Baidu Q3 profit doubles to $24.2m

Baidu Q3 profit doubles to $24.2m

China's search leader preps eBay-style auction site

Leading Chinese search firm Baidu has announced a doubling of profits to $24.2m in the third quarter compared to a year ago.

However, the company dampened investor expectations with conservative revenue forecasts for the fourth quarter.

Baidu chief executive Robin Li told analysts that third-quarter revenues rose 107 per cent year on year to reach $66.3m.

The company operates, China's most popular internet search website, and enjoys a market share estimated at more than 60 per cent. Second placed Google has between 20 and 25 per cent of the market.

Baidu's main revenue earner is advertising, and the company claimed that its advertising customers grew by almost 12 per cent.

"We added 15,000 new active online marketing customers during the quarter bringing the total to 143,000," said Li.

The average payment Baidu received from each online marketing customer increased 11 per cent quarter-on-quarter to reach $467.

Among a variety of new ventures, Baidu plans to open a new online auction website next year hoping to capitalise on its existing customer base in an already crowded market.

"Forty-nine per cent of China's current consumer-to-consumer users conduct searches before visiting e-commerce sites, so Baidu's high search traffic and large online community will be an enormous advantage," said Li.

China's online auction market is dominated by Yahoo's local partner Alibaba and its Taobao subsidiary.

However, despite Baidu's strong performance, the company's shares fell almost five per cent on Friday.

Investors had hoped for even better results and were disappointed by the company's conservative forecasts for the next quarter, local media reports said.