Feb. 7, 2007 (China Knowledge) – Sohu.com, China’s second-largest online portal, announced that fourth-quarter profit fell 32% amid a declining profit margin in online advertising and deteriorating sales of wireless services.

The announcement caused its shares to drop in U.S. after-hours trading. The shares fell almost 8% to US$24.50 in after-hours trade on the Nasdaq.

Quarterly earnings for the company fell to US$6.1 million, or 16 U.S. cents per share, from US$8.9 million, or 23 U.S. cents per share a year earlier. Total revenue grew 15% to US$34.3 million from US$29.6 million a year earlier.

Sohu is spending money on acquiring premium content to compete with larger rival Sina, which is recognized for its news coverage.