Baidu defies controversy with revenue surge

The search engine, which came under fire last year for mixing paid-for and organic results and for carrying ads for unlicensed medical firms, launched a TV campaign over Chinese New Year to reassure Chinese consumers.

In the fourth quarter of last year, Baidu posted a total marketing revenue of US$132.1 million, up 58 per cent year on year but down two per cent on the third quarter. Net income stood at $42.3 million, up 33.7 per cent increase compare to the same corresponding period in 2007.

For the full year, marketing revenues stood at $468.2 million, an 83.5% increase from 2007.

The rise of internet users in China also accounts for the increase in traffic and client spending. More than 30 per cent increase in users is expected this year.

However, Baidu warned of slower growth ahead. “We expect moderate year-over-year growth for the first quarter of 2009 due to two factors. First, we anticipate a portion of our online marketing customers may scale back on marketing spending given the current market environment. Second, we expect that the removal of certain sponsored links during the fourth quarter of 2008 resulted in a net loss of around five per cent of revenue, impacting the first quarter.”