Baidu Posts 50 Pct. Revenue Growth But Shy Of Investor Hopes

Chinese search engine and advertising provider Baidu announced quarterly earnings today. The company fell just shy of financial analysts’ estimates, which were $1.54 billion (51 percent growth). Instead, the company announced $1.573 billion in revenue, which was a 50.3 percent increase from a year ago.

For fiscal 2013, Baidu reported total revenues of $5.277 billion, a roughly 43 percent increase over 2012. Profit was $1.849 billion, which was a very tiny 1.3 percent increase vs. a year ago.

The company also reported 753,000 active advertisers for 2013 (and 451,000 in Q4). The 753,000 figure represented growth of 26.3 percent over last year. Revenue per marketer for the year grew 13 percent to a relatively modest $6,971.

Traffic acquisition costs as a percentage of overall revenue went up to $194.3 million in the quarter (12.3 percent of revenue). A year ago, that number was under 10 percent. Increased traffic costs were attributed to higher fees paid to publishers in Baidu’s distribution network. Most other costs increased at the company as well.

Baidu is the leading search engine in China. It dominates the market in that country the way Google does in other markets.

Here’s another estimate of search traffic from Q3 2013 with quite different figures:

• Baidu: 69 percent
• Qihoo: 15 percent
• Sogou: 8.9 percent
• Soso: 3.5 percent
• Google: 2.1 percent

StatCounter offers yet another estimate of search traffic (including mobile) that estimates Baidu’s share at just under 58 percent and Google at 7.6 percent.