Baidu, the leading internet search provider in China, has announced a 3% decrease in its third-quarter revenue, aligning with market forecasts.

The decline is attributed to reduced spending on its advertising services, affecting its core search business.

Despite the fall in ad revenue, Baidu’s total revenue for the quarter ending September 30 reached 33.56 billion yuan (US$4.6 billion). This figure slightly surpassed the analyst consensus of 33.43 billion yuan.

Net income rose to 7.63 billion yuan (US$1.05 billion), exceeding expectations of 4.67 billion yuan (US$644.8 million), bolstered by growth in its AI Cloud segment.

Baidu is diversifying into autonomous driving and AI. It has integrated its Ernie LLM into various applications, including a chatbot similar to ChatGPT.

However, online ads remain a primary revenue source, making the company vulnerable to economic downturns that lead businesses to cut ad spending.

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