A Baidu Apollo robotaxi passes by a Baidu office building in Beijing on Aug. 21, 2023.
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BEIJING — Chinese tech company Baidu reported impressive second-quarter revenue growth of 15%, surpassing expectations. This growth was primarily driven by an increase in advertising.
According to Refinitiv data, this marks the fastest quarterly year-on-year growth pace in two years.
Baidu’s U.S.-traded shares saw a more than 4% increase in pre-market trading.
Here’s a breakdown of Baidu’s performance in the second quarter, compared to Refinitiv consensus estimates:
- Revenue: 34.1 billion yuan ($4.7 billion) versus 33.28 billion yuan expected.
Within Baidu’s core businesses, online marketing revenue rose by 15% to 19.6 billion yuan in the second quarter, while non-online marketing revenue increased by 12% to 6.8 billion yuan.
Earnings per American Depositary Share on a non-GAAP basis were 22.55 yuan, compared to 15.79 yuan in the year-ago period.
“In the second quarter of 2023, Baidu Core accelerated revenue and profit growth, driven by the solid performance of our online marketing business and operating leverage,” said Robin Li, Co-founder and CEO of Baidu.
Li added, “Generative AI and large language models have transformative potential in various industries, presenting us with a significant market opportunity.”
Baidu has been making significant progress with its Chinese-language ChatGPT alternative called Ernie bot. This bot, which was launched in March and is open to the public, is seen as a competitor to OpenAI’s popular chatbot.
Last week, Baidu announced the wider availability of five Ernie bot plugins, including ones for text-to-video conversion and PDF search. Three of these plugins can be used simultaneously, providing users with greater functionality.
Baidu also introduced an AI-powered assistant last week, designed to assist users with tasks such as meeting bookings, air ticket reservations, and hotel bookings. However, details on how users can obtain this assistant are currently unavailable.
The company is also expanding the application of AI in the automobile sector. Baidu recently entered into a strategic agreement with state-owned Changan Automobile to develop autonomous driving capabilities using the AI model behind Baidu’s Ernie bot.
Other Chinese tech giants are also venturing into AI-related products. Alibaba, the e-commerce giant, stated that the demand for training AI models on the cloud and the associated business opportunity is just starting. Tencent, the internet titan, announced plans to launch its own AI model later this year for use in gaming and advertising.
Robotaxi Business
In addition to its core businesses, Baidu operates self-driving taxis under the Apollo Go brand in China. In the second quarter, Baidu reported approximately 714,000 robotaxi rides, an increase from 660,000 in the first quarter.
The company received approval to charge fares for public robotaxi rides in Beijing in November 2021, and passengers can book these rides through an app. While the majority of the robotaxis still have human staff inside, Baidu has obtained approval to operate some robotaxis without employees in certain areas.
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