I think the market is overly optimistic about this one. The same pressures that are affecting Google and Bidu will affect this company. Because their market share is small, they will have to discount to get advertising money more than Bidu which has a much bigger customer network. The CEO of this company is known for exaggerating their market share. Just because he says he's targeting 15-20% of the market doesn't mean he will get it. It would seem there are moneyed interests who want to see this thing go up and who therefore are paying for positive "advertising" from analysts. We'll see how it goes. But sales don't equal earnings and earnings are where it's at.
The firms that helped bring this to market are the ones pumping it. There is no study that shows Qihoo has taken any significant market share from Baidu. Baidu has been targeted by these same firms and their analysts with downgrades before and just after earnings. Baidu beat on EPS by a wide margin and narrowly missed on Revs while increasing significantly their customer base. Baidu did guide lower on Revs percentage wise compared to last year because of the slowdown in China but still maintains high growth rates compared to most companies. Qihu, well it continues to avoid any real scrutiny on their numbers form the analysts who claim it is doing so well.