(Yicai Global) Aug. 13 -- Baidu’s shares skidded after China’s dominant internet search provider published cautious guidance on revenue for the current three months following better-than-expected second-quarter revenue.

Baidu [HKG:9888] fell 3.1 percent in Hong Kong today to HKD154 (USD19.79), following a 3.2 percent drop in its New York-traded stock [NASDAQ:BIDU] yesterday to USD159.63.

The Beijing-based tech firm, whose business interests range from internet and cloud services to autonomous driving, expects revenue in the three months through Sept. 31 to climb 8 percent to 19 percent from a year earlier to between CNY30.6 billion and CNY33.5 billion (USD4.7 billion and USD5.2 billion), according to the earnings report it released yesterday. The market consensus was for CNY31.02 billion (USD5.12 billion).

“The Covid-19 situation in China is evolving and business visibility is limited,” the company said, adding that the outlook “reflects Baidu's current and preliminary view, which is subject to substantial uncertainties.”

In the quarter ended June 20, revenue jumped 20 percent to CNY31.4 billion from a year ago, beating the market’s expectation for CNY30.96 billion amid a pickup in advertising income at Baidu’s core search business and stronger demand for the firm’s AI and cloud services.

But Baidu reported a CNY583 million (USD90 million) loss for the period, versus a CNY3.58 billion  net profit in the same quarter of 2020, because of a CNY3.1 billion fair value loss from long-term investments, chiefly a marking down of the value of it stake in Kuaishou Technology, China second-biggest short video platform operator.

As of today’s close, Kauaishou’s shares [HKG:1024] have fallen 81 percent to HKD80.05 each from a peak of HKD415 on Feb. 17 amid a wider regulatory clampdown on China’s big tech companies.

Baidu’s non-GAAP net income rose 5 percent to CNY5.36 billion in the second quarter. Core business revenue gained 27 percent to CNY24 billion, boosted by 71 percent growth at Baidu’s AI cloud services.

“Baidu Core delivered another strong quarter, powered by the fast growth of our new AI business. AI enables businesses and local governments to do more and serve more people," said Robin Li, co-founder and chief executive. “We are excited about the opportunities to help different industries transform their business with AI and support our goal to become carbon neutral by 2030.”

Baidu’s smart speaker Xiaodu’s service revenue, including advertising and membership, surged five-fold, accounting for more than 10 percent of Xiaodu’s quarterly total revenue.

The monthly active users of Baidu’s mobile ecosystem reached 580 million in June, and 77 percent of them were daily logged-in users.

Editor: Futura Costaglione