Baidu revenue falls for fifth straight quarter

Baidu reported a fifth straight quarterly revenue decline on Tuesday, as the Chinese technology company said growth in artificial intelligence services supported its longer-term transition.

The Beijing-based search engine provider reported second-quarter revenue of 31.3 billion yuan, or $4.6 billion, down 4% from a year earlier, according to an unaudited financial report. Operating income for the three months ending June 30 was 3 billion yuan, compared with 3.3 billion yuan a year earlier.

Chief executive Robin Li said Baidu's online marketing business remained under pressure, but that momentum in its AI-powered business supported the company's shift from an internet-focused business to an AI-first company.

Revenue from Baidu's AI business, including applications and supporting infrastructure, rose 25% year on year to 12.5 billion yuan in the second quarter. Revenue from online marketing services fell 19% to 13.1 billion yuan.

Baidu has promoted AI for years and released Ernie, one of China's first AI chatbots. Its search marketing business has been affected by weaker Chinese consumer spending. China's National Bureau of Statistics said retail sales grew 0.6% in July, below the 1.5% forecast in a Bloomberg survey and down from 1% growth in June.