CHINESE search engine operator Baidu Inc. on Friday booked its first quarterly loss since listing in 2005 and forecast quarterly revenue below market estimates, saying a “challenging marketing environment” is sapping income from advertisers.

The tech giant also pointed to the income impact of heightened government scrutiny of online advertising aimed at reducing the visibility of potentially fraudulent businesses.

Last year, Baidu said tighter ad regulations as well as an ongoing trade dispute between China and the United States could temper short-term profit, but that investment in new technology would pay off in the long term.

In an earnings briefing, CEO Robin Li said a slowdown in China’s technology sector and the economy at large would impact Baidu’s performance.

Baidu reported a net loss attributable to shareholders of 327 million yuan (US$47.51 million) for the first three months of the year, versus profit of 6.69 billion yuan in the same period a year prior. The loss was its first since going public in 2005.

Revenue from online marketing services, a key contributor to overall sales, rose nearly 3 percent, falling slightly short of analyst estimates compiled by researcher FactSet. Total revenue grew 15.4 percent, matching estimates, according to data from Refinitiv IBES

Excluding one-off items, Baidu earned 2.77 yuan per American depositary share, falling short of analysts’ 2.89 yuan estimate.

Baidu forecast second-quarter revenue of 25.1 billion yuan to 26.6 billion yuan. That compared with the 29.30 billion yuan average analyst estimate, showed data from Refinitiv IBES. (SD-Agencies)