424B5
BAIDU, INC. filed this Form 424B5 on 06/26/2017
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a decrease of 339.4% in bad debt provision and a decrease of 63.9% in intangible amortization expenses, all compared to the amounts in the three months ended March 31, 2016, respectively.

Transaction Services. Operating costs and expenses of transaction services mainly consist of marketing and promotion expenses, staff related costs, depreciation and intangible amortization expenses, bandwidth costs, traffic acquisition costs, delivery costs and business tax and surcharges, respectively.

Operating costs and expenses of transaction services were RMB3.1 billion (US$452.5 million) in the three months ended March 31, 2017, compared to RMB4.3 billion in the three months ended March 31, 2016. The decrease was primarily a result of a 79.9% decrease in marketing and promotion expenses, partially offset by a 34.9% increase in staff related costs, all compared to the amounts in the three months ended March 31, 2016, respectively.

iQiyi. Operating costs and expenses of iQiyi mainly consist of content costs, bandwidth costs, staff related costs, marketing and promotion expenses, and business tax and surcharges.

Operating costs and expenses of iQiyi were RMB4.2 billion (US$616.5 million) in the three months ended March 31, 2017, compared to RMB2.8 billion in the three months ended March 31, 2016. The increase was primarily due to a result of an 87.2% increase in content costs, a 43.9% increase in staff related costs, a 67.0% increase in business tax and surcharges, and a 19.8% increase in bandwidth costs, partially offset by a 75.0% decrease in film distribution costs, all compared to the amounts in the three months ended March 31, 2016, respectively.

Cash Flows and Working Capital

As of March 31, 2017, we held a total of RMB90.7 billion (US$13.2 billion) in cash and cash equivalents and short-term investments.

The following table sets forth a summary of our cash flows for the periods indicated.

 

     For the Three Months Ended March 31,  
     2016      2017  
     RMB      RMB      US$  
     (in thousands, unaudited)  

Net cash generated from operating activities

     4,931,093        4,703,606        683,346  

Net cash used in investing activities

     (2,665,149      (21,485,187      (3,121,395

Net cash generated from financing activities

     402,828        20,475,915        2,974,766  

Net increase in cash and cash equivalents

     2,633,312        3,667,295        532,789  

Cash and cash equivalents at beginning of the period

     9,959,932        10,898,463        1,583,342  

Cash and cash equivalents at end of the period

     12,593,244        14,565,758        2,116,131  

Net cash generated from operating activities decreased to RMB4.7 billion (US$683.3 million) in the three months ended March 31, 2017 from RMB4.9 billion in the three months ended March 31, 2016. This decrease was primarily due to the decrease in net income, as adjusted for non-cash items and changes in working capital.

Net cash used in investing activities increased to RMB21.5 billion (US$3.1 billion) in the three months ended March 31, 2017 from RMB2.7 billion in the three months ended March 31, 2016. The increase was primarily due to increased purchases of short-term investments, increased micro loan origination and disbursement, and purchases of trading investments for our wealth management business, partially offset by increased sales and maturities of short-term investments.

Net cash generated from financing activities increased to RMB20.5 billion (US$3.0 billion) in the three months ended March 31, 2017 from RMB402.8 million in the three months ended March 31, 2016. The increase

 

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