China's Baidu revenue falls as AI cloud growth fails to offset ad weakness

BEIJING: Baidu Inc. reported a 10% year-on-year drop in revenue for the fourth quarter, missing analyst expectations as growth in its AI cloud business was insufficient to compensate for a slump in its core advertising segment. The company's total revenue stood at 31.64 billion yuan ($4.40 billion) for the three months ended December 31, compared to 35.08 billion yuan a year earlier. This figure fell short of the 31.80 billion yuan average estimate from 27 analysts polled by Refinitiv. Baidu's advertising revenue, which has historically been its primary income source, declined by 9% year-on-year. While the company highlighted strong performance in its cloud services, driven by its artificial intelligence initiatives, this growth was not enough to fully counteract the downturn in advertising. The results underscore the ongoing challenges Baidu faces in diversifying its revenue streams amidst a shifting digital advertising landscape.