BEIJING, Oct. 24, 2016 /PRNewswire/ -- Sohu.com Inc.
(NASDAQ: SOHU), China's leading
online media, video, search and gaming business group, today
reported unaudited financial results for the third quarter ended
September 30, 2016.
Third Quarter Highlights
- Total revenues were US$411
million[1], down 21% year-over-year and 2%
quarter-over-quarter.
- Brand advertising revenues were US$111
million, down 27% year-over-year and 2%
quarter-over-quarter.
- Sogou[2] revenues were US$166
million, up 2% year-over-year and down 6%
quarter-over-quarter.
- Online game revenues were US$99
million, down 35% year-over-year and largely flat
quarter-over-quarter.
- GAAP net loss attributable to Sohu.com Inc. was US$75 million, or US$1.94 loss per fully-diluted share.
- Non-GAAP[3] net loss attributable to Sohu.com Inc.
was US$65 million, or US$1.68 loss per fully-diluted share.
Dr. Charles Zhang, Chairman and
CEO of Sohu.com Inc., commented, "In the third quarter, the Group
total revenues reached our prior guidance amid challenging
operating climate that mainly affected our online advertising
businesses. By business unit, for Sohu Media Portal, we strived to
bring users high quality and enriched content while continued to
optimize Sohu News App design. Sohu Video accelerated investment in
self-developed content that would benefit our subscription business
and help improve the cost structure. For Sogou, it continued to
enhance its vertical search capability while the mobile search
traffic maintained strong momentum. Changyou delivered
better-than-expected results as its existing games performed
steadily while the development of new mobile games was well on
track."
Mr. Xiaochuan Wang, CEO of Sogou,
commented, "In the third quarter, Sogou continued its efforts in
product differentiation and focused on AI-powered technology
innovation. Traffic share and revenue were trending higher. Mobile
search traffic more than doubled from a year ago and grew 16%
sequentially. Financially, quarterly total revenues reached
US$166 million, or RMB1.11 billion, up 9% year-over-year in RMB
terms."
[1] For
the third quarter of 2016, on yearly basis, depreciation of the RMB
against the U.S. dollar impacted our reported financial results.
Should the exchange rate of RMB6.26=US$1.00 be used as the same of
the third quarter of 2015, total revenues in the third quarter of
2016 would have been US$437 million, or US$26 million higher than
the GAAP total revenue, or down 16% year-over-year.
|
[2] Sogou
operates the search and search-related business and offers Internet
value-added services ("IVAS") with respect to Web games developed
by third-party developers. In the statements of operations,
revenues from search and search-related services are recorded as
"Search and search-related" revenue, and revenues from IVAS are
recorded as "Others" revenue.
|
[3]
Non-GAAP results exclude share-based compensation expense, non-cash
tax benefits from excess tax deductions related to share-based
awards, income/expense from the adjustment of contingent
consideration previously recorded for acquisitions and dividend and
deemed dividend to non-controlling preferred shareholders of Sogou.
Explanation of the Company's non-GAAP financial measures and
related reconciliations to GAAP financial measures are included in
the accompanying "Non-GAAP Disclosure" and "Reconciliations of
Non-GAAP Results of Operation Measures to the Nearest Comparable
GAAP Measures."
|
Third Quarter Financial Results
Revenues
Total revenues for the third quarter of 2016 were US$411 million, down 21% year-over-year and 2%
quarter-over-quarter.
Total online advertising revenues, which include revenues from
the brand advertising and search and search-related businesses, for
the third quarter of 2016 were US$262
million, down 13% year-over-year and 4%
quarter-over-quarter.
Brand advertising revenues for the third quarter of 2016 totaled
US$111 million, down 27%
year-over-year and 2% quarter-over-quarter. The year-over-year
decrease was mainly attributable to the decrease in the video
advertising businesses. Revenues of Sohu Media Portal, or Sohu.com
excluding Sohu Video, were US$48
million, down 6% year-over-year and up 2%
quarter-over-quarter. Revenues of Sohu Video were US$25 million, down 54% year-over-year and 20%
quarter-over-quarter.
Search and search-related revenues for the third quarter of 2016
were US$151 million, up 2%
year-over-year and down 6% quarter-over-quarter. The
quarter-over-quarter decrease was largely due to a negative impact
from new regulations with respect to search advertising.
Online game revenues for the third quarter of 2016 were
US$99 million, down 35%
year-over-year and largely flat quarter-over-quarter. The
year-over-year decrease was mainly due to the natural decline in
revenues of older games, such as TLBB and TLBB 3D, and a decrease
in Web game revenues upon the completion of the sale of the 7Road
business during the third quarter of 2015.
Gross Margin
Both GAAP and non-GAAP gross margin was 46% for the third
quarter of 2016, compared with 59% in the third quarter of 2015 and
49% in the second quarter of 2016.
Both GAAP and non-GAAP gross margin for the online advertising
business for the third quarter of 2016 was 32%, compared with 49%
in the third quarter of 2015 and 39% in the second quarter of
2016.
Both GAAP and non-GAAP gross margin for the brand advertising
business in the third quarter of 2016 was 8%, compared with 40% in
the third quarter of 2015 and 17% in the second quarter of 2016.
The year-over-year decrease was mainly due to decreased video
revenues. The quarter-over-quarter decrease was mainly due to an
increase in video content costs.
Both GAAP and non-GAAP gross margin for the search and
search-related business in the third quarter of 2016 was 49%,
compared with 58% in the third quarter of 2015 and 55% in the
second quarter of 2016. The decreases were mainly due to higher
traffic acquisition cost as a percentage of search and
search-related revenues.
Both GAAP and non-GAAP gross margin for online games in the
third quarter of 2016 was 76%, compared with 77% in the third
quarter of 2015 and 74% in the second quarter of 2016. The
quarter-over-quarter increase was due to a smaller revenue
contribution from mobile games, which typically require additional
revenue-sharing payments.
Operating Expenses
For the third quarter of 2016, GAAP operating expenses totaled
US$239 million, down 10%
year-over-year and up 1% quarter-over-quarter. Non-GAAP operating
expenses were US$226 million, down
15% year-over-year and 3% quarter-over-quarter. The year-over-year
decrease was mainly due to US$40
million of impairments to goodwill and intangibles via
acquisitions of businesses the Company recognized in the third
quarter of 2015.
Operating Loss
GAAP operating loss for the third quarter of 2016 was
US$52 million, compared with an
operating profit of US$43 million in
the third quarter of 2015 and an operating loss of US$29 million in the second quarter of 2016.
Non-GAAP operating loss for the third quarter of 2016 was
US$38 million, compared with an
operating profit of US$41 million in
the third quarter of 2015 and an operating loss of US$26 million in the second quarter of 2016.
Other Income
Other income for the third quarter of 2016 was US$4 million, compared with other income of
US$70 million which included gain
recognized from the divestment of 7Road in the third quarter of
2015 and other expense of US$25
million in the second quarter of 2016, which was mainly
related to a donation by Sogou to Tsinghua University.
Income Tax Expense
Both GAAP and non-GAAP income tax expense was US$1 million for the third quarter of 2016,
compared with income tax expense of US$29
million in the third quarter of 2015 and income tax expense
of US$2 million in the second quarter
of 2016.
Net Loss
Before deducting the share of net income pertaining to
non-controlling interest, GAAP net loss for the third quarter of
2016 was US$42 million, compared with
a net income of US$93 million in the
third quarter of 2015 and net loss of US$47
million in the second quarter of 2016. Before deducting the
share of net income pertaining to non-controlling interest,
non-GAAP net loss for the third quarter of 2016 was US$29 million, compared with a net income of
US$91 million in the third quarter of
2015 and net loss of US$44 million in
the second quarter of 2016.
GAAP net loss attributable to Sohu.com Inc. for the third
quarter of 2016 was US$75 million, or
US$1.94 loss per fully-diluted share,
compared with a net income of US$39
million in the third quarter of 2015 and net loss of
US$63 million in the second quarter
of 2016. Non-GAAP net loss attributable to Sohu.com Inc. for the
third quarter of 2016 was US$65
million, or US$1.68 loss per
fully-diluted share, compared with a net income of US$49 million in the third quarter of 2015 and
net loss of US$63 million in the
second quarter of 2016.
Liquidity
As of September 30, 2016, the Sohu
Group had cash and cash equivalents and short-term investments of
US$1.36 billion compared with
US$1.42 billion as of December 31, 2015.
Recent Development
Loan Agreement and Share Pledge Agreement with
Changyou
On October 24, 2016, Sohu entered
into a loan agreement with Changyou pursuant to which a PRC
subsidiary of Sohu may borrow up to RMB1
billion (or approximately US$148.64
million) from a PRC subsidiary of Changyou from time to
time, with the first advance request to occur prior to December 31, 2016 and Sohu's right to request
advances continuing for one year after the first advance, subject
to extension for an additional year with Changyou's consent.
Principal amounts outstanding under the loan agreement will bear
interest at an annual rate of 6%, accruing and payable on each
one-year anniversary of each advance. The outstanding principal of
each advance will be due one year from the date of the advance,
subject to extension for an additional year with Changyou's
consent. Advances under the loan agreement will be secured by a
pledge to Changyou under a share pledge agreement of an agreed-upon
number of Changyou Class B ordinary shares of Changyou held by
Sohu. The share pledge agreement will give Changyou the right to
apply the outstanding principal and accrued interest on the loan to
the repurchase of Changyou Class B ordinary shares from Sohu in the
event such principal and interest are not paid when due. Sohu
intends to use amounts drawn down under the loan agreement to
finance Sohu's operations, excluding the operations of Changyou and
of Sogou.
Business Outlook
For the fourth quarter of 2016, Sohu estimates:
- Total revenues to be between US$370
million and US$400 million.
- Brand advertising revenues to be between US$95 million and US$105 million; this implies an
annual decrease of 25% to 33% and a sequential decrease of 5% to
14%. Sohu Media Portal revenues to be between US$42 million and US$45 million. Sohu Video
revenues to be between US$25 million and
US$28 million.
- Sogou revenues to be between US$155
million and US$165 million; this implies annual and
sequential decreases of 1% to 7%.
- Online game revenues to be between US$85
million and US$95 million; this implies an annual decrease
of 25% to 33% and a sequential decrease of 4% to14%.
- Before deducting the share of non-GAAP net income pertaining to
non-controlling interest, non-GAAP net loss to be
between US$75 million and US$85
million. Assuming no new grants of share-based awards and
that the market price of our shares is unchanged; we estimate that
compensation expense relating to share-based awards will be
around US$12 million. Considering the impact of these
share-based awards, GAAP net loss before non-controlling
interest to be between US$87 million and
US$97 million.
- Non-GAAP net loss attributable to Sohu.com Inc. to be
between US$85 million and US$95
million, and non-GAAP loss per fully-diluted share to be
between US$2.20 and US$2.45.
Considering the impact of the aforementioned share-based awards,
and netting off approximately US$5 million of Sohu's economic
interests in Changyou and Sogou, GAAP net loss attributable
to Sohu.com Inc. to be between US$92 million and
US$102 million, and GAAP loss per
fully-diluted share to be between US$2.38 and US$2.63.
For the fourth quarter 2016 guidance, the Company has adopted a
presumed exchange rate of RMB6.7=US$1.00, as
compared with the actual exchange rate of approximately
RMB6.39=US$1.00 for the fourth quarter of 2015, and
RMB6.66=US$1.00 for the third quarter of 2016.
Non-GAAP Disclosure
To supplement the unaudited consolidated financial statements
presented in accordance with accounting principles generally
accepted in the United States of
America ("GAAP"), Sohu's management uses non-GAAP measures
of gross profit, operating profit, net income, net income
attributable to Sohu.com Inc. and diluted net income attributable
to Sohu.com Inc. per share, which are adjusted from results based
on GAAP to exclude the impact of the share-based awards, which
consist mainly of share-based compensation expenses and non-cash
tax benefits from excess tax deductions related to share-based
awards, income/expense from the adjustment of contingent
consideration previously recorded for acquisitions, and dividend
and deemed dividend to non-controlling preferred shareholders.
These measures should be considered in addition to results prepared
in accordance with GAAP, but should not be considered a substitute
for, or superior to, GAAP results.
Sohu's management believes excluding the share-based
compensation expense, non-cash tax benefits from excess tax
deductions related to share-based awards, income/expense from the
adjustment of contingent consideration previously recorded for
acquisitions and dividend and deemed dividend to non-controlling
preferred shareholders from its non-GAAP financial measure is
useful for itself and investors. Further, the impact of share-based
compensation expense, non-cash tax benefits from excess tax
deductions related to share-based awards, income/expense from the
adjustment of contingent consideration previously recorded for
acquisitions, and dividend and deemed dividend to non-controlling
preferred shareholders cannot be anticipated by management and
business line leaders and these expenses were not built into the
annual budgets and quarterly forecasts, which have been the basis
for information Sohu provides to analysts and investors as guidance
for future operating performance. As the impact of share-based
compensation expense, non-cash tax benefits from excess tax
deductions related to share-based awards, income/expense from the
adjustment of contingent consideration previously recorded for
acquisitions, and dividend and deemed dividend to non-controlling
preferred shareholders does not involve subsequent cash outflow or
is reflected in the cash flows at the equity transaction level,
Sohu does not factor this impact in when evaluating and approving
expenditures or when determining the allocation of its resources to
its business segments. As a result, in general, the monthly
financial results for internal reporting and any performance
measures for commissions and bonuses are based on non-GAAP
financial measures that exclude the share-based compensation
expense, non-cash tax benefits from excess tax deductions
related to share-based awards, income/expense from the adjustment
of contingent consideration previously recorded for acquisitions,
and dividend and deemed dividend to non-controlling preferred
shareholders.
The non-GAAP financial measures are provided to enhance
investors' overall understanding of Sohu's current financial
performance and prospects for the future. A limitation of using
non-GAAP gross profit, operating profit, net income, net income
attributable to Sohu.com Inc. and diluted net income attributable
to Sohu.com Inc. per share, excluding share-based compensation
expense, non-cash tax benefits from excess tax deductions
related to share-based awards, income/expense from the adjustment
of contingent consideration previously recorded for acquisitions,
and dividend and deemed dividend to non-controlling preferred
shareholders is that the impact of share-based awards and non-cash
tax benefits from excess tax deductions related to share-based
awards has been and will continue to be a significant recurring
expense in Sohu's business for the foreseeable future,
income/expense from the adjustment of contingent consideration
previously recorded for acquisitions may recur in the future,
and dividend and deemed dividend to non-controlling preferred
shareholders may recur when Sohu and its affiliates enter into
equity transactions. In order to mitigate these limitations Sohu
has provided specific information regarding the GAAP amounts
excluded from each non-GAAP measure. The accompanying tables
include details on the reconciliation between the GAAP financial
measures that are most directly comparable to the non-GAAP
financial measures that have been presented.
Notes to Financial Information
Financial information in this press release other than the
information indicated as being non-GAAP is derived from Sohu's
unaudited interim financial statements prepared in accordance with
GAAP.
Safe Harbor Statement
This announcement contains forward-looking statements. It is
currently expected that the Business Outlook will not be updated
until release of Sohu's next quarterly earnings announcement;
however, Sohu reserves right to update its Business Outlook at any
time for any reason. Statements that are not historical facts,
including statements about Sohu's beliefs and expectations, are
forward-looking statements. These statements are based on current
plans, estimates and projections, and therefore you should not
place undue reliance on them. Forward-looking statements involve
inherent risks and uncertainties. We caution you that a number of
important factors could cause actual results to differ materially
from those contained in any forward-looking statement. Potential
risks and uncertainties include, but are not limited to,
instability in global financial and credit markets and its
potential impact on the Chinese economy; exchange rate
fluctuations, including their potential impact on the Chinese
economy and on Sohu's reported US dollar results; recent slow-downs
in the growth of the Chinese economy; the uncertain regulatory
landscape in the People's Republic of
China; fluctuations in Sohu's quarterly operating results;
Sohu's current and projected future losses due to increased
spending by Sohu for video content; the possibilities that Sohu
will be unable to recoup its investment in video content and that
Changyou will be unable to develop a series of successful games for
mobile platforms or successfully monetize mobile games it develops
or acquires; and Sohu's reliance on online advertising sales,
online games and mobile services for its revenues. Further
information regarding these and other risks is included in Sohu's
annual report on Form 10-K for the year ended December 31, 2015, and other filings with the
Securities and Exchange Commission.
Conference Call and Webcast
Sohu's management team will host a conference call at
8:30 a.m. U.S. Eastern Time,
October 24, 2016 (8:30 p.m. Beijing/Hong
Kong time, October 24, 2016)
following the quarterly results announcement.
The dial-in details for the live conference call are:
US
Toll-Free:
|
+1-866-519-4004
|
International:
|
+65-6713-5090
|
Hong Kong:
|
+852-3018-6771
|
China
Mainland
|
+86-800-819-0121 /
+86-400-620-8038
|
Passcode:
|
SOHU
|
Please dial in 10 minutes before the call is scheduled to begin
and provide the passcode to join the call.
A telephone replay of the call will be available after the
conclusion of the conference call at 11:30
a.m. Eastern Time on October 24
through October 31, 2016. The dial-in details for the
telephone replay are:
International:
|
+1-646-254-3697
|
Passcode:
|
92227550
|
The live Webcast and archive of the conference call will be
available on the Investor Relations section of Sohu's Website at
http://investors.sohu.com/.
About Sohu.com
Sohu.com Inc. (NASDAQ: SOHU) is China's premier online brand and indispensable
to the daily life of millions of Chinese, providing a network of
Web properties and community based/Web 2.0 products which offer the
vast Sohu user community a broad array of choices regarding
information, entertainment and communication. Sohu has built one of
the most comprehensive matrices of Chinese language web properties
and proprietary search engines, consisting of the mass portal and
leading online media destination www.sohu.com; the interactive
search engine www.sogou.com; the developer and operator of online
games www.changyou.com/en/ and the leading online video Website
tv.sohu.com.
Sohu corporate services consist of online brand advertising on
its matrix of websites as well as bid listing and home page on its
in-house developed search directory and engine. Sohu also provides
multiple news and information service on mobile platforms,
including Sohu News App and mobile news portal m.sohu.com. Sohu's
online game subsidiary, Changyou.com (NASDAQ: CYOU) has a diverse
portfolio of popular online games, such as Tian Long Ba Bu ("TLBB"), one of the most
popular PC games in China, as well
as a number of mobile games. Changyou also owns and operates the
17173.com Website, a leading game information portal in
China. Sohu.com, established by
Dr. Charles Zhang, one of
China's internet pioneers, is in
its twentieth year of operation.
For investor and media inquiries, please contact:
In China:
Mr. Eric
Yuan
|
Sohu.com
Inc.
|
Tel:
|
+86 (10)
6272-6593
|
E-mail:
|
ir@contact.sohu.com
|
In the United
States:
Ms. Linda
Bergkamp
|
Christensen
|
Tel:
|
+1 (480)
614-3004
|
E-mail:
|
lbergkamp@christensenir.com
|
SOHU.COM
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(UNAUDITED, IN
THOUSANDS EXCEPT PER SHARE AMOUNTS)
|
|
|
Three Months
Ended
|
|
|
Sep. 30,
2016
|
|
Jun. 30,
2016
|
|
Sep. 30,
2015
|
Revenues:
|
|
|
|
|
|
|
Online
advertising
|
|
|
|
|
|
|
Brand advertising
|
$
|
110,871
|
$
|
112,887
|
$
|
151,517
|
Search and search-related
|
|
150,667
|
|
160,152
|
|
147,938
|
Subtotal
|
|
261,538
|
|
273,039
|
|
299,455
|
Online games
|
|
98,553
|
|
99,227
|
|
152,501
|
Others
|
|
50,491
|
|
47,872
|
|
70,134
|
Total revenues
|
|
410,582
|
|
420,138
|
|
522,090
|
|
|
|
|
|
|
|
Cost of
revenues:
|
|
|
|
|
|
|
Online
advertising
|
|
|
|
|
|
|
Brand advertising (includes stock-based
compensation expense of $265, $-73 and
$184,
respectively)
|
|
102,137
|
|
93,654
|
|
91,163
|
Search and search-related (includes stock-based
compensation expense of $4, $0 and $12,
respectively)
|
|
76,457
|
|
71,998
|
|
62,365
|
Subtotal
|
|
178,594
|
|
165,652
|
|
153,528
|
Online games (includes
stock-based compensation
expense of $26, $17 and $-96, respectively)
|
|
23,719
|
|
25,380
|
|
34,635
|
Others
|
|
20,571
|
|
21,226
|
|
25,996
|
Total cost of revenues
|
|
222,884
|
|
212,258
|
|
214,159
|
|
|
|
|
|
|
|
Gross
profit
|
|
187,698
|
|
207,880
|
|
307,931
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Product development
(includes stock-based
compensation expense of $4,105, $1,699 and $-1,332,
respectively)
|
|
90,007
|
|
88,959
|
|
92,779
|
Sales and marketing
(includes stock-based compensation
expense of $752, $161 and $466, respectively)
|
|
110,584
|
|
117,966
|
|
98,596
|
General and
administrative (includes stock-based
compensation expense of $8,018, $740 and $-1,536,
respectively)
|
|
38,670
|
|
29,650
|
|
33,330
|
Goodwill impairment
and impairment of intangibles via
acquisitions of businesses
|
|
-
|
|
-
|
|
40,324
|
Total operating expenses
|
|
239,261
|
|
236,575
|
|
265,029
|
|
|
|
|
|
|
|
Operating (loss)
/profit
|
|
(51,563)
|
|
(28,695)
|
|
42,902
|
|
|
|
|
|
|
|
Other income
/(expense)
|
|
3,678
|
|
(24,573)
|
|
70,219
|
Net interest
income
|
|
6,118
|
|
5,040
|
|
5,192
|
Exchange
difference
|
|
702
|
|
3,866
|
|
4,322
|
(Loss) /income before
income tax expense
|
|
(41,065)
|
|
(44,362)
|
|
122,635
|
|
|
974
|
|
2,430
|
|
29,461
|
Income tax
expense
|
Net (loss)
/income
|
|
(42,039)
|
|
(46,792)
|
|
93,174
|
|
|
|
|
|
|
|
Less: Net income
attributable to the noncontrolling
interest shareholders
|
|
32,775
|
|
16,232
|
|
42,142
|
Deemed dividend to non-controlling Sogou series
A preferred shareholders
|
|
-
|
|
-
|
|
11,911
|
|
|
(74,814)
|
|
(63,024)
|
|
39,121
|
Net (loss) /income
attributable to Sohu.com Inc.
|
|
|
|
|
|
|
|
Basic net (loss)
/income per share attributable to Sohu.com
Inc.
|
$
|
(1.93)
|
$
|
(1.63)
|
$
|
1.01
|
Shares used in
computing basic net (loss) /income per share
attributable to Sohu.com Inc.
|
|
38,728
|
|
38,691
|
|
38,633
|
|
|
|
|
|
|
|
Diluted net (loss)
/income per share attributable to
Sohu.com Inc.
|
$
|
(1.94)
|
$
|
(1.64)
|
$
|
1.00
|
Shares used in
computing diluted net (loss) /income per
share attributable to Sohu.com Inc.
|
|
38,728
|
|
38,691
|
|
38,665
|
SOHU.COM
INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(UNAUDITED, IN
THOUSANDS)
|
|
|
As of Sep. 30,
2016
|
|
As of Dec. 31,
2015
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash equivalents
|
$
|
1,092,085
|
$
|
1,245,205
|
Restricted time
deposits (a)
|
|
-
|
|
227,285
|
Short-term
investments
|
|
264,109
|
|
174,515
|
Accounts receivable, net
|
|
204,748
|
|
273,617
|
Prepaid and other current assets
|
|
274,701
|
|
158,890
|
Assets held for sale
(b)
|
|
101,786
|
|
-
|
Total current assets
|
|
1,937,429
|
|
2,079,512
|
Long-term
investments
|
|
68,861
|
|
62,093
|
Fixed assets,
net
|
|
525,899
|
|
508,692
|
Goodwill
|
|
69,688
|
|
154,219
|
Intangible assets,
net
|
|
33,593
|
|
55,415
|
Restricted time
deposits (a)
|
|
9,270
|
|
136,694
|
Prepaid non-current
assets
|
|
5,167
|
|
6,254
|
Other
assets
|
|
25,546
|
|
39,315
|
Total assets
|
$
|
2,675,453
|
$
|
3,042,194
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts payable
|
$
|
163,843
|
$
|
129,025
|
Accrued liabilities
|
|
335,046
|
|
309,657
|
Receipts in advance and deferred revenue
|
|
128,943
|
|
135,385
|
Accrued salary and benefits
|
|
84,783
|
|
99,631
|
Taxes payable
|
|
38,764
|
|
67,480
|
Deferred tax liability
|
|
26,247
|
|
24,884
|
Short-term bank loans (a)
|
|
-
|
|
344,500
|
Other short-term liabilities
|
|
198,171
|
|
154,017
|
Liabilities held for
sale (b)
|
|
3,236
|
|
-
|
Total current liabilities
|
$
|
979,033
|
$
|
1,264,579
|
|
|
|
|
|
Long-term accounts
payable
|
|
17,272
|
|
4,600
|
Long-term tax
payable
|
|
33,199
|
|
24,732
|
Deferred tax
liabilities
|
|
14,037
|
|
17,531
|
Total long-term
liabilities
|
$
|
64,508
|
$
|
46,863
|
Total liabilities
|
$
|
1,043,541
|
$
|
1,311,442
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY:
|
|
|
|
|
Sohu.com Inc. shareholders' equity
|
|
1,084,273
|
|
1,241,022
|
Noncontrolling Interest
|
|
547,639
|
|
489,730
|
Total shareholders' equity
|
$
|
1,631,912
|
$
|
1,730,752
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$
|
2,675,453
|
$
|
3,042,194
|
|
Note:
|
(a) Changyou had
repaid all of the remaining bank loans of $344.5 million, and
restricted time deposits of $354.7 million that secured these loans
had been released during the first quarter of 2016.
|
(b) Changyou's
management had an intention to divest its interest in MoboTap
during the third quarter of 2016. Therefore, the assets and
liabilities of MoboTap were recognized as "Assets held for sale"
and "Liabilities held for sale," respectively, in the third quarter
of 2016.
|
SOHU.COM
INC.
|
RECONCILIATIONS OF
NON-GAAP RESULTS OF OPERATION MEASURES TO THE NEAREST COMPARABLE
GAAP MEASURES
|
(UNAUDITED, IN
THOUSANDS EXCEPT PER SHARE AMOUNTS)
|
|
|
Three Months
Ended Sep. 30, 2016
|
|
Three Months
Ended Jun. 30, 2016
|
|
Three Months
Ended Sep. 30, 2015
|
|
|
GAAP
|
|
Non-GAAP
Adjustments
|
|
Non-GAAP
|
|
GAAP
|
|
Non-GAAP
Adjustments
|
|
Non-GAAP
|
|
GAAP
|
|
Non-GAAP
Adjustments
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
265
|
(a)
|
|
|
|
|
(73)
|
(a)
|
|
|
|
|
184
|
(a)
|
|
Brand advertising
gross profit
|
$
|
8,734
|
$
|
265
|
$
|
8,999
|
$
|
19,233
|
$
|
(73)
|
$
|
19,160
|
$
|
60,354
|
$
|
184
|
$
|
60,538
|
Brand advertising
gross
margin
|
|
8%
|
|
|
|
8%
|
|
17%
|
|
|
|
17%
|
|
40%
|
|
|
|
40%
|
|
|
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
12
|
(a)
|
|
Search and
search-related
gross profit
|
$
|
74,210
|
$
|
4
|
(a) $
|
74,214
|
$
|
88,154
|
$
|
-
|
(a) $
|
88,154
|
$
|
85,573
|
$
|
12
|
$
|
85,585
|
Search and
search-related
gross margin
|
|
49%
|
|
|
|
49%
|
|
55%
|
|
|
|
55%
|
|
58%
|
|
|
|
58%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
269
|
(a)
|
|
|
|
|
(73)
|
(a)
|
|
|
|
|
196
|
(a)
|
|
Online advertising
gross profit
|
$
|
82,944
|
$
|
269
|
$
|
83,213
|
$
|
107,387
|
$
|
(73)
|
$
|
107,314
|
$
|
145,927
|
$
|
196
|
$
|
146,123
|
Online advertising
gross
margin
|
|
32%
|
|
|
|
32%
|
|
39%
|
|
|
|
39%
|
|
49%
|
|
|
|
49%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26
|
(a)
|
|
|
|
|
17
|
(a)
|
|
|
|
|
(96)
|
(a)
|
|
Online games gross
profit
|
$
|
74,834
|
$
|
26
|
$
|
74,860
|
$
|
73,847
|
$
|
17
|
$
|
73,864
|
$
|
117,866
|
$
|
(96)
|
$
|
117,770
|
Online games gross
margin
|
|
76%
|
|
|
|
76%
|
|
74%
|
|
|
|
74%
|
|
77%
|
|
|
|
77%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Others gross
profit
|
$
|
29,920
|
$
|
-
|
(a) $
|
29,920
|
$
|
26,646
|
$
|
-
|
(a) $
|
26,646
|
$
|
44,138
|
$
|
-
|
$
|
44,138
|
Others gross
margin
|
|
59%
|
|
|
|
59%
|
|
56%
|
|
|
|
56%
|
|
63%
|
|
|
|
63%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
295
|
(a)
|
|
|
|
|
(56)
|
(a)
|
|
|
|
|
100
|
(a)
|
|
Gross
profit
|
$
|
187,698
|
$
|
295
|
$
|
187,993
|
$
|
207,880
|
$
|
(56)
|
$
|
207,824
|
$
|
307,931
|
$
|
100
|
$
|
308,031
|
Gross
margin
|
|
46%
|
|
|
|
46%
|
|
49%
|
|
|
|
49%
|
|
59%
|
|
|
|
59%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,170
|
(a)
|
|
|
|
|
2,544
|
(a)
|
|
|
|
|
(2,302)
|
(a)
|
|
Operating (loss)
/profit
|
$
|
(51,563)
|
$
|
13,170
|
$
|
(38,393)
|
$
|
(28,695)
|
$
|
2,544
|
$
|
(26,151)
|
$
|
42,902
|
$
|
(2,302)
|
$
|
40,600
|
Operating
margin
|
|
-13%
|
|
|
|
-9%
|
|
-7%
|
|
|
|
-6%
|
|
8%
|
|
|
|
8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,147
|
(a)
|
|
|
|
|
2,550
|
(a)
|
|
|
|
|
(2,302)
|
(a)
|
|
Net (loss)
/income
before non-controlling interest
|
$
|
(42,039)
|
$
|
13,147
|
$
|
(28,892)
|
$
|
(46,792)
|
$
|
2,550
|
$
|
(44,242)
|
$
|
93,174
|
$
|
(2,302)
|
$
|
90,872
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,147
|
(a)
|
|
|
|
|
2,550
|
(a)
|
|
|
|
|
725
|
(b)
|
|
|
|
|
|
(2,806)
|
(b)
|
|
|
|
|
(2,001)
|
(b)
|
|
|
|
|
11,911
|
(c)
|
|
Net (loss)
/income
attributable to Sohu.com Inc.
for diluted net (loss) /income
per share
|
$
|
(75,286)
|
$
|
10,341
|
$
|
(64,945)
|
$
|
(63,386)
|
$
|
549
|
$
|
(62,837)
|
$
|
38,796
|
$
|
10,334
|
$
|
49,130
|
Diluted
net (loss) /income
per share attributable to
Sohu.com Inc.
|
$
|
(1.94)
|
|
|
$
|
(1.68)
|
$
|
(1.64)
|
|
|
$
|
(1.62)
|
$
|
1.00
|
|
|
$
|
1.27
|
Shares used in
computing
diluted net (loss) /income
per share attributable to
Sohu.com Inc.
|
|
38,728
|
|
|
|
38,728
|
|
38,691
|
|
|
|
38,691
|
|
38,665
|
|
|
|
38,701
|
|
Note:
|
(a) To eliminate the
impact of share-based awards as measured using the fair value
method.
|
(b) To adjust Sohu's
economic interests in Changyou and Sogou under the treasury stock
method.
|
(c) Deemed dividend
to non-controlling Sogou series A preferred
shareholders.
|
Logo - http://photos.prnewswire.com/prnh/20100201/CNM013LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/sohucom-reports-third-quarter-2016-unaudited-financial-results-300349604.html
SOURCE Sohu.com