China’s Baidu Misses Expectations As Net Profit Crashes 18.9%

Chinese search engine company Baidu published its unaudited financial report for the first quarter ended March 31, 2016, stating that its total operating revenue reached CNY15.821 billion, which was about USD2.454 billion and a year-on-year increase of 24.3%. But its net profit decreased by 18.9% year-on-year to CNY1.987 billion, which was about USD308.1 million.

Based on the average expectations of Wall Street analysts and calculated by GAAP, Baidu's expected earnings per share was CNY5.96. The financial report showed that Baidu's earnings per share was CNY5.38 during the first quarter of 2016, which failed to meet the expectations. Meanwhile, based on the average expectations of Wall Street analysts, Baidu's expected operating revenue was CNY15.83 billion. The financial report showed that Baidu's operating revenue was CNY15.821 billion during the reporting period, which basically met the expectation.

According to the company's report, in March 2016, Baidu's mobile search business had 663 million monthly active users, an increase of 9% compared with the same period of last year; its mobile map business had 321 million monthly active users, an increase of 19% compared with the same period of last year.

From January to March 2016, Baidu's gross merchandise volume was CNY16 billion, which was about USD2.5 billion and a year-on-year increase of 268%. By the end of March 2016, Baidu Wallet had 65 million active accounts, representing a year-on-year increase of 152%.

In addition, Baidu announced a personnel change to its board. William Decker, former member of the board and chairman of audit committee, left the board due to retirement and replaced by Brent Callinicos. Callinicos once worked for Uber as CFO and became independent director of Baidu in October 2015.