Baidu's Advertising Business Recovery Tied to China's Outlook -- Market Talk
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Express News | Huaxing Securities (Hong Kong) has downgraded the rating of Baidu Group ADR to hold, with a target price of 86 dollars.
Bocom intl lowers the target price for Baidu (09888.HK) to 105 yuan, noting the cashing process next year.
Bocom Intl released a report stating that Baidu (09888.HK) had third-quarter revenue of 33.6 billion yuan, a 3% year-on-year decrease, which was basically in line with the bank's and market's expectations. Adjusted net profit was 5.9 billion yuan, corresponding to a net profit margin of 18%, lower than the bank's and market's expected 5%, marketing and management expenses increased by 2% year-on-year, higher than the bank's expected 4%, due to channel expenditures and promotional expenses. The report indicated that Baidu's advertising revenue is expected to continue to be impacted by the transformation of AI search-generated results crowding out traditional search ad positions, and the positive boost of offline consumer policy may be reflected next year. Therefore, the advertising revenue for the fourth quarter is expected to be impacted.
"Big Bank" htsc lowered the target price of baidu (BIDU.US) to $119.8, with AI contributions continuously increasing.
HTSC research report pointed out that Baidu (BIDU.US) third-quarter total revenue of 33.6 billion yuan, a 2.6% year-on-year decrease, the growth rate basically meets expectations. Non-GAAP net profit was 5.9 billion yuan, corresponding to a non-GAAP net profit margin of 17.5%, a decrease of 3.6 percentage points year-on-year, lower than expected, mainly due to exchange losses. The bank recommends paying attention to the progress of Baidu's AI search commercialization transformation and the recovery pace of advertising business demand. The bank stated that Baidu's AI contribution continues to increase, but fundamental stability takes time, maintaining a "buy" rating on US stocks with a US stock target.
Baidu's core net profit in Q3 exceeded expectations, and a new version of the Wenxin large model is about to be released.
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