Baidu Inc. (BIDU) – Get the report from Baidu Inc. U.S.-listed stocks fell on Wednesday after the Chinese tech giant warned of slowing ad sales as part of Beijing’s broader crackdown on corporate profits and business practices.
Baidu, often referred to as the Google (GOOGL) – Get the Class A report from Alphabet Inc. of China, posted third-quarter earnings per share of 14.66 Chinese yuan, with revenue up 13% from last year to 31.9 billion yuan ($ 5 billion). Turning to the final months of the year, which will include sales of the “Singles Day” business event in early November, Baidu said revenue will remain largely flat, with a midpoint of 4.8 billion. dollars, as ad sales slow amid Beijing’s recent restrictions on the tech sector.
“Our ad spending has been affected by sectors such as education, real estate and furniture, travel and franchising as we expect this headwind to continue in the near term,” said Wednesday. CEO Robin Li to investors.
Baidu shares were down 5.6% at midday on Wednesday to change hands to $ 161.65 each. China-based companies listed in the US were also trading lower, with JD.com (JD) – Get the report from JD.com Inc. 3% drop to $ 83.11 and Alibaba Group Holding (BABA) – Get the report from Alibaba Group Holding Ltd. down 3.9% to $ 161.90 each.
Earlier this year, regulators in Beijing fined the group a record $ 2.8 billion in a large-scale anti-monopoly investigation by China’s State Administration for Market Regulation , who said that some of its practices “undermine the activities of merchants on the platforms and the legitimate rights and interests of consumers.
China extended its crackdown on the tech industry in September with a warning to the country’s largest companies to stop blocking links to rivals’ platforms.
In a move by many analysts interpreted as another blow through the arc of tech giants Alibaba and Tencent (IRRITABLE) , China’s Ministry of Industry and Information Technology said it was “guiding affected companies to self-examine and rectify” their long-standing practice of blocking access to competitors.
Another report from the Financial Times in London suggested that Beijing was also making plans to force the split of Ant Group’s popular Alipay while creating a new payments app that will be at least partly state-owned.