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Jul. 27, 2015, 4:48 PM
- Though it posted in-line Q2 sales (and beat on EPS), Baidu (NASDAQ:BIDU) is guiding for Q3 revenue of RMB18.17B-RMB18.58B ($2.931B-$2.997B, +34.4%-37.4% Y/Y), below an RMB18.79B consensus.
- Mobile: After rising to 50% of revenue Q1 from 42% in Q4 and 36% in Q3, mobile remained at 50% of revenue in Q2. Mobile search monthly active users (MAUs) +24% Y/Y to 629M; mobile maps MAUs +48% to 304M.
- Metrics: Online ad customers rose 12.6% Q/Q and 20.9% Y/Y to 590K. Revenue per ad customer rose 15.1% Q/Q (seasonality) and 13.2% Y/Y to $4,419. GMV for online-to-offline (O2O) services rose 109% Y/Y to $6.5B.
- Financials: Spending remains aggressive: SG&A spend rose 81% Y/Y to $627.4M, and R&D spend rose 56.2% to $437.5M. Traffic acquisition costs were 12.7% of revenue, down 80 bps Q/Q and flat Y/Y. Bandwidth costs fell to 5.4% of revenue from 5.8% a year ago; content costs (online video-driven) rose to 5.1% from 3%. Baidu ended Q2 with $12.1B in cash, and $657M in debt.
- Baidu has fallen to $186.80 AH.
- Q2 results, PR
- Yesterday: Baidu investing heavily in O2O services to head off mobile app threat
- Update (5:08PM ET): Shares are now down 9% AH.
Jul. 27, 2015, 4:32 PM
- Baidu (NASDAQ:BIDU): Q2 EPS of RMB11.19 beats by RMB0.61.
- Revenue of RMB16.58B (+38.3% Y/Y) in-line.
- Shares -6%
Jul. 26, 2015, 5:35 PM
Jul. 26, 2015, 4:05 PM
- "[A] lot of the companies that started to build their own apps — they don’t allow us to index their content ... If they go directly to those apps and get the services, they don’t need search anymore because search is just for information," observes Baidu (NASDAQ:BIDU) CEO Robin Li in an interview, suggesting his company's plans to pour billions into developing online-to-offline (O2O) services is partly an effort to address the challenge posed to search by mobile apps. "We need to [directly] connect people with services — mobile buying, movie tickets, these sort of high frequency services."
- Li adds Baidu's O2O investments go well beyond developing sites/apps. "You need a large salesforce. You need to talk to those mom-and-pop shops face-to-face. You need a lot of people who are paid one tenth of a Google engineer, you need to manage that kind of workforce to do that." In late 2014, Baidu invested in UBER, arguably the world's most successful O2O platform to date and a company rapidly expanding its Chinese footprint.
- He estimates 99% of the local service providers signed up for Baidu's O2O platform are new customers, rather than existing search ad buyers. "They don’t have a powerful website to advertise, those mom-and-pop shops. When we run their services, we do it ourselves. We take photos of their dishes ourselves, and put it on our site."
- When asked why Baidu invested in Uber over Chinese rival Didi Kuaidi (backed by Alibaba, Tencent, and SoftBank), Li notes Uber agreed to integrate Baidu's mapping and payment services with Uber's Chinese apps. Didi Kuaidi supports Alibaba's Alipay and Tencent's WePay services.
- Baidu's Q2 report arrives on Monday afternoon.
Jul. 17, 2015, 12:59 PM
- Add Baidu (NASDAQ:BIDU) to the list of companies - see also Facebook, LinkedIn, and Priceline - shooting higher after Google (up over 14%) provided market-pleasing Q2 figures and CC remarks.
- Google, of course, gets only a small % of its revenue from China, after having shut down Google.cn in 2010. Much of the company's Chinese business revolves around ad sales to Chinese companies looking to reach potential overseas buyers.
- Baidu's own Q2 report is due on July 27. The Chinese search giant is up 11% from a July 8 low of $178.81 (hit as Chinese tech stocks nosedived), and trades for 22x a 2016 EPS consensus of $9.15. 2015 and 2016 revenue growth consensus estimates are at 38.4% and 32.8%.
Jul. 16, 2015, 5:41 PM
Jul. 7, 2015, 11:08 AM
- Though not seeing the 10%+ declines witnessed by many U.S.-traded Chinese tech peers, Alibaba (NYSE:BABA) and Baidu (NASDAQ:BIDU) are down sharply following fresh overnight losses for the Shanghai and Shenzhen exchanges.
- Yahoo (NASDAQ:YHOO), whose 384M-share Alibaba stake is currently worth $29.4B, is once more following in Alibaba's footsteps. The Nasdaq is down 1.5%.
- Alibaba has made fresh post-IPO lows. Baidu is less than $7 away from a 52-week low of $176.69. Alibaba now trades for 21x an FY17 (ends March '17) EPS consensus of $3.72. Baidu trades for 20x a 2016 EPS consensus of $9.29.
Jun. 30, 2015, 1:44 PM
- Baidu (BIDU +0.1%) plans to spend RMB20B ($3.22B) over the next 3 years in growing its online-to-offline (O2O) service offerings, including its Nuomi group-buying/daily deals platform. CEO Robin Li: "Right now Baidu has over fifty billion [yuan] in cash on its books ... We're going to take 20 billion of that and do Nuomi right."
- In addition to Nuomi, Baidu's O2O efforts cover services such as food delivery and movie ticket bookings; it has also taken a stake in Uber. The Chinese search giant is counting its huge mobile user and local advertiser bases to give it an edge. Alibaba has also shown a strong interest in O2O services.
- The spending commitment comes shortly after Baidu priced a $1.25B debt offering.
- See also: O2O Can Be Baidu's Next Growth Driver
Jun. 25, 2015, 5:35 PM
Jun. 23, 2015, 11:05 PM
- Baidu (NASDAQ:BIDU) is selling $750M worth of 3% notes due 2020, and $500M worth of 4.125% notes due 2025.
- Net proceeds are expected to total $1.24B. The offering stands to raise Baidu's debt balance to ~$1.9B, and its cash/short-term investment balance to ~$10.9B.
- Previously: Baidu plans to sell 5-year and 10-year debt
Jun. 23, 2015, 8:39 AM
- Baidu (NASDAQ:BIDU) plans a debt offering of 5-year and 10-year dollar-denominated notes The offering's size remains unknown for now. Yields are expected to be 160bps and 200bps above those of comparable Treasurys. The company only says proceeds will be used for "general corporate purposes."
- Moody's has given the offering, which comes a year after Baidu sold $1B worth of 5-year debt, an A3 (upper medium grade) rating. The Chinese search giant had $9.36B in cash/short-term investments at the end of Q1, and over $650M in debt.
- Shares are up fractionally premarket.
Jun. 18, 2015, 12:02 PM
- Nokia (NOK +1.5%) is "leaning toward" selling its HERE mapping/navigation software unit to a consortium featuring HERE clients BMW, Audi, and Daimler, Bloomberg reports. However, the automakers reportedly "may hesitate to pay the as much as $4 billion being sought for the unit."
- Final bids are said to be due this week. One source states Baidu (NASDAQ:BIDU), which previously teamed with UBER and P-E firm Apax, may join the automakers' bid. Apax and other P-E firms have dropped out of the bidding.
- Last month, the NYT reported Uber had bid up to $3B for HERE, and Reuters reported the automakers' bid was backed by P-E firm General Atlantic.
Jun. 14, 2015, 11:19 AM
- Alibaba (NYSE:BABA) is planning to build China's version of Netflix (NASDAQ:NFLX) and HBO (NYSE:TWX) via a new service called Tmall Box Office.
- "We want to create a whole new family entertainment experience," Alibaba's Liu Chunning told reporters in Shanghai.
- TBO will launch in about two months, with content bought from China and other countries, as well as in-house productions.
- Related tickers: Tencent (OTCPK:TCEHY), Baidu (NASDAQ:BIDU), Sohu (NASDAQ:SOHU)
Jun. 11, 2015, 3:15 PM
- BMW (OTCPK:BAMXY) and Baidu (NASDAQ:BIDU) plan to start road testing a self-driving car the two companies are developing together later this year.
- The partners aim to create a prototype that can be taken out on highways in Beijing and Shanghai.
- Some automobile industry watchers think self-driving cars will be used for commercial purposes (delivery, shuttles, taxis) before being produced for the mass-market segment.
- Google is now building its own self-driving protoypes after relying on Lexus and Toyota models previously.
Jun. 1, 2015, 7:35 PM
- "On May 8, 2015, we received an unsolicited offer from Ctrip.com International (NASDAQ:CTRP), Ltd., or Ctrip, to acquire all of our outstanding shares," says Qunar (NASDAQ:QUNR) in its Q1 report. "After careful consideration of such offer, we declined to pursue it in a letter response dated June 1, 2015 ... we remain open to engaging in further discussions with Ctrip as well as with other strategic players in our sector."
- Bloomberg reported of Ctrip/Qunar merger talks back in 2014; antitrust approval of a deal could prove difficult, given the companies' combined Chinese online travel share. Since the time of Ctrip's offer, Ctrip has struck a deal to buy a 37.6% stake in smaller rival eLong, and has received a new $250M investment from Priceline.
- Also: Effective today, Qunar has terminated its Zhixin cooperation agreement with parent Baidu (NASDAQ:BIDU), through which Qunar ran an online travel marketplace for which Baidu promised to drive a guaranteed amount of traffic. SA author John Zhang has argued the deal was unfair to Qunar, noting (among other things) Baidu gets 76% of all Zhixin revenue beyond a "benchmark" level, and that Qunar has been paying Baidu huge sums for marketing services.
- Baidu has been given (and has exercised) warrants for 11.45M Qunar Class B shares (equal to 3.82M ADS, current value of $180M) for the traffic it drove. At the same time, Baidu is paying Qunar an RMB207M ($33.4M) termination fee.
- Meanwhile, Qunar has entered into a deal with Baidu (expires in May 2016, subject to renewal) through which "Baidu has agreed to grant Qunar an exclusive right to integrate hotel information and products into the PC and mobile app versions of Baidu Maps."
- On an RMB basis, Qunar is guiding for 105%-110% Y/Y Q2 revenue growth, a faster clip than Q1's 100%. The consensus is for 75.9% dollar-based growth.
- QUNR +2.3% AH to $47.05.
May 18, 2015, 3:10 PM
- Bloomberg reports Baidu (BIDU -0.8%) is teaming with top ride-sharing platform Uber and P-E firm Apax Partners to jointly bid for Nokia's (NOK +0.7%) HERE mapping/navigation software unit. Sources state the business could fetch as much as $4B.
- A rival group consisting of Chinese messaging/gaming giant Tencent (OTCPK:TCEHY), Chinese mapping firm/Tencent partner NavInfo, and Swedish P-E firm EQT Partners is also reportedly bidding. A group of German automakers (mentioned in past reports) and a trio of P-E firms are reportedly interested as well, and Microsoft (NASDAQ:MSFT) has offered to buy a minority stake.
- The next round of bids are reportedly due in 2 weeks. Baidu is said to be partnering with Uber to "avoid regulatory scrutiny." The NYT previously reported Uber has bid up to $3B for HERE, which has a dominant position in the in-car automotive market.
- Separately, Baidu has announced a "strategic investment" in content recommendation platform Taboola - readers may be familiar with the "Recommend for you" article boxes Taboola provides at the bottom of articles on partner sites. The WSJ reports Baidu, which plans to bring Taboola's platform to China, invested $20M-$30M.
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