09888

The analyst rating from BofA Securities is based on the strong business outcomes driven by BIDU-SW's AI technology development. In the third quarter of 2025, the company reported a significant increase in revenue from its new AI businesses, with overall growth exceeding 50% year-over-year, reaching around RMB10 billion. Key contributors to this growth included a 128% increase in AI high-performance computing facility subscription revenue and a 262% surge in AI-native marketing service revenue. As a result of these positive developments, BofA Securities reiterated a Buy rating and raised its target price for Baidu from USD100 to USD151 and for BIDU-SW from HKD98 to HKD148.

The analyst rating from Daiwa for BIDU-SW (09888.HK) is a "Buy" due to several factors. Despite Baidu Core revenue for 3Q25 declining by 9.5% year-over-year, the company's operating profit slightly exceeded expectations, benefiting from other income and tax incentives. Additionally, the report highlights the growth in cloud services revenue and the announcement of new financial disclosures for AI-native products. Although Daiwa lowered Baidu's EPS estimates for FY2026-27 by 3-4% based on revised R&D expenditure forecasts, they still raised the target price from HKD158 to HKD162, indicating confidence in the company's future performance.

The analyst rating for BIDU-SW (09888.HK) was kept at "Outperform" despite a reduction in the adjusted EPS forecasts for 2025 and 2026 by 19% and 10%, respectively. This decision is supported by the company's strong performance in its AI-empowered business, which saw revenue from new AI businesses increase by over 50% year-over-year to approximately RMB10 billion. The growth was primarily driven by advancements in AI cloud infrastructure, AI applications, and AI-native marketing services, indicating a positive outlook for the company's future performance in the AI sector.

The analyst rating from BOCI for BIDU-SW (Baidu) is a "Buy" due to several factors highlighted in their research report. The company's 3Q25 results were in line with expectations, with total revenue decreasing by 7% year-over-year, which was slightly better than market forecasts. Notably, while advertising revenue declined by 18% YoY, non-advertising revenue increased by 21%, indicating a shift in revenue sources. Additionally, the AI-driven business revenue surged by 50% YoY, showcasing Baidu's success in AI commercialization. The adjusted operating profit margin of 7.1% also met expectations. Based on these results, BOCI raised its target price for Baidu from USD133 to USD137, reinforcing their positive outlook on the stock.

The analyst rating from Goldman Sachs is maintained at "Buy" due to several key factors. Firstly, Baidu's 3Q25 results were in line with expectations, with solid growth in its cloud business helping to offset a decline in advertising revenue. Additionally, the company disclosed performance metrics for its AI-related operations for the first time, highlighting the achievements of its AI technology-empowered business. Goldman Sachs anticipates that while the traditional search advertising business may face challenges in the near term, there will be a recovery in revenue in 4Q25 and 2026, driven by the rapid growth of AI-empowered businesses. The firm also projects that the net profit margin will bottom out from the 3Q25 level, further supporting their positive outlook. Consequently, they raised their target prices for Baidu's H-shares and US stock, reinforcing their bullish stance.

The analyst rating from Goldman Sachs is a "Buy" for Baidu (BIDU) based on several key factors: 1. Transition in AI Industry: Baidu's management highlighted a shift towards a "Reverse Pyramid" structure in the AI industry, indicating that AI models and applications are expected to capture greater value. This strategic focus suggests potential for significant growth. 2. Capital Expenditure Focus: The company plans to direct capital expenditures towards areas that can drive substantial commercial value, particularly in business-to-business (B2B) and business-to-consumer (B2C) applications. 3. Kunlun Chips Development: Baidu has outlined a five-year plan for its Kunlun chips, with new models set to launch in 2026 and 2027. The existing Kunlun P800 has already garnered orders, indicating strong demand for their technology. 4. Robotaxi Business Growth: Baidu Apollo's Robotaxi service has seen impressive growth, achieving 250,000 orders in a week and 17 million passenger trips overall. The company has reached profitability in Wuhan and anticipates rapid global expansion of this service. 5. AI Integration in Search Engine: The search engine's integration of AI-generated content, with 70% of searches involving such content, demonstrates Baidu's innovative approach and its ability to enhance user experience through multimodal responses. Given these factors, Goldman Sachs set a target price of HKD150 for Baidu's Hong Kong shares and USD154 for its US shares, reinforcing their positive outlook on the company's future performance.