On Tuesday, China’s Baidu Inc reported earnings results and its revenue for the third quarter surpassed Wall Street’s estimate. In the quarter, the company saw a recovery in its online advertising sales and growth in its cloud and artificial intelligence (AI) business.
Like many other businesses situated in China, Baidu’s business was affected by the strict Zero-COVID policies in the country which caused frequent lockdowns that affected economic activity. The company which derives most of its revenue from ads on its search engine has witnessed a recovery since the second quarter.
Revenue was up 2 percent to 32.54 billion yuan ($4.56 billion) in the third quarter that ended September 30th. Revenue for the third quarter surpassed analysts’ estimate of 31.79 billion yuan, according to data from Refinitiv.
The company’s non-online marketing revenue which houses cloud and its AI businesses, went up 25 percent year on year to 6.5 billion.
As a way of diversifying its revenue sources, Baidu has been placing a focus on self-driving technologies for the last five years. Last year, the company started charging fees for its robotaxi service Apollo Go on open roads. Over the quarter, Apollo Go operated at least 474,000 rides over the quarter and had a total of 1.4 million rides by the end of the third quarter.
In the third quarter, operating income went up to 5.32 billion yuan from the 2.31 billion yuan reported in the year-ago quarter. Excluding items, Baidu earned 16.87 yuan per American Depository Share (ADS).
During a conference call and while talking about the impact of the United State’s recent restrictions on the exportation of some chips to China, the company’s cloud chief Shen Dou said that this impact was only limited to the near future adding that most of Baidu’s AI businesses have only little dependence on highly advanced chips. He also added that the company had plans of developing its own AI chips in the future.