SOHU.COM REPORTS FIRST QUARTER 2026 UNAUDITED FINANCIAL RESULTS
Rhea-AI Summary
Sohu (NASDAQ: SOHU) reported Q1 2026 revenues of US$141 million, up 4% year-over-year and down 1% quarter-over-quarter. Online game revenues were US$125 million, up 6% year-over-year and 3% quarter-over-quarter, while marketing services revenues were US$13 million, down 8% year-over-year.
GAAP and non-GAAP net loss attributable to Sohu was US$4 million. GAAP operating loss narrowed to US$7 million. Changyou generated GAAP operating profit of US$65 million. Cash, cash equivalents, short-term investments and long-term time deposits totaled about US$1.2 billion. Sohu has repurchased 8.7 million ADSs for roughly US$116 million under its US$150 million buyback.
AI-generated analysis. Not financial advice.
Positive
- Total Q1 2026 revenues up 4% year-over-year to US$141 million
- Online game revenues up 6% year-over-year and 3% quarter-over-quarter to US$125 million
- Total cost of revenues down 10% year-over-year and 15% quarter-over-quarter to US$30 million
- GAAP operating loss reduced to US$7 million from US$19 million a year ago
- Changyou GAAP operating profit rose to US$65 million from US$54 million a year ago
- Strong liquidity with about US$1.2 billion in cash, investments and deposits
- Share repurchases of 8.7 million ADSs for approximately US$116 million under US$150 million program
Negative
- GAAP and non-GAAP net loss attributable to Sohu of US$4 million in Q1 2026
- Marketing services revenues fell 8% year-over-year and 26% quarter-over-quarter to US$13 million
- Guided Q2 2026 GAAP and non-GAAP net loss of US$15–25 million
- Guided Q2 2026 online game revenues of US$104–114 million, implying an 8–17% sequential decline
Key Figures
Market Reality Check
Peers on Argus
Two gaming peers on the momentum scanner, GDC and SKLZ, were both moving down around 5–6%, indicating broader sector pressure alongside SOHU’s -1.03% pre-news move.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Feb 09 | Q4/FY25 earnings | Positive | -1.8% | Strong FY2025 profit aided by large tax reversal and solid game revenue. |
| Nov 17 | Q3 2025 earnings | Positive | +7.3% | Robust revenue and online game growth plus buybacks and Q4 guidance. |
| Aug 04 | Q2 2025 earnings | Negative | -6.3% | Sharp revenue declines and ongoing GAAP net loss despite some improvement. |
| May 19 | Q1 2025 earnings | Neutral | -3.0% | Stable games, lower marketing revenue and large one-off tax benefit. |
| Feb 18 | Q4/FY24 earnings | Negative | -7.7% | Revenue pressure and continued annual GAAP net loss in 2024. |
Earnings releases have averaged a -2.32% move, with several instances where strong or tax-boosted results were followed by negative price reactions.
Over the last few earnings cycles, Sohu has shown improving fundamentals, especially in online games and 2025 profitability, supported by a strong cash position of about $1.2B and ongoing buybacks. However, the stock reaction to earnings has been skewed to the downside, including a -7.7% move on Q4 2024 results and declines after tax-driven profit spikes. This Q1 2026 update, with modest revenue growth but a small net loss, follows that pattern of complex headline numbers after prior one-off tax benefits.
Historical Comparison
In the past five earnings releases, SOHU’s average move was -2.32%, with frequent selling even on strong or tax-boosted results. Q1 2026 fits a pattern of nuanced earnings with mixed reactions.
Earnings history shows online games driving revenue, large 2025 tax benefits swinging to profit, and consistent maintenance of ~$1.2B liquidity alongside ongoing share repurchases.
Market Pulse Summary
This announcement highlights modest Q1 2026 revenue growth to US$141 million, driven by online games, alongside a small US$4 million GAAP and non-GAAP net loss and guidance for a deeper Q2 loss. Historically, earnings releases produced an average move of -2.32%, often skewed to the downside even when tax benefits boosted results. Investors may focus on the durability of game revenues, pressure in marketing services, the sizeable US$1.2 billion cash balance, and execution against Q2 guidance.
Key Terms
gaap financial
non-gaap financial
ads financial
monthly active user accounts technical
active paying accounts technical
exchange rate financial
AI-generated analysis. Not financial advice.
First Quarter Highlights
- Total revenues were
US , up$141 million 4% year-over-year and down1% quarter-over-quarter. - Marketing services revenues were
US , down$13 million 8% year-over-year and26% quarter-over-quarter. - Online game revenues were
US , up$125 million 6% year-over-year and3% quarter-over-quarter. - GAAP net loss attributable to Sohu.com Limited was
US , compared with net income[1] of$4 million US in the first quarter of 2025 and net income[2] of$182 million US in the fourth quarter of 2025.$223 million - Non-GAAP[3] net loss attributable to Sohu.com Limited was
US , compared with a net loss of$4 million US in the first quarter of 2025 and net income[2] of$16 million US in the fourth quarter of 2025.$261 million
[1] In the first quarter of 2025, due to the expiration during the quarter of the statutory period for the [2] In the fourth quarter of 2025, due to a revision of the dividend policy for Changyou, previously accrued withholding income tax of approximately [3] Non-GAAP results exclude share-based compensation expense; impairment of goodwill; and the income tax benefit in connection with the Toll Charge and related accrued interest expense. Explanation of the Company's non-GAAP financial measures and related reconciliations to GAAP financial measures are included in the accompanying "Non-GAAP Disclosure" and "Reconciliations of Non-GAAP Results of Operation Measures to the Nearest Comparable GAAP Measures." |
Dr. Charles Zhang, Chairman and CEO of Sohu.com Limited, commented, "In the first quarter of 2026, our marketing services revenues, online game revenues, and bottom-line performance all exceeded our previous guidance. For the Sohu media platform, we continued to focus on promoting a healthy and vibrant atmosphere on our platform with a series of differentiated events. At the same time, we kept refining our products to cater to users' needs. Leveraging our unique events and brand influence, we were able to explore new monetization opportunities. For our online games, we delivered another solid quarter, driven by a wealth of high-quality content and targeted operational refinements that resonated with our diverse player base."
First Quarter Financial Results
Revenues
Total revenues were
Marketing services revenues were
Online game revenues were
Cost of Revenues
Both GAAP and non-GAAP total cost of revenues were
Both GAAP and non-GAAP cost of marketing services revenues were
Both GAAP and non-GAAP cost of online game revenues were
Operating Expenses
GAAP operating expenses were
Non-GAAP operating expenses were
Operating Loss
GAAP operating loss was
Non-GAAP operating loss was
Income Tax Expense/(Benefit)
GAAP income tax expense was
Net Income/(Loss)
GAAP net loss attributable to Sohu.com Limited was
Non-GAAP net loss attributable to Sohu.com Limited was
Liquidity and Capital Resources
As of March 31, 2026, cash and cash equivalents, short-term investments and long-term time deposits totaled approximately
Supplementary Information for Changyou Results[4]
First Quarter 2026 Operating Results
- For PC games, total average monthly active user accounts[5] (MAU) were 2.7 million, an increase of
17% year-over-year and a decrease of2% quarter-over-quarter. Total quarterly aggregate active paying accounts[6] (APA) were 1.0 million, an increase of7% year-over-year and a decrease of4% quarter-over-quarter. The year-over-year increases in MAU and APA were mainly from Changyou's PC game Tian Long Ba Bu ("TLBB"): Return, which was launched during the third quarter of 2025.
- For mobile games, total average MAU were 1.7 million, a decrease of
20% year-over-year and9% quarter-over-quarter. Total quarterly APA were 0.3 million, a decrease of22% year-over-year and12% quarter-over-quarter. The decreases in MAU and APA were mainly due to the natural decline of Changyou's older games.
[4] "Changyou Results" consist of the results of Changyou's online game business and its 17173.com Website. [5] Monthly active user accounts refers to the number of registered accounts that are logged in to these games at least once during the month. [6] Quarterly aggregate active paying accounts refers to the number of accounts from which game points are utilized at least once during the quarter. |
First Quarter 2026 Unaudited Financial Results
Total revenues were
Both GAAP and non-GAAP total cost of revenues were
GAAP operating expenses were
Non-GAAP operating expenses were
GAAP operating profit was
Non-GAAP operating profit was
Recent Development
Under the previously-announced share repurchase program of up to
Business Outlook
For the second quarter of 2026, Sohu estimates:
- Marketing services revenues to be between
US and$13 million US ; this implies an annual decrease of$14 million 10% to17% , and a sequential increase of4% to11% . - Online game revenues to be between
US and$104 million US ; this implies an annual decrease of$114 million 2% to an annual increase of8% , and a sequential decrease of8% to17% . - Both non-GAAP and GAAP net loss attributable to Sohu.com Limited to be between
US and$15 million US .$25 million
For the second quarter 2026 guidance, the Company has adopted a presumed exchange rate of
This forecast reflects Sohu's management's current and preliminary view, which is subject to substantial uncertainty.
Non-GAAP Disclosure
To supplement the unaudited consolidated financial statements presented in accordance with accounting principles generally accepted in
Sohu's management believes excluding share-based compensation expense; impairment of goodwill; and the income tax benefit in connection with the Toll Charge and related accrued interest expense from the Company's non-GAAP financial measures is useful for itself and investors. Further, the impact of share-based compensation expense; impairment of goodwill; and the income tax benefit in connection with the Toll Charge and related accrued interest expense could not be anticipated by management and business line leaders, and these expenses were not built into the annual budgets and quarterly forecasts that have been the basis for information Sohu provides to analysts and investors as guidance for future operating performance. As share-based compensation expense, and impairment of goodwill do not involve subsequent cash outflow and are not reflected in the cash flows at the equity transaction level, Sohu does not factor in their impact when evaluating and approving expenditures or when determining the allocation of its resources to its business segments. As a result, in general, the monthly financial results for internal reporting and any performance measures for commissions and bonuses are based on non-GAAP financial measures that exclude share-based compensation expense, and impairment of goodwill, and also exclude the income tax benefit in connection with the Toll Charge and related accrued interest expense.
The non-GAAP financial measures are provided to enhance investors' overall understanding of Sohu's current financial performance and prospects for the future. A limitation of using non-GAAP gross profit, operating profit/(loss), net income/(loss), net income/(loss) attributable to Sohu.com Limited, and diluted net income/(loss) attributable to Sohu.com Limited per ADS excluding share-based compensation expense is that this expense has been and can be expected to continue to recur in Sohu's business. It is also possible that impairments of goodwill will recur in the future. In order to mitigate these limitations Sohu has provided specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables include details on the reconciliation between the GAAP financial measures that are most directly comparable to the non-GAAP financial measures that have been presented.
Notes to Financial Information
Financial information in this press release other than the information indicated as being non-GAAP is derived from Sohu's unaudited financial statements prepared in accordance with GAAP.
Safe Harbor Statement
This announcement contains forward-looking statements. It is currently expected that the Business Outlook will not be updated until release of Sohu's next quarterly earnings announcement; however, Sohu reserves right to update its Business Outlook at any time for any reason. Statements that are not historical facts, including statements about Sohu's beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Potential risks and uncertainties include, but are not limited to, instability in global financial and credit markets and its potential impact on the Chinese economy; exchange rate fluctuations, including their potential impact on the Chinese economy and on Sohu's reported
Conference Call and Webcast
Sohu's management team will host a conference call at 5:00 a.m.
The live Webcast and archive of the conference call will be available on the Investor Relations section of Sohu's website at https://investors.sohu.com/.
About Sohu
Sohu.com Limited (NASDAQ: SOHU) was established by Dr. Charles Zhang, one of
As a mainstream media platform with social features, Sohu is indispensable to the daily life of millions of Chinese, providing to a vast number of users a network of web properties and community based products, which offer a broad array of content, such as news and information, in the form of text, picture, video, and live broadcasting. Sohu also attracts users to actively engage in content generation and distribution, and actively interact with each other on the platform. Sohu's online game business is conducted by its subsidiary Changyou, which develops and operates a diverse portfolio of PC and mobile games, such as the well-known TLBB PC and Legacy TLBB Mobile.
For investor and media inquiries, please contact:
Sohu.com Limited
Ms. Pu Huang
Tel: +86 (10) 6272-6645
E-mail: ir@contact.sohu.com
Christensen Advisory
E-mail: sohu@christensencomms.com
SOHU.COM LIMITED | ||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||
(UNAUDITED, IN THOUSANDS EXCEPT PER SHARE AMOUNTS) | ||||||
Three Months Ended | ||||||
Mar. 31, 2026 | Dec. 31, 2025 | Mar. 31, 2025 | ||||
Revenues: | ||||||
Marketing services | $ | 12,560 | $ | 17,027 | $ | 13,725 |
Online games | 124,567 | 120,361 | 117,347 | |||
Others | 4,157 | 4,872 | 4,573 | |||
Total revenues | 141,284 | 142,260 | 135,645 | |||
Cost of revenues: | ||||||
Marketing services | 12,583 | 15,959 | 12,341 | |||
Online games | 15,899 | 17,947 | 18,136 | |||
Others | 1,326 | 1,280 | 2,669 | |||
Total cost of revenues | 29,808 | 35,186 | 33,146 | |||
Operating expenses: | ||||||
Product development | 61,883 | 63,891 | 62,972 | |||
Sales and marketing (includes share-based compensation expense of nil, $nil, and respectively) | 42,850 | 45,159 | 45,586 | |||
General and administrative (includes share-based compensation expense of respectively) | 13,475 | 27,111 | 12,969 | |||
Goodwill impairment[7] | - | 36,955 | - | |||
Total operating expenses | 118,208 | 173,116 | 121,527 | |||
Operating loss | (6,732) | (66,042) | (19,028) | |||
Other income, net | 4,682 | 3,725 | 4,199 | |||
Interest income | 5,995 | 6,719 | 7,708 | |||
Exchange difference | (1,318) | (908) | (119) | |||
Income/(loss) before income tax expense | 2,627 | (56,506) | (7,240) | |||
Income tax expense/(benefit)[8] | 6,942 | (279,791) | (189,391) | |||
Net income/(loss) | (4,315) | 223,285 | 182,151 | |||
Less: Net loss attributable to the noncontrolling interest shareholders | - | - | (9) | |||
Net income/(loss) attributable to Sohu.com Limited | (4,315) | 223,285 | 182,160 | |||
Basic net income/(loss) per share/ADS attributable to Sohu.com Limited | $ | (0.17) | $ | 8.38 | $ | 6.07 |
Shares/ADSs used in computing basic net income/(loss) per share/ADS attributable to Sohu.com Limited[9] | 26,058 | 26,658 | 30,008 | |||
Diluted net income/(loss) per share/ADS attributable to Sohu.com Limited | $ | (0.17) | $ | 8.38 | $ | 6.07 |
Shares/ADSs used in computing diluted net income/(loss) per share/ADS attributable to Sohu.com Limited | 26,058 | 26,658 | 30,008 | |||
[7] In the fourth quarter of 2025, the Company recognized a goodwill impairment loss of approximately | ||||||
[8] See footnote 1 and footnote 2. | ||||||
[9] Each ADS represents one ordinary share. | ||||||
SOHU.COM LIMITED | |||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||
(UNAUDITED, IN THOUSANDS) | |||||
As of Mar. 31, 2026 | As of Dec. 31, 2025 | ||||
ASSETS | |||||
Current assets: | |||||
Cash and cash equivalents | $ | 110,360 | $ | 128,308 | |
Short-term investments | 698,136 | 702,372 | |||
Accounts receivable, net | 41,787 | 43,335 | |||
Prepaid and other current assets | 98,815 | 93,903 | |||
Total current assets | 949,098 | 967,918 | |||
Fixed assets, net | 247,337 | 246,263 | |||
Goodwill | 10,257 | 10,257 | |||
Long-term investments, net | 44,244 | 43,939 | |||
Intangible assets, net | 3,797 | 4,692 | |||
Long-term time deposits | 357,900 | 350,659 | |||
Other assets | 12,027 | 12,325 | |||
Total assets | $ | 1,624,660 | $ | 1,636,053 | |
LIABILITIES | |||||
Current liabilities: | |||||
Accounts payable | $ | 38,991 | $ | 36,215 | |
Accrued liabilities | 98,662 | 95,430 | |||
Receipts in advance and deferred revenue | 50,087 | 54,878 | |||
Accrued salary and benefits | 37,091 | 55,018 | |||
Taxes payables | 20,371 | 15,571 | |||
Other short-term liabilities | 75,954 | 76,601 | |||
Total current liabilities | $ | 321,156 | $ | 333,713 | |
Long-term other payables | 3,199 | 2,896 | |||
Long-term tax liabilities | 21,363 | 21,051 | |||
Other long-term liabilities | 382 | 322 | |||
Total long-term liabilities | $ | 24,944 | $ | 24,269 | |
Total liabilities | $ | 346,100 | $ | 357,982 | |
SHAREHOLDERS' EQUITY: | |||||
Sohu.com Limited shareholders' equity | 1,278,216 | 1,277,727 | |||
Noncontrolling interest | 344 | 344 | |||
Total shareholders' equity | $ | 1,278,560 | $ | 1,278,071 | |
Total liabilities and shareholders' equity | $ | 1,624,660 | $ | 1,636,053 | |
SOHU.COM LIMITED | |||||||||||||||||||||
RECONCILIATIONS OF NON-GAAP RESULTS OF OPERATIONS MEASURES TO THE NEAREST COMPARABLE GAAP MEASURES | |||||||||||||||||||||
(UNAUDITED, IN THOUSANDS EXCEPT PER SHARE AMOUNTS) | |||||||||||||||||||||
Three Months Ended Mar. 31, 2026 | Three Months Ended Dec. 31, 2025 | Three Months Ended Mar. 31, 2025 | |||||||||||||||||||
GAAP | Non-GAAP Adjustment | Non- GAAP | GAAP | Non-GAAP Adjustment | Non- GAAP | GAAP | Non-GAAP Adjustment | Non- GAAP | |||||||||||||
(244) | (a) | (324) | (a) | (392) | (a) | ||||||||||||||||
- | (36,955) | (c) | - | ||||||||||||||||||
Operating expenses | $ | 118,208 | $ | (244) | $ | 117,964 | $ | 173,116 | $ | (37,279) | $ | 135,837 | $ | 121,527 | $ | (392) | $ | 121,135 | |||
Operating loss | $ | (6,732) | $ | 244 | (a) | $ | (6,488) | $ | (66,042) | $ | 37,279 | (a,c) | $ | (28,763) | $ | (19,028) | $ | 392 | (a) | $ | (18,636) |
Income tax expense/(benefit)[10] | $ | 6,942 | $ | - | $ | 6,942 | $ | (279,791) | $ | - | $ | (279,791) | $ | (189,391) | $ | 199,018 | (b) | $ | 9,627 | ||
Net income/(loss) before non-controlling interest | $ | (4,315) | $ | 244 | (a) | $ | (4,071) | $ | 223,285 | $ | 37,279 | (a,c) | $ | 260,564 | $ | 182,151 | $ | (198,626) | (a,b) | $ | (16,475) |
Net income/( loss) attributable to Sohu.com Limited for diluted net income/( loss) per share/ADS | $ | (4,315) | $ | 244 | (a) | $ | (4,071) | $ | 223,285 | $ | 37,279 | (a,c) | $ | 260,564 | $ | 182,160 | $ | (198,626) | (a,b) | $ | (16,466) |
Diluted net income/( loss) per share/ADS attributable to Sohu.com Limited | $ | (0.17) | $ | (0.16) | $ | 8.38 | $ | 9.77 | $ | 6.07 | $ | (0.55) | |||||||||
Shares/ADSs used in computing diluted net income/( loss) per share/ADS attributable to Sohu.com Limited | 26,058 | 26,058 | 26,658 | 26,658 | 30,008 | 30,008 | |||||||||||||||
Note: | |||||||||||||||||||||
(a) Share-based compensation expense | |||||||||||||||||||||
(b) Reversal of the tax expense in connection with the Toll Charge and related accrued interest expense | |||||||||||||||||||||
(c) Impairment of goodwill | |||||||||||||||||||||
[10] See footnote 1 and footnote 2. | |||||||||||||||||||||
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SOURCE Sohu.com Limited