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Sohu
(NASDAQ:SOHU)
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Rating:56Neutral
Price Target:
$14.00
▲(8.78% Upside)
Action:Reiterated
Date:08/10/26
SOHU scores as a mid-range setup driven by (1) mixed fundamentals: strong balance sheet and margins but persistent operating losses and recent cash burn; (2) cautious earnings outlook with guided near-term losses and declining game revenue YoY, despite Q2 outperformance and buybacks; partially offset by (3) very low P/E valuation and (4) mildly improving near-term technicals that are still below longer-term trend levels.
Positive Factors
Strong balance sheet and cash reserves
Sohu’s minimal debt and roughly $1.2B cash provide a durable liquidity cushion that supports operations, buybacks and strategic flexibility. This balance-sheet strength reduces solvency risk, allowing the company to fund game operations and weather advertising cyclicality without immediate financing needs.
Negative Factors
Negative operating cash flow and FCF trend
Persistent negative operating and free cash flow across recent years signals the business is burning cash despite reported profits in some periods. This weak cash generation undermines durability of earnings, pressures reserves over time, and limits organic funding for growth or sustained buybacks without drawing on the large but finite cash stockpile.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong balance sheet and cash reserves
Sohu’s minimal debt and roughly $1.2B cash provide a durable liquidity cushion that supports operations, buybacks and strategic flexibility. This balance-sheet strength reduces solvency risk, allowing the company to fund game operations and weather advertising cyclicality without immediate financing needs.
Read all positive factors
Sohu Key Performance Indicators (KPIs)
Any
Gross Profit by Segment
Reflects the profit left after direct costs for each segment, revealing which parts of Sohu actually generate earnings versus those that only add top-line revenue. Improving gross profit or margins shows stronger unit economics or pricing power, while shrinking margins can indicate cost pressure or heavy investment needs.
Reflects the profit left after direct costs for each segment, revealing which parts of Sohu actually generate earnings versus those that only add top-line revenue. Improving gross profit or margins shows stronger unit economics or pricing power, while shrinking margins can indicate cost pressure or heavy investment needs.
Data provided by:
The Fly
The FlySohu (SOHU) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$372.27M
Dividend YieldN/A
Average Volume (3M)38.14K
Price to Earnings (P/E)1.7
Beta (1Y)1.00
Revenue Growth9.23%
EPS Growth106.05%
CountryUS
Employees4,000
SectorCommunication Services
Sector Strength97
IndustryInternet Content & Information
Share Statistics
EPS (TTM)8.60
Shares Outstanding26,069,021
10 Day Avg. Volume37,935
30 Day Avg. Volume38,142
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)0.35
Price to Sales (P/S)0.76
P/FCF Ratio-30.54
Enterprise Value/Market Cap>-0.01
Enterprise Value/Revenue>-0.01
Enterprise Value/Gross Profit>-0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)-1.32
Revenue Forecast (FY)$548.50M
Sohu Business Overview & Revenue Model
Company Description
Founded in 1996 and headquartered in Beijing, China, Sohu.com Limited functions as a comprehensive digital enterprise, offering a diverse range of online media, video, and gaming solutions to consumers across China, accessible on both personal com...
How the Company Makes Money
Sohu primarily generates revenue from (1) online advertising and marketing services and (2) online game-related revenues from its gaming operations (including sales of virtual items and related in-game services), with the relative contribution of ...
Sohu Earnings Call Summary
Earnings Call Date:Aug 10, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 16, 2026
Earnings Call Sentiment Negative
The quarter showed several positive elements — YoY revenue growth, stronger-than-expected game performance in Q2, active user engagement initiatives, and an aggressive share repurchase program — but management warned of a weak advertising macro and provided a cautious Q3 outlook with a large implied annual decline in online game revenues (29%–35%) and an expected net loss. The Q2 GAAP/net income improvement was materially driven by a one-time ~$30M tax reversal rather than sustained operating gains. Near-term guidance and persistent media operating losses offset many of the Q2 positives.Positive Updates
Total Revenue Growth (YoY)
Total revenue of $136.0 million in Q2 2026, up 7% year-over-year (but down 4% sequentially).
Negative Updates
Weak Advertising Macro and Category Pressures
Management repeatedly described the macro advertising environment as 'bad' and cautious; key advertising categories are under pressure with auto at 33%, FMCG at 20% and IT at 17%, all reportedly "not doing well".
Read all updates
Q2-2026 Updates
Positive
Negative
Total Revenue Growth (YoY)
Total revenue of $136.0 million in Q2 2026, up 7% year-over-year (but down 4% sequentially).
Read all positive updates
Company Guidance
For Q3 2026 management guided marketing services revenue of $40–$50 million (implying +3% to +10% year‑over‑year and -1% to -8% sequentially) and online game revenue of $105–$150 million (implying -29% to -35% year‑over‑year and -1% to -10% sequentially); both GAAP and non‑GAAP net loss attributable to Sohu.com Limited are expected to be in the $30–$23 million range. This follows Q2 continuing‑operations results of $136 million total revenue (+7% YoY, -4% QoQ), marketing services $15 million (-3% YoY, +21% QoQ), online games $116 million (+10% YoY, -7% QoQ), segment results of Sohu Media revenue $19 million (flat YoY) with an operating loss of $71 million and Changyou revenue $117 million with operating profit $56 million, and a ~ $30 million reversal of uncertain tax positions that produced GAAP net income of $0.2 million and non‑GAAP net income of $0.5 million in Q2. Management emphasized the Q3 forecast is preliminary and subject to substantial uncertainty; the board also extended an open‑ended ADS buyback after repurchasing 9.4 million ADS for about $124 million toward a $150 million authorization (≈$26 million remaining).Sohu Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
78
Positive
Cash Flow
33
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 600.13M | 584.33M | 598.40M | 600.67M | 733.87M | 835.58M |
| Gross Profit | 471.13M | 452.84M | 432.57M | 454.92M | 542.30M | 630.90M |
| EBITDA | -46.86M | -24.52M | -76.97M | 24.59M | 71.90M | 175.02M |
| Net Income | 228.61M | 394.10M | -100.27M | -30.38M | -17.34M | 927.73M |
Balance Sheet | ||||||
| Total Assets | 1.62B | 1.64B | 1.73B | 1.88B | 1.98B | 2.25B |
| Cash, Cash Equivalents and Short-Term Investments | 833.00M | 830.68M | 904.42M | 960.27M | 1.17B | 1.40B |
| Total Debt | 0.00 | 0.00 | 37.51M | 41.36M | 36.50M | 36.12M |
| Total Liabilities | 333.48M | 357.98M | 811.98M | 822.82M | 867.07M | 953.60M |
| Stockholders Equity | 1.28B | 1.28B | 922.34M | 1.06B | 1.11B | 1.29B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | -14.46M | -67.94M | -43.98M | 8.40M | -104.48M |
| Operating Cash Flow | 0.00 | -4.77M | -48.02M | -25.57M | 32.24M | -62.28M |
| Investing Cash Flow | 0.00 | 24.91M | -113.36M | -291.67M | -232.79M | 516.73M |
| Financing Cash Flow | 0.00 | -54.22M | -40.88M | -6.56M | -82.14M | -434.10M |
Sohu Technical Analysis
Positive
12.87
Price Trends
13.25
Positive
14.04
Positive
14.95
Negative
Market Momentum
0.32
Negative
57.16
Neutral
45.03
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SOHU, the sentiment is Positive. The current price of 12.87 is below the 20-day moving average (MA) of 14.02, below the 50-day MA of 13.25, and below the 200-day MA of 14.95, indicating a neutral trend. The MACD of 0.32 indicates Negative momentum. The RSI at 57.16 is Neutral, neither overbought nor oversold. The STOCH value of 45.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SOHU.
Sohu Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
87 Outperform | $82.04B | 17.08 | 20.04% | 2.53% | 9.83% | -2.22% | |
85 Outperform | $638.74M | 5.11 | 12.93% | ― | 13.89% | 18.17% | |
65 Neutral | $7.12B | 34.14 | 9.32% | ― | 11.20% | ― | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
56 Neutral | $372.27M | 1.66 | 18.68% | ― | 9.23% | 106.05% | |
54 Neutral | $192.85M | 2.68 | -60.77% | ― | ― | ― |
* Communication Services Sector Average
SOHU
Sohu
14.28
-1.77
-11.03%
NTES
NetEase
128.17
-4.21
-3.18%
NCTY
The9
5.78
-2.53
-30.49%
BILI
Bilibili
17.06
-6.19
-26.62%
DDI
Doubledown Interactive Co
12.89
3.46
36.69%
GDEV
Nexters
10.63
-1.93
-15.34%
Sohu Corporate Events
Sohu Posts Q2 2026 Profit Boosted by Tax Reversal and Extends US$150 Million Buyback Program
Aug 10, 2026
In its August 10, 2026 disclosure, Sohu reported unaudited second-quarter 2026 results showing total revenue of US$136 million, up 7% year-on-year but down 4% sequentially, driven mainly by a 10% annual rise in online game revenue to US$116 millio...
Sohu Posts First-Quarter 2026 Loss as Game Revenues Rise and Costs Fall
May 18, 2026
Sohu.com Limited reported unaudited results for the first quarter ended March 31, 2026, showing total revenues of US$141 million, up 4% year over year but down 1% sequentially, driven largely by online game revenues of US$125 million, which rose 6...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.