SHANGHAI: Chinese Web search engine Baidu has said its net profit nearly tripled in the fourth quarter, as it strengthens its grip on the Chinese market amid Google's troubles with the authorities.
The Nasdaq-listed Baidu said Monday net profit rose 171.3 percent in the quarter to 1.16 billion yuan ($175.9 million) while revenue was up 94.4 percent to 2.45 billion yuan.
Baidu shares soared in after-hours electronic trading on the news, gaining 7.7 percent to $116.99 after closing at $108.63 on Wall Street.
Baidu said revenue increased 78 percent for the full year to 7.92 billion yuan while net profit rose 137.4 percent to 3.53 billion yuan.
"For the first time, search became the number one Internet application for Internet users in China last year," Baidu chairman and chief executive Robin Li told a conference call.
"It's a long-deserved position, but we just got there last year. That tells you the potential for our business, or the search market, in China."
Market momentum and continued improvements in how the company finds ways to generate money from its services fuelled top line growth, Li said.
"Baidu continues to build upon our clear leadership in China's search market," Li said in a statement ahead of the conference call.
"Looking forward, we will further integrate search with online activities such as e-commerce and social networking, and I am confident that Baidu will remain at the centre of China's Internet ecosystem."
Baidu said it expects revenue of between 2.38 billion and 2.45 billion yuan for the first quarter of the year.
"Let's put it this way -- there are a lot of good factors in 2010 that helped to drive the revenue growth," Li said.
Li credited the strong results on the transition to Baidu's new search engine advertising programme Phoenix Nest, the recovery from the financial crisis and "the better position of our search market leadership".
Baidu enjoyed a 75.5 percent share of the Chinese search market in the fourth quarter, up from 73 percent the previous quarter, according to Beijing-based Analysys International.
Google saw its share of the Chinese search market continue to slide, falling to 19.6 percent in the fourth quarter from 21.6 percent in the previous period, Analysys said.
"We do expect we will have a very long period of high growth going forward," Li said.
Although China's Internet population is massive -- now at 457 million users -- that represents only a third of the country's population, Li said.
Baidu has seen its market share increase steadily following Google's public spat with Beijing last year over censorship.
In March, Google said it would no longer bow to government censors and effectively shut down its Chinese search engine, automatically re-routing mainland users to its uncensored site in Hong Kong.
But it ended the automatic redirect in June to avoid having its licence suspended by China.
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