Jan. 9, 2014, 5:38 PM
Jan. 9, 2014, 10:44 AM
- China's iResearch estimates Qihoo (QIHU -6.5%) has only a 14.4% Chinese search share (translation). That's well below the 22.4% estimated by frequently-referenced CNZZ, as well as Qihoo's own numbers; the company stated on its Q3 CC (transcript) it believes its Chinese search share is "comfortable above 20%."
- An iResearch analyst suggests CNZZ's reliance on traffic data from small/medium-sized sites provides it with an incomplete picture of Chinese search trends. iResearch claims to analyze data from 3K+ sites (including large ones) and 1K+ apps.
- If iResearch's figure is reasonably accurate, it would be a positive for Baidu (BIDU -0.2%). Most of the share gains Qihoo has seen since launching its search engine in the summer of 2012 have come at Baidu's expense. CNZZ estimates Baidu had a 63.1% search share in December (-860 bps Y/Y).
- Qihoo is giving back a majority of the gains it saw yesterday following an Alibaba investment rumor. The company has said it's aiming to have a 30% search share by the end of 2014.
Jan. 8, 2014, 10:08 AM
- "Industry insiders" tell Marbridge Consulting Chinese e-commerce giant Alibaba (ABABA) is talking with Qihoo (QIHU +6.6%) regarding a possible investment in the search/browser/security software provider. The talks are said to have been "underway for a significant period of time."
- Though its track record isn't perfect, Marbridge has provided some accurate scoops in the past. Moreover, Alibaba has already made sizable investments in Sina and AutoNavi. The investments are part of the company's efforts to expand its Web empire, and thereby better compete with messaging/gaming leader Tencent and search king/Qihoo rival Baidu.
- However, China's 86Research thinks the odds of an Alibaba investment in Qihoo remain low.
Jan. 8, 2014, 9:11 AM
Dec. 31, 2013, 10:02 AM
- Qihoo's (QIHU +2.6%) Sina Weibo stream (translation) indicates the company has formed a partnership with Apple related to its mobile security apps. The company suggests details will be arriving shortly.
- The news comes ten months after Qihoo's iOS apps were banned from the App Store, allegedly due to abuses such as the manipulation of App Store rankings and the encouraging of jailbreaking.
- Ahead of China Mobile's iPhone launch, Kantar Worldpanel has estimated the iPhone only had a 15.5% smartphone share within "Urban China" from August-October. But iPhone users (in aggregate) represent a wealthier demographic than Android users, and could thus monetize better.
- Thanks to strong Android-related demand, there were already 408M users of Qihoo's 360 Mobile Safe security app as of September, up from a mere 149M a year earlier.
Dec. 10, 2013, 12:49 PM
- Pac Crest (Outperform) says its Chinese checks indicate Baidu's (BIDU +3.9%) Q4 trends are stable, at the company's growth rate can match that of the Chinese search market going forward.
- Though shares have risen sharply this year thanks to improved ad monetization (particularly on mobile) and a general rally in Chinese Internet stocks, concerns about search share losses to Qihoo (QIHU +1.4%) and (to a lesser extent) Sohu's (SOHU +2%) Sogou unit have persisted.
- Research firm CNZZ estimates Baidu had a 61.7% Chinese search share in October, down from 73.5% a year earlier. Over the same time, Qihoo's share surged to 21.4% from 9.8%, and Sogou's rose to 10.5% from 7.5%.
Nov. 26, 2013, 1:33 PM
- Citi, Goldman, Macquarie, Jefferies, and Maxim have raised their Qihoo (QIHU +6.4%) PTs following the company's Q3 report (I, II). That's helping shares recoup a big chunk of yesterday's post-earnings losses; they're now only down 3% from Friday's close.
- Citi (Buy, $87 PT) has lifted its 2013-2015 EPS estimates by 7%-16% in response to Qihoo's Q3 beat and solid Q4 guidance. Macquarie (Outperform, $118 PT) praises Qihoo's search and mobile momentum: The firm estimates search revenue rose 87% Q/Q and made up 15% of total revenue, and that mobile revenue rose 67% Q/Q and made up 13% of total revenue.
- Goldman (Neutral, $79 PT) notes management stated on the CC (transcript) Qihoo's Chinese search share is up to 22%, and estimates its share is now 700-800 bps above that of Sohu's (SOHU +2.9%) Sogou unit.
- At the same time, with Qihoo estimating it only has a 1% search revenue share - Goldman thinks Sogou's search revenue remains 2x larger - the firm sees plenty of room to improve monetization. However, it cautions the investments needed to so are likely to depress near-term margins.
- Separately, a source tells Marbridge Consulting Qihoo plans to separate the management of its mobile gaming ops from that of its Android app store business. The source adds Qihoo's mobile gaming revenue now exceeds its PC browser gaming revenue.
Nov. 25, 2013, 10:18 AM
- In addition to beating Q3 estimates, Qihoo (QIHU -4%) is guiding for Q4 revenue of $206M-$208M, above a $203M consensus.
- Nonetheless, with shares up 192% YTD going into the Q3 report, Stifel is cutting Qihoo to Hold. The firm, which has been bullish on Qihoo since the $20s, thinks the company's revenue growth will slow over the next two quarters thanks to policy changes at a top advertiser.
- Online ad revenue (64% of total revenue) rose 33% Q/Q and 107% Y/Y in Q3; the Y/Y clip is up from Q2's 78%, and has much to do with ramping search ad sales. Continued growth for Qihoo's browser home page also didn't hurt.
- Internet value-added services revenue (gaming-driven) rose 10% Q/Q and 163% Y/Y, after rising 33% Q/Q and 181% Y/Y in Q2.
- While revenue rose 124% Y/Y, opex rose 74%. Sales/marketing spend more than doubled to $28.1M, and R&D spend surged 65% to $68.5M.
- Total monthly active users for Qihoo products only rose 1% Q/Q and 5% Y/Y to 465M, but growth for certain major products was much stronger. Smartphone users of Qihoo's 360 Mobile Safe security app rose 21% Q/Q and 173% Y/Y to 408M, and daily unique visitors for the company's browser home page rose 11% Q/Q and 29% Y/Y to 126M.
- Q3 results, PR
Nov. 25, 2013, 5:49 AM| Comment!
Nov. 25, 2013, 12:05 AM
Nov. 24, 2013, 5:30 PM
Nov. 13, 2013, 3:49 PM
- Six days after dropping in the face of Twitter's strong debut, high-flying Internet names are rallying in the wake of Chinese microblogging leader Sina's Q3 beat and strong Q4 guidance.
- The day has also seen a dismal IPO from online textbook rental leader Chegg, a WSJ report of a rejected $3B+ Facebook offer for Snapchat, and a vague afternoon rumor about M&A interest in Trulia from Realogy.
- U.S. standouts: ZNGA +7.4%. LNKD +4.8%. P +3.3%. ANGI +2.6%. GSVC +4.1% (owns a Chegg stake).
- Chinese standouts: QIHU +8.9%. SFUN +7.5%. LITB +6.4%. YY +6.9%. CYOU +6.3%. QUNR +5.7%. CTRP +3.7%.
- Baidu (BIDU +1.4%) is up moderately following news Chinese online video rivals Sohu (SOHU +1.7%) and Youku (YOKU +3%) have joined the MPAA and various entertainment/media companies in suing it for piracy. The assorted parties accuse Baidu of enabling piracy through its video search engine, as well as through video player apps and a TV dongle.
- The suit comes as Baidu ramps its content spending for its iQiyi and PPS video sites.
Nov. 7, 2013, 11:48 AM
- Even as Twitter blasts off to a $25B valuation following its much-hyped IPO, U.S. and foreign Internet stocks are giving back some more of the massive 2013 gains that have led many names to trade at steep multiples.
- One sign investors in this space are in a profit-taking mood: Zillow (Z -4.3%) and YY both sold off yesterday in spite of delivering Q3 beats (I, II) and above-consensus guidance; Zillow is adding to its losses today. Likewise, SouFun (SFUN -5.4%) has turned negative after providing a Q3 beat and strong guidance.
- Notable U.S. decliners: FB -2.4%. LNKD -2.8%. GRPN -4.7% (reports after the close). ZNGA -2.7%. P -3.8%. TRLA -5.4%.
- Notable foreign decliners: BIDU -2.4%. QIHU -6.7%. SINA -5% (generally viewed as the Chinese Twitter). DANG -6.2%. VIPS -7.7%. RENN -4.2%. AMAP -4.7%. CTRP -5.7%. YOKU -5.6%. RENN -4.2%. YNDX -5.1%. MELI -2.4% (plunged yesterday thanks to a Q3 miss). SIFY -2.6%.
- Internet/social media ETFs: FDN, PNQI, SOCL
Oct. 29, 2013, 8:21 PM
- Several Chinese Internet names recently pressured by a generally selloff in tech momentum plays are up AH after Baidu beat Q3 estimates on the back of strong growth in ad revenue/customer, and issued above-consensus Q4 guidance.
- SINA +2.3% AH. QIHU +2.1%. YOKU +2%. RENN +2.1%. NTES +2.5%. DANG +1.6%.
- NQ Mobile (NQ) is up 2.5% AH after posting a 25.1% gain in regular trading as investors welcomed its fund transfer announcement.
- Bulls and bears continue to argue fiercely over NQ's prospects. On SA, bearish Goldbaum Research observes NQ's games (offered via its FL Mobile game publishing subsidiary) appear to have been pulled from Apple's App Store, while bullish Toro Investment Partners argues Muddy Waters' track record is quite mixed, and that many firms have had a chance to look at NQ's books.
Oct. 28, 2013, 12:15 PM
- Though the Nasdaq is only down 0.1%, many 2013 Internet, solar, and enterprise software high-flyers are diving once more. Chinese names are well-represented in the group, as NQ Mobile continues crashing thanks to fraud allegations and Sohu plunges due to weak Q4 EPS guidance.
- The WSJ and NYT have each run pieces asking whether a new tech bubble is afoot, at least in certain hot sectors. "People are reaching for growth," says one fund manager quoted by the WSJ. Others argue the fact the high-flyers generally have substantial revenue, and are often profitable, makes the current situation different from the Dot.com bubble.
- Internet decliners: FB -3.4%. MELI -2.8%. GRPN -5%. ZNGA -2.7%. P -2.4%. DANG -7.6%. VIPS -7%. YY -4.8%. QIHU -5.6%. RENN -5.7%. SINA -2.4%. FUEL -4%.
- Solar decliners: JKS -12.4%. FSLR -4.8%. SOL -8.4%. YGE -8%. JASO -6.9%. GTAT -5.4%. SUNE -4.6%. SPWR -4.3%. SCTY -3.8%. STP -8.9%. TSL -13.2%.
- Enterprise decliners: CRM -3.8%. DATA -4.5%. MKTO -5.8%. WDAY -4%. DWRE -3.4%. VEEV -5.1%. IMPV -3.4%.
- Recent declines: I, II.
- Previous: Cashin sees mobile/cloud bubble
Oct. 25, 2013, 4:21 PM
- Chinese Internet and solar stocks, many of which have skyrocketed this year, have closed with decent losses after the Shanghai exchange fell for the fourth day in a row amid credit crunch worries, and as NQ Mobile continued to feel the impact of Muddy Waters' fraud allegations.
- Muddy Waters' detailed accusations regarding ghost addresses, a shell company, inflated market share figures, dubious cash balances, and spyware are likely to yield fresh scrutiny of the financial statements provided by Chinese ADRs, and could also affect the reception given to upcoming IPOs (I, II). Investor concerns about the bookkeeping of U.S.-traded Chinese firms had diminished some this year.
- Chinese Internet decliners: VIPS -9.1%. AMAP -6.1%. YY -6%. QIHU -4.8%. PWRD -5.7%. CYOU -4.7%. SINA -3.8%. LONG -3.5%. YOKU -3%.
- Chinese solar decliners: YGE -12.2%. JKS -9.4%. JASO -9%. DQ -7.2%. TSL -6.8%. CSIQ -4.8%. CSUN -4.4%.
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