BEIJING – November 08, 2026 -- Sohu.com Limited (NASDAQ: SOHU) swung to a third-quarter 2026 net loss of US$15 million attributable to the company, against net income of US$9 million a year earlier, as total revenues fell 26% year-over-year to US$133 million.
Online games drive the revenue decline as marketing services grow
Online game revenues dropped 30% year-over-year to US$114 million and 2% from the second quarter. Marketing services revenues rose 10% year-over-year to US$15 million but slipped 2% sequentially. The GAAP net loss equals US$0.60 per fully diluted ADS; the non-GAAP loss is US$0.59 per ADS. Sohu's CEO, Charles Zhang, said marketing revenues reached the high end of guidance while game revenues and profitability matched expectations.
Operating loss of US$18 million replaces a US$14 million profit
Total cost of revenues came to US$32 million, down 9% year-over-year and up 9% quarter-over-quarter. Cost of marketing services revenues rose 23% year-over-year to US$15 million, while cost of online game revenues fell 33% to US$14 million. Operating expenses declined 9% year-over-year to US$120 million. Income tax expense was US$4 million, against US$17 million in the third quarter of 2025.
The second-quarter 2026 tax line included a reversal of about US$13 million in tax expense tied to uncertain tax positions. Cash, short-term investments and long-term time deposits totaled roughly US$1.2 billion at September 30.
Changyou operating profit falls to US$58 million from US$87 million
Changyou, Sohu's game business, reported revenues of US$115 million, down 30% year-over-year. Sohu attributes the drop to a high comparison base from content updates for Tian Long Ba Bu (TLBB) PC and the launch of TLBB: Return in the third quarter of 2025. Changyou's operating expenses fell 23% year-over-year to US$42 million on lower salary and benefits costs and reduced game marketing spend. Non-GAAP operating profit was US$59 million, against US$88 million a year earlier.
PC games averaged 2.6 million monthly active user accounts, down 4% year-over-year, with 1.0 million quarterly active paying accounts, down 8%. Mobile games averaged 1.4 million monthly active accounts, down 24% year-over-year and 16% sequentially. Mobile paying accounts totaled 0.2 million, down 25% year-over-year. Sohu cites the natural decline of older titles as the main cause.
Fourth-quarter guidance points to a US$17 million to US$27 million net loss
For the fourth quarter of 2026, Sohu expects marketing services revenues of US$13 million to US$14 million, an annual decrease of 18% to 24%. It forecasts online game revenues of US$111 million to US$121 million, ranging from an 8% annual decrease to a 1% increase. Both GAAP and non-GAAP net loss attributable to the company are projected at US$17 million to US$27 million. Guidance assumes an exchange rate of RMB6.73 per US dollar, against RMB6.78 in the third quarter of 2026.
Sohu has spent US$134 million of its US$150 million buyback authorization
As of November 5, 2026, Sohu had repurchased 10.1 million ADSs for about US$134 million under its program of up to US$150 million.