Chinese tech giant Baidu on Wednesday posted fourth-quarter results that topped estimates for earnings, with revenue just below consensus expectations. But U.S.-listed Baidu shares fell following the report.
For its December quarter, Baidu said Wednesday that it earned RMB 21.86 ($3.04) per American depository share on sales of RMB 34.95 billion ($4.85 billion). On average, analysts polled by FactSet expected the Beijing-based company to earn RMB 17.55 per share on sales of RMB 35 billion.
Sales increased 6% year over year in local currency while adjusted earnings per share jumped 43%.
On the stock market today, Baidu stock lost 8% to close at 103.31.
Baidu's AI Push
Baidu, which operates China's top search engine, said average monthly active users for its app reached 667 million in December, up 3% from the same period last year.
Baidu last year launched a ChatGPT-like artificial intelligence chatbot called Ernie. Baidu Chief Executive Robin Li said in a news release that the company last year "made significant strides in advancing Ernie and Ernie Bot, reinventing our products and services."
For the December quarter, Baidu's online marketing sales climbed 6% year over year to RMB 19.2 billion. Meanwhile, nonmarketing revenue increased 9% to RMB 8.3 billion. Baidu credited the nonmarketing revenue growth to its AI Cloud business.
Baidu Stock Technical Scores
Coming into the report, Baidu stock was down about 3% to start 2024. U.S.-listed shares had lost 18% over the past 12 months. The company's share price has been stung by broader concerns about the Chinese economy.
According to IBD Stock Checkup, U.S.-listed shares of Baidu had an IBD Composite Rating of 64 out of 99. IBD's Composite Rating combines fundamental and technical metrics for an overview of a stock's strengths. The best-rated growth stocks have a Composite Rating of 90 or better.
Further, Baidu stock had a Relative Strength rating of 18 out of a best possible 99. The score indicates Baidu's stock price growth is outperforming just 17% of stocks over the past 52 weeks.
On the other hand, Baidu held an EPS Rating of 86 out of a best-possible 99. That highlights the company's earnings growth despite the lackluster share performance.
