The leading Chinese language internet search provider, announces its unaudited financial results for the quarter ended September 30, 2012. Operating profit increased 48.1% from the corresponding period in 2011.
Baidu reported total revenues of RMB 6.251 billion ($994.6 million) for the third quarter of 2012, representing almost 50% increase from the corresponding period in 2011. Online marketing revenues for the third quarter of 2012 were RMB 6.246 billion ($993.8 million), representing a 49.6% increase from the corresponding period in 2011. Baidu says it has approximately 390,000 active online marketing customers in the third quarter of 2012, representing a 28.3% increase from the corresponding period in 2011. Revenue per online marketing customer for the third quarter was approximately RMB 16,000 ($2,546), a 16.8% increase from the corresponding period in 2011. "During the quarter, we worked to improve user experience by more closely integrating Baidu's suite of (...) vertical products with Web search, explained Robin Li, chairman and cofounder of Baidu.
Mobile search is the next battle
Mobile and cloud represent our vision for the future of China's Internet, and Baidu will continue to proactively drive the development of this crucial ecosystem. We stand ready to meet the challenges and capture the opportunities the PC-to-mobile transition presents." According to iResearch, Baidu market share in China’s search engine market in Q2 2012, was 79.4%. Sogou market share was to 2.9% and Google China market share was 16.2%. The Chinese mobile search market reached RMB 570 million in 2011, increasing by 96.6% compared with 2010. Analyst from iResearch estimated that 2012 will see the fastest increase in Chinese mobile search market and total revenues probably reach to RMB 1.25 billion.
Increasing expenses in the R&D
Baidu's traffic acquisition cost (TAC) was RMB 538.2 million ($85.6 million), representing 8.6% of total revenues, as compared to 8.0% in the corresponding period in 2011. Bandwidth costs were RMB 266.9 million ($42.5 million), representing 4.3% of total revenues, compared to 4.0% in the corresponding period in 2011. In term of expenses, Baidu says it has to increase its network infrastructure capacity, marketing and also personnel-related expenses, particularly in the R&D. Operating profit was RMB 3.297 billion ($524.6 million), representing a 48.1% increase from the corresponding period in 2011. Finally, net income attributable to Baidu was RMB 3.008 billion ($478.6 million), representing a 59.8% increase from the corresponding period in 2011. As of September 30, 2012, the Company had cash, cash equivalents and short-term investments of RMB 21.287 billion ($3.387 billion). Net operating cash inflow for the third quarter of 2012 was RMB 3.779 billion ($601.3 million). Capital expenditures for the third quarter of 2012 were RMB 504.3 million ($80.2 million).