Sohu.com Ltd – ADR (NASDAQ:SOHU) just announced reported unaudited financial results for the third quarter ended September 30, 2018.
The company reported that total revenues came in at $460 million, down 11% year-over-year and 5% quarter-over-quarter; brand advertising revenues were $57 million, down 24% year-over-year and 7% quarter-over-quarter; search and search-related advertising revenues were $255 million, up 13% year-over-year and down 6% quarter-over-quarter; and online game revenues were $96 million, down 28% year-over-year and up 2% quarter-over-quarter.
Sohu.com Ltd – ADR (NASDAQ:SOHU) bills itself as a company that provides online media, search, and game services on personal computers (PCs), mobile devices, and tablets in the People’s Republic of China.
The company operates sohu.com, which provides online news and information; Sohu News APP, a mobile phone application, as well as m.sohu.com mobile portal; tv.sohu.com that offers online video content and service, as well as Sohu Video APP, a mobile phone application; and focus.cn, which provides online real estate information and services. It also offers paid subscription services, interactive broadcasting services, and sub-licensing of purchased video content to third parties.
The company’s search and search-related business provides Sogou Search, which makes information accessible for Chinese Internet users; Sogou Input Method, a cloud-based Chinese language input software for PC and mobile users; Sogou Browser for Web navigation; Sogou Web Directory, a content aggregation and distribution platform; and Sogou Translation to deliver language translation, as well as offers pay-for-click and other online advertising services for advertisers. In addition, its online game business offers PC games, mobile games, and Web games to game players.
Further, the company’s platform channel business operates 17173.com Website, a game information portal; RaidCall, which provides online music and entertainment services; and MoboTap that offers software applications for PCs and mobile devices through the Dolphin Browser, a gateway to a host of user activities on mobile devices, as well as online card and board games. Additionally, it provides Internet value-added services; and cinema advertising services.
The company was formerly known as Internet Technologies China Incorporated and changed its name to Sohu.com Inc. in September 1999. Sohu.com Inc. was founded in 1996 and is headquartered in Beijing, the People’s Republic of China.
Kitchen Sink Dreams
We started off by noting that SOHU just hit the wires with the announcement reported unaudited financial results for the third quarter ended September 30, 2018, including 11% y/y quarterly topline growth. However, as noted above, brand revs fell 24% and online game revenues fell $96 28% year-over-year.
That announcement helped to spark a relief rally in a context of recent action that hadn’t really been a happy time for SOHU shareholders leading up to the release. But things have ended up basically back where they started going back a week.
Dr. Charles Zhang, Chairman and CEO of Sohu.com Limited, commented, “For the third quarter, while our total revenues were largely in-line with prior guidance, the bottom line performance, excluding non-operating items, came in better than we expected, mainly driven by the cost savings of Sohu Video and solid results of our online game business. For Sohu Media Portal, we focused our efforts on upgrading the content as well as optimizing our recommendation engine algorithms. Our key mobile apps gained momentum in terms of DAU and time spent by users. For Sohu Video, we remained on track to reduce content costs while develop new original programs, which tend to generate better ROI. This helped us narrow the segment’s loss by more than 50% year-over-year. Sogou continuously integrated more innovative AI features into its search and mobile keyboard products, strengthening its market competiveness. Lastly, Changyou comfortably beat expectations on both revenues and profit, supported by the healthy performance of its TLBB PC and mobile games.”