搜狐 (SOHU.US) 2026年第一季度业绩电话会
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会议摘要
SoHo's Q1 2026 revenue was $141 million, down 1% quarter over quarter, with a net loss of $4 million. Marketing services revenue decreased 8% year over year to $13 million, while gaming revenue increased 6% year over year to $125 million. The company repurchased 8.7 million shares for $160 million. Despite economic challenges and cautious advertiser spending, particularly in auto and FMCG sectors, the IT sector showed positive signs. The online game business exceeded guidance, and the company plans to explore new monetization opportunities. For Q2, marketing services revenue is expected between $13 million and $40 million, and gaming revenue between $104 million and $140 million.
会议速览
SoHo's Q1 2026 Earnings Call Highlights Revenue and Monetization StrategiesSoHo's earnings call for Q1 2026 revealed a revenue of $141 million, with a focus on enhancing platform atmosphere, product refinement, and exploring new monetization avenues for online games, amidst fluctuations in marketing services and online gate revenues.
Expanding Social Media Influence Through Innovative Events and TechnologyIn Q1 2026, the social media platform integrated resources, upgraded products with cutting-edge technology, and hosted successful offline events like the Super News Marathon and Spring Convention, enhancing user engagement and brand influence. The platform also launched competitions and leveraged unique content and live broadcasting technology to explore new business opportunities and provide targeted marketing solutions for advertisers.
Online Game Business Updates, Financials, and Share Repurchase ProgramOnline game revenues exceeded guidance due to successful holiday events and updates. Mobile and PC games showed stable earnings. The company committed to a top games strategy, focusing on user-centric development and technology implementation. Financials reported for the first quarter of 2026, with expectations for the second quarter outlined. Share repurchase program update provided, with 8.7 million shares repurchased for $160 million.
Q&A Session on Advertising Outlook and Gaming Business PerformanceDiscussed advertising revenue growth in Q2 due to unique marketing solutions, cautious spending amid economic downturn; gaming business Q2 performance leaning towards guidance range; Q2 loss widening seen as conservative, questioning projection for Q3 and Q4.
Q2 Financials and Revenue Trends in Gaming IndustryDiscussion revolves around Q2 performance aligning with expectations, forecasting natural revenue decline due to fewer promotional activities, and comparing Q2 losses with Q1 gains, setting a benchmark for future quarters.
Analysis of Sequential Revenue Trends and Operating Losses in Q2The dialogue explores the reasons behind weaker-than-expected Q2 revenue growth, questioning if macroeconomic conditions have deteriorated since the beginning of the year. It also seeks clarification on the significant operating loss in the marketing ad business, inquiring about the allocation of expenses between product development and user acquisition.
Analysis of Operating Losses in Social Network Products and User Acquisition CostsThe dialogue discusses the operating losses of 17 million associated with three social network products, attributing the costs to user acquisition and product development. Despite efforts to scale successful products, current revenue from advertising is insufficient to cover expenses, leading to consistent financial challenges across quarters.
Revenue Guidance Down Due to Market Competition and Reduced Consumer Spending Across IndustriesThe dialogue highlights the cautious approach towards revenue guidance, attributing the decline to fierce competition in the auto industry and reduced consumer spending across various sectors, including FMCG, impacting companies' decision to cut advertising budgets.
Advertising Revenue Breakdown by Industry VerticalsDiscussed the contribution percentages of various industry verticals to advertising revenue, noting auto at 19%, IT services, home appliances, and electronics at 19%, and CG at 14%, providing a clear picture of revenue distribution.
AI-Driven Home Appliances & Market Trends: Opportunities & Challenges in Q2The dialogue discusses the transformation of traditional home appliances into AI-enhanced products, highlighting opportunities seen at the Shanghai AWE. It also touches on Q2 market expectations, noting potential growth in IT and FMCG sectors, while expressing concerns over competition and efficiency in the auto industry, particularly electric vehicles.
High Housing Mortgages and Debt: Major Hurdles to Chinese Consumer SpendingThe dialogue discusses how high housing mortgages and debt are significant factors affecting consumer spending in China, with individuals prioritizing mortgage payments over discretionary spending, impacting the economy.
Conference Call Concludes with Question ReminderA reminder was given to press Star 1 1 to ask questions. No further inquiries were noted, and the conference call was concluded, thanking participants for their attendance.
要点回答
Q：What initiatives are being undertaken to promote a healthy and vibrant atmosphere on the social media platform?
A：To promote a healthy and vibrant atmosphere on the social media platform, the company is holding various preventive events and refining their products to cater to users' needs. They are also leveraging unique events and brand influence to explore new monetization opportunities for online games.
Q：What were the financial results for SoHo's first quarter 2026?
A：SoHo's first quarter 2026 results included total revenues of $141 million, a year-over-year increase of 1% and a decrease of 1% quarter over quarter. Marketing services revenues were $13 million, down 8% year over year and 26% quarter over quarter. Selling and general revenue was $125 million, up 6% year over year and 6% quarter over quarter. The net loss attributable to Sohu.com Limited was $4 million, compared with a net income of about $182 million in the first quarter of 2025.
Q：What was the impact of the events mentioned on user engagement and content dissemination?
A：The events mentioned, such as the 18th Super News Marathon, the Hong Kong and Offline Seminar of Physics class, and the 2026 Spring Convention of Sohu Video Influencers, among others, have impacted user engagement and content dissemination by providing interaction opportunities, improving social engagement, and generating a large amount of premium content that was widely spread over the Internet.
Q：What are the strategic priorities for the online game business?
A：The strategic priorities for the online game business include continuing the successful implementation of New Year and Valentine's Day events, as well as regular PLV PC promotional events to sustain stable player engagement. Efforts are also focused on introducing a new mural plan for TL B Bibo, updating and refining TLD B return to ensure long-term vitality, and launching expansion packs for Legacy TL B Mobile to celebrate Chinese New Year. Moving forward, the business aims to roll out expansion, tax, and content updates for TLB services to further engage players.
Q：What is the status of the ongoing share repurchase program as of May 13, 2026?
A：As of May 13, 2026, Sohu had repurchased 8.7 millionADS for an aggregated cost of approximately $160 million.
Q：What are the expected revenue figures for the second quarter of 2026?
A：For the second quarter of 2026, the expected marketing services revenue is between $13 million and $40 million, indicating an annual decrease of 10% to 17% and a sequential increase of 4% to 11%. The expected daily revenues are between $104 million and $140 million, with an annual decrease of 2% and an annual increase of 8%, and a sequential decrease of 8% to 17%.
Q：How is the advertising outlook for the second half and full year expected to be affected by upcoming events?
A：The advertising outlook for the second half and full year is expected to be positively affected by upcoming events, with a focus on Q2 and Q3 revenues. The exact impact of these events on advertising revenue in Q2 and Q3 is not quantified in the transcript.
Q：What factors are contributing to the expected revenue growth despite a cautious spending environment?
A：Despite a cautious spending environment, revenue growth is expected due to the company's unique and differentiated marketing solutions, events, and collaborations with influencers. Specific examples include leveraging networks, influencers, and offline events like the k-pop competition.
Q：How does the company expect gaming revenue to perform in the second quarter?
A：The company expects gaming revenue to experience a natural decline in the second quarter due to the planned rollout of fewer promotional and revenue-boosting activities. The exact performance in the second quarter compared to the low or high end of the revenue guidance is not specified.
Q：What impact did Q1 have on the company's performance and what is the expectation for Q2 and Q3?
A：Q1 performance was better than expected, but Q2 is seeing a sequential widening of losses. Q2 is expected to be similar to Q3 in terms of performance, with both experiencing a loss compared to Q1 due to factors such as a lower cover rate in Q2. The company is still maintaining a stable user base and at least pack growth.
Q：What are the main reasons for the operating loss in the marketing and ad business?
A：The operating loss in the marketing and ad business is reiterated as $17 million, which seems to be a transcription error as the correct operating loss mentioned is $171,700. The expenses are double the revenue, and the focus of spending is on product development and user acquisition.
Q：What factors are influencing the company's spending on user acquisition and product development?
A：The company's spending on user acquisition and product development is influenced by its focus on multiple social network products, competition, and the macroeconomic situation affecting advertising revenue. The revenue recognition does not cover the costs incurred in building successful products, which requires cautious spending and a focus on unique events or optimizations to achieve scale.
Q：How is the revenue guidance for the current period?
A：The revenue guidance is worse than expected due to intense competition and lower margins in the auto industry. The company is responding by being more cautious and looking for unique opportunities to engage users and offer differentiated solutions.
Q：Are there other industry verticals besides auto that are seeing more cautious budgets?
A：Yes, all industry verticals are facing more cautious budgets as Chinese consumers are spending less. This is affecting companies across the board, including in FMCG (fast-moving consumer goods), due to the general reduction in consumer spending.
Q：What is the advertising revenue contribution by industry vertical for the first quarter?
A：For the first quarter, the advertising revenue contribution by industry vertical is as follows: 19% from the auto industry, 19% from IT services, home appliances, and electronics, and 14% from CG (presumably Consumer Goods or another category not explicitly named).
Q：How is the traditional home appliances industry changing with the advent of AI?
A：The traditional home appliances industry is transforming into AI products with the integration of intelligent technology. This shift is creating new opportunities in the market, evidenced by the presence of many innovative AI-enhanced products at events like the Shanghai AWE.
Q：What is the expected trend in advertising revenue contribution by industry vertical in the second quarter?
A：In the second quarter, it is expected that the advertising revenue contribution will be more positive for IT and possibly FMCG sectors. However, there is a suggestion of a continued downturn in the auto industry due to intense competition and the introduction of more efficient electric vehicles.
Q：What are the reasons behind the reduction in consumer spending in China?
A：The reduction in consumer spending in China is attributed to people prioritizing high mortgage payments over other expenditures. As a result, they have less money left to spend on non-essential items, which is a major determinant of the Chinese economy's consumer spending pattern.
Sohu.com Ltd.
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