22 Apr

What Affected Baidu’s Revenue in 2018?

WRITTEN BY Adam Rogers

Sales rose over 21% in 2018

Sales of Chinese (FXI) Internet giant Baidu (BIDU) rose 21% YoY (year-over-year) to $15 billion in 2018. The company’s sales rose 53% in 2014, 35% in 2015, 6.3% in 2016, and 20% in 2017.

Baidu’s sales in 2018 were driven by its online marketing sales, which rose over 19% to $11.9 billion. The company’s number of active online marketing customers rose 10% to 856,000. Its revenue per online customer amounted to $13,900—a rise of 10%.

What Affected Baidu’s Revenue in 2018?

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Other revenue for Baidu rose by a significant 86% to $3 billion driven by growth in its iQIYI membership services, its cloud vertical, and other segments. Baidu’s core sales rose 14% YoY to $3 billion.

The number of daily active users on the Baidu App reached 161 million in 2018, a rise of 24% YoY.

Cost drivers for Baidu in 2018

Baidu’s content costs rose 75% YoY to $3.42 billion in 2018 driven by its increased investments in its iQIYI content and BJH accounts. Its traffic acquisition costs amounted to $1.66 billion and rose 18% in 2018.

Its bandwidth costs rose 17% to $944 million. Other costs, including depreciation, share-based compensation, and operational costs, rose 7% to $1.51 billion in 2018. A rise in promotional spending drove the company’s selling, general, and administrative costs up 46% to $2.80 billion.

Baidu continues to invest in research and development. These costs increased 22% to $2.29 billion in 2018.

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