China's Baidu revenue, profits up on strong traffic growth

Baidu is the default search engine on 80 percent of China's Android phones, the company said

China's largest search engine, Baidu, reported strong revenue and profit growth in the first quarter, driven by "solid traffic growth" and measures to generate more revenue from the company's sites.

Its search engine is already the default for 80 percent of Android phones in China. The company is now testing its own browser, and offers a beta version of its microblogging site as it pursues new opportunities in the country.

Baidu, which operates in a country with 457 million Internet users, reported on Thursday that net profits for the quarter ended March 31 were US$164 million, up by 123 percent from the same quarter last year. The company’s revenue for the quarter was $372 million, up 88 percent from the same period last year.

The company expects revenue in the second quarter to be in the range of $493 million to $504 million, a year-on-year increase of up to 72.4 percent.

Baidu currently has a 75.8 share of China's search engine market, according to Beijing-based research firm Analysys International. Google is a distant second with a 19.2 percent share.

The company expects further growth, as search is now the most used Internet service in China, CEO Robin Li said during a conference call on Thursday.

According to the China Internet Network Information Center, search became the top service in 2010, with about 82 percent of the country's Web population using it. Online music is ranked second with 79 percent of the country's Internet users.

Baidu is also expanding its presence in mobile phones. Android is developed by Baidu's rival Google, but the mobile operating system is open-source software, allowing handset manufacturers to make changes to it. Baidu has been able to pre-install its search service on Android mobile phones through "revenue sharing agreements" with device makers.

Even as search remains Baidu's core service, the company has been including social networking features in its platform, Li said. Both analysts and Internet firms have identified Twitter-like microblogging as the next big Web service to hit China.

The company recently introduced a feature to its Baidu search engine, allowing users to directly post from the search page to third-party microblogging sites. In addition, the company has a beta version of its own microblogging platform at Baidu Talk.

Baidu also reported growth with Qiyi.com, the company’s video sharing site. The video site now has more than 150 million monthly unique users, just one year after its launch, Li said. "This is by far a record for online video sites," he added. Qiyi operates as a video site that hosts licensed videos, much like Hulu does.

In comparison, Youku, China's largest video sharing site, reported last October that 230 million users visit the site on a monthly basis.

Baidu has also been eyeing China's web browser space. The company is currently testing out its own browser that's customized for Chinese users. "Having control of a browser would certainly drive traffic to Baidu search," Li said. "We would like to offer a better user experience with our browser."

Internet Explorer is used by about 83 percent of China's Web users, according to CNZZ.com, an analytical web research site.

Join the PC World newsletter!

Error: Please check your email address.

Tags business issuesBaidu.comfinancial resultsinternetsearch engines

Struggling for Christmas presents this year? Check out our Christmas Gift Guide for some top tech suggestions and more.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Michael Kan

IDG News Service

Most Popular Reviews

Follow Us

Best Deals on GoodGearGuide

Shopping.com

Latest News Articles

Resources

GGG Evaluation Team

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Steph Mundell

LIFEBOOK UH574

The Fujitsu LifeBook UH574 allowed for great mobility without being obnoxiously heavy or clunky. Its twelve hours of battery life did not disappoint.

Andrew Mitsi

STYLISTIC Q702

The screen was particularly good. It is bright and visible from most angles, however heat is an issue, particularly around the Windows button on the front, and on the back where the battery housing is located.

Simon Harriott

STYLISTIC Q702

My first impression after unboxing the Q702 is that it is a nice looking unit. Styling is somewhat minimalist but very effective. The tablet part, once detached, has a nice weight, and no buttons or switches are located in awkward or intrusive positions.

Latest Jobs

Shopping.com

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?