Baidu 6K Announces Second Quarter 2024 Results | BIDU 22 Aug 24

Exhibit 99.1

Baidu Announces Second Quarter 2024 Results

BEIJING, China, Aug 22, 2024 — Baidu, Inc. (NASDAQ: BIDU and HKEX: 9888 (HKD Counter) and 89888 (RMB Counter)), (“Baidu” or the “Company”), a leading AI company with strong Internet foundation, today announced its unaudited financial results for the second quarter ended June 30, 2024.

“AI Cloud continued to accelerate in the second quarter, offsetting the ongoing macro headwinds for online marketing revenue and resulting in modestly positive topline growth for Baidu Core. Operationally, we fast-tracked the renovation of Baidu search, which we believe will drive long-term success despite the short-term impact on monetization. We also achieved new breakthroughs with Apollo Go, which now offers 100% fully driverless ride-hailing services in practically the entire Wuhan municipality, and has started scalable testing of the latest RT6 vehicles,” said Robin Li, Co-founder and CEO of Baidu. “Gradually, the transformative impact of Gen-AI and foundation models is becoming more tangible in business and everyday life. Throughout all layers of our AI technology stack and with the rapid adoption of applications built on top of ERNIE, we are scaling AI to address real-world problems and generate substantial value both for external customers and our own product portfolio.”

“As we speeded up the AI-native transformation of our products in the second quarter, we continued to optimize our operations and maintained a healthy margin,” said Rong Luo, CFO of Baidu. “For AI Cloud in particular, we expect growth to maintain a strong momentum.”

Second Quarter 2024 Financial Highlights¹


	Baidu, Inc.
(In millions except per ADS, unaudited)	Q2			Q1
	2023			2024			Q2 2024						YOY			QOQ
	*RMB*			*RMB*			*RMB*			*US$*
Total revenues		34,056			31,513			33,931			4,669			(0	%)		8	%
Operating income		5,210			5,484			5,944			818			14	%		8	%
Operating income (non-GAAP)²		7,334			6,673			7,500			1,032			2	%		12	%
Net income to Baidu		5,210			5,448			5,488			755			5	%		1	%
Net income to Baidu (non-GAAP)²		7,998			7,011			7,396			1,018			(8	%)		5	%
Diluted earnings per ADS		14.17			14.91			15.01			2.07			6	%		1	%
Diluted earnings per ADS (non-GAAP)²		22.55			19.91			21.02			2.89			(7	%)		6	%
Adjusted EBITDA²		9,116			8,244			9,147			1,259			0	%		11	%
Adjusted EBITDA margin		27	%		26	%		27	%		27	%

1	Unless otherwise noted, RMB to USD was converted at an exchange rate of RMB7.2672 as of June 28, 2024, 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).


	Baidu Core
(In millions, unaudited)	Q2			Q1
	2023			2024			Q2 2024						YOY			QOQ
	*RMB*			*RMB*			*RMB*			*US$*
Total revenues		26,407			23,803			26,687			3,672			1	%		12	%
Operating income		4,568			4,538			5,608			772			23	%		24	%
Operating income (non-GAAP)²		6,516			5,586			7,005			964			8	%		25	%
Net income to Baidu Core		5,012			5,150			5,462			752			9	%		6	%
Net income to Baidu Core (non-GAAP)²		7,694			6,628			7,290			1,003			(5	%)		10	%
Adjusted EBITDA²		8,229			7,118			8,617			1,186			5	%		21	%
Adjusted EBITDA margin		31	%		30	%		32	%		32	%

Operational Highlights

Corporate

•	Baidu expanded the ERNIE family of models with the launch of ERNIE 4.0 Turbo in June 2024, offering superior capabilities for typical use cases, and designed to run faster and at lower cost compared to ERNIE 4.0.

•	Baidu returned US$301 million to shareholders since the beginning of Q2 2024, bringing the cumulative repurchase to about US$1.2 billion under the 2023 share repurchase program.

•

Baidu earned a position in the China edition of the S&P Global Sustainability Yearbook, in recognition of its exceptional ESG performance. The selection stems from a comprehensive evaluation of 1,700 Chinese companies as part of the S&P Global 2023 Corporate Sustainability Assessment, underscoring Baidu’s sustainability practices.

AI Cloud

•	PaddlePaddle and ERNIE developer community grew to 14.7 million in June 2024.

Intelligent Driving

•	Apollo Go, Baidu’s autonomous ride-hailing service, provided about 899K rides in the second quarter of 2024, up 26% year over year. As of July 28, 2024, the cumulative rides provided to the public by Apollo Go surpassed 7 million.

•	On June 19, Apollo Go started offering 100% fully driverless operations in practically the entire Wuhan municipality, its largest operational city, marking a significant milestone.

•	The sixth-generation of our autonomous vehicle, the RT6, is now undergoing scalable testing.

Mobile Ecosystem

•	In June 2024, Baidu App’s MAUs reached 703 million, up 4% year over year.

•	Managed Page accounted for 51% of Baidu Core’s online marketing revenue in the second quarter of 2024.

Second Quarter 2024 Financial Results

Total revenues were RMB33.9 billion ($4.67 billion), which was basically flat from last year.

•

Revenue from Baidu Core was RMB26.7 billion ($3.67 billion), increasing 1% year over year; online marketing revenue was RMB19.2 billion ($2.64 billion), decreasing 2% year over year, and non-online marketing revenue was RMB7.5 billion ($1.03 billion), up 10% year over year, mainly driven by AI Cloud business.

•	Revenue from iQIYI was RMB7.4 billion ($1.02 billion), decreasing 5% year over year.

Cost of revenues was RMB16.4 billion ($2.26 billion), increasing 1% year over year, primarily due to an increase in traffic acquisition costs and costs related to AI Cloud business.

Selling, general and administrative expenses were RMB5.7 billion ($784 million), decreasing 9% year over year, primarily due to a decrease in expected credit losses, channel spending and promotional marketing expenses and personnel related expenses.

Research and development expenses were RMB5.9 billion ($810 million), decreasing 8% year over year, primarily due to a decrease in personnel related expenses.

Operating income was RMB5.9 billion ($818 million). Baidu Core operating income was

RMB5.6 billion ($772 million), and Baidu Core operating margin was 21%. Non-GAAP operating income was RMB7.5 billion ($1.03 billion). Non-GAAP Baidu Core operating income was RMB7.0 billion ($964 million), and non-GAAP Baidu Core operating margin was 26%.

Total other income, net was RMB771 million ($106 million), decreasing 44% year over year, primarily due to a decrease in net foreign exchange gain and disposal gain, partially offset by the decrease in fair value loss and impairment loss from long-term investments.

Income tax expense was RMB1.1 billion ($156 million), compared to RMB1.3 billion in the same period last year.

Net income attributable to Baidu was RMB5.5 billion ($755 million), and diluted earnings per ADS was RMB15.01 ($2.07). Net income attributable to Baidu Core was RMB5.5 billion ($752 million), and net margin for Baidu Core was 20%. Non-GAAP net income attributable to Baidu was RMB7.4 billion ($1.02 billion). Non-GAAP diluted earnings per ADS was RMB21.02 ($2.89). Non-GAAP net income attributable to Baidu Core was RMB7.3 billion ($1.00 billion), and non-GAAP net margin for Baidu Core was 27%.

Adjusted EBITDA was RMB9.1 billion ($1.26 billion) and adjusted EBITDA margin was 27%. Adjusted EBITDA for Baidu Core was RMB8.6 billion ($1.19 billion) and adjusted EBITDA margin for Baidu Core was 32%.

As of June 30, 2024, cash, cash equivalents, restricted cash and short-term investments were RMB162.0 billion ($22.29 billion), and cash, cash equivalents, restricted cash and short-term investments excluding iQIYI were RMB155.0 billion ($21.32 billion). Free cash flow was

RMB6.3 billion ($862 million), and free cash flow excluding iQIYI was RMB5.9 billion ($810 million).

Conference Call Information

Baidu’s management will hold an earnings conference call at 8.00 AM on Aug 22, 2024, U.S. Eastern Time (8.00 PM on Aug 22, 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. Q2 2024 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/10040402-jgu7y6.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

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, non-GAAP operating margin, non-GAAP net income 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.

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, and amortization and impairment of intangible assets resulting from business combinations.

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, impairment of long-term investments, and fair value gain (loss) of long-term investments, 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, and share-based compensation expenses.

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.”

Baidu, Inc.

Condensed Consolidated Statements of Income

(In millions except for per share (or ADS) information, unaudited)


	Three Months Ended												Six Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,			June 30,			June 30,
	2023			2024			2024			2024			2023			2024			2024
	RMB			RMB			RMB			US$⁽²⁾			RMB			RMB			US$⁽²⁾
Revenues:
Online marketing services		21,081			18,490			20,625			2,838			39,053			39,115			5,382
Others		12,975			13,023			13,306			1,831			26,147			26,329			3,623

Total revenues		34,056			31,513			33,931			4,669			65,200			65,444			9,005

Costs and expenses:
Cost of revenues⁽¹⁾		16,167			15,291			16,398			2,257			31,319			31,689			4,361
Selling, general and administrative⁽¹⁾		6,298			5,375			5,700			784			11,887			11,075			1,524
Research and development⁽¹⁾		6,381			5,363			5,889			810			11,804			11,252			1,548

Total costs and expenses		28,846			26,029			27,987			3,851			55,010			54,016			7,433

Operating income		5,210			5,484			5,944			818			10,190			11,428			1,572
Other income:
Interest income		1,948			2,091			1,993			274			3,863			4,084			562
Interest expense		(817	)		(766	)		(742	)		(102	)		(1,621	)		(1,508	)		(208	)
Foreign exchange gain, net		1,176			401			93			13			1,070			494			68
Share of losses from equity method investments		(383	)		(205	)		(119	)		(16	)		(431	)		(324	)		(45	)
Others, net		(555	)		(275	)		(454	)		(63	)		1,083			(729	)		(100	)

Total other income, net		1,369			1,246			771			106			3,964			2,017			277

Income before income taxes		6,579			6,730			6,715			924			14,154			13,445			1,849
Income tax expense		1,270			883			1,131			156			2,463			2,014			277

Net income		5,309			5,847			5,584			768			11,691			11,431			1,572
Net income attributable to noncontrolling interests		99			399			96			13			656			495			68

Net income attributable to Baidu		5,210			5,448			5,488			755			11,035			10,936			1,504


	Three Months Ended								Six Months Ended
	June 30,		March 31,		June 30,		June 30,		June 30,		June 30,		June 30,
	2023		2024		2024		2024		2023		2024		2024
	RMB		RMB		RMB		US$⁽²⁾		RMB		RMB		US$⁽²⁾
Earnings per ADS
(1 ADS representing 8
Class A ordinary shares):
— Basic		14.34		14.97		15.11		2.08		30.55		30.12		4.14
— Diluted		14.17		14.91		15.01		2.07		30.05		29.98		4.13
Earnings per share for Class A and Class B ordinary shares:
— Basic		1.79		1.87		1.89		0.26		3.82		3.77		0.52
— Diluted		1.77		1.86		1.88		0.26		3.76		3.74		0.51
Weighted average number of Class A and Class B ordinary shares outstanding (in millions):
— Basic		2,804		2,804		2,796		2,796		2,801		2,800		2,800
— Diluted		2,834		2,816		2,804		2,804		2,836		2,810		2,810

(1) Includes share-based compensation expenses as follows:

Cost of revenues		194		108		146		20		292		254		35
Selling, general and administrative		446		417		385		53		909		802		110
Research and development		1,403		618		981		135		2,231		1,599		220

Total share-based compensation expenses		2,043		1,143		1,512		208		3,432		2,655		365

(2)	All translations from RMB to U.S. dollars are made at a rate of RMB7.2672 to US$1.00, the exchange rate in effect as of June 28, 2024 as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System.

Baidu, Inc.

Condensed Consolidated Balance Sheets

(In millions, unaudited)


	December 31,		June 30,		June 30,
	2023		2024		2024
	RMB		RMB		US$
ASSETS
Current assets:
Cash and cash equivalents		25,231		43,534		5,990
Restricted cash		11,503		11,646		1,603
Short-term investments, net		168,670		106,821		14,699
Accounts receivable, net		10,848		11,112		1,529
Amounts due from related parties		1,424		1,396		192
Other current assets, net		12,579		12,757		1,756

Total current assets		230,255		187,266		25,769

Non-current assets:
Fixed assets, net		27,960		29,154		4,012
Licensed copyrights, net		6,967		6,914		951
Produced content, net		13,377		14,320		1,970
Intangible assets, net		881		812		112
Goodwill		22,586		22,586		3,108
Long-term investments, net		47,957		46,193		6,356
Long-term time deposits and held-to-maturity investments		24,666		72,497		9,976
Amounts due from related parties		195		212		29
Deferred tax assets, net		2,100		2,342		322
Operating lease right-of-use assets		10,851		10,919		1,503
Other non-current assets		18,964		22,312		3,071

Total non-current assets		176,504		228,261		31,410

Total assets		406,759		415,527		57,179


	December 31,		June 30,		June 30,
	2023		2024		2024
	RMB		RMB		US$
LIABILITIES, REDEEMABLE
NONCONTROLLING INTERESTS AND EQUITY
Current liabilities:
Short-term loans		10,257		12,514		1,722
Accounts payable and accrued liabilities		37,717		37,988		5,227
Customer deposits and deferred revenue		14,627		14,038		1,932
Deferred income		306		291		40
Long-term loans, current portion		2		29		4
Convertible senior notes, current portion		2,802		2,892		398
Notes payable, current portion		6,029		7,986		1,099
Amounts due to related parties		1,603		1,831		252
Operating lease liabilities		3,108		3,196		440

Total current liabilities		76,451		80,765		11,114

Non-current liabilities:
Deferred income		200		287		39
Deferred revenue		481		520		72
Amounts due to related parties		77		67		9
Long-term loans		14,223		14,859		2,045
Notes payable		34,990		27,860		3,834
Convertible senior notes		8,144		8,408		1,157
Deferred tax liabilities		2,725		2,940		405
Operating lease liabilities		5,040		5,056		696
Other non-current liabilities		1,820		1,827		250

Total non-current liabilities		67,700		61,824		8,507

Total liabilities		144,151		142,589		19,621

Redeemable noncontrolling interests		9,465		10,107		1,391
Equity
Total Baidu shareholders’ equity		243,626		252,769		34,782
Noncontrolling interests		9,517		10,062		1,385

Total equity		253,143		262,831		36,167

Total liabilities, redeemable noncontrolling interests, and equity		406,759		415,527		57,179

Baidu, Inc.

Selected Information

(In millions, unaudited)


	Three months ended												Three months ended												Three months ended												Three months ended
	June 30, 2023 (RMB)												March 31, 2024 (RMB)												June 30, 2024 (RMB)												June 30, 2024 (US$)
	Baidu						Elim &			Baidu,			Baidu						Elim &			Baidu,			Baidu						Elim &			Baidu,			Baidu					Elim &			Baidu,
	Core			iQIYI			adj⁽²⁾			Inc.			Core			iQIYI			adj⁽²⁾			Inc.			Core			iQIYI			adj⁽²⁾			Inc.			Core		iQIYI			adj⁽²⁾			Inc.
Total revenues		26,407			7,802			(153	)		34,056			23,803			7,927			(217	)		31,513			26,687			7,439			(195	)		33,931			3,672		1,024			(27	)		4,669
YOY																										1	%		(5	%)					(0	%)
QOQ																										12	%		(6	%)					8	%
Costs and expenses:
Cost of revenues⁽¹⁾		10,553			5,774			(160	)		16,167			9,839			5,631			(179	)		15,291			10,888			5,678			(168	)		16,398			1,498		781			(22	)		2,257
Selling, general and administrative⁽¹⁾		5,344			979			(25	)		6,298			4,492			922			(39	)		5,375			4,751			970			(21	)		5,700			654		133			(3	)		784
Research and development⁽¹⁾		5,942			439			—			6,381			4,934			429			—			5,363			5,440			449			—			5,889			748		62			—			810

Total costs and expenses		21,839			7,192			(185	)		28,846			19,265			6,982			(218	)		26,029			21,079			7,097			(189	)		27,987			2,900		976			(25	)		3,851

YOY
Cost of revenues																										3	%		(2	%)					1	%
Selling, general and administrative																										(11	%)		(1	%)					(9	%)
Research and development																										(8	%)		2	%					(8	%)
Costs and expenses																										(3	%)		(1	%)					(3	%)
Operating income (loss)		4,568			610			32			5,210			4,538			945			1			5,484			5,608			342			(6	)		5,944			772		48			(2	)		818
YOY																										23	%		(44	%)					14	%
QOQ																										24	%		(64	%)					8	%
Operating margin		17	%		8	%					15	%		19	%		12	%					17	%		21	%		5	%					18	%
Add: total other income (loss), net		1,603			(234	)		—			1,369			1,508			(262	)		—			1,246			1,011			(240	)		—			771			139		(33	)		—			106
Less: income tax expense		1,262			8			—			1,270			866			17			—			883			1,105			26			—			1,131			152		4			—			156
Less: net (loss) income attributable to NCI		(103	)		3			199	⁽³⁾		99			30			11			358	⁽³⁾		399			52			7			37	⁽³⁾		96			7		1			5	⁽³⁾		13

Net income (loss) attributable to Baidu		5,012			365			(167	)		5,210			5,150			655			(357	)		5,448			5,462			69			(43	)		5,488			752		10			(7	)		755

YOY																										9	%		(81	%)					5	%
QOQ																										6	%		(89	%)					1	%
Net margin		19	%		5	%					15	%		22	%		8	%					17	%		20	%		1	%					16	%


	Three months ended										Three months ended										Three months ended										Three months ended
	June 30, 2023 (RMB)										March 31, 2024 (RMB)										June 30, 2024 (RMB)										June 30, 2024 (US$)
	Baidu						Elim &	Baidu,			Baidu						Elim &	Baidu,			Baidu						Elim &	Baidu,			Baidu				Elim &	Baidu,
	Core			iQIYI			adj⁽²⁾	Inc.			Core			iQIYI			adj⁽²⁾	Inc.			Core			iQIYI			adj⁽²⁾	Inc.			Core		iQIYI		adj⁽²⁾	Inc.
Non-GAAP financial measures:
Operating income (non-GAAP)		6,516			786				7,334			5,586			1,086				6,673			7,005			501				7,500			964		70			1,032
YOY																						8	%		(36	%)			2	%
QOQ																						25	%		(54	%)			12	%
Operating margin (non-GAAP)		25	%		10	%			22	%		23	%		14	%			21	%		26	%		7	%			22	%
Net income attributable to Baidu (non-GAAP)		7,694			595				7,998			6,628			844				7,011			7,290			247				7,396			1,003		34			1,018
YOY																						(5	%)		(58	%)			(8	%)
QOQ																						10	%		(71	%)			5	%
Net margin (non-GAAP)		29	%		8	%			23	%		28	%		11	%			22	%		27	%		3	%			22	%
Adjusted EBITDA		8,229			855				9,116			7,118			1,125				8,244			8,617			536				9,147			1,186		75			1,259
YOY																						5	%		(37	%)			0	%
QOQ																						21	%		(52	%)			11	%
Adjusted EBITDA margin		31	%		11	%			27	%		30	%		14	%			26	%		32	%		7	%			27	%

(1) Includes share-based compensation as follows:
Cost of revenues		160			34				194			76			32				108			117			29				146			16		4			20
Selling, general and administrative		356			90				446			353			64				417			292			93				385			40		13			53
Research and development		1,358			45				1,403			575			43				618			945			36				981			130		5			135

Total share-based compensation		1,874			169				2,043			1,004			139				1,143			1,354			158				1,512			186		22			208

(2)	Relates to intersegment eliminations and adjustments

(3)	Relates to the net income attributable to iQIYI noncontrolling interests

Baidu, Inc.

Condensed Consolidated Statements of Cash Flows

(In millions,unaudited)


	Three months ended									Three months ended									Three months ended									Three months ended
	June 30, 2023 (RMB)									March 31, 2024 (RMB)									June 30, 2024 (RMB)									June 30, 2024 (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		9,746			886			10,632			5,284			936			6,220			7,970			409			8,379			1,097			56			1,153
Net cash provided by (used in) investing activities		7,309			(421	)		6,888			(2,893	)		(223	)		(3,116	)		13,824			337			14,161			1,903			46			1,949
Net cash provided by (used in) financing activities		1,908			(1,176	)		732			2,126			261			2,387			(9,946	)		869			(9,077	)		(1,369	)		120			(1,249	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		496			128			624			154			15			169			66			22			88			9			3			12

Net increase (decrease) in cash, cash equivalents and restricted cash		19,459			(583	)		18,876			4,671			989			5,660			11,914			1,637			13,551			1,640			225			1,865
Cash, cash equivalents and restricted cash
At beginning of period		30,355			5,665			36,020			32,293			5,281			37,574			36,964			6,270			43,234			5,086			863			5,949
At end of period		49,814			5,082			54,896			36,964			6,270			43,234			48,878			7,907			56,785			6,726			1,088			7,814
Net cash provided by operating activities		9,746			886			10,632			5,284			936			6,220			7,970			409			8,379			1,097			56			1,153
Less: Capital expenditures		(2,693	)		(13	)		(2,706	)		(2,016	)		(22	)		(2,038	)		(2,090	)		(28	)		(2,118	)		(287	)		(4	)		(291	)

Free cash flow		7,053			873			7,926			3,268			914			4,182			5,880			381			6,261			810			52			862

Note: Baidu excl. iQIYI represents Baidu, Inc. minus iQIYI’s consolidated cash flows.

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
	June 30, 2023 (RMB)									March 31, 2024 (RMB)									June 30, 2024 (RMB)								June 30, 2024 (US$)

	Baidu						Baidu,			Baidu						Baidu,			Baidu					Baidu,			Baidu					Baidu,
	Core			iQIYI			Inc.			Core			iQIYI			Inc.			Core			iQIYI		Inc.			Core			iQIYI		Inc.
Operating income		4,568			610			5,210			4,538			945			5,484			5,608			342		5,944			772			48		818
Add: Share-based compensation expenses		1,874			169			2,043			1,004			139			1,143			1,354			158		1,512			186			22		208
Add: Amortization and impairment of intangible assets⁽¹⁾		74			7			81			44			2			46			43			1		44			6			—		6

Operating income (non-GAAP)		6,516			786			7,334			5,586			1,086			6,673			7,005			501		7,500			964			70		1,032
Add: Depreciation of fixed assets		1,713			69			1,782			1,532			39			1,571			1,612			35		1,647			222			5		227

Adjusted EBITDA		8,229			855			9,116			7,118			1,125			8,244			8,617			536		9,147			1,186			75		1,259
Net income attributable to Baidu		5,012			365			5,210			5,150			655			5,448			5,462			69		5,488			752			10		755
Add: Share-based compensation expenses		1,872			169			1,949			1,003			139			1,066			1,353			158		1,425			185			22		196
Add: Amortization and impairment of intangible assets⁽¹⁾		61			7			65			42			2			43			41			1		41			6			—		6
Add: Disposal (gain)		(919	)		(89	)		(959	)		(458	)		—			(458	)		(30	)		—		(30	)		(4	)		—		(4	)
Add: Impairment of long-term investments		270			155			340			36			71			68			26			17		34			4			2		5
Add: Fair value loss (gain) of long-term investments		1,239			(4	)		1,237			725			(23	)		714			531			2		531			73			—		73
Add: Reconciling items on equity method investments⁽²⁾		296			(9	)		292			280			—			280			83			—		83			11			—		11
Add: Tax effects on non-GAAP adjustments⁽³⁾		(137	)		1			(136	)		(150	)		—			(150	)		(176	)		—		(176	)		(24	)		—		(24	)

Net income attributable to Baidu (non-GAAP)		7,694			595			7,998			6,628			844			7,011			7,290			247		7,396			1,003			34		1,018

Three months ended

June 30, 2023 (RMB)

March 31, 2024 (RMB)

June 30, 2024 (RMB)

June 30, 2024 (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

14.17

14.91

15.01

2.07

Add: Accretion of the redeemable noncontrolling interests

0.50

0.55

0.57

0.08

Add: Non-GAAP adjustments to earnings per ADS

7.88

4.45

5.44

0.74

Diluted earnings per ADS (non-GAAP)

22.55

19.91

21.02

2.89

(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.

Baidu (BIDU) 6-KBaidu Announces Second Quarter 2024 Results