Sohu Registers 13% Revenue Decline In Q1 Due To Lower Brand Advertising, Online Gaming Revenues - Sohu.com (NASDAQ:SOHU)

Sohu.com Limited SOHU reported a first-quarter FY22 revenue decline of 13% year-on-year to $193 million. Revenue was flat quarter-over-quarter.
Brand advertising revenues declined 23% Y/Y to $24 million due to decreases in portal advertising revenues.
Online game revenues decreased 11% Y/Y to $158 million, mainly due to the decline of TLBB Vintage.
The non-GAAP gross margin was 75%, contracting 400 basis points Y/Y and expanding 200 basis points sequentially. The non-GAAP gross margin for online games was 86% versus 90% last year and 84% in 4Q21.
Non-GAAP earnings per ADS were $0.26.
Sohu held $1.54 billion in cash and equivalents.
Average monthly active user accounts for Changyou PC games decreased 13% Y/Y to 2 million, mainly due to the natural decline of Changyou's older games. Average MAU for Changyou mobile games rose 16% Y/Y to 2.4 million.
Chair and CEO Dr. Charles Zhang commented, "In the first quarter of 2022, despite the negative impact of COVID-19 and a challenging macroeconomic environment, we continued to focus on product refinements and improving operational efficiency. Thanks to the excellent performance of our online game business, we delivered better-than-expected bottom-line performance and achieved profitability for the quarter."
Outlook: Sohu sees Q2 brand advertising revenue decrease 32%-40% Y/Y to $22 million - $25 million.
It sees Q2 online game revenues decline of (1)%-6% Y/Y to $150 million - $160 million.
Price Action: SOHU shares closed higher by 3.81% at $14.44 on Friday.

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