BAIDU PROFIT UP ON MOBILE, A.I. FOCUS
Earnings rise 83.5pc to 4.41b yuan in 3 months through June
CHINESE Internet search engine provider Baidu Inc has reported a jump in quarterly earnings, recovering from a string of regulatory investigations last year, as sharpened focus on mobile and artificial intelligence (AI) services drives growth.
The result comes as Baidu narrows its attention to just a handful of areas outside its core business, while the other two of China’s big-three tech firms — Tencent Holdings Ltd and Alibaba Group Holding Ltd — spend billions of dollars expanding into sundry sectors in multiple markets.
Baidu said net profit hit 4.41 billion yuan (RM2.79 billion) in the three months through June, 83.5 per cent more than a year earlier when profit dropped by a third in what was the firm’s weakest result since listing in New York in 2005.
Last year’s profit drop coincided with investigations into how third parties used Baidu’s adver- tising service, prompted by the death of a cancer patient who found ineffectual treatment via ads placed with Baidu.
The probe in turn led to restructuring at Baidu which diverted resources from less-profitable ventures into AI, big data, cloud and video services — which contributed to its second-quarter profit jump.
The firm expects further growth with third-quarter revenue rising as much as 30 per cent over the same period last year.
“It’s done what it needed to do to make itself less dependent on search,” said Mark Natkin, managing director of Marbridge Consulting.
The firm has pulled resources from areas including group-buying service Nuomi in a reshuffle that prioritises the integration of AI into its ads business as well as its video site, autonomous driving platform and financial services.
Its latest change in financial services is a deal announced on Thursday with American payment service provider PayPal Holdings Inc, to give Chinese customers access to PayPal merchants using Baidu’s digital wallets. Reuters