Sohu.com Limited (NASDAQ:SOHU) reported a revenue decline of 14% year-over-year to $139.4 million for the fiscal first quarter of 2024. Revenue was down by 1% Q/Q.
The Chinese internet company's adjusted loss per ADS was $(0.65), missing the analyst consensus loss estimate of $(0.49).
Brand advertising revenues declined 29% Y/Y to $16 million. Online game revenues decreased 9% Y/Y to $118 million.
The adjusted gross margin improved by 200 bps Y/Y to 77% and by 100 bps Q/Q. The adjusted gross margin for online games was 88% versus 85% last year and 87% in the prior quarter.
Sohu held $1.3 billion in cash and equivalents as of March-end.
Average monthly active user accounts for ChangyouPC games increased by 5% Y/Y to 2.3 million. The average MAU for Changyoumobile games grew by 71% Y/Y to 2.8 million.
Under the previously-announced share repurchase program, Sohu had repurchased ADSs worth $17 million.
Charles Zhang, Chairman and CEO of Sohu.com Limited, commented, “For Sohu Media and Sohu Video, we continued to enhance user experience by refining products and optimizing algorithms.”
Outlook: Sohu expects second-quarter brand advertising revenue of $18 million – $20 million, an annual decrease of 16% – 25% Y/Y.
It projects quarterly online game revenues growth by 12% – 21% to $133 million – $143 million. Sohu estimates a quarterly adjusted net loss of $27 million – $37 million.
Sohu stock gained 22% year-to-date. Investors can gain exposure to Sohu via Invesco Golden Dragon China ETF (NASDAQ:PGJ) and SPDR S&P Emerging Markets Small Cap ETF (NYSE:EWX).
Price Action: SOHU shares traded lower by 0.38% at $11.89 at last check Monday.
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