Baidu Shares Drop After Company Announces Q2 Results

China’s Baidu announced its second quarter financial results this week and while they topped analysts forecasts, shares still slipped anyway on Thursday.

Baidu’s Nasdaq-listed shares (ticker: BAIDU) fell 3.9% after reporting a profit of $2.39 a share, beating forecasts for $2.07, on sales of $4.86 billion. This had come ahead of estimates of $4.78 billion.

“Baidu Core delivered another strong quarter, powered by the fast growth of our new AI business. AI enables businesses and local governments to do more and serve more people,” said Robin Li, co-founder and CEO of the company.

“We are excited about the opportunities to help different industries transform their business with AI and support our goal to become carbon neutral by 2030.”

“Baidu Core revenue grew 27% year over year in the second quarter, boosted by AI cloud growing 71% year over year,” said Herman Yu, the company’s CFO. “Baidu’s search and feed business was solid, and we continue to execute and lead on our new AI business, including AI cloud, autonomous driving and smart assistant.”

So why the drop in share price? It may be Wall Street’s concern over the current quarter.

Conservative revenue guidance for the September quarter has correlated with new outbreaks of the coronavirus in China.

“The Covid-19 situation in China is evolving and business visibility is limited,” Baidu said in their earnings release.

On another note, Baidu has also said its chief financial officer, Herman Yu, has been appointed chief strategy officer.

Shares of Baidu have fallen 26% so far in 2021.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.