Chinese search giant Baidu's revenue growth slows

Image source, AFP

Image caption, Baidu's revenue for the first quarter came in below market expectations again

Chinese online search giant Baidu saw its slowest revenue growth for nearly seven years in the first quarter of 2015.

The firm, seen as China's equivalent of Google, had revenue of 12.73bn yuan ($2bn; 拢1.3bn) from January to March, below forecasts of 12.9bn yuan.

Its net profit for the quarter also fell 3.4% compared with a year ago.

Baidu said customers spending less money on its online marketing business had hit its earnings.

New York-listed shares of the company were down 2.6% in after-hours trading as a result of the quarterly report.

Struggling at the top

The tech giant has been struggling to stay ahead of its rivals in the world's second-biggest economy.

In February, it reported 2014 fourth-quarter earnings below expectations, sending its shares plunging.

The company is still dealing with the impact of consumers moving away from personal computers to mobile phones, where it makes half of its revenue. But businesses pay less for advertising on smartphones than they do on computers.

Social media rivals such as Tencent and e-commerce giant Alibaba are also giving it intense competition.

A bid to create new streams of income from mobile has also pushed up Baidu's costs. Expenses for its research and development department shot up 79% to $368.8m.

"We continue to execute on our investment plan to capture the vast growth opportunities ahead and fulfil our vision," said chief financial officer Jennifer Li in a on Wednesday.