Baidu's CEO Discusses 4Q2011 Results - Earnings Call Transcript
Baidu, Inc. (
)
Q4 2011 Earnings Call
February 16, 2011 8:00 p.m. EST
Executives
Victor Tseng – IR Director
Robin Li – Chairman and CEO
Jennifer Li – CFO
Analysts
Alex Yao – Deutsche Bank
Dick Wei – JPMorgan
Alicia Yap – Barclays Capital
[Yin Wong] – Nomura
Jiong Shao – Macquarie Group
Eddie Leung – Merrill Lynch
Yu Jin – CICC
Catherine Leung – Goldman Sachs
Cynthia Meng – Jefferies & Co.
Ming Zhao – SIG
Eric Wen – Mirae Asset Management
Aaron Kessler – Raymond James
Wallace Cheung – Credit Suisse
Ravi Sarathy – Citigroup
Richard Ji – Morgan Stanley
Wendy Huang – RBS
Elinor Leung – CLSA
Presentation
Operator
Hello and thank you for standing by for Baidu’s fourth quarter and full-year 2011 earnings conference call.
(Operator Instructions). Today’s question is being recorded. If you have any objections, you may disconnect at this time.
I would now like to turn the meeting over to your host for today’s conference, Victor Tseng, Baidu’s Investor Relations Director.
Victor Tseng
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Hello, everyone, and welcome to Baidu’s fourth quarter and full-year 2011 earnings conference call. Baidu’s earnings release was distributed earlier today, and you can find a copy on our website as well as on Newswire services.
Today you will hear from Robin Li, Baidu’s Chief Executive Officer, and Jennifer Li, Baidu’s Chief Financial Officer. After their prepared remarks, Robin and Jennifer will answer your questions.
Before we continue, please note that the discussion today will contain forward-looking statements made under the Safe Harbor Provisions of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include but are not limited to those outlined in our public filings with the SEC, including our annual report on Form 20-F. Baidu does not undertake any obligation to update any forward-looking statement except as required under applicable law.
Our earnings press release in this call includes discussions of certain unaudited non-GAAP financial measures. Our press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures and is available on our IR website at ir.baidu.com.
As a reminder, this conference is being recorded. In addition, a webcast of this conference call will also be available on Baidu’s IR website.
I will now turn the call over to Baidu’s CEO, Robin Li.
Robin Li
Hello, everyone, and welcome to today’s call. In the final quarter of 2011, we delivered strong financial results, driven by our relentless execution and ability to capitalize on exceptional market opportunities. Overall, 2011 was an extraordinary year for Baidu with strong financials and encouraging progress.
Today I’d like to take you through some of the achievements for the quarter and the year and discuss our strategy going into 2012. I’ll begin by looking at some of the advances we’ve made on the user front in Q4.
We made great strides in mobile strategy over the quarter. The mobile internet is growing at an astonishing pace in China, and Baidu has kept abreast of that growth. We devoted significant resources to enhancing user experience for our products and optimizing them for mobile. I'm pleased to say that all of our mobile products are growing very well and we expect to see strong growth momentum carrying into 2012.
Search query for mobile devices already represent more than 15% of our total search query volume. Smartphone shipments in China surpassed results in the US last quarter, and Baidu has positioned itself to capture this opportunity. Baidu is already the default search engine on 80% of branded Android handsets sold in China.
In addition, we developed a mobile phone platform called Baidu Yi to integrate our services, including web search, music, maps and LBS to ensure that users get the premium internet experience right on their mobile devices. Currently we have a partnership with Dell and we are looking forward to working with more vendors and to introducing Yi to many more users this year.
Building on our success in the desktop maps market where we have an 85% market share, we are moving ahead [full throttle] with [Mobile Maps 2]. The number of daily users using Baidu maps on mobile devices grew by more than 10 times in 2011. In Q4 we introduced a range of new services, including interior maps of shopping malls, airports and other large facilities, as well as satellite maps of major Chinese cities, in addition to 3D map services we were already offering. Meanwhile, we continue to deepen our partnerships with leading content providers and to more tightly integrate Baidu products like Symbian to offer Baidu maps users greater and more useful content.
Like cloud 2011, we made important progress on the user front. As a key part of our efforts to increase user engagement in September, we introduced Baidu’s a new personalized homepage feature. Using past search behavior and intelligent recommendation technology, the new homepage allows users to access much of the data content, services and apps they most want with just one click. Our landing page strategy helps to ensure that users enjoy an optimal experience even after they leave the Baidu site. We made great progress here by partnering with a large number of leading sites in important verticals like online video, travel, music, automotive, real estate and finance.
In the booming travel space, we signed a landmark deal to acquire a majority stake in the leading travel search provider Qunar. Qunar continues to grow well, and we have integrated its comprehensive travel database into our product lines.
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