Categories Earnings, LATEST, Technology

Earnings: Sogou stock falls on weak guidance

Shares of search and internet company Sogou Inc. (NYSE: SOGO) fell 4.15% during pre-market trading hours on Monday, after it issued weaker-than-expected third-quarter guidance. Meanwhile, the company reported second-quarter results that were better than street expectation.

The Chinese company’s Q2 revenue inched up 1% to $303.6 million, slightly higher than analysts’ estimate of $301.72 million. The company added that in RMD terms, revenue rose 8%.

search engine market share in china

Driven by the strong growth in auction-based pay-for-click services, the company witnessed a 2% growth in search and search-related revenues to $276.2 million. However, weakness in sales of smart products pulled down other revenues 11%.

On an adjusted basis, the company earned 7 cents per share, one cent higher than the street view, helped by an income tax benefit of $1.4 million during the quarter.

Sogou Mobile Keyboard had 453 million daily average users at the end of the second quarter, up 17% year-over-year.

READ: Google trails at fifth spot in the Chinese search engine market

CEO  Xiaochuan Wang said, “Leveraging our core AI capabilities, we made significant progress in upgrading the smart hardware business, with new AI-enabled products launched and more in the pipeline. Going forward, we believe the steady growth in our core search business, coupled with the solid progress in the big data and recommendation service and smart hardware, will support sustainable expansion across our businesses.”

For the third quarter, Sogou expects total revenues to be in the range $304 million to $314 million, representing a 10% to 14% increase year-over-year. This was, however, weaker than the street expectation of $318 million.

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