|Revenue growth accelerates, registered users
double, WAP network widens.
Beijing, August 1, 2000 - SOHU.com (Nasdaq: SOHU), a leading
Chinese Internet portal, today announced earnings results for the second quarter
ended June 30, 2000.
SOHU.com reported consolidated net revenues of $1.3 million for the second
quarter ended June 30, 2000, an increase of 206% compared to net revenues of
$0.4 million for the second quarter of June 30, 1999, and a sequential increase
of 58% over net revenues of $0.8 million for the first quarter ended March 31,
2000. Online advertising comprised 94% of net revenues with Web site design and
registration fees constituting the remainder.
SOHU.com recorded a net loss for the quarter of $6.5 million or a pro forma
net loss of $0.17 per share after giving effect to the conversion of preference
shares into common stock. The company had net losses of $0.5 million and $4.1
million for the corresponding period in 1999 and for the quarter ended March 31,
2000, respectively. Excluding non-cash charges for stock-based compensation
($0.2 million) and accretion on redeemable preferred stock prior to conversion
of all the company's outstanding preferred stock into common stock upon the
completion of the company's initial public offering in July 2000 ($2.1 million),
the net loss totaled $4.1 million in the quarter compared to $0.3 million and
$2.3 million for the corresponding period in 1999 and for the quarter ended
March 31, 2000, respectively.
An exclusively Mainland China-focused portal network, SOHU.com averaged in
excess of 16.3 million page views per day during June 2000, 2000, a 72% increase
from 9.5 million averaged in March 2000. The company's registered user base
reached 3.3 million at the end of June, an increase of 108% from 1.6 million
registered users at the end of March 2000. SOHU.com continued to acquire new
subscribers at a low cost as the cost per new subscriber acquired in the quarter
ended June 30, 2000, at $1.73, was unchanged from the quarter ended March 31,
"SOHU.com has completed its second quarter of the year 2000, its first
reporting period as a public company, with very positive results and strong
growth in our revenue generating capacity. We successfully completed our initial
public offering on Nasdaq on July 12, 2000, raising the funds needed to solidify
our position as one of the top Internet portals in Mainland China", said Charles
Zhang, Chief Executive Officer and President of SOHU.com.
During the second quarter of 2000, SOHU.com was the first Internet portal in
China to introduce WAP services. SOHU.com's WAP services were initially
introduced in Beijing in April 2000. During the second quarter of 2000, the
company expanded its services to nine provinces, a geographic area covering
nearly half of all mobile phone users in China.
In addition, SOHU.com has further expanded its range of products and services
during the second quarter of 2000 as Chinese consumers continued to embrace the
Internet. In particular, SOHU.com introduced new online community features,
including ICQ and Free Home Page and commenced the offering of Localized Portal
Editions in ten major Chinese cities. The company also has improved its
e-commerce services by launching an expanded platform for e-tailing and by
offering a comprehensive online travel-booking center. Furthermore, the company
launched an English channel offering news and features on China.
SOHU.com has expanded its operations by opening offices in Hong Kong and
Silicon Valley to address foreign commercial interests in Mainland China and to
develop technology and marketing alliances.
SOHU.com is the leading Internet portal in
Mainland China with current daily page views exceeding 12 million. It provides
navigation/search, news, sports, business and finance, real estate channel,
entertainment, chat, email and e-commerce activities for a solid and wide base
of visitors. Dr. Charles Zhang founded SOHU.com in 1997. Its investors include
Intel, Dow Jones, IDG, the Morningside China Group, PCCW, Legend and Hikari. Its
content partners include CNET, DOW Jones and dozens of local media organizations
Safe Harbor Statement
Except for the historical
information contained herein, the matters discussed in this news release are
forward-looking statements involving risks and uncertainties that could cause
actual results to differ materially from those in such forward-looking
statements. Potential risks and uncertainties include, but are not limited to,
SOHU.com's historical and future losses, limited operating history, uncertain
regulatory landscape in the People's Republic of China, fluctuations in
quarterly operating results and the company's reliance on online advertising
sales for substantially all of its revenues. Further information regarding these
and other risks is included in SOHU.com's prospectus dated July 12, 2000 and in
its other filings with the Securities and Exchange Commission.
For further information:
Relations and Communications
Tel: +86 10 6272 6598