Sohu.com To Resume Sending MMSs on Monday

NEW YORK (Dow Jones)--Chinese Internet portal Sohu.com Inc. (SOHU) will resume delivering multimedia messaging services on Monday, a month before a one-year suspension was scheduled to be lifted.

Sohu doesn't expect the move to affect its third-quarter earnings guidance, issued Wednesday.

In a press release Friday, Sohu said China Mobile Communication Corp., the country's largest mobile carrier, informed the company it decided to resume multimedia messaging cooperation on its nationwide network on Monday. China Mobile had suspended the services for a year because of unsolicited marketing by Sohu to some customers.

Sohu said it transferred its multimedia messaging services business onto China Mobile's mobile information service center platform in June, so it is "technically ready" to resume the MMS business.

Because it will need to rebuild the business after 11 months of suspension, Sohu doesn't expect the service resumption to materially affect its third-quarter outlook.

Earlier this week, Sohu reported its second-quarter profit fell 28%, to $7.1 million, or 18 cents a share, and said third-quarter results would be weaker than expected, largely because of disappointing advertising revenue growth.

The company projects third-quarter earnings of 18 cents to 22 cents a share, on revenue of $26.5 million to $28.5 million. Analysts surveyed by Thomson First Call, on average, estimate earnings of 22 cents a share, on revenue of $28.75 million.

Sohu said Friday it will leverage its resources to rebuild the multimedia messaging services business and will cooperate with online and wireless partner Walt Disney Co. (DIS) to add MMS services to co-promotion efforts during the Disney On Ice event in August and the opening of Hong Kong Disneyland in September.

China Mobile (Hong Kong) Ltd. (CHL) is the listed arm of China Mobile Communications Corp. Its American depositary shares recently traded at $20.09, down 14 cents, or 0.7%.

Sohu.com's shares were trading at $18.65, up 35 cents, or 1.9%, on Nasdaq. The issue reached a 52-week high of $23.74 on July 15, and a 52-week low of $13.56 on Aug. 13, 2004.

-Tom Rojas; Dow Jones Newswires; 201-938-5400; AskNewswires@dowjones.com

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Posted to the site on 29th July 2005