Baidu’s online advertising sales returned to growth in Q1, after declining throughout 2022, with the company benefitting from the end of Covid-19 (coronavirus) restrictions in China.
On an earnings call, CEO Robin Li highlighted double-digit revenue growth, driven by various verticals in offline sectors including travel, healthcare and business services.
He said a contributing factor to Baidu’s growth was an overall improvement in China’s economic recovery and commercial environment.
Li cited generative AI as an opportunity for Baidu, noting it is testing a standalone chatbot application.
“AI chatbots will become a traffic gateway for people to seek information and content. Therefore, we should continue to gain user traffic and mindshare, which will drive monetisation over time.”
Baidu’s AI cloud unit achieved profitability in Q1, with Li noting the company focused on building sustainable growth for its cloud business by phasing out low-quality projects and businesses starting in Q2 2022.
The company booked a net profit of CNY5.8 billion ($829.1 million) compared with a loss of CNY885 million in Q1 2022.
Revenue increased 10 per cent to CNY31.1 billion.
Online marketing revenue rose 6 per cent to CNY16.6 billion,
Offline ad revenue increased 11 per cent to CNY6.4 billion.
Video streaming platform iQIYI booked a 27.7 per cent increase in average daily subscribing members to 219 million, with revenue up 15 per cent to CNY8.1 billion.
Monthly active users (MAUs) of the Baidu app increased 4 per cent to 657 million.
R&D expenses fell 3 per cent to CNY5.4 billion.