Changyou.com Limited reported unaudited consolidated earnings results for the second quarter ended June 30, 2017. For the quarter, the company reported total revenue was USD 150 million, representing an increase of 16% year-over-year and 25% quarter-over-quarter. Online game revenue was increased mainly due to the successful launch of the company's new mobile game, Legacy TLBB, in the second quarter. Online advertising revenue was decreased mainly due to fewer games being marketed on the 17,173 website. The quarter-over-quarter increase was mainly due to a seasonal trend in online game advertising typical of the second quarter. Cinema advertising revenue was increased because the company took an active approach in acquiring more advertising resources. The quarter-over-quarter decrease was a result of a seasonal trend in cinema advertising typical of the second quarter. Internet value-added services revenue was decreased due to a result of lower revenue from PC internet products in the second quarter of 2017. Operating profit was USD 54 million, compared with USD 29 million in the second quarter of 2016 and USD 32 million in the first quarter of 2017. Non-GAAP operating profit was USD 63 million, compared with USD 33 million in the second quarter of 2016 and USD 37 million in the first quarter of 2017. Net income was USD 52 million, compared with USD 33 million in the second quarter of 2016 and USD 30 million in the first quarter of 2017. Non-GAAP net income was USD 61 million, compared with USD 37 million in the second quarter of 2016 and USD 35 million in the first quarter of 2017. Net income attributable to the company was USD 52 million, compared with USD 33 million in the second quarter of 2016 and USD 30 million in the first quarter of 2017. Fully-diluted net income attributable to the company per ADS5 was USD 0.96, compared with USD 0.62 in the second quarter of 2016 and USD 0.56 in the first quarter of 2017. Non-GAAP net income attributable to the company was USD 61 million, compared with USD 36 million in the second quarter of 2016 and USD 35 million in the first quarter of 2017. Non-GAAP fully-diluted net income attributable to the company per ADS was USD 1.14, compared with USD 0.68 in the second quarter of 2016 and USD 0.66 in the first quarter of 2017. Operating cash flow for the second quarter of 2017 was a net inflow of USD 33 million. Income before income tax expense was USD 61,640,000 compared to USD 38,348,000 a year ago.

For the third quarter of 2017, the company expects total revenue to be between USD 160 million and USD 170 million, including online game revenue of USD 120 million to USD 130 million; Non-GAAP net income attributable to the company to be between USD 55 million and USD 60 million, and non-GAAP income per fully-diluted ADS to be between USD 1.02 and USD 1.12. Share based compensation to be around USD 2 million, assuming no new grants of share-based awards and that the market price of the company ADSs is unchanged. Taking into account the elimination of the impact of these share-based awards, GAAP net income attributable to the company to be between USD 53 million and USD 58 million, and GAAP income per fully-diluted ADS to be between USD 0.99 and USD 1.08.