Baidu (BIDU) is a 0.46% position in Appaloosa’s ~$7 billion U.S. long portfolio.
Baidu, which is also dubbed as the “Google of China” reported strong results in the third quarter as revenue remained on a solid growth trajectory although its outlook was considered to be modest. The company generates most of its revenue from search advertising. Mobile search revenues in particular saw an increase in 3Q. The company is stepping up efforts to expand into the mobile search and software applications segment. With the acquisition of online video business of PPS, 91 Wireless last year and Renren’s remaining stake in Nuomi last month, Baidu has strengthened its mobile native app distribution capabilities.
In terms of guidance, the company expects total revenues for the fourth quarter to be between $1.51 billion and $1.55 billion, representing a 45.5%-to-49.6% year-over-year increase. Analysts are bullish about the stock, which was up almost 77% last year.
According to CNZZ, Baidu’s search engine market share by volume accounted for 63.1% in December 2013. However, the company is losing market share to rivals Qihoo 360 (QIHU) and Sogou, in which Tencent has a 36.5% stake.