Sohu.com (SOHU) 5 Aug 24 2024 Q2 Earnings call transcript
Sohu, a leading internet company in China, recently held its second quarter 2024 earnings call, where key executives discussed the company's performance and future outlook. The call was marked by a focus on growth opportunities and challenges, as well as strategic initiatives to boost revenue and user engagement.
Financial Performance
For the second quarter of 2024, Sohu reported total revenues of $172 million, up 13% year-over-year and 24% quarter-over-quarter. Brand advertising revenues came in at $20 million, down 17% year-over-year but up 24% quarter-over-quarter. Online game revenues exceeded expectations, totaling $147 million, up 24% year-over-year and 25% quarter-over-quarter.
GAAP net loss attributable to Sohu.com Limited was $38 million, compared with a net loss of $21 million in the second quarter of last year and a net loss of $25 million in the last quarter. Non-GAAP net loss attributable to Sohu.com Limited was $34 million, compared with a net loss of $18 million last year and a net loss of $22 million in the first quarter of this year.
Business Highlights
Sohu Media and Sohu Video were the standout performers, with a focus on promoting premium content and social interactions among users. Events and marketing campaigns have strengthened brand influence and opened up new monetization opportunities. The online game business also performed well, with revenues exceeding expectations. New initiatives, such as the launch of Westward Journey, a licensed card-based RPG, and optimizing gameplay for TLBB series, have kept players engaged and attracted new audiences.
Future Outlook
Looking ahead, Sohu is planning to continue investing in talent development, content innovation, and expanding its international presence. The company aims to maintain its core competitiveness in MMORPGs while exploring opportunities in other game genres. For the third quarter of 2024, Sohu expects brand advertising revenues to be between $70 million and $90 million, with online game revenues between $104 million and $114 million.
Investor Questions
During the Q&A session, analysts asked about the impact of macroeconomic conditions on the advertising market and the gaming business. Sohu executives acknowledged challenges in the advertising market due to advertiser caution but highlighted the company's ability to attract spending through innovative marketing campaigns. Regarding the gaming business, executives expressed optimism about the potential for Westward Journey to rebound in later quarters, citing ongoing development efforts to improve the user experience.
Conclusion
Sohu's second quarter 2024 earnings call highlighted the company's strategic initiatives to drive revenue growth and user engagement across its media and gaming businesses. Despite challenges in the macroeconomic environment, Sohu's focus on innovation, user experience, and strategic partnerships positions the company well for future growth. With a strong focus on expanding its user base and investing in content and talent, Sohu is confident in its ability to turn its media business into a profitable venture, offering a promising outlook for its shareholders.