Flat top-line quarterly growth and operating in a relatively sluggish economy put the hurt on Baidu (BIDU 3.95%) stock Thursday. The veteran Chinese tech company's American depositary shares (ADSs) declined by more than 4% following its latest quarterly earnings hitting the news feeds. By comparison, the S&P 500 index fell by a relatively light 0.9% on the day.
Top- and bottom-line declines in the second quarter
For its second quarter, Baidu posted revenue of 33.9 billion yuan ($4.8 billion), a figure marginally lower than the slightly over 34 billion yuan ($4.8 billion) it earned in the same period of 2023. What didn't help was a slide in online marketing revenue, an important business for the company; this fell by 2% to just over 19 billion yuan ($2.7 billion).
Non-GAAP (adjusted) net income saw a steeper drop than those two line items, falling by 8% year over year to a bit under 7.4 billion yuan ($1 billion). Per-ADS, the company's adjusted profitability was 21.02 yuan ($2.95).
This meant a mixed quarter for the sprawling tech company. The consensus analyst estimate for revenue was 34.14 billion yuan ($4.8 billion), and that for adjusted net income was 18.54 ($2.60) per ADS.
NASDAQ: BIDU
Key Data Points
Of AI and robotaxis
Baidu devoted plenty of ink to the hot technology of 2024, artificial intelligence (AI), in its earnings release. Progress in the segment wasn't enough to compensate for sluggishness elsewhere in its business, however. On a brighter note, its robotaxi service Apollo Go saw a leap in volume, with its roughly 899,000 rides during the quarter representing a 26% year-over-year improvement.
