Baidu’s AI Chip Unit Kunlunxin Prepares for Hong Kong IPO to Raise Up to $2 Billion

Baidu Inc (NASDAQ: BIDU) is moving forward with plans to list its artificial intelligence chipmaking subsidiary, Kunlunxin, in Hong Kong, in a deal that could raise as much as $2 billion, according to a Bloomberg report citing people familiar with the matter. The potential Hong Kong initial public offering marks a significant step in Baidu’s broader strategy to strengthen its position in the fast-growing AI semiconductor market.

The report said Kunlunxin has appointed major Chinese investment banks China International Capital Corp (CICC), Citic Securities Co, and Huatai Securities as lead underwriters for the IPO. These banks are expected to play a key role in guiding the listing process, which is still subject to regulatory approvals and market conditions. Reports last week also indicated that Kunlunxin had already confidentially filed for a Hong Kong IPO, suggesting that preparations are well underway.

Kunlunxin is a core part of Baidu’s push to secure advanced artificial intelligence chips, an area that has become increasingly strategic for China’s technology sector. As global competition intensifies and access to foreign-made chips becomes more restricted, Chinese tech giants such as Baidu are accelerating efforts to develop domestically produced AI processors. This push has also received strong backing from Beijing, which views semiconductor self-sufficiency as a national priority.

The news of the potential IPO had a positive impact on Baidu’s stock performance in Hong Kong. Baidu’s Hong Kong-listed shares (HK:9888) rose about 0.5% following the report, outperforming the broader Hang Seng Index, which fell nearly 1% during the same session. The market reaction highlights investor interest in Baidu’s AI and chipmaking ambitions, as well as optimism around Kunlunxin’s growth prospects.

If successful, the Kunlunxin IPO could become one of the most notable Hong Kong listings linked to China’s AI industry, providing Baidu with additional capital to expand research, development, and production of AI chips. The move also underscores how China’s leading technology companies are racing to gain a stronger foothold in artificial intelligence hardware, a sector widely seen as critical to future innovation and economic growth.