TLDR
- Baidu’s Q4 net profit dropped 66% year-over-year to 1.78 billion yuan, missing analyst estimates
- Revenue fell 4% to 32.74 billion yuan, marking the third straight quarter of decline
- AI-powered business revenue grew 48%, now making up 43% of general business revenue
- Apollo Go completed 3.4 million driverless rides in Q4, up over 200% year-over-year
- Ernie AI assistant hit 202 million monthly active users in December
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Baidu’s fourth-quarter results came in below expectations, sending its American depositary receipts down 2.7% to $129.80 in premarket trading on Thursday.
$BIDU (Baidu) #earnings are out: pic.twitter.com/waup0Lt7iW
— The Earnings Correspondent (@earnings_guy) February 26, 2026
Net profit fell 66% year-over-year to 1.78 billion yuan ($259 million). Analysts had penciled in 2.56 billion yuan, so this was a clear miss.
Revenue dropped 4% to 32.74 billion yuan for the three months ended December. That marks the third consecutive quarter of declining sales. A year earlier, Baidu posted revenue of 34.12 billion yuan and net income of 5.19 billion yuan.
Baidu, Inc., BIDU
For the full year, revenue slipped 3% while net profit slumped 76% to 5.59 billion yuan.
The weak numbers were driven largely by Baidu’s advertising business, which has been struggling in a tough economic environment. Soft consumer spending in China has weighed on ad budgets across the board.
AI Growth Isn’t Enough Yet
There was a bright side. Baidu’s AI-powered business — covering cloud infrastructure, autonomous vehicles, and AI applications — grew revenue 48% from a year ago to 11.3 billion yuan.
That segment now accounts for 43% of general business revenue, up from 39% in Q3.
AI cloud infrastructure revenue rose 34% to 5.8 billion yuan.
Ernie, Baidu’s AI assistant, crossed 200 million monthly active users in December. It’s integrated into both the Baidu search app and PC.
Apollo Go, its autonomous ride-hailing service, completed 3.4 million driverless rides in Q4, a jump of more than 200% year-over-year.
CEO Robin Li called 2025 “a pivotal year as AI became the new core of Baidu.” The AI numbers look decent on paper, but they weren’t enough to offset the advertising slump.
What’s Next for BIDU
Baidu restructured its earnings report this quarter to better reflect its AI-first focus. The company announced plans earlier this month for its first-ever dividend and a new $5 billion share buyback program.
Analysts have pointed to a potential IPO of Kunlunxin, Baidu’s AI chip unit, as a possible catalyst for the stock. Nomura analysts suggested the listing could be well-received given strong appetite for Chinese chip designers.
BIDU’s ADRs have fallen around 16% over the past month and are down more than 6% so far this year, after a nearly 60% gain in 2025.
At the time of reporting, BIDU ADRs were trading at $129.80, down 2.7% premarket.
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