By Sherry Qin

Baidu's Hong Kong-listed shares rose sharply after the company reported better-than-expected quarterly results and a strong outlook.

Shares of the Chinese technology giant advanced 5.7% to 113.50 Hong Kong dollars (US$14.56) early Wednesday, on track for their biggest gain in almost four months.

Baidu said after Tuesday's market close that its third-quarter revenue rose 6% from a year earlier to 34.45 billion yuan (US$4.85 billion) and operating income climbed 18% to CNY6.27 billion. Its adjusted net income of CNY7.27 billion beat analysts' consensus estimate.

Baidu's advertising revenue growth slowed from the previous quarter on macro uncertainties, but the company said in a postearnings briefing it is optimistic its online marketing revenue growth for 2024 will outpace China's economic expansion.

The company said it expects artificial-intelligence-related ad revenue to contribute hundreds of millions of yuan in the fourth quarter following a restructuring of its overall ad platform.

Although the revenue contribution from AI in online ads and cloud is small at the early stage, Baidu said it expects growing AI-related revenue to become a more significant revenue driver next year.

Citi analysts said in a research note that Baidu is "well positioned to capture the AI monetization opportunity in ads, content and cloud revenues."

In response to the latest U.S. restrictions on exports of high-performance chips to China, Baidu Chairman and Chief Executive Robin Li said the company has secured sufficient advanced chips for AI model training and doesn't expect a meaningful impact on its business in the near term.

Write to Sherry Qin at

(END) Dow Jones Newswires

11-21-23 2256ET