Moody’s lowers Baidu to stable

Moody’s Investors Service said it changed the outlook on Baidu Inc. to stable from positive.

Moody’s also said it affirmed Baidu’s A3 issuer and senior unsecured debt ratings.

The outlook change reflects an expectation of weaker revenue growth over the next 12 to 18 months due to the controversy related to the way the company posted medical advertisements, the agency said.

As a result of the anticipated weaker revenue growth, Baidu’s credit metrics are less likely to strengthen in the next year, Moody’s said.

The ratings consider the company’s position as the leading Chinese language Internet search engine and the largest provider of online advertising in China, the agency said.

The ratings are constrained by the competitive state of China’s Internet market and the rising acquisition risks related to the company’s efforts to build a full mobile platform, Moody’s said.

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