Baidu beat Wall Street estimates for the first quarter of 2021, reporting a 25% bump in revenue of about $4.38 billion during an earnings call on Tuesday.
IBES data from Refinitiv predicted revenue of about $4.2 billion for Q1, according to Reuters, but the company has invested heavily in artificial intelligence and its cloud business, leading to a 70% year-on-year growth of its non-advertising revenue.
Herman Yu, CFO of Baidu, said during an earnings call that Baidu Core saw revenue growth of 34% year over year and that the company continues to "invest heavily in sales, R&D, and operations to support the rapid growth of our AI-powered business."
The company has faced pressure in recent years from major rivals like Alibaba and ByteDance, forcing them to expand beyond advertising revenue and diversify with more projects in cloud services, smart transport technology, and artificial intelligence.
Despite the increasing competition, Baidu still brought in $2.48 billion in online marketing revenue, a 27% jump year-over-year.
During the earnings call, the company said it expected to reach up to $5 billion in sales for Q2, while experts predicted about $4.6 billion.
"We are delighted to bring innovation across many sectors, including marketing cloud, enterprise cloud, smart transportation, autonomous driving, smart assistant and AI chip, through our decade-long investment in AI," said Robin Li, co-founder and CEO of Baidu.
"With AI powering the next stage of technology growth, many Baidu alumni have rejoined us, and our employees are energized from working on intelligent computing that can improve daily life and make the complex world simpler."
The company reported in March that it hit 558 million monthly active users on the Baidu App.