On Thursday, the Chinese search engine giant Baidu released an official statement announcing that it has exceeded the market estimates for fourth-quarter revenue and profit. The credit for such a smashing fourth quarter should be given to its online marketing business which continued to grow at a decent pace even after facing severe competition and its streaming service iQiyi which saw a substantial surge in overall revenue.
The Chinese search engine giant has now decided to invest and expand rapidly to other sectors such as video streaming and upcoming technologies like artificial intelligence which will help the firm in generating greater revenue and also make up for the declining advert sales from industries such as real estate, finance etc. that are affected heavily by the ongoing economic slowdown in China.
For the past year, the company has been investing to a great extent on original content for its streaming service iQiyi and marketing for onboarding new customers principally to reduce dependence on its search business as its online ad sales are on the verge of dying.
“We have entered a new stage for the Chinese internet, new growth will be driven by technological innovation, and for our core search and news feed we continue to see a lot of room to grow,” Robin Li, CEO of Baidu, told market analysts during a conference call.
As of now, Baidu’s online marketing business which comprises of search, news feed, and a video application is responsible for more than three-quarters of its overall revenue, however, it grew barely 10 percent in the fourth quarter whereas the company’s streaming service iQiyi saw a boost of more than 55 percent.
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