Baidu Shares Climb as AI Businesses Show Strong Growth Despite Quarterly Loss

Baidu’s stock gained momentum on Wednesday as investors shifted their focus from the company’s quarterly loss to the solid performance of its artificial intelligence-driven businesses. The Chinese tech giant released its third-quarter earnings late Tuesday, revealing steady growth across cloud services, autonomous driving initiatives, and AI-native applications — even as its traditional online advertising segment continued to face pressure.

Hong Kong-listed Baidu shares rose as much as 4% to HK$115.7 before easing slightly, still trading about 2% higher by 03:13 GMT. The market reaction reflects growing confidence in Baidu’s long-term AI strategy, which is becoming a more critical driver of revenue and innovation.

For the third quarter, Baidu reported total revenue of RMB31.2 billion, a 7% decline from the previous year. The weakness was primarily concentrated in its online marketing business, which dropped 18% to RMB15.3 billion as advertisers remained cautious amid China’s uneven economic recovery. The company also recorded a net loss of RMB11.2 billion after taking RMB16.2 billion in impairment charges linked to long-lived assets. Without these charges, Baidu noted that net income would have reached RMB2.6 billion, underscoring healthier underlying operations.

A bright spot in the earnings report was the strong surge in AI-powered revenue, which grew more than 50% year-on-year to around RMB10 billion. This performance was driven by continued expansion in Baidu AI Cloud, rising demand for AI-native marketing solutions, and growing adoption of subscription-based AI applications. As China accelerates its push for artificial intelligence development, Baidu’s investments in foundation models, enterprise AI tools, and autonomous driving technologies appear well-positioned to capture new market opportunities.

Investors seem increasingly optimistic that Baidu’s pivot toward high-growth AI businesses could offset lingering pressure on advertising, helping the company advance its transformation into a leading AI platform in China’s competitive technology landscape.