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
(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