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Baidu Stock Slumps As Tech Giant Cautions on Beijing Crackdown Hit to Ad Spend

Baidu, the Google of China, said ad spending would be hit by Beijing's ongoing crackdown on the tech sector, sending China-listed shares lower in New York trading.

Baidu Inc.'s  (BIDU) - Get Baidu Inc. Report U.S.-listed shares slumped lower Wednesday after the China-based tech giant cautioned on slowing ad sales amid Beijing's broader crackdown on corporate profits and business practices. 

Baidu, often referred to as the Google  (GOOGL) - Get Alphabet Inc. Class A Report of China, posted third quarter earnings of 14.66 Chinese yuan per share, with revenues rising 13% from last year to $31.9 billion yuan ($5 billion). Looking into the final months of the year, which will include sales from the early November 'Singles' Day' shopping event, Baidu said revenues would remain largely flat, with a midpoint of $4.8 billion, as ad sales slow amid Beijing's recent restrictions on the tech sector. 

"Our ad spend has been impacted by sectors like education, real estate and home furnishing, travel and franchising as we expect this headwind to continue in the near term," CEO Robin Li told investors Wednesday.   

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Baidu shares were marked 5.6% lower in mid-day trading Wednesday to change hands at $161.65 each. China-based companies with U.S. listings were also trading lower, with JD.com  (JD) - Get JD.com Inc. Report falling 3% to $83.11 and Alibaba Group Holding  (BABA) - Get Alibaba Group Holding Ltd. Report falling 3.9% to $161.90 each.

Earlier this year, Beijing regulators fined the group a record $2.8 billion as part of a far-reaching anti-monopoly probe by China’s State Administration for Market Regulation, which said some of its practices "infringe on the businesses of merchants on the platforms and the legitimate rights and interests of consumers."

China extended its crackdown on the tech industry in September ith a warning to the country's biggest companies to stop blocking links to their rivals' platforms.

In a move many analysts interpreted as another shot across the bow of tech giants Alibaba and Tencent  (TECHY) , China's Ministry of Industry and Information Technology said it was "guiding relevant companies to carry out self-examination and rectification" of their long-standing practice of blocking access to rivals.

A further report from London's Financial Times suggested Beijing was also readying plans to force the split of Ant Group's popular Alipay while creating a new payment app that will be at least partially state-owned.