(Reuters) –China‘s Baidu Inc beat analysts’ estimates for quarterly revenue and adjusted profit on Wednesday, helped by stronger demand for its artificial intelligence (AI) and cloud products.
Baidu, called China’s Google, has forayed into AI, cloud and autonomous driving to supplement its core search business that has been pressured by competition and a regulatory crackdown. Last year, it launched robotaxi services in Beijing.
“Baidu Core delivered another solid quarter, powered by our AI cloud revenue growing 73% year-over-year,” said Rong Luo, chief financial officer of Baidu.
Baidu’s U.S.-listed shares, which have slumped 21% this year, were up 1.4% at $173.8 premarket.
The company‘s results come amid a wide-ranging regulatory crackdown by China on its technology sector that includes heavyweights like Tencent and Alibaba in a bid to keep a check on their monopolistic practices.
Earlier this month, Tencent Holdings warned the outlook for the advertising sector would remain weak into next year.
Baidu’s largest segment, online marketing, rose 6% this quarter. However, the growth rate has been slowing in the last two quarters.
In a bid to expand its portfolio, the company has entered into a partnership with Chinese auto manufacturer Geely to develop electric vehicles, a fast-evolving sector where many tech companies are looking to make a mark.
Baidu expects current-quarter revenue to be between 31 billion yuan and 34 billion yuan, largely in line with analysts’ expectation of 32.60 billion yuan, according to Refinitiv IBES data.
Its streaming affiliate, iQIYI, which saw its subscribers reach 104 million in September, also reported a 6% rise in revenue during the quarter.
Baidu’s third-quarter revenue was 31.92 billion yuan ($5.00 billion) versus estimates of 31.71 billion yuan.
On an adjusted basis, the company earned 14.66 yuan per ADS, compared to 12.81 yuan per ADS estimates.
($1 = 6.3811 Chinese yuan renminbi)
(Reporting by Tiyashi Datta and Akash Sriram in Bengaluru; Editing by Shailesh Kuber)
