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Baidu is a Chinese language internet search engine located in Beijing,China. Baidu was incorporated in 2000 and has a current market cap of $9.15 billion. Bidu has on online auction,P4P, which allows clients of Bidu to bid on the positioning of their links based on what they are willing to pay.
Baidu reported 4th quarter 2007 earnings and they had some great improvements in gross revenue and net revenue. Revenue jumped 110 % over 4th quarter 2006 revenue to $78 million. Net revenue jumped 79 % over 4th quarter 2006 to $30 million or .87 cents per share. Bidu had a $10 million dollar charge related to expansion into Japan and this will be a future revenue source.
China is booming and it's possible to find companys with phenomenal growth like Baidu. The internet is in it's infancy in China and will continue to grow along with many other business models.
At this time I would still be hesitant to invest in Biadu. Baidu has couple of giants trailing it and trouble could on the horizon. Biadu currently has 60 % of the Chinese internet search traffic,but guess whos closing in? Google and Yahoo-China. As I said earlier the Chinese internet model is in its infancy and Baidu has a 60 % market share,but Google has 29% and Yahoo-China has 10 %. This is great for now ,but Google I think will soon start gaining market share from Baidu. And then you have Yahoo-China. Yahoo-China has 10 % of the traffic now,but they own 10 % of Alibaba,the largest ecommerce site in China and 40 % of the Alibaba Group parent company of Alibaba and Alibaba Group controls 69 % of all the online transaction traffic in China.
My outlook is Microsoft buys Yahoo and that gives Microsoft a huge foot print in China. That gives all of Yahoo a new management and pools all the resources of Yahoo and Microsoft and that makes Microsoft the leader in China.
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