Baidu, Inc 6-K, filed Feb 28, 2024
Baidu, Inc. (BIDU)
About this 6-K
Baidu, Inc filed this 6-K on February 28, 2024.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of February 2024
Commission File Number: 000-51469
BAIDU, INC.
Baidu Campus
No. 10 Shangdi 10th Street
Haidian District, Beijing 100085
The People’s Republic of China
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Exhibit 99.1 — Press Release
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| BAIDU, INC. | ||||
| By | : | /s/ Rong Luo | ||
| Name | : | Rong Luo | ||
| Title | : | Chief Financial Officer | ||
Date: February 28, 2024
Exhibit 99.1
Baidu Announces Fourth Quarter and Fiscal Year 2023 Results
BEIJING, China, February 28, 2024 — Baidu, Inc. (NASDAQ: BIDU and HKEX: 9888 (HKD Counter) and 89888 (RMB Counter)) (“Baidu” or the “Company”), a leading AI company with a strong Internet foundation, today announced its unaudited financial results for the quarter and fiscal year ended December 31, 2023.
“Baidu Core reported another solid quarter,” said Robin Li, Co-founder and CEO of Baidu. “Throughout 2023, we made significant strides in advancing ERNIE and ERNIE Bot, reinventing our products and services, and achieving breakthroughs in monetization. Concurrently, our core business remained resilient and healthy. Looking ahead, our commitment to Gen-AI and foundation models remains unwavering, paving the way for the gradual creation of a new growth engine.”
“In the fourth quarter, we maintained our focus on enhancing operational efficiencies,” said Rong Luo, CFO of Baidu. “As we look ahead into 2024, our goal is to persistently enhance operational efficiencies and achieve high-quality growth.”
Fourth Quarter and Fiscal Year 2023 Financial Highlights1
| Baidu, Inc. | ||||||||||||||||||||||||||||||||||||
| (In millions except per ADS, unaudited) | Q4 | Q3 | FY | |||||||||||||||||||||||||||||||||
| 2022 | 2023 | Q4 2023 | YOY | 2022 | FY 2023 | YOY | ||||||||||||||||||||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||||||||||||||||||
| Total revenues |
33,077 | 34,447 | 34,951 | 4,923 | 6 | % | 123,675 | 134,598 | 18,958 | 9 | % | |||||||||||||||||||||||||
| Operating income |
4,593 | 6,274 | 5,392 | 759 | 17 | % | 15,911 | 21,856 | 3,078 | 37 | % | |||||||||||||||||||||||||
| Operating income (non-GAAP)2 |
6,497 | 7,596 | 7,075 | 996 | 9 | % | 23,186 | 28,433 | 4,005 | 23 | % | |||||||||||||||||||||||||
| Net income to Baidu |
4,953 | 6,681 | 2,599 | 366 | (48 | %) | 7,559 | 20,315 | 2,861 | 169 | % | |||||||||||||||||||||||||
| Net income to Baidu (non-GAAP)2 |
5,371 | 7,267 | 7,755 | 1,092 | 44 | % | 20,680 | 28,747 | 4,049 | 39 | % | |||||||||||||||||||||||||
| Diluted earnings per ADS |
13.59 | 18.22 | 6.77 | 0.95 | (50 | %) | 19.85 | 55.08 | 7.76 | 177 | % | |||||||||||||||||||||||||
| Diluted earnings per ADS (non-GAAP)2 |
15.25 | 20.40 | 21.86 | 3.08 | 43 | % | 58.93 | 80.85 | 11.39 | 37 | % | |||||||||||||||||||||||||
| Adjusted EBITDA2 |
8,231 | 9,505 | 9,057 | 1,276 | 10 | % | 29,663 | 35,823 | 5,046 | 21 | % | |||||||||||||||||||||||||
| Adjusted EBITDA margin |
25 | % | 28 | % | 26 | % | 26 | % | 24 | % | 27 | % | 27 | % | ||||||||||||||||||||||
| 1 | Unless otherwise noted, RMB to USD was converted at an exchange rate of RMB 7.0999 as of December 29, 2023, as set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System. Translations are provided solely for the convenience of the reader. |
| 2 | Non-GAAP measures are defined in the Non-GAAP Financial Measures section (see also “Reconciliations of Non-GAAP Financial Measures to the Nearest Comparable GAAP Measures” for more details). |
1
| Baidu Core | ||||||||||||||||||||||||||||||||||||
| (In millions, unaudited) | Q4 2022 | Q3 2023 | Q4 2023 | YOY | FY 2022 | FY 2023 | YOY | |||||||||||||||||||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||||||||||||||||||
| Total revenues |
25,654 | 26,572 | 27,488 | 3,872 | 7 | % | 95,431 | 103,465 | 14,573 | 8 | % | |||||||||||||||||||||||||
| Operating income |
3,782 | 5,498 | 4,668 | 657 | 23 | % | 14,534 | 18,825 | 2,651 | 30 | % | |||||||||||||||||||||||||
| Operating income (non-GAAP)2 |
5,491 | 6,672 | 6,197 | 873 | 13 | % | 20,948 | 24,748 | 3,486 | 18 | % | |||||||||||||||||||||||||
| Net income to Baidu Core |
4,773 | 6,436 | 2,440 | 344 | (49 | %) | 7,551 | 19,401 | 2,733 | 157 | % | |||||||||||||||||||||||||
| Net income to Baidu Core (non-GAAP)2 |
4,915 | 6,956 | 7,500 | 1,056 | 53 | % | 19,935 | 27,418 | 3,862 | 38 | % | |||||||||||||||||||||||||
| Adjusted EBITDA2 |
7,146 | 8,513 | 8,118 | 1,143 | 14 | % | 27,088 | 31,863 | 4,488 | 18 | % | |||||||||||||||||||||||||
| Adjusted EBITDA margin |
28 | % | 32 | % | 30 | % | 30 | % | 28 | % | 31 | % | 31 | % | ||||||||||||||||||||||
Operational Highlights
Corporate
| • | Baidu returned US$318 million to shareholders since the beginning of Q4 2023, bringing the cumulative repurchase to US$669 million under the 2023 share repurchase program. |
AI Cloud
| • | PaddlePaddle developer community has grown to 10.7 million and has served 235,000 businesses, as of the end of 2023. Developers have created 860,000 models on PaddlePaddle by the end of 2023. |
Intelligent Driving
| • | Apollo Go, Baidu’s autonomous ride-hailing service, provided about 839K rides in the fourth quarter of 2023, up 49% year over year. As of January 2, 2024, accumulated rides provided by Apollo Go on public roads surpassed 5 million. |
| • | In the fourth quarter of 2023, the proportion of fully driverless orders within the overall order portfolio in Wuhan reached 45%, up from 40% in the third quarter of 2023. |
2
Mobile Ecosystem
| • | In December 2023, Baidu App’s MAUs reached 667 million, up 3% year over year. |
| • | Managed Page accounted for 51% of Baidu Core’s online marketing revenue in the fourth quarter of 2023. |
iQIYI
| • | iQIYI’s average daily number of total subscribing members for the quarter was 100.3 million, compared to 111.6 million for the fourth quarter of 2022 and 107.5 million for the third quarter of 2023. More importantly, iQIYI’s monthly average revenue per membership (ARM) for the quarter was RMB15.98, compared to RMB14.17 for the fourth quarter of 2022 and RMB15.54 for the third quarter of 2023. |
Fourth Quarter 2023 Financial Results
Total revenues were RMB35.0 billion ($4.92 billion), increasing 6% year over year.
| • | Revenue from Baidu Core was RMB27.5 billion ($3.87 billion), increasing 7% year over year; online marketing revenue was RMB19.2 billion ($2.70 billion), up 6% year over year, and non-online marketing revenue was RMB8.3 billion ($1.17 billion), up 9% year over year, mainly driven by AI Cloud business. |
| • | Revenue from iQIYI was RMB7.7 billion ($1.09 billion), increasing 2% year over year. |
Cost of revenues was RMB17.4 billion ($2.45 billion), increasing 3% year over year, primarily due to an increase in costs related to AI Cloud business, partially offset by a decrease in content costs.
Selling, general and administrative expenses were RMB5.9 billion ($825 million), which remained flat compared to the same period last year.
Research and development expenses were RMB6.3 billion ($886 million), increasing 11% year over year, primarily due to an increase in server depreciation expenses and server custody fees which support Gen-AI research and development inputs.
Operating income was RMB5.4 billion ($759 million). Baidu Core operating income was RMB4.7 billion ($657 million), and Baidu Core operating margin was 17%. Non-GAAP operating income was RMB7.1 billion ($996 million). Non-GAAP Baidu Core operating income was RMB6.2 billion ($873 million), and non-GAAP Baidu Core operating margin was 23%.
Total other loss, net was RMB2.5 billion ($356 million), compared to total other income, net of RMB1.8 billion for the same period last year, mainly due to a pickup of losses from an equity method investment as a result of a modification of certain terms of the underlying preferred shares.
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Income tax benefit was RMB96 million ($14 million), compared to income tax expense of RMB1.3 billion for the same period last year, mainly due to a change of certain subsidiaries’ amounts of valuation allowance for deferred tax assets.
Net income attributable to Baidu was RMB2.6 billion ($366 million), and diluted earnings per ADS was RMB6.77 ($0.95). Net income attributable to Baidu Core was RMB2.4 billion ($344 million), and net margin for Baidu Core was 9%. Non-GAAP net income attributable to Baidu was RMB7.8 billion ($1.09 billion). Non-GAAP diluted earnings per ADS was RMB21.86 ($3.08). Non-GAAP net income attributable to Baidu Core was RMB7.5 billion ($1.06 billion), and non-GAAP net margin for Baidu Core was 27%.
Adjusted EBITDA was RMB9.1 billion ($1.28 billion) and adjusted EBITDA margin was 26%. Adjusted EBITDA for Baidu Core was RMB8.1 billion ($1.14 billion) and adjusted EBITDA margin for Baidu Core was 30%.
As of December 31, 2023, cash, cash equivalents, restricted cash and short-term investments were RMB205.4 billion ($28.93 billion), and cash, cash equivalents, restricted cash and short-term investments excluding iQIYI were RMB200.0 billion ($28.17 billion). Free cash flow was RMB7.0 billion ($980 million), and free cash flow excluding iQIYI was RMB6.3 billion ($894 million).
Fiscal Year 2023 Results
Total revenues were RMB134.6 billion ($18.96 billion), increasing 9% year over year.
| • | Revenue from Baidu Core was RMB103.5 billion ($14.57 billion), increasing 8% year over year; online marketing revenue was RMB75.1 billion ($10.58 billion), up 8% year over year, and non-online marketing revenue was RMB28.4 billion ($3.99 billion), up 9% year over year. |
| • | Revenue from iQIYI was RMB31.9 billion ($4.49 billion), increasing 10% year over year. |
Cost of revenues was RMB65.0 billion ($9.16 billion), increasing 2% year over year, primarily due to an increase in traffic acquisition costs, partially offset by a decrease in content costs and costs related to AI Cloud business.
Selling, general and administrative expenses were RMB23.5 billion ($3.31 billion), increasing 15% year over year, primarily due to an increase in channel spending and promotional marketing expenses.
Research and development expenses were RMB24.2 billion ($3.41 billion), increasing 4% year over year, primarily due to an increase in server depreciation expenses and server custody fees which support Gen-AI research and development inputs.
4
Operating income was RMB21.9 billion ($3.08 billion). Baidu Core operating income was RMB18.8 billion ($2.65 billion), and Baidu Core operating margin was 18%. Non-GAAP operating income was RMB28.4 billion ($4.01 billion). Non-GAAP Baidu Core operating income was RMB24.7 billion ($3.49 billion), and non-GAAP Baidu Core operating margin was 24%.
Total other income, net was RMB3.3 billion ($472 million), compared to total other loss, net of RMB5.8 billion last year, mainly due to a fair value gain of RMB198 million from long-term investments this year, compared to a fair value loss of RMB3.9 billion last year; and a decrease of RMB2.2 billion in impairment of long-term investments.
Income tax expense was RMB3.6 billion ($514 million), increasing 42% year over year, primarily due to an increase in profit before tax.
Net income attributable to Baidu was RMB20.3 billion ($2.86 billion), and diluted earnings per ADS was RMB55.08 ($7.76). Net income attributable to Baidu Core was RMB19.4 billion ($2.73 billion), and net margin for Baidu Core was 19%. Non-GAAP net income attributable to Baidu was RMB28.7 billion ($4.05 billion). Non-GAAP diluted earnings per ADS was RMB80.85 ($11.39). Non-GAAP net income attributable to Baidu Core was RMB27.4 billion ($3.86 billion), and non-GAAP net margin for Baidu Core was 26%.
Adjusted EBITDA was RMB35.8 billion ($5.05 billion) and adjusted EBITDA margin was 27%. Adjusted EBITDA for Baidu Core was RMB31.9 billion ($4.49 billion) and adjusted EBITDA margin for Baidu Core was 31%.
Free cash flow was RMB25.4 billion ($3.58 billion), and free cash flow excluding iQIYI was RMB22.1 billion ($3.11 billion).
5
Conference Call Information
Baidu’s management will hold an earnings conference call at 7.30 AM on February 28, 2024, U.S. Eastern Time (8.30 PM on February 28, 2024, Beijing Time).
Please register in advance of the conference call using the link provided below. It will automatically direct you to the registration page of “Baidu Inc Q4 2023 Earnings Conference Call”. Please follow the steps to enter your registration details, then click “Register”. Upon registering, you will then be provided with the dial-in number, the passcode, and your unique access PIN. This information will also be emailed to you as a calendar invite.
For pre-registration, please click:
https://s1.c-conf.com/diamondpass/10036733-mjkcdg.html
In the 10 minutes prior to the call start time, you may use the conference access information (including dial-in number(s), the passcode and unique access PIN) provided in the calendar invite that you have received following your pre-registration.
Additionally, a live and archived webcast of this conference call will be available at https://ir.baidu.com.
About Baidu
Founded in 2000, Baidu’s mission is to make the complicated world simpler through technology. Baidu is a leading AI company with strong Internet foundation, trading on NASDAQ under “BIDU” and HKEX under “9888”. One Baidu ADS represents eight Class A ordinary shares.
Contacts
Investors Relations, Baidu, Inc.
Tel: +86-10-5992-8888
Email: ir@baidu.com
6
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident” and similar statements. Among other things, Baidu’s and other parties’ strategic and operational plans, contain forward-looking statements. Baidu may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in announcements made on the website of The Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including but not limited to statements about Baidu’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Baidu’s growth strategies; its future business development, including development of new products and services; its ability to attract and retain users and customers; competition in the Chinese Internet search and newsfeed market; competition for online marketing customers; changes in the Company’s revenues and certain cost or expense items as a percentage of its revenues; the outcome of ongoing, or any future, litigation or arbitration, including those relating to intellectual property rights; the expected growth of the Chinese-language Internet search and newsfeed market and the number of Internet and broadband users in China; Chinese governmental policies relating to the Internet and Internet search providers, and general economic conditions in China and elsewhere. Further information regarding these and other risks is included in the Company’s annual report on Form 20-F and other documents filed with the Securities and Exchange Commission, and announcements on the website of the Hong Kong Stock Exchange. Baidu does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release and in the attachments is as of the date of the press release, and Baidu undertakes no duty to update such information, except as required under applicable law.
Non-GAAP Financial Measures
To supplement Baidu’s consolidated financial results presented in accordance with GAAP, Baidu uses the following non-GAAP financial measures: non-GAAP operating income (loss), non-GAAP operating margin, non-GAAP net income (loss) attributable to Baidu, non-GAAP net margin, non-GAAP diluted earnings per ADS, adjusted EBITDA, adjusted EBITDA margin and free cash flow. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.
7
Baidu believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding certain items that may not be indicative of its recurring core business operating results, such as operating performance excluding non-cash charges or non-operating in nature. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to Baidu’s historical performance and liquidity. The Company believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude certain items that have been and will continue to be for the foreseeable future a significant component in the Company’s results of operations. These non-GAAP financial measures presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company’s data.
Non-GAAP operating income represents operating income excluding share-based compensation expenses, amortization and impairment of intangible assets resulting from business combinations, and contingent loss pertaining to legal proceeding in relation to former advertising agencies.
Non-GAAP net income attributable to Baidu represents net income attributable to Baidu excluding share-based compensation expenses, amortization and impairment of intangible assets resulting from business combinations, disposal gain or loss, impairment of long-term investments, fair value change of long-term investments, and contingent loss pertaining to legal proceeding in relation to former advertising agencies, charitable donation from Baidu, adjusted for related income tax effects. Baidu’s share of equity method investments for these non-GAAP reconciling items, amortization and impairment of intangible assets not on the investees’ books, accretion of their redeemable non-controlling interests, and the gain or loss associated with the issuance of shares by the investees at a price higher or lower than the carrying value per share, adjusted for related income tax effects, are also excluded.
Non-GAAP diluted earnings per ADS represents diluted earnings per ADS calculated by dividing non-GAAP net income attributable to Baidu, by the weighted average number of ordinary shares expressed in ADS. Adjusted EBITDA represents operating income excluding depreciation, amortization and impairment of intangible assets resulting from business combinations, share-based compensation expenses, and contingent loss pertaining to legal proceeding in relation to former advertising agencies.
For more information on non-GAAP financial measures, please see the tables captioned “Reconciliations of non-GAAP financial measures to the nearest comparable GAAP measure.
8
Baidu, Inc.
Condensed Consolidated Statements of Income
(In millions except for per share (or ADS) information, unaudited)
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
| 2022 | 2023 | 2023 | 2023 | 2022 | 2023 | 2023 | ||||||||||||||||||||||
| RMB | RMB | RMB | US$(2) | RMB | RMB | US$(2) | ||||||||||||||||||||||
| Revenues: |
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| Online marketing services |
19,571 | 21,346 | 20,804 | 2,930 | 74,711 | 81,203 | 11,437 | |||||||||||||||||||||
| Others |
13,506 | 13,101 | 14,147 | 1,993 | 48,964 | 53,395 | 7,521 | |||||||||||||||||||||
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| Total revenues |
33,077 | 34,447 | 34,951 | 4,923 | 123,675 | 134,598 | 18,958 | |||||||||||||||||||||
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| Costs and expenses: |
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| Cost of revenues(1) |
16,945 | 16,294 | 17,418 | 2,453 | 63,935 | 65,031 | 9,159 | |||||||||||||||||||||
| Selling, general and administrative(1) |
5,881 | 5,778 | 5,854 | 825 | 20,514 | 23,519 | 3,314 | |||||||||||||||||||||
| Research and development(1) |
5,658 | 6,101 | 6,287 | 886 | 23,315 | 24,192 | 3,407 | |||||||||||||||||||||
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| Total costs and expenses |
28,484 | 28,173 | 29,559 | 4,164 | 107,764 | 112,742 | 15,880 | |||||||||||||||||||||
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| Operating income |
4,593 | 6,274 | 5,392 | 759 | 15,911 | 21,856 | 3,078 | |||||||||||||||||||||
| Other income (loss): |
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| Interest income |
1,647 | 2,082 | 2,064 | 291 | 6,245 | 8,009 | 1,128 | |||||||||||||||||||||
| Interest expense |
(738 | ) | (853 | ) | (774 | ) | (109 | ) | (2,913 | ) | (3,248 | ) | (457 | ) | ||||||||||||||
| Foreign exchange (loss) gain, net |
(338 | ) | (26 | ) | (449 | ) | (63 | ) | (1,484 | ) | 595 | 84 | ||||||||||||||||
| Share of losses from equity method investments |
(523 | ) | (398 | ) | (2,970 | ) | (418 | ) | (1,910 | ) | (3,799 | ) | (535 | ) | ||||||||||||||
| Others, net |
1,733 | 1,100 | (398 | ) | (57 | ) | (5,737 | ) | 1,785 | 252 | ||||||||||||||||||
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| Total other income (loss), net |
1,781 | 1,905 | (2,527 | ) | (356 | ) | (5,799 | ) | 3,342 | 472 | ||||||||||||||||||
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| Income before income taxes |
6,374 | 8,179 | 2,865 | 403 | 10,112 | 25,198 | 3,550 | |||||||||||||||||||||
| Income tax expense (benefit) |
1,254 | 1,282 | (96 | ) | (14 | ) | 2,578 | 3,649 | 514 | |||||||||||||||||||
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| Net income |
5,120 | 6,897 | 2,961 | 417 | 7,534 | 21,549 | 3,036 | |||||||||||||||||||||
| Net income (loss) attributable to noncontrolling interests |
167 | 216 | 362 | 51 | (25 | ) | 1,234 | 175 | ||||||||||||||||||||
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| Net income attributable to Baidu |
4,953 | 6,681 | 2,599 | 366 | 7,559 | 20,315 | 2,861 | |||||||||||||||||||||
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9
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
| 2022 | 2023 | 2023 | 2023 | 2022 | 2023 | 2023 | ||||||||||||||||||||||
| RMB | RMB | RMB | US$(2) | RMB | RMB | US$(2) | ||||||||||||||||||||||
| Earnings per ADS (1 ADS representing 8 Class A ordinary shares): |
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| — Basic |
13.73 | 18.45 | 6.85 | 0.96 | 20.02 | 55.83 | 7.86 | |||||||||||||||||||||
| — Diluted |
13.59 | 18.22 | 6.77 | 0.95 | 19.85 | 55.08 | 7.76 | |||||||||||||||||||||
| Earnings per share for Class A and Class B ordinary shares: |
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| — Basic |
1.72 | 2.31 | 0.86 | 0.12 | 2.50 | 6.98 | 0.98 | |||||||||||||||||||||
| — Diluted |
1.70 | 2.28 | 0.85 | 0.12 | 2.48 | 6.89 | 0.97 | |||||||||||||||||||||
| Weighted average number of Class A and Class B ordinary shares outstanding (in millions): |
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| — Basic |
2,789 | 2,814 | 2,812 | 2,812 | 2,782 | 2,807 | 2,807 | |||||||||||||||||||||
| — Diluted |
2,801 | 2,846 | 2,830 | 2,830 | 2,809 | 2,837 | 2,837 | |||||||||||||||||||||
| (1) Includes share-based compensation expenses as follows: |
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| Cost of revenues |
158 | 139 | 159 | 23 | 409 | 590 | 83 | |||||||||||||||||||||
| Selling, general and administrative |
450 | 358 | 411 | 58 | 1,750 | 1,678 | 236 | |||||||||||||||||||||
| Research and development |
1,233 | 778 | 1,068 | 150 | 4,629 | 4,077 | 575 | |||||||||||||||||||||
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| Total share-based compensation expenses |
1,841 | 1,275 | 1,638 | 231 | 6,788 | 6,345 | 894 | |||||||||||||||||||||
| (2) | All translations from RMB to U.S. dollars are made at a rate of RMB 7.0999 to US$1.00, the exchange rate in effect as of December 29, 2023 as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System. |
10
Baidu, Inc.
Condensed Consolidated Balance Sheets
(In millions, unaudited)
| December 31, 2022 |
December 31, 2023 |
December 31, 2023 |
||||||||||
| RMB | RMB | US$ | ||||||||||
| ASSETS |
||||||||||||
| Current assets: |
||||||||||||
| Cash and cash equivalents |
53,156 | 25,231 | 3,554 | |||||||||
| Restricted cash |
11,330 | 11,503 | 1,620 | |||||||||
| Short-term investments, net |
120,839 | 168,670 | 23,757 | |||||||||
| Accounts receivable, net |
11,733 | 10,848 | 1,528 | |||||||||
| Amounts due from related parties |
5,432 | 1,424 | 201 | |||||||||
| Other current assets, net |
10,360 | 12,579 | 1,772 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total current assets |
212,850 | 230,255 | 32,432 | |||||||||
|
|
|
|
|
|
|
|||||||
| Non-current assets: |
||||||||||||
| Fixed assets, net |
23,973 | 27,960 | 3,938 | |||||||||
| Licensed copyrights, net |
6,841 | 6,967 | 981 | |||||||||
| Produced content, net |
13,002 | 13,377 | 1,884 | |||||||||
| Intangible assets, net |
1,254 | 881 | 124 | |||||||||
| Goodwill |
22,477 | 22,586 | 3,181 | |||||||||
| Long-term investments, net |
55,297 | 47,957 | 6,755 | |||||||||
| Long-term time deposits and held-to-maturity investments |
23,629 | 24,666 | 3,474 | |||||||||
| Amounts due from related parties |
60 | 195 | 27 | |||||||||
| Deferred tax assets, net |
2,129 | 2,100 | 296 | |||||||||
| Operating lease right-of-use assets |
10,365 | 10,851 | 1,528 | |||||||||
| Other non-current assets |
19,096 | 18,964 | 2,671 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total non-current assets |
178,123 | 176,504 | 24,859 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total assets |
390,973 | 406,759 | 57,291 | |||||||||
|
|
|
|
|
|
|
|||||||
11
| December 31, 2022 |
December 31, 2023 |
December 31, 2023 |
||||||||||
| RMB | RMB | US$ | ||||||||||
| LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY |
||||||||||||
| Current liabilities: |
||||||||||||
| Short-term loans |
5,343 | 10,257 | 1,445 | |||||||||
| Accounts payable and accrued liabilities |
38,014 | 37,717 | 5,312 | |||||||||
| Customer deposits and deferred revenue |
13,116 | 14,627 | 2,060 | |||||||||
| Deferred income |
72 | 306 | 43 | |||||||||
| Long-term loans, current portion |
— | 2 | — | |||||||||
| Convertible senior notes, current portion |
8,305 | 2,802 | 395 | |||||||||
| Notes payable, current portion |
6,904 | 6,029 | 849 | |||||||||
| Amounts due to related parties |
5,067 | 1,603 | 226 | |||||||||
| Operating lease liabilities |
2,809 | 3,108 | 438 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total current liabilities |
79,630 | 76,451 | 10,768 | |||||||||
|
|
|
|
|
|
|
|||||||
| Non-current liabilities: |
||||||||||||
| Deferred income |
159 | 200 | 28 | |||||||||
| Deferred revenue |
331 | 481 | 68 | |||||||||
| Amounts due to related parties |
99 | 77 | 11 | |||||||||
| Long-term loans |
13,722 | 14,223 | 2,003 | |||||||||
| Notes payable |
39,893 | 34,990 | 4,928 | |||||||||
| Convertible senior notes |
9,568 | 8,144 | 1,147 | |||||||||
| Deferred tax liabilities |
2,898 | 2,725 | 384 | |||||||||
| Operating lease liabilities |
4,810 | 5,040 | 710 | |||||||||
| Other non-current liabilities |
2,058 | 1,820 | 257 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total non-current liabilities |
73,538 | 67,700 | 9,536 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total liabilities |
153,168 | 144,151 | 20,304 | |||||||||
|
|
|
|
|
|
|
|||||||
| Redeemable noncontrolling interests |
8,393 | 9,465 | 1,333 | |||||||||
| Equity |
||||||||||||
| Total Baidu shareholders’ equity |
223,478 | 243,626 | 34,314 | |||||||||
| Noncontrolling interests |
5,934 | 9,517 | 1,340 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total equity |
229,412 | 253,143 | 35,654 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total liabilities, redeemable noncontrolling interests, and equity |
390,973 | 406,759 | 57,291 | |||||||||
|
|
|
|
|
|
|
|||||||
12
Baidu, Inc.
Selected Information
(In millions, unaudited)
| Three months ended December 31, 2022 (RMB) |
Three months ended September 30, 2023 (RMB) |
Three months ended December 31, 2023 (RMB) |
Three months ended December 31, 2023 (US$) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Total revenues |
25,654 | 7,593 | (170 | ) | 33,077 | 26,572 | 8,015 | (140 | ) | 34,447 | 27,488 | 7,707 | (244 | ) | 34,951 | 3,872 | 1,086 | (35 | ) | 4,923 | ||||||||||||||||||||||||||||||||||||||||||||
| YOY |
7 | % | 2 | % | 6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| QOQ |
3 | % | (4 | %) | 1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Costs and expenses: |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of revenues (1) |
11,712 | 5,405 | (172 | ) | 16,945 | 10,610 | 5,840 | (156 | ) | 16,294 | 12,050 | 5,533 | (165 | ) | 17,418 | 1,698 | 779 | (24 | ) | 2,453 | ||||||||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative (1) |
4,969 | 939 | (27 | ) | 5,881 | 4,810 | 981 | (13 | ) | 5,778 | 4,936 | 948 | (30 | ) | 5,854 | 695 | 134 | (4 | ) | 825 | ||||||||||||||||||||||||||||||||||||||||||||
| Research and development (1) |
5,191 | 467 | — | 5,658 | 5,654 | 447 | — | 6,101 | 5,834 | 453 | — | 6,287 | 822 | 64 | — | 886 | ||||||||||||||||||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
| Total costs and expenses |
21,872 | 6,811 | (199 | ) | 28,484 | 21,074 | 7,268 | (169 | ) | 28,173 | 22,820 | 6,934 | (195 | ) | 29,559 | 3,215 | 977 | (28 | ) | 4,164 | ||||||||||||||||||||||||||||||||||||||||||||
|
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|
|
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|
|
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|
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|
|
|
|||||||||||||||||||||||||||||||||
| YOY |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of revenues |
3 | % | 2 | % | 3 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative |
(1 | %) | 1 | % | (0 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Research and development |
12 | % | (3 | %) | 11 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Costs and expenses |
4 | % | 2 | % | 4 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating income (loss) |
3,782 | 782 | 29 | 4,593 | 5,498 | 747 | 29 | 6,274 | 4,668 | 773 | (49 | ) | 5,392 | 657 | 109 | (7 | ) | 759 | ||||||||||||||||||||||||||||||||||||||||||||||
| YOY |
23 | % | (1 | %) | 17 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| QOQ |
(15 | %) | 3 | % | (14 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating margin |
15 | % | 10 | % | 14 | % | 21 | % | 9 | % | 18 | % | 17 | % | 10 | % | 15 | % | ||||||||||||||||||||||||||||||||||||||||||||||
| Add: total other income (loss), net |
2,271 | (490 | ) | — | 1,781 | 2,159 | (254 | ) | — | 1,905 | (2,267 | ) | (260 | ) | — | (2,527 | ) | (319 | ) | (37 | ) | — | (356 | ) | ||||||||||||||||||||||||||||||||||||||||
| Less: income tax expense (benefit) |
1,265 | (11 | ) | — | 1,254 | 1,272 | 10 | — | 1,282 | (134 | ) | 38 | — | (96 | ) | (19 | ) | 5 | — | (14 | ) | |||||||||||||||||||||||||||||||||||||||||||
| Less: net income (loss) attributable to NCI |
15 | (1 | ) | 153 | (3) | 167 | (51 | ) | 7 | 260 | (3) | 216 | 95 | 9 | 258 | (3) | 362 | 13 | 1 | 37 | (3) | 51 | ||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
| Net income (loss) attributable to Baidu |
4,773 | 304 | (124 | ) | 4,953 | 6,436 | 476 | (231 | ) | 6,681 | 2,440 | 466 | (307 | ) | 2,599 | 344 | 66 | (44 | ) | 366 | ||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||
| YOY |
(49 | %) | 53 | % | (48 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| QOQ |
(62 | %) | (2 | %) | (61 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net margin |
19 | % | 4 | % | 15 | % | 24 | % | 6 | % | 19 | % | 9 | % | 6 | % | 7 | % | ||||||||||||||||||||||||||||||||||||||||||||||
13
| Three months ended December 31, 2022 (RMB) |
Three months ended September 30, 2023 (RMB) |
Three months ended December 31, 2023 (RMB) |
Three months ended December 31, 2023 (US$) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP financial measures: |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating income (non-GAAP) |
5,491 | 977 | 6,497 | 6,672 | 895 | 7,596 | 6,197 | 927 | 7,075 | 873 | 130 | 996 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| YOY |
13 | % | (5 | %) | 9 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| QOQ |
(7 | %) | 4 | % | (7 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating margin (non-GAAP) |
21 | % | 13 | % | 20 | % | 25 | % | 11 | % | 22 | % | 23 | % | 12 | % | 20 | % | ||||||||||||||||||||||||||||||||||||||||||||||
| Net income attributable to Baidu (non-GAAP) |
4,915 | 856 | 5,371 | 6,956 | 622 | 7,267 | 7,500 | 681 | 7,755 | 1,056 | 96 | 1,092 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| YOY |
53 | % | (20 | %) | 44 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| QOQ |
8 | % | 9 | % | 7 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net margin (non-GAAP) |
19 | % | 11 | % | 16 | % | 26 | % | 8 | % | 21 | % | 27 | % | 9 | % | 22 | % | ||||||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA |
7,146 | 1,056 | 8,231 | 8,513 | 963 | 9,505 | 8,118 | 988 | 9,057 | 1,143 | 140 | 1,276 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| YOY |
14 | % | (6 | %) | 10 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| QOQ |
(5 | %) | 3 | % | (5 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA margin |
28 | % | 14 | % | 25 | % | 32 | % | 12 | % | 28 | % | 30 | % | 13 | % | 26 | % | ||||||||||||||||||||||||||||||||||||||||||||||
| (1) Includes share-based compensation as follows: |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of revenues |
122 | 36 | 158 | 107 | 32 | 139 | 125 | 34 | 159 | 18 | 5 | 23 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative |
355 | 95 | 450 | 290 | 68 | 358 | 340 | 71 | 411 | 48 | 10 | 58 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Research and development |
1,177 | 56 | 1,233 | 732 | 46 | 778 | 1,020 | 48 | 1,068 | 144 | 6 | 150 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||
| Total share-based compensation |
1,654 | 187 | 1,841 | 1,129 | 146 | 1,275 | 1,485 | 153 | 1,638 | 210 | 21 | 231 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) | Relates to intersegment eliminations and adjustments |
| (3) | Relates to the net income/(loss) attributable to iQIYI noncontrolling interests |
14
Baidu, Inc.
Selected Information
(In millions except for per ADS information, unaudited)
| Twelve months ended December 31, 2022 (RMB) |
Twelve months ended December 31, 2023 (RMB) |
Twelve months ended December 31, 2023 (US$) |
||||||||||||||||||||||||||||||||||||||||||||||
| Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
|||||||||||||||||||||||||||||||||||||
| Total revenues |
95,431 | 28,998 | (754 | ) | 123,675 | 103,465 | 31,873 | (740 | ) | 134,598 | 14,573 | 4,489 | (104 | ) | 18,958 | |||||||||||||||||||||||||||||||||
| YOY |
8 | % | 10 | % | 9 | % | ||||||||||||||||||||||||||||||||||||||||||
| Costs and expenses: |
||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of revenues (1) |
42,378 | 22,321 | (764 | ) | 63,935 | 42,592 | 23,103 | (664 | ) | 65,031 | 5,999 | 3,254 | (94 | ) | 9,159 | |||||||||||||||||||||||||||||||||
| Selling, general and administrative (1) |
17,103 | 3,466 | (55 | ) | 20,514 | 19,623 | 4,014 | (118 | ) | 23,519 | 2,765 | 565 | (16 | ) | 3,314 | |||||||||||||||||||||||||||||||||
| Research and development (1) |
21,416 | 1,899 | — | 23,315 | 22,425 | 1,767 | — | 24,192 | 3,158 | 249 | — | 3,407 | ||||||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| Total costs and expenses |
80,897 | 27,686 | (819 | ) | 107,764 | 84,640 | 28,884 | (782 | ) | 112,742 | 11,922 | 4,068 | (110 | ) | 15,880 | |||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| YOY |
||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of revenues |
1 | % | 4 | % | 2 | % | ||||||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative |
15 | % | 16 | % | 15 | % | ||||||||||||||||||||||||||||||||||||||||||
| Research and development |
5 | % | (7 | %) | 4 | % | ||||||||||||||||||||||||||||||||||||||||||
| Cost and expenses |
5 | % | 4 | % | 5 | % | ||||||||||||||||||||||||||||||||||||||||||
| Operating income |
14,534 | 1,312 | 65 | 15,911 | 18,825 | 2,989 | 42 | 21,856 | 2,651 | 421 | 6 | 3,078 | ||||||||||||||||||||||||||||||||||||
| YOY |
30 | % | 128 | % | 37 | % | ||||||||||||||||||||||||||||||||||||||||||
| Operating margin |
15 | % | 5 | % | 13 | % | 18 | % | 9 | % | 16 | % | ||||||||||||||||||||||||||||||||||||
| Add: total other (loss) income, net |
(4,453 | ) | (1,346 | ) | — | (5,799 | ) | 4,298 | (956 | ) | — | 3,342 | 607 | (135 | ) | — | 472 | |||||||||||||||||||||||||||||||
| Less: income tax expense |
2,494 | 84 | — | 2,578 | 3,568 | 81 | — | 3,649 | 503 | 11 | — | 514 | ||||||||||||||||||||||||||||||||||||
| Less: net income (loss) attributable to NCI |
36 | 18 | (79 | )(3) | (25 | ) | 154 | 27 | 1,053 | (3) | 1,234 | 22 | 4 | 149 | (3) | 175 | ||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|||||||||||||||||||||||||
| Net income (loss) attributable to Baidu |
7,551 | (136 | ) | 144 | 7,559 | 19,401 | 1,925 | (1,011 | ) | 20,315 | 2,733 | 271 | (143 | ) | 2,861 | |||||||||||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| YOY |
157 | % | (1,515 | %) | 169 | % | ||||||||||||||||||||||||||||||||||||||||||
| Net margin |
8 | % | (0 | %) | 6 | % | 19 | % | 6 | % | 15 | % | ||||||||||||||||||||||||||||||||||||
15
| Twelve months ended December 31, 2022 (RMB) |
Twelve months ended December 31, 2023 (RMB) |
Twelve months ended December 31, 2023 (US$) |
||||||||||||||||||||||||||||||||||||||||||||||
| Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
Baidu Core |
iQIYI | Elim & adj(2) |
Baidu, Inc. |
|||||||||||||||||||||||||||||||||||||
| Non-GAAP financial measures: |
||||||||||||||||||||||||||||||||||||||||||||||||
| Operating income (non-GAAP) |
20,948 | 2,173 | 23,186 | 24,748 | 3,643 | 28,433 | 3,486 | 513 | 4,005 | |||||||||||||||||||||||||||||||||||||||
| YOY |
18 | % | 68 | % | 23 | % | ||||||||||||||||||||||||||||||||||||||||||
| Operating margin (non-GAAP) |
22 | % | 7 | % | 19 | % | 24 | % | 11 | % | 21 | % | ||||||||||||||||||||||||||||||||||||
| Net income attributable to Baidu (non-GAAP) |
19,935 | 1,284 | 20,680 | 27,418 | 2,838 | 28,747 | 3,862 | 400 | 4,049 | |||||||||||||||||||||||||||||||||||||||
| YOY |
38 | % | 121 | % | 39 | % | ||||||||||||||||||||||||||||||||||||||||||
| Net margin (non-GAAP) |
21 | % | 4 | % | 17 | % | 26 | % | 9 | % | 21 | % | ||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA |
27,088 | 2,510 | 29,663 | 31,863 | 3,918 | 35,823 | 4,488 | 552 | 5,046 | |||||||||||||||||||||||||||||||||||||||
| YOY |
18 | % | 56 | % | 21 | % | ||||||||||||||||||||||||||||||||||||||||||
| Adjusted EBITDA margin |
28 | % | 9 | % | 24 | % | 31 | % | 12 | % | 27 | % | ||||||||||||||||||||||||||||||||||||
| (1) Includes share-based compensation as follows: |
|
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| Cost of revenues |
261 | 148 | 409 | 457 | 133 | 590 | 64 | 19 | 83 | |||||||||||||||||||||||||||||||||||||||
| Selling, general and administrative |
1,326 | 424 | 1,750 | 1,363 | 315 | 1,678 | 192 | 44 | 236 | |||||||||||||||||||||||||||||||||||||||
| Research and development |
4,390 | 239 | 4,629 | 3,888 | 189 | 4,077 | 548 | 27 | 575 | |||||||||||||||||||||||||||||||||||||||
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| Total share-based compensation |
5,977 | 811 | 6,788 | 5,708 | 637 | 6,345 | 804 | 90 | 894 | |||||||||||||||||||||||||||||||||||||||
| (2) | Relates to intersegment eliminations and adjustments |
| (3) | Relates to the net loss attributable to iQIYI noncontrolling interests |
16
Baidu, Inc.
Condensed Consolidated Statements of Cash Flows
(In millions, unaudited)
| Three months ended | Three months ended | Three months ended | Three months ended | |||||||||||||||||||||||||||||||||||||||||||||
| December 31, 2022 | September 30, 2023 | December 31, 2023 | December 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||
| (RMB) | (RMB) | (RMB) | (US$) | |||||||||||||||||||||||||||||||||||||||||||||
| Baidu | Baidu | Baidu | Baidu | |||||||||||||||||||||||||||||||||||||||||||||
| excl. | Baidu, | excl. | Baidu, | excl. | Baidu, | excl. | Baidu, | |||||||||||||||||||||||||||||||||||||||||
| iQIYI | iQIYI | Inc. | iQIYI | iQIYI | Inc. | iQIYI | iQIYI | Inc. | iQIYI | iQIYI | Inc. | |||||||||||||||||||||||||||||||||||||
| Net cash provided by operating activities |
6,999 | 854 | 7,853 | 8,694 | 831 | 9,525 | 9,985 | 633 | 10,618 | 1,407 | 89 | 1,496 | ||||||||||||||||||||||||||||||||||||
| Net cash (used in) provided by investing activities |
(5,902 | ) | 579 | (5,323 | ) | (11,345 | ) | (55 | ) | (11,400 | ) | (11,805 | ) | (1,431 | ) | (13,236 | ) | (1,662 | ) | (202 | ) | (1,864 | ) | |||||||||||||||||||||||||
| Net cash (used in) provided by financing activities |
(5,124 | ) | 2,862 | (2,262 | ) | (5,253 | ) | 269 | (4,984 | ) | (7,586 | ) | (22 | ) | (7,608 | ) | (1,069 | ) | (3 | ) | (1,072 | ) | ||||||||||||||||||||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash |
(1,420 | ) | (9 | ) | (1,429 | ) | 153 | 5 | 158 | (364 | ) | (31 | ) | (395 | ) | (52 | ) | (4 | ) | (56 | ) | |||||||||||||||||||||||||||
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| Net (decrease) increase in cash, cash equivalents and restricted cash |
(5,447 | ) | 4,286 | (1,161 | ) | (7,751 | ) | 1,050 | (6,701 | ) | (9,770 | ) | (851 | ) | (10,621 | ) | (1,376 | ) | (120 | ) | (1,496 | ) | ||||||||||||||||||||||||||
| Cash, cash equivalents and restricted cash |
||||||||||||||||||||||||||||||||||||||||||||||||
| At beginning of period |
62,821 | 3,576 | 66,397 | 49,814 | 5,082 | 54,896 | 42,063 | 6,132 | 48,195 | 5,924 | 864 | 6,788 | ||||||||||||||||||||||||||||||||||||
| At end of period |
57,374 | 7,862 | 65,236 | 42,063 | 6,132 | 48,195 | 32,293 | 5,281 | 37,574 | 4,548 | 744 | 5,292 | ||||||||||||||||||||||||||||||||||||
| Net cash provided by operating activities |
6,999 | 854 | 7,853 | 8,694 | 831 | 9,525 | 9,985 | 633 | 10,618 | 1,407 | 89 | 1,496 | ||||||||||||||||||||||||||||||||||||
| Less: Capital expenditures |
(1,920 | ) | (9 | ) | (1,929 | ) | (3,525 | ) | (4 | ) | (3,529 | ) | (3,641 | ) | (19 | ) | (3,660 | ) | (513 | ) | (3 | ) | (516 | ) | ||||||||||||||||||||||||
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| Free cash flow |
5,079 | 845 | 5,924 | 5,169 | 827 | 5,996 | 6,344 | 614 | 6,958 | 894 | 86 | 980 | ||||||||||||||||||||||||||||||||||||
Note: Baidu excl. iQIYI represents Baidu, Inc. minus iQIYI’s consolidated cash flows.
17
Baidu, Inc.
Condensed Consolidated Statements of Cash Flows
(In millions, unaudited)
| Twelve months ended | Twelve months ended | Twelve months ended | ||||||||||||||||||||||||||||||||||
| December 31, 2022 | December 31, 2023 | December 31, 2023 | ||||||||||||||||||||||||||||||||||
| (RMB) | (RMB) | (US$) | ||||||||||||||||||||||||||||||||||
| Baidu | Baidu | Baidu | ||||||||||||||||||||||||||||||||||
| excl. | Baidu, | excl. | Baidu, | excl. | Baidu, | |||||||||||||||||||||||||||||||
| iQIYI | iQIYI | Inc. | iQIYI | iQIYI | Inc. | iQIYI | iQIYI | Inc. | ||||||||||||||||||||||||||||
| Net cash provided by (used in) operating activities |
26,241 | (71 | ) | 26,170 | 33,263 | 3,352 | 36,615 | 4,685 | 472 | 5,157 | ||||||||||||||||||||||||||
| Net cash (used in) provided by investing activities |
(4,210 | ) | 266 | (3,944 | ) | (48,657 | ) | (1,740 | ) | (50,397 | ) | (6,853 | ) | (245 | ) | (7,098 | ) | |||||||||||||||||||
| Net cash (used in) provided by financing activities |
(10,859 | ) | 4,469 | (6,390 | ) | (9,876 | ) | (4,286 | ) | (14,162 | ) | (1,391 | ) | (604 | ) | (1,995 | ) | |||||||||||||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash |
1,606 | 123 | 1,729 | 189 | 93 | 282 | 27 | 13 | 40 | |||||||||||||||||||||||||||
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| Net increase (decrease) in cash, cash equivalents and restricted cash |
12,778 | 4,787 | 17,565 | (25,081 | ) | (2,581 | ) | (27,662 | ) | (3,532 | ) | (364 | ) | (3,896 | ) | |||||||||||||||||||||
| Cash, cash equivalents and restricted cash |
||||||||||||||||||||||||||||||||||||
| At beginning of period |
44,596 | 3,075 | 47,671 | 57,374 | 7,862 | 65,236 | 8,080 | 1,108 | 9,188 | |||||||||||||||||||||||||||
| At end of period |
57,374 | 7,862 | 65,236 | 32,293 | 5,281 | 37,574 | 4,548 | 744 | 5,292 | |||||||||||||||||||||||||||
| Net cash provided by (used in) operating activities |
26,241 | (71 | ) | 26,170 | 33,263 | 3,352 | 36,615 | 4,685 | 472 | 5,157 | ||||||||||||||||||||||||||
| Less: Capital expenditures |
(8,112 | ) | (174 | ) | (8,286 | ) | (11,154 | ) | (36 | ) | (11,190 | ) | (1,571 | ) | (5 | ) | (1,576 | ) | ||||||||||||||||||
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| Free cash flow |
18,129 | (245 | ) | 17,884 | 22,109 | 3,316 | 25,425 | 3,114 | 467 | 3,581 | ||||||||||||||||||||||||||
Note: Baidu excl. iQIYI represents Baidu, Inc. minus iQIYI’s consolidated cash flows.
18
Baidu, Inc.
Reconciliations of Non-GAAP Financial Measures to the Nearest Comparable GAAP Measures
(In millions except for per ADS information, unaudited)
| Three months ended | Three months ended | Three months ended | Three months ended | |||||||||||||||||||||||||||||||||||||||||||||
| December 31, 2022 | September 30, 2023 | December 31, 2023 | December 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||
| (RMB) | (RMB) | (RMB) | (US$) | |||||||||||||||||||||||||||||||||||||||||||||
| Baidu | Baidu, | Baidu | Baidu, | Baidu | Baidu, | Baidu | Baidu, | |||||||||||||||||||||||||||||||||||||||||
| Core | iQIYI | Inc. | Core | iQIYI | Inc. | Core | iQIYI | Inc. | Core | iQIYI | Inc. | |||||||||||||||||||||||||||||||||||||
| Operating income |
3,782 | 782 | 4,593 | 5,498 | 747 | 6,274 | 4,668 | 773 | 5,392 | 657 | 109 | 759 | ||||||||||||||||||||||||||||||||||||
| Add: Share-based compensation expenses |
1,654 | 187 | 1,841 | 1,129 | 146 | 1,275 | 1,485 | 153 | 1,638 | 210 | 21 | 231 | ||||||||||||||||||||||||||||||||||||
| Add: Amortization and impairment of intangible assets(1) |
55 | 8 | 63 | 45 | 2 | 47 | 44 | 1 | 45 | 6 | — | 6 | ||||||||||||||||||||||||||||||||||||
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| Operating income (non-GAAP) |
5,491 | 977 | 6,497 | 6,672 | 895 | 7,596 | 6,197 | 927 | 7,075 | 873 | 130 | 996 | ||||||||||||||||||||||||||||||||||||
| Add: Depreciation of fixed assets |
1,655 | 79 | 1,734 | 1,841 | 68 | 1,909 | 1,921 | 61 | 1,982 | 270 | 10 | 280 | ||||||||||||||||||||||||||||||||||||
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| Adjusted EBITDA |
7,146 | 1,056 | 8,231 | 8,513 | 963 | 9,505 | 8,118 | 988 | 9,057 | 1,143 | 140 | 1,276 | ||||||||||||||||||||||||||||||||||||
| Net income attributable to Baidu |
4,773 | 304 | 4,953 | 6,436 | 476 | 6,681 | 2,440 | 466 | 2,599 | 344 | 66 | 366 | ||||||||||||||||||||||||||||||||||||
| Add: Share-based compensation expenses |
1,654 | 187 | 1,748 | 1,128 | 146 | 1,194 | 1,484 | 153 | 1,553 | 209 | 22 | 219 | ||||||||||||||||||||||||||||||||||||
| Add: Amortization and impairment of intangible assets(1) |
50 | 8 | 55 | 43 | 2 | 44 | 42 | 1 | 42 | 6 | — | 6 | ||||||||||||||||||||||||||||||||||||
| Add: Disposal (gain) loss |
(484 | ) | 62 | (453 | ) | (753 | ) | — | (753 | ) | (37 | ) | (1 | ) | (38 | ) | (5 | ) | — | (5 | ) | |||||||||||||||||||||||||||
| Add: Impairment of long-term investments |
318 | 271 | 453 | 46 | — | 46 | 132 | 62 | 160 | 19 | 8 | 23 | ||||||||||||||||||||||||||||||||||||
| Add: Fair value (gain) loss of long-term investments |
(1,662 | ) | 8 | (1,658 | ) | (384 | ) | (2 | ) | (385 | ) | 403 | — | 403 | 57 | — | 57 | |||||||||||||||||||||||||||||||
| Add: Reconciling items on equity method investments(2) |
377 | 18 | 386 | 572 | — | 572 | 3,172 | — | 3,172 | 447 | — | 447 | ||||||||||||||||||||||||||||||||||||
| Add: Tax effects on non-GAAP adjustments(3) |
(111 | ) | (2 | ) | (113 | ) | (132 | ) | — | (132 | ) | (136 | ) | — | (136 | ) | (21 | ) | — | (21 | ) | |||||||||||||||||||||||||||
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| Net income attributable to Baidu (non-GAAP) |
4,915 | 856 | 5,371 | 6,956 | 622 | 7,267 | 7,500 | 681 | 7,755 | 1,056 | 96 | 1,092 | ||||||||||||||||||||||||||||||||||||
19
| Three months ended | Three months ended | Three months ended | Three months ended | |||||||||||||||||||||||||||||||||||||||||||||
| December 31, 2022 | September 30, 2023 | December 31, 2023 | December 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||
| (RMB) | (RMB) | (RMB) | (US$) | |||||||||||||||||||||||||||||||||||||||||||||
| Baidu | Baidu, | Baidu | Baidu, | Baidu | Baidu, | Baidu | Baidu, | |||||||||||||||||||||||||||||||||||||||||
| Core | iQIYI | Inc. | Core | iQIYI | Inc. | Core | iQIYI | Inc. | Core | iQIYI | Inc. | |||||||||||||||||||||||||||||||||||||
| Diluted earnings per ADS |
13.59 | 18.22 | 6.77 | 0.95 | ||||||||||||||||||||||||||||||||||||||||||||
| Add: Accretion of the redeemable noncontrolling interests |
0.46 | 0.53 | 0.53 | 0.07 | ||||||||||||||||||||||||||||||||||||||||||||
| Add: Non-GAAP adjustments to earnings per ADS |
1.20 | 1.65 | 14.56 | 2.06 | ||||||||||||||||||||||||||||||||||||||||||||
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| Diluted earnings per ADS (non-GAAP) |
15.25 | 20.40 | 21.86 | 3.08 | ||||||||||||||||||||||||||||||||||||||||||||
| (1) | This represents amortization and impairment of intangible assets resulting from business combinations. |
| (2) | This represents Baidu’s share of equity method investments for other non-GAAP reconciling items, amortization and impairment of intangible assets not on the investee’s books, accretion of their redeemable noncontrolling interests, and the gain or loss associated with the issuance of shares by the investees at a price higher or lower than the carrying value per share. |
| (3) | This represents tax impact of all non-GAAP adjustments. |
20
Baidu, Inc.
Reconciliations of Non-GAAP Financial Measures to the Nearest Comparable GAAP Measures
(In millions except for ADS and per ADS information, unaudited)
| Twelve months ended | Twelve months ended | Twelve months ended | ||||||||||||||||||||||||||||||||||
| December 31, 2022 | December 31, 2023 | December 31, 2023 | ||||||||||||||||||||||||||||||||||
| (RMB) | (RMB) | (US$) | ||||||||||||||||||||||||||||||||||
| Baidu | Baidu, | Baidu | Baidu, | Baidu | Baidu, | |||||||||||||||||||||||||||||||
| Core | iQIYI | Inc. | Core | iQIYI | Inc. | Core | iQIYI | Inc. | ||||||||||||||||||||||||||||
| Operating income |
14,534 | 1,312 | 15,911 | 18,825 | 2,989 | 21,856 | 2,651 | 421 | 3,078 | |||||||||||||||||||||||||||
| Add: Share-based compensation expenses |
5,977 | 811 | 6,788 | 5,708 | 637 | 6,345 | 804 | 90 | 894 | |||||||||||||||||||||||||||
| Add: Amortization and impairment of intangible assets(1) |
223 | 50 | 273 | 215 | 17 | 232 | 31 | 2 | 33 | |||||||||||||||||||||||||||
| Add: Contingent loss(2) |
214 | — | 214 | — | — | — | — | — | — | |||||||||||||||||||||||||||
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| Operating income (non-GAAP) |
20,948 | 2,173 | 23,186 | 24,748 | 3,643 | 28,433 | 3,486 | 513 | 4,005 | |||||||||||||||||||||||||||
| Add: Depreciation of fixed assets |
6,140 | 337 | 6,477 | 7,115 | 275 | 7,390 | 1,002 | 39 | 1,041 | |||||||||||||||||||||||||||
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| Adjusted EBITDA |
27,088 | 2,510 | 29,663 | 31,863 | 3,918 | 35,823 | 4,488 | 552 | 5,046 | |||||||||||||||||||||||||||
| Net income (loss) attributable to Baidu |
7,551 | (136 | ) | 7,559 | 19,401 | 1,925 | 20,315 | 2,733 | 271 | 2,861 | ||||||||||||||||||||||||||
| Add: Share-based compensation expenses |
5,964 | 811 | 6,371 | 5,704 | 637 | 5,993 | 803 | 90 | 844 | |||||||||||||||||||||||||||
| Add: Amortization and impairment of intangible assets(1) |
200 | 50 | 229 | 195 | 17 | 204 | 27 | 2 | 29 | |||||||||||||||||||||||||||
| Add: Disposal (gain) |
(515 | ) | (368 | ) | (700 | ) | (1,926 | ) | (90 | ) | (1,967 | ) | (271 | ) | (13 | ) | (277 | ) | ||||||||||||||||||
| Add: Impairment of long-term investments |
2,180 | 841 | 2,601 | 479 | 336 | 631 | 67 | 47 | 89 | |||||||||||||||||||||||||||
| Add: Fair value loss (gain) of long-term investments |
3,977 | (18 | ) | 3,968 | (54 | ) | 4 | (52 | ) | (8 | ) | 1 | (7 | ) | ||||||||||||||||||||||
| Add: Reconciling items on equity method investments(3) |
1,473 | 105 | 1,548 | 3,918 | 9 | 3,922 | 552 | 2 | 551 | |||||||||||||||||||||||||||
| Add: Charitable donation from Baidu(4) |
136 | — | 136 | — | — | — | — | — | — | |||||||||||||||||||||||||||
| Add: Contingent loss(2) |
214 | — | 214 | — | — | — | — | — | — | |||||||||||||||||||||||||||
| Add: Tax effects on non-GAAP adjustments(5) |
(1,245 | ) | (1 | ) | (1,246 | ) | (299 | ) | — | (299 | ) | (41 | ) | — | (41 | ) | ||||||||||||||||||||
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| Net income attributable to Baidu (non-GAAP) |
19,935 | 1,284 | 20,680 | 27,418 | 2,838 | 28,747 | 3,862 | 400 | 4,049 | |||||||||||||||||||||||||||
21
| Twelve months ended | Twelve months ended | Twelve months ended | ||||||||||||||||||||||||||||||||||
| December 31, 2022 | December 31, 2023 | December 31, 2023 | ||||||||||||||||||||||||||||||||||
| (RMB) | (RMB) | (US$) | ||||||||||||||||||||||||||||||||||
| Baidu | Baidu, | Baidu | Baidu, | Baidu | Baidu, | |||||||||||||||||||||||||||||||
| Core | iQIYI | Inc. | Core | iQIYI | Inc. | Core | iQIYI | Inc. | ||||||||||||||||||||||||||||
| Diluted earnings per ADS |
19.85 | 55.08 | 7.76 | |||||||||||||||||||||||||||||||||
| Add: Accretion of the redeemable noncontrolling interests |
1.68 | 2.02 | 0.28 | |||||||||||||||||||||||||||||||||
| Add: Non-GAAP adjustments to earnings per ADS |
37.40 | 23.75 | 3.35 | |||||||||||||||||||||||||||||||||
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| Diluted earnings per ADS (non-GAAP) |
58.93 | 80.85 | 11.39 | |||||||||||||||||||||||||||||||||
| (1) | This represents amortization and impairment of intangible assets resulting from business combinations. |
| (2) | This represents contingent loss pertaining to legal proceeding involving former advertising agency. |
| (3) | This represents Baidu’s share of equity method investments for other non-GAAP reconciling items, amortization and impairment of intangible assets not on the investee’s books, accretion of their redeemable noncontrolling interests, and the gain or loss associated with the issuance of shares by the investees at a price higher or lower than the carrying value per share. |
| (4) | This represents non-recurring charitable donation to discrete events. |
| (5) | This represents tax impact of all non-GAAP adjustments. |
22