Baidu reported non-GAAP earnings of $3 per share on revenues of $4.16 billion, ahead of FactSet consensus estimates for earnings of $1.98 per share and in line with revenue estimates.
Separately on Monday after the close, Baidu announced that it had agreed to buy the Chinese live streaming business of JOYY Inc. for $3.6 billion in cash and expected the deal to close in the first half of 2021. The business includes the YY mobile app, YY.com website and PC YY.
Shares of Baidu were falling 1.6% to $145.48 after the results were released.
"Our revenue growth turned positive in the third quarter with many advertising verticals turning around, putting Baidu in a good position to further benefit from a recovery in the Chinese economy,” said Robin Li, co-founder and CEO of Baidu. “The vibrant mobile ecosystem that Baidu has built in the last few years sets a strong foundation for us to grow our non-advertising business.”
Baidu CFO Herman Yu added that "our team executed in the third quarter with top line growth, resilient profitability and strong cash flow, a testament to the durability of Baidu's business, despite China experiencing a second wave of COVID-19 in July."
For the fourth quarter, Baidu said it expects revenues to be between RMB 28.6 billion ($4.2 billion) and RMB 31.3 billion ($4.6 billion), representing a growth rate of -1% to 8% year over year. Consensus Q4 estimates call for revenue to be right at the midpoint of that guidance range, or $4.4 billion.
Speaking specifically of the deal with JOYY, Li said in a statement that “this transaction will catapult Baidu into a leading platform for live streaming and diversify our revenue source."