Tuesday, January 8, 2008

Baidu expected to hit high end of Q4 07 estimate

At 2007 end, China had 182 million users.
Search ad revenue was at 2.87 billion Yuan
last year. Assuming Baidu has 61% revenue share,
that translates to net revenue of $241.02 million
for 2008.

(2.87 billion yuan / 7.264 yuan-per-dollar
x 0.61) = $241.02 million

That is close to the highest estimate
on the street, $241.89 million dollars. There
is upside to my estimate, since 61% market share
for all of 2007 is conservative - Baidu has been
steadily increasing share.

Search revenue is expected to grow 81% this year,
and currency future traders are betting on the
Yuan appreciating 8 to 10%. That totals to an EPS
rise of almost 100% in 2008, even if margins just
stay the same.

Summary of Internet Society of China report

No comments: