Revenue: $1.92 B
FY 2014: $7.82 B
FY 2014: $5.22
• It’s important to understand that while Baidu is
growing revenue by leaps and bounds, earnings
are expected to jump by more modest amounts.
• This is because the company is investing heavily
in mobile and app platforms that should drive
both revenue and profitability for years to come.
Many will closely
paid clicks and cost
per click metrics.
Generally, as more mobile ads are displayed, cost per
click (CPC) goes down, as the total number of paid
clicks goes up.
• In 2013, paid clicks increased 33%. The company
usually only makes vague comments on paid click
increases in quarterly conference calls.
• In the fourth quarter of last year, CPC on mobile
devices was about 60% of what it was on desktop.
Management should comment on this in the
conference call, and investors should hope this
number moves ever-higher.
Internet is quickly
needs to maintain
dominance in the
mobile and PC
Total Search Market
Baidu once had a commanding 80% market share
of China’s PC search market. Qihoo has taken as
much as 25% of that, and Baidu now stands at 58%
among PC searches.
• However, Baidu still commands 73% of the
combined mobile/PC search market.
• As this is still primarily an advertising business,
sustaining market share is vital for the decades
You don’t necessarily need to invest in Chinese companies to profit from the
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does tons of business in Mainland China.
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