Baidu, Inc. Set for Fourth Quarter Earnings Report Amid Difficult Conditions
Baidu, Inc. (BIDU) is set to announce its fourth-quarter 2024 results on February 18.
Revenue and Earnings Projections
The Zacks Consensus Estimate predicts revenues of $4.56 billion, reflecting a decrease of 7.31% compared to the same quarter last year.
Earnings are expected at $1.73 per share, which represents a significant drop of 42.2% from the previous year’s results. This estimate has fallen by 12.3% in the last month.
Baidu, Inc. Stock Performance and EPS Surprise
Baidu, Inc. price-eps-surprise | Baidu, Inc. Quote
For the latest EPS forecasts and surprises, check Zacks Earnings Calendar.
BIDU has beaten EPS estimates in each of the last four quarters, averaging a surprise of 10.17%.
What to Expect from Baidu
Baidu is likely to report disappointing results for the fourth quarter of 2024, facing several challenges. In the third quarter, revenue fell 3% year over year to RMB33.6 billion ($4.78 billion), highlighting ongoing difficulties.
The online marketing division, a critical revenue stream, saw a 4% drop in revenue from the previous year. This trend may persist due to a sluggish recovery in China’s economy and reduced advertising budgets.
Although Baidu is investing heavily in AI and autonomous driving, these efforts may pressure profit margins without delivering immediate results.
China’s economic landscape remains challenging, with deflationary issues and real estate market worries affecting both ad spending and business investment. Furthermore, Baidu’s iQIYI segment has struggled, reporting a 10% revenue decrease in the third quarter, with expectations for continued weakness.
While growth has been noted in Baidu’s AI Cloud services, it has not compensated for declines in its core areas. The company’s focus on cost control for maintaining margins hints at limited growth prospects. Additionally, Baidu faces fierce competition in the AI sector and an unpredictable regulatory environment, complicating its efforts to sustain market share and shareholder value.
Current Earnings Predictions for BIDU
Our model does not predict a favorable earnings surprise for Baidu this time. A combination of positive Earnings ESP along with a Zacks Rank of #1 (Strong Buy), #2 (Buy), or #3 (Hold) would typically increase the chances of an earnings beat, but Baidu falls short in this area.
Baidu has an Earnings ESP of -11.55% and a Zacks Rank of #4 (Sell). Discover stocks with better chances of success using our Earnings ESP Filter.
Additional Stock Considerations
Investors may find these stocks interesting as they have the potential for earnings surprises this quarter.
Akamai Technologies (AKAM) has an Earnings ESP of +0.09% and a Zacks Rank of #2. They are expected to report results on February 20, with an earnings estimate of $1.52 per share, down slightly over the last two months. AKAM shares have declined 20.3% over the past year.
Autohome (ATHM) shows an Earnings ESP of +11.32% and also has a Zacks Rank of #2.
Set to report on February 20, Autohome’s earnings estimate stands at 53 cents per share, reflecting an 8.6% drop from the same quarter last year. ATHM shares, however, have increased by 5.7% in the last year.
Sabre (SABR) boasts an Earnings ESP of +25.93% and has a Zacks Rank of #3.
Reporting results on February 20, Sabre is estimated to post a loss of 7 cents per share, which is an improvement over the 12-cent loss reported last year. SABR shares have seen a significant decrease of 21.2% over the past year.
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Baidu, Inc. (BIDU): Free Stock Analysis Report
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
