Inc., China's most-used Internet search engine, said fourth-quarter profit increased almost fourfold
after advertising sales beat expectations. The shares soared 12 percent."
"China's Internet users rose 18 percent last year to 111 million, the world's second-largest Internet market behind the U.S., prompting more companies to advertise online, according to Ministry of Information data. Baidu.com more than doubled spending on research and tripled marketing outlays in the quarter as Google
Inc. and Yahoo!
Inc. stepped up competition for users.
``The Internet market in China is still in the early stages and is an extremely promising industry
,'' said Safa Rashtchy, an analyst at Piper Jaffray in Menlo Park, California, who rates Baidu shares ``underperform.'' Competition in China ``is getting heated and these companies have access to more money and costs are increasing
.''Press ReleaseFourth Quarter and Fiscal Year 2005 Highlights
*Fourth quarter 2005 total revenues increased to $14.2 million, representing a 29.2% increase from the previous quarter and a 167.7% increase from the corresponding period in 2004.
*Fiscal year 2005 total revenues increased to $39.6 million, representing a 171.8% increase from 2004.
*Fourth quarter 2005 net income increased to $3.0 million, representing a 188.7% increase from the previous quarter and a 285.6% increase from the corresponding period in 2004.
*Fiscal year 2005 net income increased to $5.9 million, representing a 296.5% increase from 2004. Basic and diluted EPS for 2005 were $0.30 and $0.18, respectively; basic and diluted EPS excluding share-based compensation expenses (non-GAAP) for 2005 were $0.51 and $0.31, respectively.
*The number of active online marketing customers during the fourth quarter grew to over 63,000, an increase of 18.6% from the previous quarter.
*Outlook for First Quarter 2006
Baidu currently expects to generate total revenues in an amount ranging from $15.5 million to $16.1 million for the first quarter of 2006, representing a 174% to 185% increase from the corresponding period in 2005.