Baidu 1Q Profit, Sales Soar

A receptionist works behind the logo for Baidu.com, a Chinese language search engine, at the company's office in Beijing, in this July 28, 2005, file photo. Baidu.com Inc. said Friday, April 27, 2007, its first-quarter profits jumped by 143 percent on strong traffic growth and higher advertising revenues. (AP Photo/Ng Han Guan, File) (Ng Han Guan - AP)

BEIJING -- Baidu.com Inc., China's most popular Internet search engine, said Friday its first-quarter profits jumped 143 percent on strong traffic growth and higher advertising revenues.

"We believe that the best is ahead of us," CEO Robin Li said in a conference call with analysts.

Profits rose to 85.5 million yuan ($11.1 million), up from 30.6 million yuan ($4 million) in the same quarter of 2006, the company said. It said total revenues rose more than 103 percent to 275.6 million yuan ($35.7 million).

Earnings were 2.47 yuan (32 cents) per American depositary share, up from 0.89 yuan (11 cents) per share in the same period of 2006.

Baidu's U.S. shares gained more than 22 percent in extended trading.

Li said traffic increased "quite quickly" after the Chinese New Year holiday in February but released no details.

The number of active online marketing customers during the quarter grew to more than 112,000, up nearly 4 percent from the previous quarter, the Beijing-based company said.

It said revenues in the coming quarter are expected to double compared with the same period last year.

Baidu appears to have resumed rapid growth after a slowdown last year caused by its introduction of a new advertising sales system, said Citigroup analyst Jason Brueschke.

"My view is that we're probably likely to see strong growth in the second half of the year," Brueschke said. "In terms of traffic, which is one of the most important things, Baidu basically has a stranglehold on Google and Yahoo at this point."

Baidu has about 55 percent of China's search engine market, ahead of Google Inc. with 21.7 percent and Yahoo Inc.'s China arm, which has 7.2 percent, according to market data company iResearch Inc.

China has the world's second-largest population of Internet users, with 137 million people online, and is on track to surpass the United States as the largest online population in two years.

Baidu has been expanding its offerings beyond search. During the first quarter, it launched a Web log service and ventures with Viacom Inc.'s MTV division to distribute music videos online and with recording company EMI Group Ltd. in streaming music.

Baidu's U.S.-traded shares added $24.63 to $134 in after-hours electronic trading after closing Thursday up $4.69, or 4.5 percent, to $109.37 on the Nasdaq Stock Market.