Baidu beats quarterly revenue estimates on strong advertising
Technology
The company's U.S.-listed shares rose 2.4% in premarket trading
(Reuters) - Chinese search engine and artificial intelligence company Baidu Inc (9888.HK) beat second-quarter revenue estimates on Tuesday, helped by strength in advertising.
The company's U.S.-listed shares rose 2.4% in premarket trading.
Businesses have revived spending on digital advertising after easing of COVID-19 restrictions spurred an economic recovery, benefiting the Chinese tech giant, which relies on online ads for most of its revenue.
Baidu has also been promoting its generative artificial intelligence (AI) large language model (LLM) tool, Ernie, to jump on the AI bandwagon — a trend that has caught the attention of investors and consumers.
"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," said Robin Li, Baidu's co-founder and CEO.
He added that Baidu was adopting an "AI native mindset". "Overall, Baidu is committed to building a new engine around generative AI and LLM to drive sustainable long-term growth."
The company's revenue for the quarter ended June 30 was 34.06 billion yuan ($4.67 billion), compared with analysts' average estimate of 33.28 billion yuan, according to Refinitiv data.
Its online marketing revenue rose 15% in the second quarter.
The company reported adjusted profit of 22.55 yuan per American Depositary Share (ADS), compared with profit of 15.79 yuan per share a year earlier. This also exceeded analysts' average estimate of 16.86 yuan per ADS, according to Refinitiv.
