CHINESE search engine Baidu.com has posted a whopping increase of 143 percent in first-quarter profit from a year ago.
The result came as more advertising customers increased their budgets to market products and services on its platform.
Net income was 85.5 million yuan (US$11.1 million), or 2.47 yuan diluted earnings per share, Beijing-based Baidu.com Inc said yesterday. Total revenue in the first three months of this year grew 103 percent from the same period last year to reach 275.6 million yuan, meeting the top range of company guidelines.
"During the first quarter, revenue continued to grow as more customers are realizing that Baidu's online marketing platform is a very effective way to promote their products and services," said Robin Li, Baidu's chairman and chief executive officer.
The number of active online marketing customers grew to more than 112,000, an increase of more than 50 percent from a year ago. They spent an average of 2,500 yuan on Baidu's search-related ads in the quarter.
But analysts said the search engine is depending too much on ads as its revenue source, which has caused it to lose growth momentum. The 103 percent sales growth in the quarter was the lowest since it floated shares on Nasdaq in 2005.
"The business model of depending too much on ads has limited its sales growth and has long-term risks for the company," said Shanghai-based consulting firm iResearch in a research note before Baidu's earnings release.
Baidu expects its second-quarter sales to rise 97 to 103 percent, ranging from 378 million yuan to 388 million yuan.
Baidu, the most used domestic search engine, had a 58 percent share of China's search market in the fourth quarter, far ahead of Google's 17 percent and Yahoo's 13 percent, according to Analysys International, a Beijing-based consultancy.
Google, the world's No. 1 search engine, is trying to catch up, launching nine new products like navigation services and mobile searches this year. Earlier this week, it announced a partnership with China Telecom, the nation's largest fixed-line phone operator, to manage and share the revenue of ads on China Telecom's 400-plus Web portals.
Source:佚名