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October 30, 2012

Baidu reports Q3 2012 earnings, revenue growth slows

Total revenues for the third quarter of 2012 were $994.6m, slowest growth in two years.

By Tineka Smith

Baidu

Baidu’s Q3 revenues of $994.6m were a 49.7% increase from the same period in 2011. However, the Chinese company’s revenue growth has been gradually slowing.

In Q2 2012, the company reported revenue increases of 59.8% and in Q1 2012 Baidu posted an increase of 75%.

Operating profit for Q3 2012 was $524.6m and Baidu’s net income was $478.6m, a 59.8% increase from the same quarter in 2011.

"We are pleased to report a solid performance for the third quarter driven by encouraging customer growth and improvements to our monetization platform," said Robin Li, chairman and chief executive officer of Baidu.

"During the quarter, we worked to improve user experience by more closely integrating Baidu’s suite of market-leading vertical products with Web search," added Li. "Mobile and cloud represent our vision for the future of China’s Internet, and Baidu will continue to proactively drive the development of this crucial ecosystem. We stand ready to meet the challenges and capture the opportunities the PC-to-mobile transition presents."

Online marketing revenues for Q3 2012 were $993.8m, a 49.6% increase during Q3 the year before. The company reported that it has approximately 390,000 active online marketing customers as of Q3 2012.

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Baidu’s fourth quarter outlook reflects the company’s revenue growth may continue to slow for the remainder of the year. Baidu expects to generate $979.3m to $1.010bn which will mean an increase of only 37.6% to 41.8% year-over-year.

"In the third quarter, we saw solid profitability as we continued our strategy of investing in key areas of future growth, particularly mobile and cloud," said Jennifer Li, Baidu’s chief financial officer. "In the quarters ahead, we will look to accelerate the pace of investment to achieve long-term, sustainable growth."

Please follow this author on Twitter @Tineka_S or comment below.

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