China's leading internet search engine, Baidu, announced a 6% increase in fourth-quarter revenue, driven by gains in its artificial intelligence applications and expanding advertising business.
With numbers from Reuters, it was found that in the three months ending December, the company reported revenue of 34.95 billion yuan ($4.92 billion). This aligns with analysts' average projection of 34.97 billion yuan, as per LSEG data.
Alongside this increase is Baidu's adjusted net income, which surged by 44% to 7.76 billion yuan ($10 billion), surpassing the previous year's 5.37 billion yuan ($7 billion) for the same period and exceeding analysts' expectations of 6.32 billion yuan ($8.7 billion).
Baidu, heavily reliant on advertising revenue, has ventured into AI investments amidst China's economic deceleration and reduced consumer spending.
In March 2023, it introduced its ERNIE Bot, akin to ChatGPT. Through this, Baidu aims to use AI applications to its fullest, with its services having begun contributing to its revenues significantly.
"Throughout 2023, we made significant strides in advancing ERNIE and ERNIE Bot, reinventing our products and services, and achieving breakthroughs in monetization," stated co-founder and CEO Robin Li.
The company's U.S.-listed shares experienced a 0.4% uptick in pre-market trading.
Similarly, Baidu's online marketing revenue surged 6% to 19.2 billion yuan ($26 billion). Its adjusted profit for the quarter stood at 21.86 yuan ($3.04) per American Depositary Share (ADS), surpassing the prior year's 15.25 yuan ($2.12) per share. This exceeded analysts' average forecast of 17.87 yuan ($2.48) per ADS, according to LSEG.
Meanwhile, Barrons describes it as a huge leap for Baidu since the surge in annual net income signals resilience and adaptability amidst regulatory challenges in China's tech sector.
Despite broader economic turbulence and regulatory oversight causing significant market capitalization losses since 2020, Baidu's positive performance reflects the tech industry's enduring importance as a driver of growth and employment in China.
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