---
title: "The first disclosure of 10 billion AI revenue, accelerating efforts in autonomous driving, is it time for Baidu's revaluation?"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/266485235.md"
description: "Baidu disclosed for the first time in the third quarter that AI revenue reached 10 billion yuan, a year-on-year increase of 50%, becoming the biggest highlight of its better-than-expected performance. AI Cloud, AI native marketing, and AI applications are all making significant progress, countering the decline in traditional advertising and reshaping the revenue structure. Citigroup raised its target price to $181, believing that increased AI transparency, growth in cloud business, and the accelerated implementation of autonomous ride-hailing will drive Baidu's valuation recovery"
datetime: "2025-11-19T06:28:32.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/266485235.md)
  - [en](https://longbridge.com/en/news/266485235.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/266485235.md)
---

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# The first disclosure of 10 billion AI revenue, accelerating efforts in autonomous driving, is it time for Baidu's revaluation?

Baidu is trying to prove to the market that it is no longer just a company reliant on traditional search advertising. In its latest earnings report, Baidu disclosed for the first time that AI-related revenue reached RMB 10 billion, a year-on-year increase of 50%, with third-quarter performance exceeding market expectations.

According to news from the Chasing Wind Trading Desk, Citigroup raised its target price by 9% to $181 in a report on the 18th, maintaining a buy rating, believing that the improvement in Baidu's operational metrics and the transparency of AI revenue will enhance investor confidence against a backdrop of low market expectations.

Baidu's total revenue in the third quarter was RMB 31.2 billion, a year-on-year decrease of 7% and a quarter-on-quarter decrease of 5%. Although there was a decline, it exceeded Citigroup's previous forecast. Revenue from core business was RMB 24.7 billion, a year-on-year decrease of 7%, which was better than expected. Despite an 18% decline in online marketing service revenue, it was partially offset by growth in cloud revenue.

Citigroup expects that the positive development of cloud business and autonomous ride-hailing will drive Baidu's valuation recovery. Analysts expect Baidu's AI cloud revenue to grow by 15% in the fourth quarter. Baidu continues to invest in upgrading the Wenxin Yiyan model and AI agents, and releases value through shareholder returns.

## AI Revenue Makes Its Debut, How Strong Is It?

The biggest highlight of Baidu's financial report is the detailed disclosure of the revenue composition of its artificial intelligence-related business for the first time. The data shows that in the third quarter of 2025, Baidu's total revenue related to AI reached approximately RMB 10 billion, with a year-on-year increase of as much as 50%.

According to the breakdown in the Citigroup report, this RMB 10 billion revenue is mainly composed of three parts:

> -   **AI Cloud Infrastructure**: Revenue of RMB 4.2 billion, a year-on-year increase of 33%. Among them, subscription revenue based on AI accelerator infrastructure increased by 128% year-on-year, showing strong market demand for computing power.
> -   **AI Native Marketing Services**: Revenue of RMB 2.8 billion, achieving explosive growth of 262% year-on-year. This indicates that AI technology is reshaping advertising placement and conversion efficiency, injecting new vitality into traditional marketing businesses.
> -   **AI Applications**: Revenue of RMB 2.6 billion, a year-on-year increase of 6%.

## Traditional Advertising Under Pressure, AI Injects New Momentum

While the AI business is booming, Baidu's traditional business is facing challenges. The financial report shows that **Baidu's core advertising revenue was RMB 15.3 billion, a year-on-year decrease of 18%.** This decline reflects the ongoing pressure from the macroeconomic environment and industry competition.

However, the strong growth of non-advertising business effectively offset the downturn in advertising business. In the **third quarter, Baidu's core non-advertising revenue reached RMB 9.3 billion, a year-on-year increase of 21%, and this part of the revenue was almost entirely driven by AI-powered cloud business and other innovative businesses.** As one rises, the other falls, Baidu's revenue structure is undergoing profound changes.

The transformation of AI on core business is also reflected at the product level. The report cites data stating that as of October 2025, approximately 70% of the content on Baidu's mobile search results page was generated by AI, a significant increase compared to about 50% at the end of June This not only improves user experience but also provides a fertile ground for the growth of new business models such as AI-native marketing.

## Investment Banks Are Bullish, Citigroup Maintains Positive Outlook

The better-than-expected performance and clear AI commercialization path have led investment banks to adopt a more optimistic view of Baidu. The Citigroup analyst team stated in their report that, against a backdrop of generally low market expectations, Baidu's performance was "better than expected."

Citigroup believes that investor confidence in Baidu's prospects will be boosted, mainly based on the following points: **First, the improvement in the company's operational metrics; second, the first disclosure of AI revenue; third, Baidu's continued investment in upgrading the Wenxin Yiyan model and AI agents; fourth, the release of value through shareholder return plans. The report particularly emphasizes that the positive development of cloud business and autonomous ride-hailing (Luobo Kuaipao autonomous driving business) is a key reason for raising the target price.**

Citigroup raised Baidu's target price from 167 yuan to 181 dollars, an increase of 9%, maintaining a buy rating. The reasons for the upgrade include the positive development of cloud business and autonomous ride-hailing business. Analysts believe that as Baidu improves the disclosure of operational metrics and AI revenue transparency, combined with ongoing investments to upgrade the Wenxin 5.0 model and AI agents, investors will have greater confidence in its operational prospects and stock performance.

Citigroup expects Baidu's core revenue in the fourth quarter to decline by 1.4% year-on-year, significantly better than the third quarter. AI cloud revenue is expected to grow by 15%.

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