Qihoo 360 collects US$175.5m in IPO

China Daily via agencies, March 31, 2011

Qihoo 360 Technology Co Ltd, China's third biggest internet company by user base, received warm welcome by the U.S. investors on Wednesday, with share prices more than doubled in its debut on the New York Stock Exchange.

Beijing-based Qihoo 360 priced its 12.11-million-share IPO at 14.50 dollars, above the expected range. However, due to strong demand from investors, the stock opened up 86 percent at 27 dollars after the market opened on Wednesday and finally ended the session at 34.00 dollars, soaring 134.48 percent.

"We don't look at our IPO here in New York as a major achievement,"said Zhou Hongyi, chairman and chief executive officer of Qihoo 360. "We regarded it as an opportunity for further brand promotion and market expansion. After our IPO, we need to provide our 300 million Chinese internet user with better services so that we can turn our great potential into real competitive advantage in the future."

Qihoo 360's glamorous debut in Wall Street reminded most investors of the Internet IPO boom in late 2010, when Youku and Dangdang, two other Chinese internet companies wowed U.S. investors with astonishing first-day performances on the New York Stock Exchange.

Meanwhile, many investors also doubted that many Chinese internet companies were over-evaluated as U.S. investors were so eager to cash in on the booming growth of the number of Chinese Web users and the country's economy.

But Zhou said that Qihoo 360's profit model was unique in the world and will be proved in future development.

According to Zhou, Qihoo 360 was the third biggest internet company in China and has a monthly user base of more than 300 million. Meanwhile, it runs the second most popular browser after Microsoft's Internet Explorer."Qihoo 360 has a vast user base in China, but we don't need to provide every single service by ourselves, otherwise we are working on building an open platform like Facebook, letting both internet companies and internet users share good products and services on our platform," Zhou said. " My other goal is to serve as an entrance for internet users who want to get great internet experiences with zero security concerns. "

When asked about the challenges Qihoo is going to face in the next couple of years, Zhou told Xinhua that Qihoo need to be focused on its core internet and wireless security business as well as web browser product, and try to seek growth through value- added services and internet advertisement.

For the year ended Dec. 31, 2010, Qihoo 360 reported net income attributable to shareholders of 5.5 million dollars, on revenue of 57.7 million dollars, according to the company's filing. That compares with a net income of 2.1 million dollars, on revenue of 32.3 million dollars, for the year-earlier period.