Baidu sees ad revenue shrink 8% in Q2

/ / News

American depositary receipts of China-based search engine Baidu Inc. fell more than 6% in the extended session Thursday after the company reported an adjusted profit above Wall Street expectations and sales that met forecasts, but said its online ad sales fell 8% year-on-year. Baidu said it earned RMB3.6 billion ($507 million), or $1.46 per ADR, in the quarter, compared with earnings of RMB2.4 billion a year ago. Adjusted for one-time items, the company earned $2.08 an ADR. Revenue fell 1% to RMB26.03 billion, or $3.7 billion, the company said. Analysts polled by FactSet expected adjusted earnings of $1.36 per ADR on sales of $3.7 billion. Online marketing revenues were RMB 17.7 billion ($2.50 billion), down 8%, the company said. “With COVID-19 becoming more manageable in China, Baidu’s business is steadily rebounding,” co-founder and Chief Executive Robin Li said in a statement, echoing a statement he made in May. Baidu guided for third-quarter revenue between RMB26.3 billion ($3.7 billion) and RMB28.7 billion ($4.1 billion), representing a negative growth rate of 6% and a growth rate of 2% year over year. “The COVID-19 situation in China is evolving, and business visibility is very limited,” with the guidance “subject to substantial uncertainty,” the company said in the statement.
Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.