Open the results a “black box”, zhang said sohu large flow is great value

(word/qing nan)

recently, sohu officially announced and annual earnings in the fourth quarter of 2014, the results after the return of the more important reason is that this is zhang to sohu organization structure adjustment and optimization of business performance one of the most concentrated period, from the part of the performance data and its adjustment thinking can roughly judge the rest of the company. Sohu chairman zhang, including hunting cloud network media interview.

first to roughly understand the sohu earnings data show:

important performance in the fourth quarter

? total revenues of $477 million, compared with the same period in 2013 increased by 24%, compared with the previous quarter growth of 11%, higher than the company expected cap of $15 million.

? Brand advertising revenues of $148 million, compared with the same period in 2013 increased by 20%, compared with the previous quarter fell by 1%. Among them, sohu media platform, that is, not including other sohu video business media business income of $49 million, down 5% compared with the same period in 2013. Sohu video revenue was $51 million, compared with the same period in 2013 increased by 64%.

? Sogou revenue was $119 million, compared with the same period in 2013 increased by 70%, 12% from the previous quarter.

? Online gaming revenue was $184 million, compared with the same period in 2013 increased by 7%, 23% from the previous quarter.

? For sohu company gaap net loss of $20 million in the United States, the United States general accounting standards diluted net loss of $0.52 a share.

2014 annual performance important

? Total revenue of $1.7 billion, up 19% from 2013.

? Brand advertising revenues of $541 million, up 26% from 2013. Among them, the income of $198 million, sohu media platform compared with the same period in 2013 increased by 9%. Sohu video revenue was $176 million, compared with the same period in 2013 increased by 61%.

? Sogou revenue was $386 million, up 79% from 2013.

? Online gaming revenue was $652 million, down 3% compared with 2013.

? to sohu company gaap net loss of $171 million in the United States, the United States general accounting standards diluted net loss of $4.43 a share.

we can see that the overall sohu revenue is growing maintain considerable level, especially the sogou, video, game after volatile basic stopped falling and began to reflect growth in the fourth quarter, sohu media business (not including video). These changes and zhang bet on video, media and games business optimization adjustment.

open results black

unlike previous quarters, the results is sohu disclose each part of the business performance is the most complete and detailed, including the previously undisclosed sogou business profit, sohu video key data such as sales, after the data is not clear.

this time are so transparent in hunting cloud network problem, zhang said, sohu hope to open the black box, let investors clearly what it is to see the business, and you can take each business line with corresponding competitive peer comparison; Not only that, but it’s also motivate a target for each business line, also accord with emphasized recently he has been ready for a more transparent, open management mode.

in zhang’s view, sohu’s media, video, search and games four high-quality assets, and is in the domestic market in every field of top position, but always failed to give a reasonable valuation, capital market undervalued sohu shares. Among them, the video is burning money business, and is one of the important factors, drag sohu group performance losses investors previously buried in the entire framework is not observed in detail the specific performance, so he will give investors show the performance of true composition.

however, during the period of Charles retreat, sohu’s swim and portal business growth is weak or even part of the reverse phenomenon, this also prompted Charles started a series of reform and structure adjustment. Changyou give up dream overseas platform game, to gather the nature of the game, the portal business again emphasizes the organization coordinated optimization architecture and energy, etc., and took the biggest cuts in the history of it. He disclosed that sohu in recent months have been laid off 2000 people swimming (1000), accounting for 13% of the total employees. At present, job layoffs has come to an end.

video business no longer participate in the fierce price war

sohu video is zhang comeback after one of the most significance of the business, not only of the CEO, also frequently to emphasize video business platform, and in 2014 acquired com strengthen strategic content resources.

zhang was a strong advocate of the original video and domestic anti-piracy most strongly advocates, after the film copyright issues fundamental eliminate, sohu video and the video website when fighting hot drama face a big problem is high royalties, it was one of the reasons for the video website can’t profit. Sohu video at the same time of using self-made drama balance cost, will also have to pay big money to buy the domestic popular drama, variety show, etc. For example, the now popular “good songs in China” by sohu video exclusive broadcast network, it is said that high prices.

how to balance the next video input and income generation problem? Zhang said the sohu video be invest less in the domestic industry is growing rapidly. “Sohu in 2015 will not be involved in like fierce price competition for 14 years, I think the Chinese drama and variety price is a little deviation from the normal level.

he also pointed out that the current general is generally accepted as shall be for a good drama, each episode in 1 million – 1.5 million, 5000, 70 million a, although it is possible with other platforms according to balance the cost, but the price is still in a high position. The reason behind is a lot of investment into video content, actor premium cost is higher.

sohu video coping strategy is to not participate in the fierce price war and reinforce the anticipation of good resources and exploring ability, at the same time, to invest more resources in the UGC and PGC, while reducing costs to develop more diversified high quality content.

sohu large flow how to liquidate

sohu how specific flow, the outside may not real forecast. Charles zhang said a year ago have Internet research data shows that the sohu has is one of the world’s top ten sites, to control the flow of resources together by sohu can also to the world top ten, in which the media business mobile daily average of 50 million active users and $477 million in revenue in the fourth quarter is not much more special. But at the moment, but the problem is traffic cash isn’t particularly effective, sohu and there are many things to do.

in sohu four core business, in addition to changyou is realized by props, the rest of the basic rely on advertising model. In zhang’s opinion, advertising is actually the most worry, sohu is the key to do is set the platform, the space is very big still.

he points out, the game in accordance with the charge to liquidate and search matching two ways according to the precise advertising is relatively easy, the hard part is the portal and video. The traditional channel portal banner ads don’t meet the needs of the broad masses of advertisers. The arrival of the mobile Internet makes according to geography, population, advertising content such as be fond of, time possible.

the current architecture, not only introduced the sohu Chen Chaohua served as editor in chief, each business line significantly improved the cooperative combat deployment, such as portal and news client, mobile phone sohu net, has realized to “central kitchen” on the organization of content, to distribute to each port at the same time, at the same time using big data features on the personalized requirements of users to recommend appropriate content.

at present a large number of advertisers have to sohu products form of recognition. In the fourth quarter, the sohu media platform mobile revenue accounted for about 30% of the sohu news advertising revenue (the next quarter is expected to 40%), sohu video advertising revenue mobile terminal also account for a third.

“sohu’s core competence is not help others move things and buy things, but to help others with information flow, a better way to convey information. We insist for a long time in such a place has long cultivated, so still go a long way.” Charles zhang said.

although earnings disclosures sohu now reached $1.1 billion in cash and equivalents, but because the business is still in the stage of burn, such as video sohu temporarily won’t consider large-scale strategic investment, but focus on product optimization and build it.