Baidu’s Li Looks to Deals to Accelerate Push Into Mobile Search

Baidu’s Li Looks to Deals to Accelerate Push Into Mobile Search

Baidu Inc. (BIDU), owner of China’s most-popular Internet search engine, is buying companies to accelerate its transition to mobile devices, where traffic is at least doubling annually, Chief Executive Officer Robin Li said. Baidu bought Santa Clara, California-based TrustGo Mobile Inc. for its security and personal-privacy protection technology earlier this year, Li said in a televised interview with “Bloomberg West,” without disclosing details.The purchase is part of Baidu’s mobile push to lure some of the estimated 460 million people in China who access the Internet from smartphones and tablet computers. The Beijing-based company has announced or completed at least four deals this year valued at an aggregate $2.43 billion, according to data compiled by Bloomberg.

Baidu yesterday said it would continue to invest aggressively in mobile search after reporting net income rose 1.3 percent to 3.05 billion yuan ($500 million) in the third quarter. That surpassed the 3 billion-yuan average of 10 analysts’ estimates compiled by Bloomberg. Revenue rose 42 percent to 8.89 billion yuan, exceeding the 8.79 billion-yuan average of 18 estimates.

International Expansion

Baidu is interested in expanding overseas and is boosting its market share in Thailand, Egypt and Brazil, Li said.

The U.S. is still not a target for expansion, said Li, who is also the company’s chairman.

“For Baidu, we choose not to come to the U.S. market first because this is a market that is very different from developing countries,” he said. “For a company to be successful internationally, they don’t need to be successful in the U.S. The U.S. is just one part of the world.”

Baidu forecast fourth-quarter revenue of as much as 9.5 billion yuan. That compares with the 8.93 billion-yuan average of 14 analysts’ estimates.

“We probably invested a lot more than any of the competitors in the mobile-search front,” Li said separately during an earnings call today. “This year and next year will be very, very crucial for the eventual success of the overall mobile strategy.”

The Internet company agreed in August to pay $160 million for 59 percent of location-based e-commerce service Nuomi Holdings Inc. and said in July it would buy app store 91 Wireless Websoft Ltd. for $1.9 billion.

Last year, the company made two acquisitions with a combined value of about $22.5 million, according to data compiled by Bloomberg.

Baidu had an 81 percent share of search-engine queries in China in the three months ended June, followed by Qihoo 360 Technology Co.’s 10.1 percent, according to data compiled by Bloomberg.

To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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