(Reuters) – Baidu Inc (BIDU.(O) beat analysts ‘ estimates for the quarter, earnings and revenue on Tuesday, helped by strong growth in its streaming video platform, iQIYI, to the transmission of the Chinese search-engine giant’s shares are up 5% after market.
FILE PHOTO: A man takes a photo at the end of 2018 Baidu World conference and exhibition, Beijing, China, on November 1, 2018. REUTERS/Jason Lee
The company has been trying in order to reduce dependence on its core business of search and to extend it to other areas, such as cloud services and artificial intelligence, but a lot of her success to date has been in the streaming video service, iQIYI, Inc., and IQ.D).
The revenues from iQIYI, which is in competition with Alibaba-backed (BABA).N), Youku, and Tencent Holdings ‘ (0700.HK) Tencent Video, were up more than 7% up to 7.4 billion yuan ($1.06 billion) in the same way as if the service crossed a 105.8-million-subscribers-in September of this year.
IQIYI, the shares were up 4 percent in extended trading.
The results, as Baidu combat a slowdown in the Chinese economy against the backdrop of a prolonged trade war with the United States, a tighter advertising regulations, and increasing competition from rivals such as ByteDance the TikTok.
Alibaba Group Holding Ltd. last week it was in profit and revenue expectations, which shows how the diversification strategies of one of the tech giants, it would help to change the macro-economic pressures.
The diversification comes at a price. Baidu’s total costs and expenses jumped more than 8.0% to 25.73 billion yuan in the previous quarter), while the content cost has increased by 4.5%.
The sales of the company’s online marketing services for business, including search, news feeds, and a video of the app, and is a major contributor to the total revenue, was down 9% to 20.43 billion yuan.
Baidu, whose search engine dominates the market in China, and forecast fourth-quarter revenue of between 27.10 billion yuan, and 28.70 billion yuan, while analysts had expected 27.52 billion yuan, according to IBES data, Refinitiv.
The net loss attributable to owners of the company is to 6.37 billion yuan in the third quarter, ended Sept. 30, compared with a net income of 12.40 billion yuan, a year earlier.
With the exception of the items, the company earned 12.61 yuan per American depositary share (ADS), beating the estimates of 7.88 yuan per ADS.
The total turnover declined marginally to 28.08 billion yuan, of 28.20 billion yuan. Analysts on average had expected 27.49 billion yuan.
The company’s US-listed shares, which have fallen more than 32% this year, an increase of approximately 5% to $112.74 in extended trading.
Reporting Akanksha Rana, Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta