Baidu Inc Earnings - Q3 2025 Analysis & Highlights
Key Takeaways
Baidu Inc's Q3 2025 earnings call highlighted the company's focus on AI-driven growth, with discussions on ERNIE 5.0, AI Cloud performance, Apollo Go's expansion, and AI-native marketing services. The company also introduced a new AI-native view to better reflect valuation drivers.
Key Financial Results
Total revenues were RMB 31.2 billion, decreasing 7% year-over-year.
Baidu Core revenue was RMB 24.7 billion, a decrease of 7% year-over-year.
Baidu Core's online marketing revenue was RMB 15.3 billion, decreasing 18% year-over-year.
Baidu Core's non-online marketing revenue was RMB 9.3 billion, up 21% year-over-year.
AI Cloud revenue was RMB 6.2 billion, an increase of 21% year-over-year.
iQIYI revenue was RMB 6.7 billion, down 8% year-over-year.
Operating loss was RMB 15.1 billion.
Non-GAAP operating income was RMB 2.2 billion.
Non-GAAP Baidu Core operating income was RMB 2.2 billion and non-GAAP Baidu Core operating margin was 9%.
Net loss attributable to Baidu was RMB 11.2 billion.
Non-GAAP net income attributable to Baidu was RMB 3.8 billion.
Non-GAAP diluted earnings per ADS was RMB 11.12.
Business Segment Results
AI Cloud Infra revenue reached RMB 4.2 billion, up 33% year-over-year.
Subscription-based AI accelerator infrastructure revenue grew 128% year-over-year.
AI Applications generated revenue of RMB 2.6 billion.
Revenue from AI-native Marketing Services reached RMB 2.8 billion, up 262% year-over-year, accounting for 18% of Baidu Core's online marketing revenue.
Capital Allocation
Baidu is reviewing future buyback mechanisms and exploring diversified return mechanisms like setting a dividend policy.
Under the plan authorized in 2023, Baidu has bought back $2.3 billion in shares.
Baidu has invested well above RMB 100 billion in AI since launching ERNIE in March 2023.
The company will continue increasing its investment intensity in the AI area.
Industry Trends and Dynamics
Enterprises are applying AI across every aspect of operations, driving strong demand for AI-centric cloud services.
There is strong market appetite for AI-native monetization approaches.
The future of AI interactions will be multi-modal, real-time generative, and interactive.
Competitive Landscape
Apollo Go is the undisputed market leader in China.
Baidu’s ride volumes were over 15 times higher than its nearest domestic peer through the first three quarters of the year.
Baidu has unmatched operational scale and technological excellence.
Growth Opportunities and Strategies
Baidu is focused on making ERNIE the strongest model for its portfolio.
The company will continue to scale up Apollo Go operations domestically and internationally.
Baidu will add more cars in existing cities, expand to more cities, and accumulate more fully driverless mileage.
The company is scaling through flexible business models, including asset-light models.
Baidu is extending its AI search capabilities to external partners through the Baidu AI Search API.
Financial Guidance and Outlook
Baidu expects penetration of AI-native Marketing Services to continue rising as adoption broadens.
The company expects to see greater operational leverage as its AI business scales.
Q3 represents a lower point for margins, and the company will strive to improve its non-GAAP operational income and margins as benefits start to flow through next year.
Baidu expects strong growth across three areas for Apollo Go in 2026 and beyond: rapid growth in ride volumes and fleet size, geographic expansion in new markets, and accelerated adoption of new business models.
Additional Themes
AI-Native View
Baidu introduced a new AI-native view to track AI-empowered assets company-wide.
This view organizes the business according to the nature of products and services, helping investors better understand the fundamental valuation drivers.
The company will provide business updates through this AI-native view on an ongoing basis, while continuing to disclose results under existing reporting methods.
The three categories highlighted are AI Cloud Infra, AI Applications, and AI-native Marketing Services.
Apollo Go
In Q3 2025, Apollo Go provided 3.1 million fully driverless operational rides, up 212% year-over-year.
As of November 2025, cumulative rides provided to the public have surpassed 17 million.
Apollo Go added six new cities, bringing its global footprint to 22 cities as of October 2025.
Apollo Go has achieved 100% fully driverless operations in multiple cities in Chinese Mainland.
Apollo Go enables cross-city travel in Hainan Province with fully driverless rental vehicles through a partnership with CAR Inc.
Through a partnership with HelloRide, Apollo Go achieved scaled, fully driverless operations in two cities in China.
AI and ERNIE
ERNIE 5.0 is Baidu's first native omni-modal foundation model with exceptional performance in omni-modal understanding, creative writing, and instruction following.
Baidu is taking an application-driven approach when it comes to ERNIE's iteration.
Roughly 70% of mobile search result pages contain AI-generated content.
Baidu is enhancing the quality of multimodal content within AI search results while expanding its overall content ecosystem.
