The increase was primarily due to an increase in headcount and personnel-related expenses.

General and administrative expenses were US$7.3 million,a 65.7% decrease from the corresponding period in 2018. The decrease was primarily due to a decrease in share-based compensation expenses and a decrease in headcount and personnel-related expenses.

Share-based compensation expenses,which were all included in operating expenses,were US$4.1 million,compared to US$13.5 million in the corresponding period in 2018. The decrease was mainly due to a modification which repriced the exercise price with respect to options during the second quarter of 2018,which led to the higher share-based compensation expenses in the three months ended June 30,2018 compared to the three months ended June 30,2019.

Loss from operationswas US$15.3 million,improved from a loss from operations of US$31.9 million in the corresponding period in 2018.

Net income attributable to Renren Inc. was US$95.7 million,compared to a net income of US$166.1 million in the corresponding period in 2018.

Adjusted loss from continuing operations (non-GAAP) was US$11.2 million,improved from an adjusted loss from continuing operations of US$18.3 million in the corresponding period in 2018. Adjusted loss from operations is defined as loss from operations excluding share-based compensation expenses and amortization of intangible assets.

Adjusted net loss (non-GAAP) was US$8.0 million,compared to an adjusted net income of US$177.5 million in the corresponding period in 2018. The adjusted net income for the second quarter of 2018 was mainly attributable to a one-time gain amounting to US$180.8 million that resulted from the private placement transaction relating to the disposition of Oak Pacific Investment. Adjusted net loss is defined as net loss excluding share-based compensation expenses,fair value change of contingent consideration and amortization of intangible assets.

Business Outlook

The Company expects to generate revenues in an amount ranging from US$72 million to US$82 million in the third quarter of 2019. This forecast reflects the Company's current and preliminary view,which is subject to change.

Conference Call Information

The Company will not host a conference call. Please contact our Investor Relations Department if you have any questions. Renren's subsidiary Kaixin Auto Holdings will host an earnings conference call at 9:00 AM U.S. Eastern Time on November 26,2019 (10:00 PM Beijing/Hong Kong time on November 26,2019).

Interested parties may participate in the conference call by dialing:

United States:

1-845-675-0437

International:

+65-6713-5090

Hong Kong:

+852-3018-6771

Mainland China:

400-620-8038

Conference ID:

9286069

Additionally,a live and archived webcast of the conference call will be available on its investor relations website at http://ir.kaixin.com.

A replay of the conference call will be accessible by phone at the following number until December 3,2019:

United States:

1-646-254-3697

International:

Hong Kong:

Mainland China:

+61-2-8199-0299

+852-3051-2780

400-632-2162

Replay Access Code:

9286069

About Renren Inc.

Renren Inc.(NYSE: RENN) operates a leading premium used auto business in China through its subsidiary Kaixin Auto Holdings (NASDAQ: KXIN) as well as several US-based SaaS business. Renren'sAmerican depositary shares,each of which currentlyrepresents fifteen Class A ordinary shares,trade onNYSEunder the symbol "RENN".

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things,the business outlook for the third quarter of 2019 and quotations from management in this announcement,as well as Renren's strategic and operational plans,contain forward-looking statements. Renren may also make written or oral forward-looking statements in its filings with the U.S. Securities and Exchange Commission ("SEC"),in press releases and other written materials and in oral statements made by its officers,directors or employees to third parties. Statements that are not historical facts,including statements about Renren's beliefs and expectations,are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement,including but not limited to the following: Renren's goals and strategies; Renren's future business development,financial condition and results of operations; Renren's expectations regarding demand for and market acceptance of its services; Renren's expectations regarding the retention and strengthening of its relationships with used auto dealerships; Renren's plans to enhance user experience,infrastructure and service offerings; competition in the used auto industry in China; and government policies and regulations relating to the used auto industry in China. Further information regarding these and other risks is included in our annual report on Form20-F and other documents filed with the SEC. All information provided in this pressreleaseand in the attachments is as of the date of this press release,and Renren does not undertake any obligation to update anyforward-looking statement,except as required under applicable law.

About Non-GAAP Financial Measures

To supplement Renren's consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"),Renren uses "adjusted income (loss) from operations" and "adjusted net income (loss)" which are defined as non-GAAP financial measures by the SEC,in evaluating its business. Renren defines adjusted income (loss) from operations as income (loss) from operations excluding share-based compensation expenses and amortization of intangible assets and adjusted net income (loss) as net income (loss) excluding share-based compensation expenses,respectively. Renren continuously and periodically reviews its operating results and business performance. Starting from the first quarter of 2018,there was a significant impact on net income (loss) due to the material and significant noncash amount of fair value change of contingent consideration relating to the used auto dealerships of the emerging used auto business. Due to the nature of the business,Renren believes that including adjusted income (loss) from operations and excluding the impact of such fair value changes more appropriately reflects Renren's results of operations,and provides investors with a better understanding of Renren's business performance. To facilitate investors and analysts,the aforesaid impact is presented retrospectively in "Reconciliation of non-GAAP results of operations measures to the comparable GAAP financial measures". Renren presents adjusted income (loss) from operations and adjusted net income (loss) because they are used by Renren's management to evaluate its operating performance. Renren also believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating Renren's consolidated results of operations in the same manner as Renren's management and in comparing financial results across accounting periods and to those of Renren's peer companies.

These non-GAAP financial measures are not intended to be considered in isolation from,or as a substitute for,the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures,please see the table captioned "Reconciliation of non-GAAP results of operations measures to the comparable GAAP financial measures" at the end of this release.

For more information,please contact:

Cynthia Liu

Investor Relations Department

Renren Inc.

Tel: (86 10) 8448 1818 ext. 1300

Email: ir@renren-inc.com

RENREN INC.

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In thousands of US dollars)

December 31,

June 30,

2018

2019

ASSETS

Current assets:

Cash and cash equivalents

$

15,333

$

9,872

Restricted cash

5,818

-

Accounts receivable,net

2,584

1,490

Financing receivable,net

3,486

107

Prepaid expenses and other current assets

49,515

51,845

Amounts due from related parties

20,829

17,185

Inventory

59,197

44,832

Total current assets

156,762

125,331

Non-current assets:

Property and equipment,net

1,555

780

Goodwill and intangible assets,net

85,526

85,448

Long-term investments

22,341

22,034

Amount due from related parties- non-current

133,880

137,539

Restricted cash – non-current

36,362

14,406

Right-of-use lease assets

-

6,185

Other non-current assets

767

726

Total non-current assets

280,431

267,118

TOTAL ASSETS

$

437,193

$

392,449

LIABILITIES AND EQUITY

Current liabilities:

Accounts payable

$

8,255

$

6,511

Short-term debt

49,887

29,657

Accrued expenses and other current liabilities

33,055

30,879

Short-term lease liabilities

-

3,368

Payable to investors

15

15

Amounts due to related parties

55

4,899

Deferred revenue

3,716

2,394

Income tax payable

20,602

20,968

Contingent consideration

11,929

2,055

Total current liabilities

127,514

100,746

Non-current liabilities:

Long-term debt

35,000

1,000

Long-term lease liabilities

-

1,783

Long-term contingent consideration

93,741

16,701

Total non-current liabilities

128,741

19,484

TOTAL LIABILITIES

$

256,255

$

120,230

Shareholders' Equity:

Class A ordinary shares

737

743

Class B ordinary shares

305

305

Additional paid-in capital

709,137

706,062

Statutory reserves

6,712

6,712

Accumulated deficit

(563,737)

(496,010)

Accumulated other comprehensive loss

(5,689)

(6,334)

Total Renren Inc. shareholders' equity

147,465

211,478

Noncontrolling interest

33,473

60,741

TOTAL EQUITY

180,938

272,219

TOAL LIABILITIES AND EQUITY

$

437,449

RENREN INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

(In thousands of US dollars,except share data and per share data,ADS data,and per ADS data)

For the Three Months Ended

For the Six Months Ended

June 30,

March 31,

2018

2019

2019

2018

2019

Net revenues:

Automobile sales

$

122,728

$

102,620

$

98,294

$

246,334

$

200,914

Others

7,018

7,743

6,471

17,366

14,214

Total net revenues

129,746

110,363

104,765

263,700

215,128

Cost of revenues

(125,503)

(101,537)

(100,336)

(249,022)

(201,873)

Gross profit

4,243

8,826

4,429

14,678

13,255

Operating expenses:

Selling and marketing

(8,841)

(6,745)

(6,024)

(18,813)

(12,769)

Research and development

(6,131)

(6,760)

(6,483)

(12,525)

(13,243)

General and administrative

(21,188)

(6,387)

(7,270)

(38,966)

(13,657)

Total operating expenses

(36,160)

(19,892)

(19,777)

(70,304)

(39,669)

Loss from operations

(31,917)

(11,066)

(15,348)

(55,626)

(26,414)

Other income

28,618

771

1,734

28,207

2,505

Fair value change of contingent consideration

2,197

(17,733)

105,849

(8,068)

88,116

Interest income

411

2,427

1,966

1,214

4,393

Interest expenses

(900)

(918)

(550)

(2,164)

(1,468)

Total non-operating income (loss)

30,326

(15,453)

108,999

19,189

93,546

(Loss) income before provision of income tax and loss in

equity method investments,net of tax

(1,591)

(26,519)

93,651

(36,437)

67,132

Income tax expenses

(116)

(1,100)

472

(947)

(628)

(Loss) income before loss in equity method investments

and noncontrolling interest,707)

(27,619)

94,123

(37,384)

66,504

Loss in equity method investments,net of tax

(621)

(436)

(474)

(1,429)

(910)

(Loss) income from continuing operations

(2,328)

(28,055)

93,649

(38,813)

65,594

Discontinued operations:

Loss from operations of discontinued operations,net of

income tax

(12,482)

-

-

(17,567)

-

Gain on deconsolidation of subsidiaries,net of income

tax

180,829

-

-

180,829

-

Income from discontinued operations,net of tax

168,347

-

-

163,262

-

Net income (loss)

166,019

(28,649

124,449

65,594

Net loss attributable to noncontrolling interest

100

108

2,025

120

2,133

Net income (loss) attributable to Renren Inc.

$

166,119

$

(27,947)

$

95,674

$

124,569

$

67,727

Net (loss) income per share from continuing operations

attributable to Renren Inc. shareholders:

Basic

$

-

$

(0.03)

$

0.07

$

(0.04)

$

0.06

Diluted

$

-

$

(0.03)

$

0.06

$

(0.04)

$

0.04

Net income (loss) per share from discontinued

operations attributable to Renren Inc. shareholders:

Basic

$

0.16

$

-

$

-

$

0.16

$

-

Diluted

$

0.15

$

-

$

-

$

0.15

$

-

Net income (loss) per share attributable to Renren Inc.

shareholders:

Basic

$

0.16

$

(0.03)

$

0.07

$

0.12

$

0.06

Diluted

$

0.15

$

(0.03)

$

0.06

$

0.11

$

0.04

Net income (loss) attributable to Renren Inc.

shareholders per ADS*:

Basic

$

2.41

$

(0.40)

$

1.05

$

1.81

$

0.90

Diluted

$

2.21

$

(0.40)

$

0.84

$

1.71

$

0.53

Weighted average number of shares used in calculating

net income(loss) per ordinary share attributable to

Renren Inc. shareholders:

Basic

1,035,143,003

1,043,848,165

1,047,002,854

1,034,310,179

1,045,443,122

Diluted

1,130,285,008

1,082,360,638

1,093,742,531

1,083,883,429

Weighted average number of shares used in calculating

net income(loss) per ordinary share from discontinued

operations attributable to Renren Inc. shareholders:

Basic

1,429

* Each ADS represents 15 Class A ordinary shares.

Reconciliation of Non-GAAP results of operations measures to the comparable GAAP financial measures

(In thousands of US dollars)

For the Three Months Ended

For the Six Months Ended

June 30,

2018

2019

2019

2018

2019

Loss from opeartions

$

(31,917)

$

(11,066)

$

(15,348)

$

(55,626)

$

(26,414)

Add back: Shared-based compensation expenses

13,465

2,809

4,060

25,792

6,869

Add back: Amortization of intangible assets

131

96

96

262

192

Adjusted loss from continuing operations

$

(18,321)

$

(8,161)

$

(11,192)

$

(29,572)

$

(19,353)

Net income (loss)

$

166,119

$

(28,055)

$

93,649

$

124,569

$

65,594

Add back: Shared-based compensation expenses

13,869

Add back: Fair value change of contingent

consideration

(2,197)

17,733

(105,849)

8,068

(88,116)

Add back: Amortization of intangible assets

131

96

96

262

192

Adjusted net income (loss)

$

177,518

$

(7,417)

$

(8,044)

$

158,691

$

(15,461)

RENREN INC.

ADDITIONAL INFORMATION (UNAUDITED)

(In thousands of US dollars)

For the Three Months Ended

June 30,2018

March 31,2019

June 30,2019

Kaixin

Ji'nan

dealership*

Renren

Total

Kaixin

Renren

Total

Kaixin

Renren

Total

Net revenues:

Automobile sales

$

106,700

$

16,028

$

-

$

122,620

$

-

$

102,294

$

-

$

98,294

Others

2,052

25

4,941

7,018

2,026

5,717

7,743

1,659

4,812

6,471

Total

108,752

16,053

4,941

129,746

104,646

5,717

110,363

99,953

4,812

104,765

Cost of revenues

$

107,613

$

15,219

$

2,671

$

125,503

$

98,529

$

3,008

$

101,537

$

97,440

$

2,896

$

100,336

* Ji'nan dealership was transferred from Kaixin Auto Group to Renren in the fourth quarter of 2018. Ji'nan dealership and Kaixin were included in the Company's Auto Group segment in 2018.

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