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Investing.com -- Baidu reported better-than-expected third-quarter profit and revenue as the Chinese internet giant’s cloud business continued to grow at a rapid pace, sending its shares up more than 2% in premarket trading on Tuesday.
The company posted earnings per share (EPS) of RMB11.12, well above the analyst estimate of RMB8.37, while total revenue fell 7% year over year to RMB31.17 billion, but ahead of the RMB30.89 billion consensus.
Baidu Core revenue declined 7% to RMB24.7 billion ($3.46 billion). Online marketing remained under pressure, dropping 18% to RMB15.3 billion ($2.16 billion), while non-online marketing revenue rose 21% to RMB9.3 billion ($1.31 billion), supported by continued growth in AI Cloud.
AI Cloud Infra continued to expand at a strong pace, with third-quarter revenue rising 33% year over year to RMB4.2 billion. Subscription-based AI accelerator infrastructure was the standout, surging 128% from a year earlier.
Streaming unit iQIYI generated RMB6.7 billion ($939 million), an 8% year-over-year decline.
"In the third quarter, we demonstrated AI’s transformative value across our portfolio. AI Cloud maintained solid growth momentum, driven by broadening enterprise adoption of our AI products and solutions," said Robin Li, Co-founder and CEO of Baidu.
Baidu’s adjusted EBITDA for the quarter fell 49% to RMB4.43 billion, while margin contracted to 14% from 26% a year earlier.