Why Sohu.com Ltd - ADR Fell Monday

What happened

Shares of Sohu.com (NASDAQ: SOHU) fell as much as 22.6% on Monday, following the Chinese online advertising, search, and gaming company's second-quarter financial results. At the time of this writing, shares are down 13.7%.

Though Sohu's non- GAAP loss per share for its second quarter was narrower than expected, the company reported revenue and guidance below consensus estimates for the metrics.

A sketch on a chalkboard of a stock price falling

Image source: Getty Images.

So what

On a non-GAAP basis, Sohu lost $1.27 per share, narrower than a consensus estimate for a loss per share of $1.49. This was on revenue of $486 million, up 5% year over year. On average, analysts were expecting revenue of $502 million for the period.

In Sohu's second-quarter press release, Sohu CEO Charles Zhang acknowledged the company's results were "mixed."

"While quarterly revenue was slightly soft given the continued headwinds against our brand advertising business, the bottom line performance was better than expected as we aggressively slashed content costs," said Zhang.

Now what

Sohu's outlook was particularly somber when compared to what analysts were expecting. For the third quarter, management guided for a loss between $1.40 and $1.65 on revenue of $445 million to $470 million. On average, analysts are expecting a third-quarter non-GAAP loss per share of $1.23 and revenue of $558 million.

10 stocks we like better than Sohu.com
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor , has quadrupled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Sohu.com wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of June 4, 2018

Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool recommends Sohu.com. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Personal Finance , Stocks
Referenced Symbols: SOHU

More from Motley Fool


Motley Fool

Motley Fool

Market News, Investing

Research Brokers before you trade

Want to trade FX?