Baidu's profit flat on growing investments in mobile

The company's research and marketing costs continue to soar

Chinese search giant Baidu's profit was flat in the third quarter because of expenses on marketing its mobile services and investing in research.

Baidu's net profit reached 3.05 billion yuan (US$498 million), up 1.3 percent from 3 billion yuan in same period a year ago. Revenue growth, however, remained strong, increasing by over 42 percent year-on-year to 8.9 billion yuan.

Profit growth for the company will remain flat over the next financial periods, according to Baidu, which is investing more in China's mobile Internet market. The company has long reigned as the country's largest search engine, with a 64 percent share of the market, according to data analytics site CNZZ.com. But the company still faces stiff competition from both traditional search engine providers and social networking products popular on mobile phones.

During the third quarter, the company's selling and administrative expenses soared 115.4 percent year-over-year, largely due to the marketing of its mobile products. Research and development costs were also up, increasing by 77.5 percent.

In addition, the company has been recently making acquisitions. In July, it purchased two app stores in the country for US$1.9 billion. Baidu wants to use the acquisition to become a leading destination for customers to find mobile apps.

In August, the company also bought a majority stake in a top group buying site in China, a move meant to bring growth to Baidu's mobile mapping services.

On Wednesday, Baidu executives called the earnings report strong, pointing to gains made in the company's mobile business, which is showing rising revenue and a growing user base. Baidu's customers in online advertising are still increasing, with the number up by 19 percent from the same period a year ago.

"Our internal tracking shows that we are the clear number one in mobile search," said Baidu CEO Robin Li, in an earnings call. The total installed base for its mobile search app reached over 330 million in the third quarter. This was up 50 percent, quarter-over-quarter.

In the fourth quarter, Baidu projects revenue will range between 9.2 billion yuan and 9.5 billion yuan, marking a 45.5 percent to 49.6 percent year-over-year growth.

Join the PC World newsletter!

Error: Please check your email address.

Tags business issuesbaidufinancial resultsinternetsearch engines

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

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

Michael Kan

IDG News Service
Show Comments

Essentials

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?