SOHU - Earnings call transcript Q4 2024

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Operator

Ladies and gentlemen, thank you for standing by, and good afternoon. Thank you for joining Sohu's Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions] Today's conference call is being recorded [Operator Instructions] I would now like to turn the conference over to your host for today's conference call, Huang Pu, Investor Relations Director of Sohu. Thank you. Please go ahead.

Pu Huang

Operator. Thanks, joining Sohu's for results. Quarter to us you Fourth discuss XXXX Thank

of Also the Chief Dewen Lv; CFO, President and are Chen; and James Officer, Vice On Yaobin Chairman Zhang; and Executive the call Wang. Changyou's us with are Dr. CFO, Charles the Finance, CEO, Deng. Joanna

information company's matters call. their in undue connection statement and reliance on on prepared begins like should Except management you may statements. harbor the I would contain not the plans, and to projections, These based today's safe conference contained remind this call Before statements place therefore, remarks, estimates you discussed on for historical of herein, the forward-looking with current them. are

a to factors cause statements. Forward-looking statements involve materially inherent differ risks and in of that actual could number any results uncertainties. those you from contained We forward-looking important caution

the more on the the filings with to information and most For annual refer Exchange the about uncertainties, please company's XX-F. including recent and potential Securities risks Commission, Form report

With now Charles call Charles, the Zhang. will turn over proceed. Dr. to please I that,

Charles Zhang

and guidance, thank online revenues Pu, hit XXXX, much was and high our bottom expected. revenues for our brand everyone, fourth our quarter Huang Thanks, of call. In our of end performance line the while advertising joining both previous the you, the game better than

potential. the experience performance, further budgets. our to high-energy of integrating business to we premier refine distribution and with our effectively games. to and the By The the games legacy and of products, attract monetization efforts product continue revitalize Media thanks relentless produce to online and were users more solid to high-quality Sohu games events, Video, Sohu and algorithms and user strictly enhance including able IPs For control Media delivered unlock generation platform, social new the the content, promote unique optimize we metrics advantages Sohu

quick a give financial detail, in overview let performance. me Before you each more unit business through of going first our

fourth quarter advertising quarter $XXX XXXX, X% compared XX% a fourth revenues, loss $XX quarter-over-quarter. Non-GAAP of in $XX million $XX and loss to Online year-over-year $XXX the XXXX. third the the Limited, in XXXX. net XXXX quarter-over-quarter. net of X% Sohu.com million, million total $XX Brand of XXXX third million, in million and of down revenues, loss quarter-over-quarter. the X% Limited, loss million net down attributable to of XX% attributable of Sohu.com with compared $XX loss a revenues, million year-over-year X% of in net For fourth million, quarter $XX a quarter game loss down net quarter year-over-year a million of net $XX of and with and the GAAP and

revenues, million compared XXXX. X% compared XXXX. to million enterprising For to the compared whole million XXXX, in $XXX $XX a year $XX loss attributable $XXX XXXX. $XX loss net XXXX. compared $XX with total million, flat game revenues, of net with loss Limited Online $XXX GAAP Non-GAAP million, revenues, a Brand down XXXX. Limited, XX% was with with of million, with attributable up net loss compared Sohu.com of million, Sohu.com in net

through detail. businesses Now more key me our let in go

generations. online needs. products We the experience more users, of fostering us especially by to platform. synergy the the diverse more younger improving technology thriving efforts and online our a metrics maximizing user monitoring improving focused integrated events, We and we platform, These actively stimulated to their attract generation, Sohu promoted community. organically Media driving interactions our and technology. and our allowed product our content Sohu the consistently Meanwhile, First, kept offline on optimizing cutting-edge also closely with their

contestants brought in final dancing held October. XXXX, dancers in China, success. at annual Korea U.S. selected were competition the join cities in the Sohu tour lot of to South of festival of great series Later of overseas Dream for in a in most major in several events, event K-pop above the outstanding Concert dancing we K-pop show XXXX XXXX become together December, in the the field was hosted the and Video has a series in Festival from So top of dancing most dancing the This year. Dancing eye-catching the with which

strengthened leading platforms. largest events also the during nationwide interactions we only Chinese costume. widespread in last and These hosted numerous acclaim our K-pop the influence Sohu and stimulated event traditional Guofeng festival, disseminations not the and quarter, -- on during a hanfu this hanfu It competition but and social extensive our and quarter media Also, received across XXXX Video showcasing position platform. sparked multiple discussions distributions strongly social verticals, the

premium advertisers. our media We brand abundant XXXX as of host These end only influence year us the Fashion also attractive continued flagship mainstream also users our to marketing consolidated content. the unique further such as which not to with provided us solutions were and XXXX events our platform at provide the for a Awards Sohu enabled Finance but Forum, Sohu Annual events and to

Sohu. to experiences to knowledge field of marketing with channels through them And were year, able popularized we collaborations science also the with for delivering the become the These going live X driving combine advertising above, IPs class. Leveraging classes books broadcasters, for and diverse advertisers unique our been and the reinforced Charles' this Physics viewers, jointly on users in and knowledge these millions science cutting-edge professional budgets. persisted competitiveness streaming. which the brand X further were Class, the Benefiting and English published broadcasting in and from unique and and audiences -- IPs to attract core science-related related has of leading dissemination knowledge have years to we able and we

series our out introducing as XXXX, TV bring enriched acquiring American short In and as rolling library well premium content we continuously dramas. dramas dramas, by TV original in

in our includes Yes, Jia the about News by media example, Dié, Xióng TV series, social For the Jin and Video. and American Sohu the both received Bear, talking Ying were series HBO also The platform we're the TV Palace, drama, Sohu Canguan, the Hairpins Chai well audience.

next, business. turn me the game Now let online to

quarter, we the and games online In game our effectively a boosting game. PC the Vintage jointly, new with plan with TLBB launched enthusiasm PC various business, exceeding guidance. and performed our for prior TLBB players' events well for revenues business the ice-themed our During jointly gameplay, along snow and regular

game. PvP introduced regular interest their PC addition, an we experience player innovative classic Vintage enhance the refreshed In renew to some play TLBB game TLBB and gameplays and of for survival in

launched new office featuring pack such content gameplays, user a expansion rich which innovative For higher as dungeons, crossover themed Legacy we satisfaction. TLBB Mobile, and drove

for quarter, expansion keep the series Next titles we to and further content TLBB packs launch engaged. continue updates and other players will to

As forge market We'll we'll competition user-centric true ahead development staying rate. and strategy, to improve to and to intensifies success and continue enhance philosophy. and rise, our for product efficiency execution top process user to research optimize game demand and innovation with quality continues our our

Meanwhile, we our expand will intensify our efforts international to presence.

including types portfolio competitiveness and actively games, diverse games While expand maintaining our with core on we cetera. will RPGs, casual card-based sports games, et MMORPGs, of also our

are the high-quality confident we games we market. bring that to With these soon efforts, can more

like on give repurchase an would Now I update share program. the ongoing to

$XX X.X for As who million. of an February approximately XX, cost million of repurchased ADS XXXX, aggregated had Sohu

turn to CFO, Joanna? with So I our call that, Joanna. will the

Joanna Lv

Thank you, a and segment will our key for are walk basis. All I the key the Charles. non-GAAP quarter of of year you on financials XXXX. through fourth growth numbers full the

to of GAAP reconciliation You may website. measures non-GAAP a find our IR on

million the the For an operating Sohu was year. revenues quarterly million year. Quarterly same compared $XX in in compared million quarter loss quarter $XX last million last $XX platform, same Media were operating with of loss $XX with

loss year XXXX. were in $XX of was compared full $XXX with with XXXX, million year full an the operating revenues $XXX For in million compared $XXX million The loss XXXX. million operating

For XXXXX, same business in quarterly operating million with million revenues, profit million and the was $XXX profit $XXX compared of the $XX last in Quarterly compared quarter with million Changyou's last year. quarter game operating $XX year. same online

compared $XXX revenue with in $XXX XXXX, were The of year million, million of revenues $XXX operating profit, operating million $XXX For compared the XXXX. year XXXX. in million full an profit full with

current a advertising decrease million. expect first $XX of sequential to to the to to of XX%. be XX% decrease million. subject and million of Online $XX between XX% $XX Sohu.com annual Sohu's loss between we of between to to increase to This loss an million, GAAP net sequential of This $XX For Limited and Limited management's million substantial be of XX% million and This annual $XX preliminary to revenues implies and game revenues to Sohu between to million. and which brand attributable a reflects forecast Acom $XXX X%. be XXXX, and Non-GAAP sequential view, XX% X% million decrease be decrease and to is quarter $XX X% attributable and net a uncertainty. $XXX implies

This our prepared open like would to call the Operator, now remarks. concludes to we questions.

Operator

from First Instructions] [Operator line Chong comes Jefferies. of Thomas the question from

Thomas Chong

the bit about for decline the year-on-year soft a the -- and is also business. that is sequential versus question QX question decline years My seems first advertising than brand the guidance, QX. more previous is It bit a

get behind latest So reason regard color sentiment. I want some with any to advertising just to the

it a we gaming Q-on-Q range the seems we comment to about the is or bit it And when because the about should on can wide? business, how And how think far? growth so management trend have Q-on-Q is decline a should expect

integration the question how last about the we implication of comment with should my management Can about Sohu? think then about is And DeepSeek.

Charles Zhang

is right? So all right. question advertising, The your about question is first the about game? second Okay,

Third of DeepSeek, one right? is application Okay.

one, question. I'll the answer first first The

because overall less where of in spending situation because are people marketing are of economic -- spending, decline QX, the For macroeconomic advertisers economy situations. the

And overall economy. overall yes, -- it's so yes,

The about the is right? second game, question

Pu Huang

Language] [Foreign

Unknown Executive

Language] [Foreign

Pu Huang

quarter The performance first expected quarter-over-quarter. be of the is flat to

Charles Zhang

Okay.

been actually last DeepSeek the the in we've social and years, our media -- So to social about applying products. language the been application, network model we've X

-- live example, streaming better the to different the -- we're And summarize AI the content sections to streaming, editing to and text-based of the applied basically our mark video the to can to for technologies help content, really text in to going organized automatically generation of -- content. summarize and into the in different technology the -- video our form especially with us example, writing the knowledge-based For and also efficiency. and internal the content abstract increased content future, the

-- And generate in also language text will to AI-aided or large or and interaction have to in in sometimes this social DeepSeek also help text model -- some production our product help in be content actually, some terms to have users ease to and it. future, and a interaction videos pictures the probably word content future of and will generate the to with to process turn with people but model -- -- voice very network, the the the it to and do able really make produce, be and really into the now some not of voice able will really will them quality, be

there of technology So a is wide application and probably AI DeepSeek. range of

got We DeepSeek we haven't at are funding, looking that but possibility.

content network right? The [Foreign AI gaming, basically social and us I organization with yes. user also also, -- it's media right, experience also editing technology, help applies right? And So Language] our and our and content model, and think generation, language

Unknown Executive

Language] [Foreign

Pu Huang

The terms development in of and design. production application area AI video technology in -- of the mainly two-dimension and is art second gaming

Charles Zhang

we Thomas. hope I answered Okay. your question,

Operator

from comes Alicia Yap Citi. next question from . Our

Alicis a Yap

to curious, the I advertising bit and technology not breakthrough on China, about one, macro these overall slightly can management on there's seen of spend technology a behavior in advertiser maybe consumer you the the of these positive budget comment sure a followup. have And positive development. to some of of to Just you as that, such little have sentiment budget any the of terms better few as also, any consumption with related a change from lot actually I'm have with of sentiment? so this a sentiment hypes seen talks Number category? related the given translate a some

that's first So question. the

million remind what's buyback can $XX buyback the outstanding the is, you amount, amount question second with us your then currently? on And

Charles Zhang

$X.X right? million, the guess. . buyback, Well, I X.X, bought we

Joanna Lv

Yes.

Charles Zhang

X/X spent million or dollars, $XX the So already. X/X of $XXX we right? million

another right, approved million So $XXX there's to by the go, Board.

year spend just the that's X companies of or In see to in okay? advertising they spend So that terms most it's have they That's just spend companies, instead. less to product our XXXX, just I in by -- almost marketing money the of terms, why consumption, RMB their now think half. lot $X.X budget, million the to people $X auto cut A see of a can ADS, I companies want spend. million, -- can of consume, as accordingly less example, macroeconomic million companies in for I trend to if situation,

less because can companies advising can the seems platform, are marketing. promote the, it that, market yes, money see feel that's weak, right? marketing decline, why the that That's As spending we in is why consumption right? So we

So money that and I less and right, them mortgage. because think, mean especially really only product technology technology the then the quite excitement. as bought it's -- pay the into and short volume of an That's run. left the there but to I because much help spending I the spend, companies don't I is drops, brought But why think DeepSeek less think don't benefit really has enthusiasm, problem can people in marketing now don't not and houses have AI People they AI have to to money it have sales -- can DeepSeek, right, immediate companies is less. overall any or are and people translate

And sometimes, not technology what I destroy jobs, see. right, actually That's jobs. creating AI can

Alicis a Yap

I see. see, I

maybe the say, follow you ad electronics the phones kind So or of for the let's any terms in ad Have cell seen bit, any of budget, you all seen, let's that? little category? have I example, Charles? a and increase can So the that up the the any terms trade-in even of in FMCG of like on holding other up say, spending given is subsector

Charles Zhang

Yes.

is automobile, has on among the electronics sales. And -- and #X, I more smaller remember top actually auto right, think becoming #X advertisers FMCG our services although risen mean, are Yes, Previously spending food, now and are it's FMCG the -- #X. IT items before, become like I #X. and people #X, to in sectors. I sector alcohol, liquor some

and the trade-in I policy -- to yes also, extent. So stimulated also think that some

Alicis a Yap

I see, I see.

helpful. Very Okay.

Operator

for participation. you we for conclude the conference your that, today. now With Thank

You may now your lines. disconnect

Sohu.com Limited (SOHU) 18 Feb 252024 Q4 Earnings call transcript