Chinese web giant Sina warned Tuesday that government requirements for microbloggers to register their real names before posting messages will hurt activity on its popular social networking site.
Sina chief executive Charles Chao said more than 40 percent of new registered users for its Weibo site had failed verification screenings since the Beijing city government announced the new regulations in December.
"We believe that the requirement to convert existing users into verified users... will have a negative impact on user activity in the short term," Chao said, after announcing Sina swung to a net profit in the fourth quarter.
"We can not rule out any new tightening policy that may be introduced in future which may further impact our user growth and user activity in a negative way."
Despite the uncertain regulatory outlook, Chao told a conference call that Sina still planned to "invest heavily" in Weibo in 2012 after its total number of registered users tripled to 300 million in 2011.
Beijing announced in December that users of weibos -- Chinese microblogs similar to Twitter -- will have to give their real names to website administrators by March 16 or be barred from posting online.
Authorities in Shanghai and the southern province of Guangdong have since introduced similar measures and a senior propaganda official said last month that real-name registration for microblogs would be expanded.
With more than half a billion Chinese now online, Chinese authorities are concerned about the power of the Internet to influence public opinion in a country that maintains tight controls on its traditional media outlets.
Ordinary Chinese are increasingly using weibos to vent their anger and frustration over official corruption, scandals and disasters, but analysts believe the new rules could curb online criticism of authorities.
Nasdaq-listed Sina said it swung to a net profit of $9.3 million in the final quarter of 2011, compared with a net loss of $100 million for the same period a year earlier, according to a statement.
Net revenue rose 21 percent year-on-year to $133.4 million, but the company flagged weaker revenue in the first quarter due to a downturn in advertising.