Sohu.com Net Rises 48%
BEIJINGChinese Internet portal Sohu.com Inc. said its first-quarter net profit rose 48% from a year earlier, beating expectations due to strong advertising and online gaming revenue growth, and it gave an upbeat revenue outlook.
Sohu also said its online gaming unit Changyou.com Ltd. will buy a majority stake in another Chinese game developer, a move to fuel further growth amid tough competition.
Net profit for the three months ended March 31 rose to $44.8 million from $30.2 million a year earlier, Sohu said in a statement. The company's net profit was above the average $38.68 million forecast of seven analysts polled by Thomson Reuters.
Sohu's earnings per share rose to $1.01 a share, from 73 cents a year earlier.
Revenue rose 35% to $174.4 million from $129.5 million. Brand advertising revenue rose 45% to $57.2 million, and online game revenue rose 32% to $94.9 million.
Sohu said it expects second-quarter revenue of $188 million-$193 million, up from $146.1 million in the same period last year and above the average $183.4 million forecast of 10 analysts in a Thomson Reuters poll.
Sohu projected second-quarter earnings per share, excluding share-based compensation, to be between $1.13 and $1.18, up from 96 cents a year earlier.
Changyou said it agreed Friday to acquire a 68.3% stake in Shenzhen 7Road Technology Co., a Chinese developer of online games like DDTank, a multiplayer shooting game. Changyou will pay an initial $68.26 million and up to $32.76 million more for the stake depending on 7Road's performance. It expects to complete the acquisition by June 30.
Firs! t-quarte r net profit rose 33% to $52.8 million from $39.7 million, Changyou said. It had been expected to report a net profit of $48.83 million, according to a Thomson Reuters poll of six analysts.
Changyou's revenue rose 35% to $97.1 million from $72.1 million. Average revenue per active paying account for Changyou's games rose 4% from a year earlier to 210 yuan (about $32).
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