Chinese tech giant reports earnings
Men interact with a Baidu AI robot near the company’s logo at its headquarters in Beijing, China April 23, 2021.
Florence Lo | Reuters
BEIJING – Chinese tech giant Baidu on Tuesday reported third-quarter earnings that beat expectations, although growth was slower than in the previous three months.
Shares of the US-listed company were up about 2% in premarket trading at 5:00 a.m. ET. The stock is down nearly 3% year to date.
Revenue grew 6% year-on-year to 34.45 billion yuan ($4.72 billion) in the quarter ended Sept. 30. That was slightly higher than analysts’ expectations of 34.33 billion yuan, according to Refinitiv.
The search engine provider’s online marketing revenue was up 5% from a year ago, while offline marketing revenue was up 6% over the same period.
It comes after revenue in the previous quarter was up 15% from a year ago, with online and offline marketing revenue growing by double digits.
“Baidu reported strong financial results in the third quarter, demonstrating resilience in a challenging economic environment,” Robin Li, Baidu’s CEO and co-founder, said in a press release.
Adjusted earnings per American investment share were 20.40 yuan in the third quarter, down from 22.55 yuan in the previous three months, but up from 16.87 yuan a year ago.
Baidu reported net income of 6.68 billion yuan for the quarter ended Sept. 30, up from 5.21 billion yuan in the previous quarter.
The company said higher marketing spending contributed to an 11% year-over-year increase in selling, general and administrative expenses that came in at 5.8 billion yuan.
Research and development expenses rose 6% to 6.1 billion year over year, partly due to an increase in server fees to support Ernie bot research, the company said. That’s up from 1% growth in the second quarter from a year ago.
Ernie bot is Baidu’s artificially powered version of the ChatGPT chatbot. Baidu only started charging for Ernie bot in November.
“Baidu Core maintained stable margins in the quarter,” Rong Luo, Baidu’s CFO, said in a press release. “Our ongoing investments in AI have underpinned technological and product innovations. Moving forward, we will continue to prioritize investments in AI, particularly in generative AI and models foundation, we will do so with a relentless focus on efficiency and strategic resource allocation.”
The company said its Apollo Go robotaxi business operated 821,000 trips in the third quarter, up from 714,000 trips in the second three months of the year.
In September, the Beijing suburb of Yizhuang officially allowed local robotaxi operators to charge fares for fully autonomous, driverless taxis inside.
Baidu also announced that Sandy Xu, former CEO of JD.com, will join the company as an independent director on the board from January 1, 2024.