China's dominant search engine, Baidu Inc., saw less than expected revenue this recent quarter as more Chinese citizens are switching from personal computers (PC) to mobile devices.

Switching to mobile means less space for Baidu's advertising.

Baidu is often referred to as China's own Google. In the past, it showed a dominant hold on China's internet usage. However, the most recent quarterly revenue only saw a 47.5 percent rise. 

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Not quite what the people at Baidu had envisioned.

The drop in revenue came due to more citizens using mobile devices to surf the web. 

While surfing on a cell phone can still have advertisements, there is much less space for the much lucrative forms of ads that Baidu has.

Shares of the company, listed in the United States, fell 7.8 percent to US $198 last Wednesday.

For the fourth quarter, Baidu reported their total revenue to be 14.05 billion yuan or $2.26 billion.

While people see the figure high, Thomson Reuters I/B/E/S said that the revenue fell short of the average estimate of 14.12 billion yuan.

In the third quarter, mobile usage represented only 36 percent of total revenue. Now though, usage has increased to 42 percent according to Baidu.

Chief Executive Robin Li said in a statement that this was the first time that mobile usage surpassed PCs. 

As to the reason behind the sudden switch, Baidu offered that it was a combination of the late timing of Chinese New Year, as well as increased contribution from mobile as a percentage of overall revenue.

Competition has begun to mount for Baidu, as they face companies such as Alibaba Group Holding Ltd and Tencent Holdings Ltd in the investment of apps that aim to keep users engaged.

Chief Financial Officer Jennifer Li is undaunted, saying the investments that Baidu has made in mobile have clearly paid off and is setting the stage for Baidu to capture an even large market.