Before the US stock market opens on May 16th, Baidu released its first quarter financial report for 2024. The report shows that Baidu's first quarter revenue was 31.5 billion yuan, a slight increase of 1% year-on-year, slightly exceeding the expected 31.43 billion yuan.
In the first quarter, Baidu's net profit attributable (Non-GAAP) to Baidu was 7.011 billion yuan, a year-on-year increase of 22%. Net profit attributable to Baidu's core (Non-GAAP) was 6.628 billion yuan, a year-on-year increase of 26%, both exceeding market expectations. The core operating profit margin (Non-GAAP) was 23.5%.
Specifically in terms of profitability, operating profit was 6.673 billion yuan, a 4% increase year-on-year, net profit attributable to Baidu was 5.4 billion yuan, net profit attributable to Baidu's core was 5.2 billion yuan, and the net profit margin of Baidu's core was 22%.
Adjusted earnings per ADS were 19.91 yuan, exceeding the estimated 15.59 yuan; adjusted core operating profit for Baidu was 5.59 billion yuan, also exceeding the expected 5.14 billion yuan. Adjusted EBITDA was 8.2 billion yuan, with an adjusted EBITDA profit margin of 26%.
After the financial report was released, Baidu's US stock rose by 2% pre-market. In addition, Baidu stated that starting from the first quarter of 2024, the amount of Baidu's share repurchase was 229 million US dollars, with a cumulative repurchase amount of 898 million US dollars under the 2023 share repurchase plan.
<h2>Core Revenue Continues to Grow, AI Continues to Drive Cloud Revenue Growth</h2>
Baidu's total revenue in the first quarter was 31.5 billion yuan, a 1% year-on-year increase; core revenue was 23.8 billion yuan, a 4% year-on-year increase.
Among them:
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Core online marketing revenue remained stable at 17 billion yuan, a 3% year-on-year increase;
Non-online marketing revenue was 6.8 billion yuan, a 6% year-on-year increase, mainly driven by the intelligent cloud business. Baidu stated that the end-to-end optimization of its artificial intelligence technology stack continued to drive the growth of intelligent cloud revenue this quarter.
iQIYI revenue was 7.9 billion yuan, a 5% year-on-year decrease.
From a cost perspective, revenue costs in the first quarter decreased slightly compared to the previous quarter, with little change compared to the same period last year. Sales costs were 15.3 billion yuan, a 1% year-on-year increase, mainly due to the increase in traffic acquisition costs and costs related to the intelligent cloud business, partially offset by the decrease in content costs
Research and development, sales, and administrative expenses have decreased, with sales and administrative expenses totaling RMB 5.4 billion, accounting for 17% of total revenue for the quarter, compared to 18% in the same period last year. Research and development expenses were RMB 5.4 billion, a 1% decrease year-on-year, mainly due to reductions in personnel-related expenses and other research and development expenses, partially offset by increased depreciation expenses for servers supporting the development of generative AI and server rack fees.
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<h2>Baidu's Autonomous Driving Orders Increase by 25% YoY</h2>
In terms of AI, Baidu expanded its Wenxin series models in the first quarter and launched multiple lightweight large language models. At the same time, Baidu introduced and improved its MaaS platform tools for enterprise customers, aiming to promote the development of native AI applications, intelligent bodies, and the creation of customized models on Baidu's MaaS platform.
As of mid-April 2024, the number of developers on Baidu's PaddlePaddle community has reached 13 million.
In terms of overall mobile ecosystem, Baidu App's monthly active users in March reached 676 million, a 3% increase year-on-year, with hosted pages accounting for 53% of Baidu's core online marketing revenue in the first quarter of 2024.
In terms of intelligent driving, in the first quarter, Baidu's autonomous ride-hailing service Luobo Kuaipao provided approximately 826,000 autonomous driving orders, a 25% year-on-year increase. As of April 19, 2024, Luobo Kuaipao has provided over 6 million autonomous driving travel service orders to the public.
Baidu's co-founder and CEO Robin Li said:
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As the new era of Chinese generative AI unfolds, foundational models like Wenxin will serve as essential infrastructure, integrating into various aspects of people's lives. We are making the Wenxin series models increasingly affordable and efficient. This should bring greater opportunities to Baidu in the future.
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Baidu's CFO Herman Yu said:
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In the first quarter of 2024, Baidu's core operating profit margin (Non-GAAP) reached 23.5%, achieving growth year-on-year and quarter-on-quarter. We have established a track record of continuously improving operational efficiency, and in the coming quarters, we will take necessary measures to enhance operational efficiency to support our AI business and high-quality growth, while maintaining a healthy operating profit margin (Non-GAAP)
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Baidu's first-quarter revenue was 31.5 billion yuan, a slight increase of 1% year-on-year, with a net profit attributable to Baidu (Non-GAAP) of 7.011 billion yuan, a 22% year-on-year growth

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Baidu rises 2% in pre-market trading, Q1 net profit increases by 22% year-on-year, AI continues to drive cloud revenue growth | Financial Report Insights