Baidu to suffer under China’s new ‘cyber crime’ crackdown

China has launched a new crackdown on illicit online activity, including online gambling sites.

On Wednesday, the Xinhua news agency announced that Beijing police had launched a two-month crackdown on illegal online activity, including gambling, guns, drugs, pornography, fraud and anything that damages political security or the existing social order.

The online purge spells more trouble for Baidu, China’s leading search engine, which was publicly embarrassed last month following a Beijing News report that found illegal online gambling operators were using Baidu’s platform to advertise their services.

Following the revelations, Baidu CEO Robin Li warned investors that the heightened regulatory scrutiny “will likely suppress company revenues for the next two to three quarters.” Baidu’s 2015 annual report showed that advertising accounted for over 96% of the company’s total revenue.