Chinese tech giant Baidu has outperformed third-quarter revenue projections, reasserting its dedication to leveraging artificial intelligence (AI) for future expansion. The company, renowned for owning China’s largest search engine, experienced robust revenue growth buoyed by a surge in advertising income, coinciding with the revival of the Chinese economy.
For the quarter concluding on September 30, Baidu reported revenue of 34.45 billion yuan ($4.72 billion). This upswing aligns with the International Monetary Fund’s revised forecast, predicting a 5.4 percent growth for China’s economy this year, encouraging increased spending on online consumer advertising by companies.
Baidu’s strategic pivot toward AI development has been evident in recent years, notably demonstrated through initiatives such as autonomous vehicle projects and substantial investments in generative AI, capable of creating various media formats from text to images.
Highlighting their technological advancements, Baidu introduced Ernie 4.0, the latest iteration of its generative AI model, comparing its capabilities favorably to OpenAI’s groundbreaking GPT-4 model, the foundation behind ChatGPT.
Rong Luo, Baidu’s Chief Financial Officer, affirmed the company’s unwavering commitment to AI investments, emphasizing a strategic focus on generative AI and foundational models to fuel their growth trajectory. Luo underlined, “We will do so with an unrelenting focus on efficiency and strategic resource allocation.”
Unlike some Chinese tech counterparts, Baidu refrained from commenting on the potential impact of heightened U.S. export restrictions on high-end technology, unlike Alibaba and Tencent, which addressed concerns regarding the implications on their cloud businesses.
In response to the escalating restrictions, news reports suggested Baidu’s proactive approach in August, placing orders for domestically-produced AI chips from Huawei in anticipation of tighter export curbs from Washington. However, the company has not provided official commentary on these reports.
Despite geopolitical complexities, Baidu witnessed a 5 percent rise in online marketing revenue, reaching 19.7 billion yuan during the third quarter. Additionally, the company reported a 23 percent surge in adjusted net income, reaching 7.27 billion yuan compared to 5.89 billion yuan in the corresponding period last year, signifying substantial growth and financial stability amid evolving market dynamics.