#China #Beijing #Sohu #online media #Game Business

Financial Performance Overview for Sohu.com Limited

Sohu.com Limited (NASDAQ: SOHU), a prominent online media and gaming platform in China, has disclosed its financial results for the second quarter of 2025 ending June 30, revealing a challenging period marked by
substantial declines in revenue. The company posted total revenues of $126 million, reflecting a 27% decrease compared to the same period last year and a 7% drop sequentially. The decline in revenue can mainly be attributed to underperformance in both their marketing services and online game divisions.

Key Financial Highlights

• - Total Revenue: $126 million, down 27% year-over-year
• - Marketing Services Revenue: $16 million, a 21% decrease from the previous year but a 14% increase quarter-over-quarter.
• - Online Game Revenue: $106 million, which is 28% lower than last year and 10% down from the previous quarter.
• - Net Loss: Sohu recorded a net loss of $20 million, compared to a net loss of $38 million in Q2 2024.

Despite the challenges, Dr. Charles Zhang, Chairman and CEO, noted that marketing services met their expectations while the online game department's revenues hit the higher end of their guidance. He emphasized the company's focus on enhancing user engagement through network operations and product refinements in their media platform, which remains vital for their growth strategy.

User Engagement and Product Strategy

During the second quarter, Sohu hosted various events aimed at fostering community interaction and promoting user participation, a strategy crucial for increasing user engagement and brand loyalty. The company views these activities as essential for not only retaining users but also attracting new ones amidst the competitive landscape of online media.

Sohu's strategic approach towards improving product offerings has centered around optimizing their gaming content while maintaining a robust social networking experience. This includes multiple updates and introductions of features designed to engage users and enhance their experience on the platform. The team's commitment to user-centric content is evident from the notable improvements in the engagement metrics observed in both PC and mobile gaming since the past quarters.

Financial Outlook and Guidance

As a forward-looking measure, Sohu has provided guidance for the third quarter of 2025, anticipating continued fluctuations in both their marketing services and online game revenues. The expected revenues from marketing services are predicted to fall between $14 million to $15 million, indicating a significant decrease when compared to the previous year. Meanwhile, online game revenues are estimated to be in the range of $107 million to $117 million, suggesting a less severe decline than seen in previous quarters.

This financial outlook also projects a potential net loss attributable to Sohu.com Limited between $25 million and $35 million, showcasing the ongoing challenges the company faces as it navigates through this tumultuous market environment.

Conclusion

The second quarter results for Sohu.com Limited underline the complexities of maintaining revenue growth in a rapidly evolving online media landscape. While the company has experienced significant challenges, their proactive engagement strategies and focus on user experience position them favorably for future recovery. As Sohu continues to adapt and extend its offerings in both media and gaming sectors, the next quarters will be pivotal in determining its path towards stabilization and growth.