(Yicai Global) Nov. 18 -- Despite a 13 percent gain in third-quarter revenue, Baidu’s shares plunged after the Chinese search engine and artificial intelligence giant reported a wider net loss.
Baidu [HKG: 9888] ended 7.8 percent down in Hong Kong today at HKD156.40 (USD20.08). Its Nasdaq-listed stock [NASDAQ: BIDU] was trading 0.9 percent lower at USD160.41 in pre-market trading as of 4.35 a.m. in New York after skidding 5.5 percent yesterday.
The net loss widened more than 28 times to CNY16.6 billion (USD2.6 billion) in the three months ended Sept. 30, from CNY583 million (USD91.4 million) a year ago, due to fair value adjustments of long-term investments, the Beijing-based firm said in its earnings report released yesterday. But non-GAAP net income was CNY5.1 billion (USD790 million), beating the market consensus.
Revenue climbed to CNY31.9 billion (USD5 billion) as solid gains at Baidu’s newer businesses such as AI Cloud, where revenue surged 73 percent, compensated for a slowdown in income from internet advertising, the report showed.
“Our AI Cloud is helping businesses better serve customers and move faster with greater efficiency,” said Robin Li, co-founder and chief executive officer.
Online marketing segment Baidu Core made up more than three-quarters of the firm’s total revenue at CNY24.7 billion, expanding by 15 percent from the same period of last year.
“Baidu Core delivered another solid quarter, powered by our AI cloud revenue,” said Chief Financial Officer Rong Luo. “With a diversified AI portfolio, including cloud services, smart transportation, smart devices, self-driving, smart EV and robotaxi, we are well positioned for long-term growth.”
Another part of Baidu’s AI push is its autonomous driving platform. “We are building Baidu Apollo smart transportation and intelligent driving to smoothen traffic congestion, accelerate the move to EV and reduce traffic accidents,” Li added.
Baidu has been boosting its research and development investment, with third-quarter R&D outlays jumping 35 percent to CNY6.2 billion from a year earlier.
Apollo Go, Baidu’s autonomous ride-hailing platform, offered 115,000 rides in the quarter, making Baidu the world’s largest autonomous mobility provider, Li wrote in an internal letter to all staff members yesterday.
In September, the Baidu mobile app's number of monthly active users rose 12 percent to 607 million from a year ago. The share of daily active users peaked at 79 percent of the total.
For the current quarter, Baidu said it expects slightly slower revenue growth. Revenue could rise to a point between CNY31 billion and CNY34 billion, a gain of 2 percent to 12 percent from a year ago. Baidu Core's revenue was forecast to grow between 5 percent and 16 percent.
Editor: Emmi Laine, Xiao Yi