Chinese Internet portal Sohu.com (SOHU) says its revenue jumped to USD102 million from USD39 million a year ago as it reported unaudited financial results for the second quarter ended June 30, 2008.

"We are very pleased with our strong performance this quarter," stated Dr. Charles Zhang, chairman and CEO of Sohu.com. "Sohu achieved another milestone in the company's history with total revenues exceeding USD100 million which further demonstrated Sohu's leadership position in the China Internet space, driven by our strong media influence, premier content offerings and increased popularity of our products such as Sohu Blogs and Sogou Pinyin, and the growth of our online games business."

Total revenues for the second quarter ended June 30, 2008 were USD102 million, compared to revenues of USD84.8 million for the first quarter ended March 31, 2008, and USD39 million for the second quarter ended June 30, 2007. Gross margin of 76% for the second quarter of 2008, was flat with the previous quarter and up from 61% in the same period of 2007. Non-GAAP gross margin was 76% in the second quarter of 2008, flat with the previous quarter and up from 62% in the same period of 2007.

Net income for the second quarter of 2008 was USD40.2 million or USD1.02 per fully diluted share.

Advertising revenues for the second quarter of 2008 totaled USD43.4 million, a 25% quarter-on-quarter increase and a 53% year-on-year increase. Advertising revenues, consisting of USD41.7 million in brand advertising and USD1.7 million in sponsored search, accounted for 43% of total revenues in the second quarter of 2008. Brand advertising revenues for the second quarter of 2008 increased 26% quarter-on-quarter and 57% year-on-year. Advertising gross margin for the second quarter of 2008 was 64%, up from 63% in the previous quarter and up from 62% in the second quarter of 2007.

For the second quarter of 2008, Sohu's non-advertising revenues, which are derived mainly from online games and wireless value-added services, were USD58.6 million, representing 57% of total revenues. Online games revenues for second quarter of 2008 were USD47.9 million, increasing 17% quarter-on- quarter and 11.5 times year-on-year. Wireless revenues were USD9.2 million, increasing 7% quarter-on-quarter and 39% year-on-year. Non-advertising gross margin was 84%, down from 85% in the previous quarter and up from 56% in second quarter of 2007. Non-GAAP non-advertising gross margin was 84%, down from 85% in the previous quarter and up from 56% in second quarter of 2007.

For the second quarter of 2008, Sohu's operating expenses totaled USD37.2 million. Income tax expense was USD0.6 million, compared to USD9.2 million for the previous quarter and USD0.2 million for the same period last year.

Sohu estimates total revenues for the third quarter 2008 to be between USD112 million to USD116 million, with advertising revenues of USD48.5 million to USD50.5 million and non-advertising revenues of USD63.5 million to USD65.5 million.

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