Nov. 3, 2014, 9:15 AM
- Along with its Q3 report, Changyou (NASDAQ:CYOU) announces CEO Tao Wang has resigned for "personal reasons." SOHU CFO Carol Yu and Changoyu president Dewen Chen will serve as co-CEOs.
- The news comes as both Changyou and parent Sohu post mixed Q3 results (EPS beats and revenue misses) and offer light Q4 sales guidance. Sohu expects Q4 revenue of $442M-$462M, mostly below a $461.1M consensus. Changyou expects Q4 revenue of $188M-$198M, below a $199.2M consensus.
- Changyou's Q3 revenue (42% of Sohu's revenue) fell 1% Y/Y due to a 7% drop in online game revenue to $150.3M; Changyou faces off against Tencent, Perfect World, Shanda, and a slew of other firms in a very competitive Chinese online gaming market.
- Average monthly active accounts for Changyou's games amounted to 29M, +21% Q/Q and -6% Y/Y. Average monthly accounts for platform channels totaled 275M, +9% Q/Q and +178% Y/Y.
- Sohu's Sogou search unit continued to perform well: Sales rose 17% Q/Q and 86% Y/Y to $106M. Meanwhile, Sohu's brand ad sales grew 12% Q/Q and 19% Y/Y to $106M.
- Sohu's gross margin was 58%, flat Q/Q and down from 66% a year ago. Opex was $275M, +3% Q/Q and +47% Y/Y.
- Sohu: Q3 results, PR. Changyou: Q3 results, PR.
Nov. 3, 2014, 5:50 AM
Nov. 2, 2014, 5:30 PM
Oct. 15, 2014, 2:28 PM
- On a day when the Nasdaq is down 1.8% and the S&P 2.2%, many Chinese Internet stocks are rallying. China's lowest CPI print in five years - it helped the Shanghai exchange rise 0.7% overnight - could be playing a role.
- Baidu (BIDU +1.1%), Sohu (SOHU +2.8%), Youku (YOKU +4.9%), Vipshop (VIPS +3%), and Weibo (WB +2.9%) are among the standouts. Others: CMGE +6.1%. MOBI +4.1%. NTES +3.5%. DANG +2.3%. SFUN +1.7%. CCIH +1.7%. BITA +1.5%.
- ETFs: KWEB, CQQQ, QQQC
Oct. 15, 2014, 2:04 PM
- Online video execs weren't shy at all about taking some shots at old media during the high-profile MIPCOM event in France this week, observes FierceOnlineVideo.
- Maker Studios CEO Ynon Kaiz boldly bragged Disney needed to buy his firm in order to stay relevant.
- Netflix CCO Ted Sarandos took some well-aimed potshots at the movie exhibitor model.
- Not to be overlooked, Sohu.com's (NASDAQ:SOHU) Charles Zhang told broadcasters to quit their jobs and move into the online content realm.
- Earlier today, Lion's Gate talked about big brands getting into the streaming game, while HBO created a buzz with the announcement it will offer a stand-alone service next year.
- Media stocks are out-performing on the day, with Lion's Gate (LGF +0.4%) even peeking out a rare gain amid the broad market sell-off.
- Related ETFS: PBS
Sep. 15, 2014, 1:21 PM
- Maybe looking to raise cash with which to buy Alibaba (Pending:BABA) this week, investors are dumping a wide swath of other Chinese internet names.
- Qihoo (QIHU -2.6%), Sohu.com (SOHU -5.3%), Baidu (BIDU -3.8%), Sina (SINA -4.9%), Renren (RENN -4%), Weibo (WB -11.3%), YY (YY -7.3%).
- Previously: Alibaba to boost IPO size
Sep. 10, 2014, 5:35 PM
Aug. 22, 2014, 7:03 PM
- Ahead of Qihoo's (NYSE:QIHU) Q2 report (due Monday morning), CNZZ estimates Qihoo now has 30.2% of the Chinese search market in terms of page views. That's up sharply from the 16.3% it had a year ago, and suggests Qihoo may have already reached its 30% year-end target.
- Baidu's (NASDAQ:BIDU) share is pegged at 54.5%, down from 67.7% a year ago. Sohu's (NASDAQ:SOHU) Sogou unit is assigned a 12.8% share, up from 9.7% a year ago.
- Two caveats: 1) iResearch has provided higher search share figures for Baidu, and lower ones for Qihoo, than CNZZ. The firm has argued CNZZ's figures paint an incomplete picture due to a heavy reliance on small/medium-sized sites for data. 2) Qihoo's mobile search position is weaker than its PC search position. Baidu, meanwhile, just topped 500M monthly mobile search users.
Jul. 28, 2014, 2:51 PM
- Sohu (SOHU +1%) expects Q3 revenue of $427M-$442M and EPS of -$0.75 to -$0.85 vs. a consensus of $451.4M and -$0.97. Subsidiary Changyou (CYOU +0.9%) expects Q3 revenue of $186M-$192M and EPS of -$0.11 to $0.00 vs. a consensus of $200.1M and -$0.04.
- While respectively up 275% and 86% Y/Y, Changyou's sales/marketing and R&D spend fell 14% and 30% Q/Q in Q2 to $69.4M and $49M. That helped both Changyou and Sohu beat EPS estimates in spite of revenue misses. Sohu's total opex fell 8% Q/Q and rose 67% Y/Y to $267M.
- Changyou notes it "scaled back its advertising and promotion of its PC-based and mobile-based software applications" in Q2. The R&D spend decline is attributed to lower expenses related to employee incentive plans.
- Each company saw declining gross margins: Changyou's GM fell to 76% from 78% in Q1 and 83% a year ago, and Sohu's fell to 58% from 62% in Q1 and 66% a year ago. In addition to Changyou, Sohu's GM was dinged by lower advertising margins caused by higher content/bandwidth costs.
- While Changyou's gaming revenue fell 9% Y/Y to $154M, Sohu's search/other revenue grew 84% Y/Y to $85M, and its brand ad revenue grew 33% Y/Y to $133M.
- Revenue related to the Sogou search engine (largely search/other) rose 30% Q/Q and 82% Y/Y to $91M. Average monthly active accounts for Changyou's games fell 14% Q/Q and 33% Y/Y to 24M. Changyou's platform channel accounts grew 5% Q/Q and 196% Y/Y to 252M.
- Q2 results: Sohu, Changyou
Jul. 28, 2014, 2:39 AM
Jul. 27, 2014, 5:30 PM
Jul. 25, 2014, 5:32 PM
- Goldman has raised its 2014-2016 Baidu (BIDU +10.9%) EPS estimates by 17%-23% following its sizable Q2 EPS beat and above-consensus Q3 guidance, and hiked its target by $35 to $260. BofA/Merrill, Deutsche, and Piper have also raised their Baidu PTs.
- Goldman was pleased with several datapoints provided in the Q2 report and CC (transcript). Among them: 1) Baidu topped 500M mobile search monthly active users (MAUs) in June. 2) Maps MAUs have passed 200M. 3) Baidu's app distribution platforms (led by 91 Wireless) averaged 130M downloads/day in Q2. 4) The Nuomi daily deals unit (acquired from Renren) has seen its user base double since Q4.
- BofA/Merrill observes Baidu's aggressive spending growth is now being fueled more by hiring than by marketing spend, something it expects will translate into future leverage. Marketing spend fell to 11.5% of revenue from 14.1% in Q1, while R&D grew to 14.6% from 13.6%.
- Baidu made fresh highs today, and provided a lift to rivals Qihoo (QIHU +3.7%) and Sohu (SOHU +2.2%) along the way.
Jul. 18, 2014, 11:05 AM
- Rucia Ren, formerly a senior finance manager at Baidu, has been named Changyou's (CYOU -1.5%) new acting CFO.
- Ren replaces Erin Sheng, who has been serving as interim CFO since former CFO Alex Ho left Changyou earlier this year to start his own company.
- Changyou, which accounts for nearly half of Sohu's (SOHU -0.1%) sales, posted a sizable Q1 loss due to heavy marketing/promotional spend for its games. More losses are expected for Q2.
May 12, 2014, 2:03 PM
- Changyou (CYOU +3.9%) "plans to transfer or lay off nearly 120 employees" in its PC gaming unit, Marbridge Consulting reports. The employees will reportedly be either laid off or transferred to Changyou's mobile gaming unit.
- The report comes after the Sohu (SOHU +3%) subsidiary reported a 2% Y/Y drop in online gaming revenue (accounted for 45% of Sohu's total revenue), and also provided soft Q2 guidance caused in part by heavy spending. Like some peers, Changyou has been struggling to deal with mobile cannibalization and intense competition - Tencent remains an industry colossus.
Apr. 28, 2014, 10:17 AM
- Sohu (SOHU -4.8%) missed Q1 estimates and provided light Q2 guidance. Meanwhile, as part of a recent crackdown, the Chinese government has pulled The Big Bang Theory and other popular U.S. shows from sites such as Sohu.com, Youku.com (YOKU -4.4%), Baidu's (BIDU -5%) iQiyi, and Tencent Video (TCEHY -2.8%). Time observes The Big Bang Theory has produced 1.3B video views since launching on Sohu TV in '09.
- The news is overshadowing a $1.22B investment in Youku by Alibaba (ABABA) and an affiliated P-E firm, and a WSJ report stating Alibaba is forming a mobile search JV with leading mobile browser firm UCWeb (once targeted by Baidu).
- The deals are the latest in a long line of investments and partnerships struck by Alibaba, Tencent, and Baidu, as each firm tries to build a Web/mobile empire covering over a dozen valuable markets.
- Is Qihoo (QIHU -0.8%) next in line to make a deal? With a $21.6B market cap, the security app/browser/search provider and Baidu rival is the biggest Chinese Internet company to remain independent of the big-3. Qihoo was reported in January to be talking with Alibaba.
- Other decliners: NQ -6.5%. VIPS -5.2%. WB -4.2%. WBAI -3%. LONG -4.5%. QUNR -2.4%.
Apr. 28, 2014, 9:15 AM
SOHU vs. ETF Alternatives
Sohu.com Incis a Chinese online media, search, gaming, community and mobile service groupproviding comprehensive online products and services on PCs and mobile devices in the People's Republic of China.
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