Google’s Chinese Competitor Baidu Doubles Profit
In terms of dollars, Baidu is still far behind Google. But in terms of percentages, the Chinese search engine bested its American competitor, posting third-quarter profits that were up 113 percent over last year’s.
That number corresponded to a similar increase in revenue, and both figures reportedly beat analysts’ expectations. Baidu is still dominating the Chinese market, too; Google has only managed to make headway of the two-steps-forward-one-step-back variety.
Nonetheless, not everything went well after Baidu released its earnings report. An AP article notes, “Despite the better-than-expected results, investors seemed to want more. Baidu’s U.S.-traded shares fell $11.12, or 3.3 percent, to $323.18 in after-hours trading.”
Since Baidu’s net income only totaled $24 million, that drop doesn’t seem too unreasonable. Also, although the Chinese search engine has frequently benefited from government intervention, that practice may come to a stop as the 2008 Olympics take place, giving investors even more reason to worry.
In other Chinese search engine news, Google’s Kai-Fu Lee has announced plans to focus on the mobile market. It’s possible (though unlikely) that this could have been another factor in Baidu’s drop.