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Baidu revenue rises the most in a year as China’s internet companies refocus on growth
- Beijing-based Baidu reports a 15 per cent rise in sales to 34.1 billion yuan for the June quarter, beating estimates for 33.3 billion yuan
- The search engine giant is riding on a recovery in advertising and consumer spending from the Covid-19 pandemic era
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Baidu’s revenue rose the most in more than a year, joining China’s largest internet companies in rediscovering growth after Beijing relaxed its grip on the private sector to try and jump-start a faltering economy.
Its shares rose about 4 per cent in pre-market trading in New York. The company reported a 15 per cent jump in sales to 34.1 billion yuan (US$4.7 billion) for the June quarter, versus estimates for 33.3 billion yuan. Net income rose 43 per cent to 5.2 billion yuan.
Like Alibaba Group Holding and Tencent Holdings, China’s search leader is riding a recovery in advertising and consumer spending from the depths of the Covid Zero era in 2022. That is despite increasing turbulence in the world’s No 2 economy that emerged in past months, from stubbornly high unemployment to a property crisis. On Tuesday, video platform Kuaishou Technology reported its first net income on record after sales beat expectations.
Investors for now are focused on Baidu’s artificial intelligence (AI) ambitions, since the Chinese company demonstrated its domestic leadership by unveiling a ChatGPT-rival called Ernie in March. Alibaba and Tencent have since joined a parade of start-ups in touting their own large language models to try and match OpenAI’s seminal creation in recent months, raising questions about whether Baidu can sustain its current lead.
Baidu reiterated that it has upgraded the AI model underpinning Ernie Bot, its answer to ChatGPT, without mentioning a date for a public roll-out.
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In June, the company – also China’s leader in autonomous driving – claimed Ernie has outperformed ChatGPT on several measures. But Tencent said last week its own model in development was already one of China’s best, while Alibaba is integrating a ChatGPT-like AI into its meeting and messaging apps.
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