China's Baidu misses quarterly revenue estimates on advertising weakness

Chinese search engine giant Baidu's (9888) quarterly revenue fell and was just shy of market estimates on Wednesday, signaling persistent weakness in the advertising market amid prolonged economic uncertainty.

US-listed shares of the company fell about 2 percent in premarket trading.

Slammed by a property market downturn, weak employment rates, and choppy consumer demand, companies in the world's second-largest economy have reined in advertising spending to cut costs and protect their margins.

Baidu, which relies heavily on advertising in its search engine, also took a hit. Its core online advertising business, which typically makes up 60 percent of the overall company revenue, reported a 15 percent decrease in revenue to 16.2 billion yuan (HK$17.6 billion) during the April-June quarter.

That eclipsed upbeat growth at the company's AI cloud segment, which drove a 34 percent increase in Baidu's non-online advertising business.

The company reported total revenue of 32.71 billion yuan during the second quarter, down 4 percent from the year earlier. Analysts on average estimated 32.76 billion yuan, according to data compiled by LSEG.

Reuters