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So Far, So Good, Sohu

Things are going so well in China that even a once-moribund media company like (Nasdaq: SOHU  ) is roaring back into growth. The company posted blowout third-quarter results last night. Revenue soared 46% higher to $51.5 million. Earnings before stock-based compensation climbed 37% higher to $0.30 a share.

Wall Street was looking for a profit of just $0.21 a share with $46.5 million on the top line. Brand advertising and online games posted healthy year-over-year gains, more than offsetting weakness in wireless and sponsored search.

The uptick in online games is noteworthy. That segment soared 473% higher to $12.7 million. That is still a small slice of the revenue mix pie at Sohu. This isn't the second coming of stronger online gaming players like (Nasdaq: NTES  ) , Shanda (Nasdaq: SNDA  ) , and The9 (Nasdaq: NCTY  ) . However, online gaming revenue is now nearly double that of the wireless segment that once defined the company.

It was just a few years ago when Sohu, SINA (Nasdaq: SINA  ) , and NetEase became market darlings on the strength of wireless entertainment services. That was before the government and cell phone carriers began to regulate and eat into the once-lucrative niche.

There are still players like Tom Online and KongZhong (Nasdaq: KONG  ) specializing in wireless leisure services, but the original players have diversified into faster-growing areas like Web portals and online multiplayer fantasy games.

The strong quarter isn't a blip at Sohu. The party will continue, going by the company's refreshing guidance. Sohu is looking to earn between $0.33 a share and $0.35 a share on $53.5 million to $55.5 million in revenue next quarter.

Too slow, Wall Street. The market was only expecting the company to earn $0.24 a share on $49.1 million in revenue during the quarter. Look higher, analysts. A lot higher.

Well done, Sohu. Now just make sure you don't get tripped by the pros down below.

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