Bank of America Securities expects Baidu's core business total revenue to turn positive in the second quarter of next year

Bank of America Securities published a report stating that Baidu-SW (09888.HK) has independently built a complete AI full-stack infrastructure and services, including self-developed AI chips capable of attracting third-party customers, globally leading autonomous ride-hailing services, rapidly growing cloud business, advanced large models, and multi-scenario application implementations.

The report mentioned that Baidu stated at an investor meeting that it believes AI will bring substantial benefits, mainly reflected in the company's possession of real-world scenarios and applications, which can effectively create incremental commercial value from AI; in the GPU era, Baidu Cloud has gained a significant competitive advantage through its full-stack service capabilities and self-developed AI chips.

The report indicated that in the third quarter, Baidu's AI-related business revenue grew by 50% year-on-year to 10 billion RMB, accounting for approximately 40% of Baidu's total core business revenue. The firm expects AI-related businesses to maintain rapid growth, gradually offsetting the decline in traditional businesses, and driving Baidu's total core business revenue to turn positive again in the second quarter of 2026. It reiterated a "Buy" rating on Baidu (BIDU.US) with a target price of $151 and an H-share target price of HKD 148