Sohu reports in-line, advertising revs grow, wireless remains weak (SOHU 2Q05 earnings results)

Sohu (ticker: SOHU) reported Q2 2005 results that met consensus revenue and EPS estimates. Key stats from the quarter:

Q2 Results:
(all percentage changes and comparisons are year on year, unless stated otherwise)

• Total revenue fell 5.1% to $25.9 million versus guidance of $25.0 - $26.0 million and consensus of $25.95 million.
• Advertising revenue rose 26.8% to $17.0 million versus guidance of $16.5 - $17.0 million.
• Brand advertising rose 26.6% to $13.9 million.
• Sponsored search revenue rose 27.7% to $3.1 million.
• Non-advertising revenue fell 35.8% to $8.9 million versus guidance of $8.5 - $9.0 million.
• Wireless revenue fell 43.8% to $6.4 million.
• E-commerce revenue fell 38.6% to $841,000.
• Gross margin was 67.4% versus 66.1%.
• Operating expenses rose 26.8% to $10.7 million.
• Product development expenses rose 71.9% to $3.6 million.
• Sales and marketing expenses were flat at $4.3 million.
• G&A expenses rose 36.9% to $2.4 million.
• Operating income fell 30.0% to $6.7 million.
• Operating margin was 25.9% versus 35.1%.
• Net income fell 28.1% to $7.1 million.
• Fully diluted EPS of $0.18 versus $0.25. Guidance of $0.17 - $0.19 and consensus of $0.18.

Q3 Guidance

• Total revenue of $26.5 - $28.5 million. Consensus is $28.69 million.
• Advertising revenue of $17.5 - $18.5 million.
• Non-advertising revenue of $9.0 - $10.0 million.
• Fully diluted EPS of $0.18 - $0.22. Consensus is $0.22.