Chinese search engine Baidu Inc. reported stronger-than-expected second-quarter results driven by growth of video-streaming business iQiyi.
Revenue for the quarter ended June 30 totaled 26.3 billion yuan ($3.73 billion), up 1.4% from the same period last year, and beat an average estimate of $3.66 billion. Net income was 2.41 billion yuan in the second quarter, compared with 6.4 billion yuan a year ago, according to the financial report released after the market close. In the first quarter this year, Baidu posted its first quarterly loss since its 2005 stock market debut.
Second-quarter revenues from online marketing declined 9% year-on-year to 19.2 billion yuan, while other revenues increased 44% to 7.1 billion, driven mainly by robust growth in iQiyi membership services, cloud and smart devices, Baidu said.
The online video streaming service contributed 7.1 billion yuan of revenue in the quarter, a 15% rise from a year ago. Membership services at iQiyi grew 38% year-over-year, while online advertising revenue fell 16%. Subscribers to iQiyi reached 100.5 million in June 2019, increasing 50% year-over-year.
For the third quarter of 2019, Baidu expects revenue to be between 26.9 billion yuan and 28.5 billion yuan, representing a decrease of 5% to an increase of 1% year-on-year, the company said.
Baidu’s stock surged more than 9% in after-hours Nasdaq trading. The company’s market value has declined by $66 billion since its peak in May 2018, removing it from the list of China’s five most valuable internet companies.