Sohu (SOHU) AI Stock Analysis

• Market Cap: $470.52M
• Dividend Yield: N/A
• Average Volume (3M): 39.09K
• Price to Earnings (P/E): 3.1
• Beta (1Y): 1.01
• Revenue Growth: -4.80%
• EPS Growth: N/A
• Country: US
• Employees: 4,300
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 0.33
• Shares Outstanding: 30,065,400
• 10 Day Avg. Volume: 38,263
• 30 Day Avg. Volume: 39,088
• PEG Ratio: -0.02
• Price to Book (P/B): 0.46
• Price to Sales (P/S): 0.71
• P/FCF Ratio: -6.21
• Enterprise Value/Market Cap: -0.94
• Enterprise Value/Revenue: -0.81
• Enterprise Value/Gross Profit: -1.08
• Enterprise Value/Ebitda: 8.38
• 1Y Price Target: $21.00
• Price Target Upside: 33.00% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): -2.95
• Revenue Forecast (FY): $525.06M

• Rating: 56 Neutral
• Price Target: $14.50 ▼(-8.17% Downside)

Sohu's overall score reflects financial challenges and bearish technical indicators, offset by strong earnings performance in gaming and an attractive valuation. The company's ability to maintain positive net income and manage market uncertainties will be crucial for future performance.

Positive Factors

Strong Gaming Segment

The strong performance in the gaming segment indicates a robust product offering and effective market penetration, contributing significantly to revenue growth and enhancing Sohu's competitive position in the gaming industry.

Positive Net Income

Achieving positive net income after previous losses demonstrates improved operational efficiency and financial management, potentially leading to increased investor confidence and financial stability.

Low Leverage

A low leverage position provides Sohu with greater financial flexibility, reducing risk and allowing for strategic investments and expansion opportunities without significant debt burden.

Negative Factors

Declining Revenue Growth

The declining revenue trend highlights challenges in maintaining market share and competitiveness, potentially impacting long-term growth and profitability if not addressed.

Negative Cash Flow

Negative cash flow indicates operational inefficiencies and challenges in generating sufficient cash to fund operations and growth, which could constrain future strategic initiatives.

Decline in Marketing Services Revenue

A significant decline in marketing services revenue suggests weakening demand or competitive pressures in this segment, potentially affecting overall revenue diversification and growth prospects.

Sohu Business Overview & Revenue Model

Company Description

Sohu.com Limited provides online media, video, and game products and services on PCs and mobile devices in China. The company offers online news, information, and content services through the mobile phone application Sohu News APP, mobile portal m.sohu.com, and www.sohu.com for PCs; and online video content and services through mobile phone application Sohu Video APP and tv.sohu.com, and ifox, a PC video application. The company is also involved in the development, operation, and licensing of online games for PCs and mobile devices, which include massive multiplayer online role-playing games, and casual and strategy games. In addition, it operates focus.cn, which provides online real estate information and services; and 17173.com website, which provides news, electronic forums, online videos, and other online game information services to game players, as well as offers mobile game distribution services. Further, the company provides paid subscription services, interactive broadcasting services, and sub-licensing of purchased video content to third parties. Sohu.com Limited was incorporated in 1996 and is headquartered in Beijing, China.

How the Company Makes Money

Sohu generates revenue through multiple streams, primarily focusing on online advertising, online gaming, and subscriptions. The advertising segment includes display ads and search engine marketing, which are supported by its popular web portal and search engine, Sogou. The online gaming division contributes significantly to revenue by offering various games, both developed in-house and through partnerships with other developers. Furthermore, Sohu earns subscriptions from its online video services, where users pay for premium content. Strategic partnerships with other tech companies and advertisers also enhance its revenue potential, allowing Sohu to leverage its content and user base effectively.

Sohu Financial Statement Overview

Summary

Sohu faces financial challenges with declining revenues and persistent net losses. Despite a strong equity position with low leverage, negative cash flows and returns on equity present significant hurdles.

Income Statement

Sohu has faced declining revenue with a decrease from $600.7M to $598.4M in 2024, representing a slight contraction. The company struggles with profitability, as evidenced by a consistent negative net income and EBIT over recent years. The gross profit margin remains strong at 72.29% for 2024, but the net profit margin is negative at -16.76%, indicating inefficiencies and high operational costs.

Balance Sheet

Sohu's balance sheet shows a relatively strong equity position, with a debt-to-equity ratio of 0.04, suggesting low leverage. The equity ratio stands at 53.16%, indicating a solid equity buffer. However, the return on equity is negative at -10.87% for 2024, highlighting challenges in generating returns for shareholders.

Cash Flow

The cash flow statement reveals a declining trend in free cash flow, with a fall from -$43.98M in 2023 to -$67.94M in 2024. Operating cash flow also turned negative, indicating cash flow challenges. The operating cash flow to net income ratio is 0.48, reflecting issues in converting profits into cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	549.03M	598.40M	600.67M	733.87M	835.58M	749.89M
Gross Profit	410.85M	432.57M	454.92M	542.30M	630.90M	532.45M
EBITDA	-53.06M	-76.97M	-57.06M	30.43M	175.02M	114.72M
Net Income	124.44M	-100.27M	-30.38M	-17.34M	927.73M	-86.11M
Balance Sheet
Total Assets	1.68B	1.73B	1.88B	1.98B	2.25B	2.82B
Cash, Cash Equivalents and Short-Term Investments	826.15M	904.42M	960.27M	1.17B	1.40B	648.59M
Total Debt	0.00	37.51M	41.36M	36.50M	36.12M	442.78M
Total Liabilities	614.44M	811.98M	822.82M	867.07M	953.60M	1.79B
Stockholders Equity	1.06B	922.34M	1.06B	1.11B	1.29B	347.37M
Cash Flow
Free Cash Flow	0.00	-67.94M	-43.98M	8.40M	-104.48M	61.43M
Operating Cash Flow	0.00	-48.02M	-25.57M	32.24M	-62.28M	95.21M
Investing Cash Flow	0.00	-113.36M	-291.67M	-232.79M	516.73M	419.77M
Financing Cash Flow	0.00	-40.88M	-6.56M	-82.14M	-434.10M	93.59M

Sohu Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 15.79
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 15.79 is above the 20-day moving average (MA) of 15.05, above the 50-day MA of 15.00, and above the 200-day MA of 13.53, indicating a bullish trend. The MACD of 0.16 indicates Negative momentum. The RSI at 59.99 is Neutral, neither overbought nor oversold. The STOCH value of 91.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SOHU.

Sohu Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NTES	81 Outperform	$88.51B	18.18	24.65%	2.05%	5.69%	32.87%
DDI	80 Outperform	$456.88M	4.00	12.55%	―	1.21%	0.72%
GDEV	63 Neutral	$404.48M	10.40	―	13.40%	―	―
BILI	62 Neutral	$10.82B	100.66	5.30%	―	16.84%	―
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
SOHU	56 Neutral	$470.52M	3.13	14.73%	―	-4.80%	―

Sohu Corporate Events

Sohu.com Reports Strong Q3 2025 Financial Results

On November 17, 2025, Sohu.com Limited announced its unaudited financial results for the third quarter ending September 30, 2025, reporting a significant financial turnaround. The company achieved total revenues of $180 million, marking a 19% increase year-over-year and a 43% rise quarter-over-quarter. This growth was driven by a 27% increase in online game revenues, primarily due to the success of their new PC game, TLBB: Return. Sohu recorded a GAAP net income of $9 million, a notable improvement from the net losses in previous quarters, highlighting the company’s strengthened market position and operational efficiency.

Sohu.com Limited Announces Election of Directors and Auditor Ratification

On September 10, 2025, Sohu.com Limited held its annual general meeting of shareholders in Beijing, China. During the meeting, three nominees, Mr. Charles Huang, Dr. Dave Qi, and Mr. Shi Wang, were elected as Class II Directors, each receiving a plurality of votes. Additionally, the shareholders ratified the appointment of PricewaterhouseCoopers Zhong Tian LLP as the company’s independent auditors for the fiscal year ending December 31, 2025. These decisions are expected to strengthen the company’s governance and financial oversight, potentially impacting its strategic direction and stakeholder confidence.