The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Sohu.com beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share contracted.
Margins dropped across the board.
Sohu.com chalked up revenue of $299.5 million. The 11 analysts polled by S&P Capital IQ expected revenue of $292.2 million on the same basis. GAAP reported sales were 22% higher than the prior-year quarter's $246.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.73. The nine earnings estimates compiled by S&P Capital IQ predicted $0.69 per share. GAAP EPS of $0.60 for Q4 were 7.7% lower than the prior-year quarter's $0.65 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 68.8%, 250 basis points worse than the prior-year quarter. Operating margin was 21.5%, 980 basis points worse than the prior-year quarter. Net margin was 8.5%, 240 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $279.6 million. On the bottom line, the average EPS estimate is $0.69.
Next year's average estimate for revenue is $1.25 billion. The average EPS estimate is $3.15.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,144 members out of 1,211 rating the stock outperform, and 67 members rating it underperform. Among 293 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 273 give Sohu.com a green thumbs-up, and 20 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Sohu.com is hold, with an average price target of $48.96.
Internet software and services are being consumed in radically different ways, on new and increasingly mobile devices. Is Sohu.com on the right side of the revolution? Check out the changing landscape and meet the company that Motley Fool analysts expect to lead "The Next Trillion-dollar Revolution." Click here for instant access to this free report.
- Add Sohu.com to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool recommends Sohu.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.