Baidu Inc (NASDAQ:BIDU) reported better-than-expected earnings for its third quarter and also announced plans to buy JOYY's live streaming business in China for $3.6 billion in cash.
In the third quarter, total revenues reached RMB 28 .2 billion ($4 .16 billion U.S.), increasing 1% year over year.
Revenue from Baidu Core reached RMB 21 .4 billion ($3 .15 billion U.S.), increasing 2% year over year. Online marketing revenue from Baidu Core was RMB 18.4 billion ( $2.72 billion U.S. ), which was basically flat from last year. Non-online marketing revenue from Baidu Core reached 2.9 billion ($434 million), increasing 14% year over year, primarily driven by the growth of cloud services.
Cost of revenues was RMB 12.8 billion ($1.89 billion), decreasing 22% year over year, primarily due to a decrease in content costs, traffic acquisition costs and costs of goods sold.
Selling, general and administrative expenses were RMB 4 .7 billion ($692 million), increasing 1% year over year.
"Our revenue growth turned positive in the third quarter with many advertising verticals turning around, putting Baidu in a good position to further benefit from a recovery in the Chinese economy. The vibrant mobile ecosystem that Baidu has built in the last few years sets a strong foundation for us to grow our non-advertising business," said CEO Robin Li.
"Our new AI businesses saw healthy growth in the third quarter, particularly from cloud, where we are differentiating with AI solutions."
BIDU shares decreased $5.71, or 3.9%, to $142.13.
