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Online gaming platform Sohu.com Q3 revenue drops on high base effect

By Reuters News


Overview

  • China online media and gaming group's Q3 revenue fell 26% yr/yr

  • Company posted non-GAAP net loss of $15 mln, reversing profit from prior year

  • Online game revenues dropped 30% yr/yr, mainly due to high base after prior-year launches


Outlook

  • Sohu sees Q4 marketing services revenue between $13 mln and $14 mln

  • Company expects Q4 online game revenue between $111 mln and $121 mln

  • Sohu forecasts Q4 net loss between $17 mln and $27 mln


Result Drivers

  • HIGH BASE EFFECT - Co said online game revenue declined due to a high comparison base from prior-year content updates and game launches

  • OLDER GAME DECLINE - Co attributed lower active user and payer numbers to the natural decline of older games

  • CONTENT UPDATES - Co said it introduced new content and tailored gameplay to maintain player engagement


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Loss Per Share

$0.60


Analyst Coverage

  • The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

  • The average consensus recommendation for the online services peer group is "buy."

  • Wall Street's median 12-month price target for Sohu.com Ltd is $19.50, about 41% above its November 6 closing price of $13.83


Reuters Recommended Reads

  • Nov 6 - Nvidia chips pile up in Hong Kong as China withholds import approval

  • Nov 6 - Hong Kong's TradeGo FinTech H1 profit falls 36%

  • Nov 6 - UK's ECO Animal Health H1 revenue falls on China weakness


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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