Sohu 1Q profit soars with rising brand ad, online game sales

NEW YORK—Chinese Internet portal operator Sohu.com Inc. said Monday that its first-quarter profit more than quadrupled as brand advertising and online game revenue jumped.

Sohu also predicted second-quarter revenue above analysts' expectations.

Shares rose $7.16, or 11.6 percent, to $69 in midday trading. Earlier, shares set a new year high of $70.74. The stock has traded in a 52-week range of $22.95 to $64.83.

For the quarter ended March 31, Sohu earned $21.6 million, or 55 cents per share, compared with $4.5 million, or 12 cents per share, in the same quarter last year. On an adjusted basis, Sohu earned 64 cents per share.

The company's revenue rose to $84.8 million from $33.1 million.

Analysts polled by Thomson Financial expected a profit of 37 cents per share on $69.3 million in revenue.

Sohu said its total advertising revenue rose to $34.8 million from $25.6 million. Brand advertising revenue rose 40.9 percent to $33.2 million, due to an ongoing shift in advertising moving from offline to online, as well as strength in advertisers' spending in the buildup to the 2008 Olympic Games.

Sohu is the official Internet portal for upcoming Beijing Olympics.

Sohu's non-advertising revenue, which includes online game and wireless value-added services revenues, rose $42.6 million to $50.1 million. The company's online game revenue rose $39.3 million to $41 million, helped by the performance of the game "Tian Long Ba Bu," which reported $38.9 million in sales.

Sohu also reported a jump in income tax expense -- $9.2 million compared with $282,000 in the same quarter last year. The company said it accounted for its income tax based on new corporate income tax laws that unify the statutory income tax rate of enterprises in China at 25 percent, which became effective on January 1.