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China’s Qihoo says new advertising tool will boost revenue growth

Maker of China’s Web browser started showing customised listings on the directory page for individual users in May

Gulf News

Beijing: Qihoo 360 Technology Co., the maker of China’s most-used Web browser, said it expects a new tool for advertisers on its online directory website will increase revenue growth.

A feature that charges advertisers for each computer-mouse click by users on some Web listings posted on the page will generate additional revenue after it was introduced this month, Qihoo Chief Financial Officer Alex Xu said in a phone interview yesterday. The company will continue to charge advertisers a fixed monthly fee for some listings, he said.

Qihoo started showing customised listings on the directory page for individual users in May, allowing the company to offer the per-click feature to boost online ad sales, Xu said. Qihoo is adding users for the directory page as more people in China download the company’s 360 Safe Browser, which accounted for 36.2 per cent of Internet surfing time in the nation in March, compared with 33.2 per cent for Microsoft Corp.’s Internet Explorer, Xu said, citing research company iResearch.

“The advertising market is moving toward a per-click, and performance-based model,” said Qiu Lin, an analyst who rates Qihoo buy at GuoSen Securities in Hong Kong. “Qihoo has been growing faster than other Internet companies in ad sales, even as the overall market slows.”

Shares gain

Qihoo’s stock has declined 2.6 per cent this year. The new advertising tool will “drive accelerated sequential growth going forward,” Xu said. Sequential refers to a quarter-on-quarter comparison, he said.

First-quarter revenue rose to $69.3 million, 11 per cent more than in the previous three months, Qihoo said in May. The figure tripled from the first quarter a year earlier.

Qihoo had 411 million users for its products and services in March, including Web browsers and anti-virus software, it said in May.

Users who access the company’s services on mobile phones have doubled to more than 100 million as of June, compared with about 50 million at the end of last year, Xu said.

Another of Qihoo’s Web browsers, Speed Browser, accounted for 5.6 per cent of Internet surfing time in China in March, Xu said, citing data from iResearch.

Chinese companies and government agencies should adopt technology to guard against computer viruses and hacking, the State Council, China’s equivalent of the cabinet, said this week.

The new government recommendation will benefit Qihoo, Xu said. The heightened awareness of information security will help boost demand for Qihoo’s products including its free anti-virus software, he said.