Sohu.com (SOHU) Q3 2024 earnings summary

Executive summary

• Q3 2024 total revenues reached $152 million, up 5% year-over-year but down 12% sequentially from Q2 2024.

• Online game revenues rose 9% year-over-year to $128 million, while brand advertising fell 15% year-over-year to $19 million.

• Brand advertising revenue met the high end of guidance; online game revenues and bottom-line performance exceeded expectations.

• Enhanced user engagement and brand influence through unique events and content updates across media and video platforms.

• CEO highlighted strong online game performance and effective cost controls.

Financial highlights

• Brand advertising revenues were $19 million, down 15% year-over-year and 6% quarter-over-quarter.

• Online game revenues were $128 million, up 9% year-over-year but down 13% sequentially.

• GAAP net loss attributable was $16 million, compared to $14 million loss last year and $38 million loss last quarter; non-GAAP net loss was $12 million.

• GAAP operating loss narrowed to $13 million from $44 million in Q2 2024.

• Cash, cash equivalents, short-term investments, and long-term time deposits totaled $1.3 billion as of September 30, 2024.

Outlook and guidance

• Q4 2024 brand advertising revenues expected between $17 million and $19 million, implying a 6%-16% annual decrease and a sequential change of -9% to +2%.

• Online game revenues expected between $97 million and $107 million, a 7%-15% annual decrease and 16%-24% sequential decrease.

• Non-GAAP net loss guidance for Q4 is $26 million to $36 million; GAAP net loss guidance is $30 million to $40 million.

• Guidance based on RMB7.10 = $1.00 exchange rate.

• Management notes guidance is conservative, especially for games, focusing on user stability over revenue growth.