China search leader Baidu (BIDU), facing tough competition from China's other so-called BAT internet leaders, posted a Q4 decline on the top and bottom lines after the close Thursday, but earnings beat expectations and shares rose late.
BAT stands for Baidu, Alibaba (BABA) and Tencent (TCEHY), companies that have branched into a number of online markets, including AI and self-driving cars, which have become big areas of focus for Baidu. The company views Duer digital assistants — voice-activated smart-home speaker systems — as a key element of its strategy. It also is a big arena for Amazon.com (AMZN), Google-parent Alphabet (GOOGL) and, probably sometime soon, Apple (AAPL), among others.
Wall Street Q4, Q1 estimates: Analysts polled by Thomson Reuters expect Baidu to post Q4 earnings per share minus items of 91 cents. Year-over-year figures are hard to pin down, though in Q4 2015 Baidu posted EPS ex items of $1.18. Thomson Reuters and some other sources, perhaps because of exchange rates, have slightly different figures. Analyst consensus on revenue is $2.67 billion, where the company reported $2.89 billion a year ago. At the reported figures, EPS ex items would plunge 23% and sales fall 7.6%. For Q1, analysts see EPS ex items of 77 cents on revenue of $2.47 billion. For Q1 2016, Baidu had reported EPS ex items of $1.05 on revenue of $2.45 billion.
Q4 results, Q1 guidance: The company posted sales of $2.62 billion, which it said was down 2.6% from Q4 2015 but would have been flat excluding Qunar Cayman Islands, an online travel company. In a stock swap, China travel firm Ctrip (CTRP) gained control of Qunar, with Baidu getting a stake in Ctrip that was 25% as of last year. Baidu reported non-GAAP earnings per share of 93 cents excluding a stock swap with China ride-hailing service Didi Chuxing that gave Didi control of Uber China. Otherwise, it reported non-GAAP EPS of $1.91. For Q1, the company expects revenue of $2.41 billion at the midpoint of its guidance range, which it said represents an increase of 4.2% to 7.6%.
Q3 results: The company posted EPS ex items of $1.49, vs. $1.46 in the year-earlier quarter, and revenue of $2.74 billion, vs. $2.89 billion. At those figures, EPS edged up 2% though revenue fell 5.4%.
Stock: Baidu stock was up 2% in after-hours trading Thursday, after its earnings release, with its conference call with analysts slated for later in the day. Shares fell 0.74% to 184.64 in the stock market today as several Chinese internet stocks sold off. Shares have been in a seven-month consolidation, with a buy point of 201.10.
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