Sohu.com(SOHU) - 2024 Q4 - Annual Report

Financial Performance - Total revenues for 2024 were approximately $598.4 million, stable compared to 2023, with a gross margin decrease from 76$100.2 million, compared to $66.1 million in 2023, with diluted net loss per share increasing from$1.93 to $3.13[699] - Revenues from Sohu were$69.7 million for 2024, down from $83.7 million in 2023, with the number of advertisers decreasing to 1,059[718] - Revenues from Changyou's 17173.com website were$3.8 million for 2024, down from $5.0 million in 2023, with the average spend per advertiser decreasing to approximately$61,000[719] - Revenues from other services decreased to $22.5 million in 2024, down$9.8 million from 2023, mainly due to a decline in paid subscription services[727] - Operating loss for 2024 was $109.4 million, compared to a loss of$87.3 million in 2023[749] - Interest income for 2024 was $38.6 million, down from$45.2 million in 2023[751] - Brand advertising gross margin decreased to 9% in 2024, down from 20% in 2023[732] - Net loss from continuing operations attributable to Sohu.com Limited for 2024 was $100.3 million, an increase from a net loss of$65.8 million in 2023 and $17.3 million in 2022[757] Revenue Breakdown - Brand advertising revenues decreased by 17$73.5 million, representing 12% of total revenues[717] - Online game revenues increased by 5% year-over-year to $502.4 million, accounting for 84$359.3 million for 2024, representing 72% of Changyou's online game revenues, with TLBB PC generating $309.2 million, accounting for approximately 52$143.1 million, a year-on-year increase of $32.1 million from 2023, primarily driven by new game contributions[723] - Legacy TLBB Mobile generated$44.4 million in 2024, accounting for approximately 9% of Changyou's total revenues[723] Advertising and Market Conditions - Sales to the five largest advertising agencies comprised approximately 24% of total brand advertising revenues for 2024, down from 28% in 2023[720] - The advertising market continues to face uncertainties, which may adversely impact revenues and results of operations[702] Cash Flow and Liquidity - Cash and cash equivalents as of December 31, 2024, were approximately $159.9 million, down from$365.7 million in 2023[761] - Net cash used in continuing operating activities for 2024 was $48.0 million, primarily due to a net loss of$100.2 million[765] - Net cash used in continuing investing activities for 2024 was $113.4 million, with$1.94 billion spent on short-term investments and time deposits[768] - Cash flows from continuing operations showed a net decrease of $205.8 million in cash, cash equivalents, and restricted cash for 2024[764] - The company may require additional cash resources due to changes in business conditions and general economic conditions[762] Capital Expenditures and Obligations - Capital expenditures for 2024 were$19.9 million, compared to $18.4 million in 2023 and$23.8 million in 2022[781] - Total payments required for contractual obligations as of December 31, 2024, amounted to $34.5 million[782] - Long-term tax liabilities recorded were$211.8 million, primarily related to unrecognized tax benefits and previous business transactions[783] Accounting Standards and Disclosures - The company expects to adopt ASU No. 2023-09 for income tax disclosures, effective after December 15, 2024, and is currently evaluating its impact[788] - The adoption of ASU No. 2023-07 on segment reporting will enhance disclosures of significant segment expenses, effective for fiscal years beginning after December 15, 2023[786] - Other accounting standards adopted from January 1, 2024, did not significantly impact the consolidated financial statements[787] - ASU No. 2023-09 on income taxes will require disaggregated information about effective tax rate reconciliation, effective for annual periods beginning after December 15, 2024[788] - ASU No. 2024-03 on comprehensive income will require disclosure of specified components of costs and expenses, effective for annual reporting periods beginning after December 15, 2026[789]