Baidu posts slowest quarterly revenue growth in two years

Baidu said on Monday that revenue in the third quarter was $994.6 million, up 49.7 percent from the year-ago period.

For the fourth quarter, Baidu said it expects revenue of $979.3 million to $1.010 billion, below the average analysts' forecasts of $1.03 billion according to Thomson Reuters I/B/E/S.

Baidu posted net income of $478.6 million in the three months ended September 30, up roughly 60 percent year-on-year. Baidu said it earned $1.39 per American Depository Share in the third quarter, excluding stock-based compensation expenses.

Baidu, which has dominated the search market since Google Inc relocated its search engine to Hong Kong in a row over censorship in 2010, is facing a new challenge from China's top anti-virus software firm, Qihoo 360 Technology.

A search engine launched by Qihoo in August has started to gain traction, accounting for 5-10 percent of search traffic since its launch, according to data from research firm Analysys International.

Baidu shares have fallen about 2 percent this year on expectations that it will be hurt by slower economic growth in China, underperforming a 14 percent rise on the Nasdaq exchange.

© Thomson Reuters 2012