Baidu Posts Increases In Net Income, Sales; But Outlook Misses

Baidu (NSDQ: BIDU) once again posted big increases in profit and revenue, but the Chinese search giant also said it expected its sales during the fourth quarter to be below analyst forecasts as it completes its switch to a new ad system. Revenue increased 39 percent during the quarter, while net income increased nearly 42 percent. Both numbers easily topped analyst estimates and emphasized China’s continued strength as an internet market; Google (NSDQ: GOOG) also called attention to its strong performance in China during its own earnings report two weeks ago.

3Q 2008 3Q 2009 Estimate
EPS $1.47 $2.07 $1.81
Net Income $51.2M $72.2M
Revenue $134.12M $187.3M $187.79M

The company also said that 70 percent of its customers were now using the new ad system, Phoneix Nest, which it introduced in April. Baidu says it will make a full switch to Phoenix Nest in December, a decision which will result in only “moderate year-over-year growth” next quarter. The company says it expects revenue to be between $174 million and $180 million during the fourth quarter; on average, analysts had been expecting sales of nearly $203 million.

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