In online stock trading, it is important to keep tabs on seemingly unlikely stocks that, though not quite conspicuous, could eventually open up to massive opportunities.
For those looking to venture into Chinese markets, they must have heard of Baidu ($BIDU). People know of it as China’s leading search engine, the equivalent of Google in the country. And like Google, it is branching out into areas way beyond search, including deep-learning and artificial intelligence (AI). Let’s check out how the company is doing.
Baidu’s Steady Growth Pace
Baidu is on a steady growth pace. It posted $10.23 billion annual revenue in the 2015 financial year, which is 29.33% more than the 2014 revenue. During this period, from the 2014 to the 2015 financial years, the company’s income rose by more than twice the rate. It posted $2.45 billion revenue in the first quarter of the current fiscal, and $2.74 billion in the second quarter, and net income of $308 million and $368 million respectively.
In the 2015 financial year, 95% of the revenue of $BIDU came from online marketing, quite like global Internet tech giants such as Facebook ($FB) which earns 96% of its revenue, and Alphabet ($GOOG, $GOOGL) that earns 90% of its revenue, from marketing online. But Baidu is heading to areas beyond search and online marketing while ensuring that it maintains its dominance in the field.
Baidu’s Share in Chinese Search Engine Marketing
In 2015 Baidu had an 80.8% share of the revenue in the Chinese search engine marketing arena, which is expected to grow above 150 billion Yuan in 2018. This massive scope exists on account of the fact that Internet usage in China is only around 52%, which is significantly lower than the average usage in developed nations such as USA, UK, Canada, Japan and Russia. The Chinese government is looking to fix that through heavy investment of $22 billion for expanding wireless, broadband and fixed-line connectivity to ensure greater Internet usage and availability in people, particularly in the rural areas, by 2020.
Foray into Autonomous Transportation
In striking similarity to Google, Baidu has invested in developing an autonomous driving unit where it develops related technologies through a combination of artificial intelligence, big data, deep learning, high definition maps and advanced hardware. It has already partnered with NVIDIA for creating a cloud-to-car autonomous platform using AI for car manufacturers in China and abroad. It has even been permitted by the California Department of Motor Vehicles for testing these autonomous technologies.
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