Sohu spend money to buy the future

Hou Jiyong newspaper reporter

Intern reporter Wang Chuanhong reported in Beijing

Sohu loss, but with Sohu CEO Zhang Chaoyang words: "Now is the time to spend money to buy the future."

On July 28, Sohu announced that its unaudited financial report for the second quarter of 2014 showed that net loss attributable to Sohu, calculated in accordance with the United States Generally Accepted Accounting Principles (GAAP), was $ 45 million. Diluted loss per share US $ 1.16, Non-GAAP non-GAAP net loss of 34 million US dollars, net loss per share of 0.88 US dollars.

This is already a two-quarter net loss for Sohu. The first quarter of this year, Sohu total revenue of 365 million US dollars, an increase of 38%; the first quarter net loss attributable to Sohu was 79 million US dollars.

Zhang Chaoyang far from Japan, said in an interview with 21st Century Business Herald: "There are three reasons for the loss, one is the promotion of Changyou platform; the other is the investment of Sohu video in terms of copyright and bandwidth; the third is the short-term fluctuation."

It is reported that in the third quarter of 2013, Changyou put forward a platform strategy. In the fourth quarter of last year, about 80% of Changyou's expenses were spent on promoting platform products. December 20 last year, Sohu Changyou announced a cost of 1 billion yuan of the "must-win plan."

Video is seen as Sohu's next independent listing of the business. According to Zhang Chaoyang, only the bandwidth investment, Sohu has invested nearly 1 billion yuan in the recent year. Although a huge investment, but in this area, Youku potatoes, fantastic, Sohu video industry top three competition, Sohu if you want to lead the need to increase investment. Sohu investment includes two aspects, namely, copyright and IT infrastructure investment.

In addition, with the emergence of the mobile media represented by today's headlines and the emergence of WeChat from the media, the portal media has been regarded as traditional media. Zhang Chaoyang launched the portal reform is to deal with this change.

Zhang Chaoyang's purpose is to open up the PC, mobile phones, tablet PCs, TVs and theaters and other terminals through Sohu, Sohu video, Sohu micro-portal, Sohu news client, Sohu video client, mobile Sohu and other products. However, the current input driven Sohu portal reform is also difficult to quantify.

However, Sohu's loss is narrowing. The first quarter of this year a loss of 79 million US dollars, the second quarter of 45 million US dollars, Sohu expects third-quarter loss will be further down the paper. But Zhang Chaoyang did not disclose when Sohu eventually completed the reform, to achieve full profit.

It is worth mentioning that, in the context of losses, Sohu business revenue are growing. Of which brand advertising revenue 133 million US dollars, an increase of 33%, growth of 20%; Sogou revenue 91 million US dollars, an increase of 82%, growth of 30%. The only performance is the online game business. Earnings reports, online games quarter revenues of 154 million US dollars, down 9%, down 6%.

Zhang Chaoyang said: "Sohu's total revenue growth due to two major reasons, first, Sohu news and video business in the commercialization of mobile products is very good; Second, Sogou and Tencent gradually deepen the cooperation, the introduction of exclusive WeChat public account search Affected by this product, Sogou has achieved profit for two consecutive quarters. "

It is learned that the smooth progress of cooperation with Tencent benefited from the steady growth of Sogou traffic in the second quarter of this year. In particular, the mobile search traffic increased more than 30% qoq.

Reflected in the financial, Sogou overall revenue in the second quarter of this year reached 91 million US dollars, an increase of 82%. Search advertisers increased 23% YoY and average spend per user increased 63% YoY. Sogou for the first time realized a large-scale profit of 9 million US dollars, and is expected in the third quarter revenue will exceed 100 million US dollars.

Zhang Chaoyang said that in addition to the impact of Tencent weChat cooperation will continue, the other two reasons will also promote the growth of sogou business, one Sogou pinyin in the mobile terminal will promote the search business, the two will get through the future; the second is the Apple ios Open for third-party input method, Sogou Pinyin have the opportunity to occupy more mobile terminals.

"Sogou used for decades, in the core competitiveness finally achieved a breakthrough from 0 to 1." Sogou CEO Wang Xiaochuan said.