Chinese company Baidu announced during Report The outlook for its manufacturing business is good in the second quarter of 2026 Kunlun chipbecause local buyers have no choice. Dou Shen, vice president of Baidu AI Cloud Business Group, said that the company is studying the listing of Kunlunxin and will provide specific information on the matter soon.
“From a business perspective, we remain confident in Kunlunxin’s long-term growth and commercial potential for several reasons.” Dou Shen said. First, infrastructure demand continues to grow, and Baidu believes this trend will continue in the long term. Second, China’s domestic market has “huge potential for growth” as the supply of AI chips “is likely to remain constrained for some time.” “Against this background, customers are increasingly seeking high-performance, reliable, and cost-effective domestic AI chips.” Shen said.
as mentioned before registerthese statements are noteworthy in the context of U.S. government policy, allow Nvidia resumed selling its products in China, prompting Beijing to react by vetoing any purchases by local companies. According to NVIDIA, Washington’s supply ban from China caused $10.5 billion in losses in just six months. The company said in its latest quarterly report reportEven after the ban is lifted, it will not generate any revenue from China and “has no confidence in allowing any imports into the country”. Now Baidu says Chinese buyers are turning to local suppliers. In addition, Beijing encourages the introduction of local technology to reduce dependence on American products.
Image source: Baidu
Baidu’s revenue fell for the fifth consecutive quarter. Sources pointed out that the advertising business is shrinking faster than the artificial intelligence business is growing. northwest northwest. The company reported revenue of 31.325 billion yen ($4.62 billion) in the second quarter ended June 30, 2026, a 4% annual decrease and a 2% quarterly decrease. The results were also below analysts’ expectations. According to Bloomberg, the South China Morning Post estimates revenue of 31.6 billion yen. According to the LSEG survey, analysts’ consensus forecast was 31.96 billion yen.
The main driver of growth is the cloud business. Revenue from artificial intelligence-related activities increased by 25% to 12.5 billion yen. The business currently accounts for half of the company’s total revenue. AI cloud service revenue increased by 50% year-on-year to 7.3 billion yen, and GPU cloud business revenue (previously known as AI accelerator infrastructure subscription revenue) increased by 283%, and the growth rate increased compared with the same period last year. 184% increase in the last season. The company said the growth of its GPU cloud business reflects the growing demand for public cloud computing for artificial intelligence. AI application revenue was 2.5 billion yuan, an annual increase of 3%, while AI marketing service revenue was basically flat at 2.6 billion yuan.
Online marketing service revenue was 13.1 billion yuan, down 19% from the same period last year. Reuters analysts attributed the trend to a prolonged slump in China’s real estate market and sluggish consumer demand. “While our online marketing business remains under pressure, the growth momentum of our core artificial intelligence business confirms Baidu’s transformation from an Internet-focused company to an artificial intelligence-first company.” ——Baidu co-founder and CEO Robin Li said in a statement, the resource wrote qz.com.
Baidu’s taxable net profit was 2.3 billion yuan, with a net profit margin of 7%. Adjusted net profit (non-GAAP) was 2.6 billion yen. The company said operating cash flow was 3.4 billion yen, its fourth consecutive quarter of positive results. Research and development expenses were 4.6 billion yen (US$679 million), a quarterly increase of 5% and an annual decrease of 10%.
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