China’s search engine giant Baidu reported a 27.2 per cent increase in its Q3 net profit to CNY3.87 billion ($631.5 million) as revenue jumped 52 per cent to CNY13.5 billion ($2.2 billion).
The company said mobile traffic surpassed PC traffic and mobile revenue accounted for 36 per cent of total revenue. Baidu CFO Jennifer Li said its investments in mobile continued to pay off “as mobile proved to be a strong driver of top-line growth”.
The company noted tablet traffic and revenue, which had been included in the PC category, are now classified as mobile. If it had classified all tablets as mobile in the second quarter, its mobile revenue would have been 33 per cent instead of 30 per cent.
Online market revenue, which accounts for nearly all of its business, rose 51.8 per cent to CNY13.4 billion during the quarter from a year ago. The number of active online customers increased 11.2 per cent from Q3 2013 and was up 5.7 per cent from Q2. Revenue per customer expanded 35.6 per cent to CNY25,900 from a year ago.
Its traffic acquisition costs rose to 12.9 per cent of total revenue compared to 11.7 per cent in Q3 of last year. R&D expenses surged 68 per cent to CNY1.8 billion, which the company said was due to a sharp increase in R&D staff.
The company said EBITDA was up 23 per cent to CNY4.9 billion in Q3 and its earnings per share (diluted) was CNY11 ($1.79).
The company’s outlook for Q4 is another 45-50 per cent increase in revenue (CNY13.85-14.25 billion) but didn’t offer guidance on Q4 profit.