Baidu, (NASDAQ:BIDU) the ‘Chinese Google’, saw revenues slow in its latest quarter a trend it expects to continue.
Increased advertising spending lifted revenues by a third 18.7bn yuan ($2.86bn), though this still represented the worst growth rate in a quarter for seven years.
Operating income rose to 3.87bn yuan as Baidu cut back on spending on online –to-offline developments, well ahed of forecasts.
That helped shares climb sharply in New York after hours trading despite the cautious tone the company adopted, which has been spending heavily to reposition itself for the surge in the Chinese mobile market
Robin Li, chairman, told analysts revenue from mobile advertising eventually could surpass that on computers.
“On mobile we can be more targeted. We know more about the user, we know the location of the user and we can enable all kinds of user actions," he told analysts.
Revenue is forecast grow to 27.8-32.5% in the current (first) quarter it said, or between 15.4bn yuan and 16 billion yuan, compared to estimates of 16.3bn yuan.
Including the gain on the disposal of online travel business Qunar Cayman Islands last October, income came in at 24.71bn yuan, or 70.92 yuan per American depositary share.