China's Baidu reports 15% revenue growth, beating expectations

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A Baidu Apollo robotaxi passes by a Baidu office building in Beijing on Aug. 21, 2023.

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BEIJING — Chinese tech company Baidu on Tuesday reported better-than-expected revenue, up by 15% year-on-year in the second quarter and bolstered by growth in advertising.

This was the fastest quarterly year-on-year growth pace in two years, according to Refinitiv data.

Baidu’s U.S.-traded shares were up by more than 4% in pre-market trading.

Here’s how Baidu did in the June quarter versus Refinitiv consensus estimates:

  • Revenue: 34.1 billion yuan ($4.7 billion) versus 33.28 billion yuan expected.

Earnings per American Depositary Share on a non-GAAP basis were 22.55 yuan, versus 15.79 yuan in the year-ago period.

Within Baidu’s core businesses, online marketing revenue rose by 15% to 19.6 billion yuan in the second quarter, and non-online marketing revenue added 12% to 6.8 billion yuan.

The company’s use of AI to better match ads to Baidu search queries helped boost the quarter’s online marketing sales growth from a year ago, Robin Li, co-founder and CEO of Baidu, said during an earnings call.

Baidu operates China’s primary internet search engine, as well as commonly used consumer apps for navigation and cloud document storage.

“In the second quarter of 2023, Baidu Core accelerated revenue and profit growth, driven by the solid performance of online marketing business and operating leverage,” Li said in a release.

“Generative AI and large language models hold immense transformative power in numerous industries, presenting a significant market opportunity for us,” he said.

Baidu has been making progress with a Chinese-language ChatGPT alternative called Ernie bot, which is open to the public and was launched in March. 01 The He This Li The The Earlier this month, e-commerce giant Alibaba claimed that “strong demand” for training artificial intelligence models on the cloud and the related business opportunity was just beginning.

Internet titan Tencent said during its earnings release last week that it plans to launch its own AI model later this year, for use in products such as gaming and advertising.

Robotaxi business

Baidu also operates self-driving taxis under the Apollo Go brand in China. Bai The In