Core Insights - Baidu's total revenue for 2025 was 129.1 billion RMB, a year-on-year decline of 3%, primarily due to decreased revenue from traditional business segments [1] - The company recorded an operating loss of 5.8 billion RMB for the year, impacted by a core asset impairment loss of 16.2 billion RMB, compared to an operating profit of 21.2 billion RMB in 2024 [1] - After excluding impairment effects, Baidu's non-GAAP net profit for the year reached 18.9 billion RMB [1] Financial Performance - In Q4 2025, Baidu's total revenue was 32.7 billion RMB, reflecting a quarter-on-quarter growth of 5% [1] - The non-GAAP net profit for Q4 was 3.9 billion RMB [1] - The net profit attributable to Baidu for 2025 was 5.6 billion RMB, with a net profit margin of 4%, a significant decrease of 76% compared to 2024's 23.8 billion RMB [1][2] Business Segments - New business segments are increasingly contributing to total revenue, with Q4 AI new business revenue exceeding 11 billion RMB, accounting for 43% of Baidu's general business revenue [2] - For the full year, intelligent cloud infrastructure revenue was approximately 20 billion RMB, a year-on-year increase of 34%, while AI applications generated over 10 billion RMB in revenue [2] - In the autonomous driving sector, the "Luobo Kuaipao" service provided 3.4 million fully unmanned operational orders in Q4, representing a year-on-year growth of over 200% [2] Capital Operations and Shareholder Returns - Baidu's board has authorized a new share repurchase plan with a maximum amount of 5 billion USD, effective until December 31, 2028 [2] - The company has approved a dividend policy for common stock, with the first dividend expected to be distributed by the end of 2026 [2] - Baidu is advancing the spin-off and independent listing process for its chip business, Kunlun [2]

Core Insights - Baidu reported fourth-quarter results that met revenue expectations while exceeding earnings forecasts, although shares fell approximately 6% intra-day on Thursday [1] Financial Performance - The company posted adjusted earnings per American Depositary Share (ADS) of RMB10.62, surpassing the consensus estimate of RMB9.65 [2] - Quarterly revenue reached RMB32.7 billion ($4.68 billion), reflecting a 5% sequential increase and closely aligning with the consensus forecast of RMB32.64 billion [2] - Adjusted operating income for the quarter was RMB3.0 billion ($424 million), resulting in an adjusted operating margin of 9% [4] - Adjusted EBITDA amounted to RMB4.7 billion ($676 million), indicating a 14% adjusted EBITDA margin [4] AI Segment Performance - Revenue from AI Cloud Infrastructure hit RMB5.8 billion in the fourth quarter, with subscription-based revenue linked to AI accelerator infrastructure soaring 143% year over year [3] - AI Applications generated RMB2.7 billion in revenue during the quarter, with full-year 2025 revenue from this segment exceeding RMB10 billion [3]

Group 1 - The Nasdaq Golden Dragon China Index (HXC) declined by 1.78% on February 27, with most Chinese concept stocks experiencing a drop [1][6] - Among the rising stocks, notable increases included Tencent Music (+0.14%), Futu Holdings (+1.05%), Huazhu Group (+2.82%), and Vipshop (+2.14%) [1][6] - The stocks that saw the largest declines included TSMC (-2.81%), Alibaba (-2.78%), Pinduoduo (-1.41%), and Baidu (-5.65%) [1][7] Group 2 - The U.S. stock market closed mixed, with the Dow Jones Industrial Average rising by 17.05 points (+0.03%) to 49,499.20, while the Nasdaq Composite fell by 273.69 points (-1.18%) to 22,878.38 [2][7] - Initial jobless claims in the U.S. were lower than expected, which did not significantly boost the market [2][7] Group 3 - The top gainers among Chinese concept stocks included Dajian Cloud Warehouse (+33.05%), GCT (+32.85%), and Jintaiyang Education (+20.54%) [3][10] - Conversely, the largest losers included QH (-79.15%), Tuniu (-12.33%), and Hang Feng Technology (-10.70%) [5][12]

Exhibit 99.1 Baidu Announces Fourth Quarter and Fiscal Year 2025 Results BEIJING, China, Feb 26, 2026 – Baidu, Inc. (NASDAQ: BIDU and HKEX: 9888 (HKD Counter) and 89888 (RMB Counter)), ("Baidu" or the "Company"), a leading AI company with strong Internet foundation, today announced its unaudited financial results for the quarter and fiscal year ended December 31, 2025. "2025 marked a pivotal year as AI became the new core of Baidu. AI Cloud Infra gained strong momentum, with our differentiated full-stack en ...

Market Overview - Pre-market indexes have recovered from earlier losses, with the Dow up 110 points (+0.22%), S&P 500 up 6 points (+0.09%), Nasdaq up 7 points (+0.03%), and Russell 2000 up 4 points (+0.18%) [1] Jobless Claims - Initial Jobless Claims for the past week were reported at 212,000, slightly below the expected 215,000 and above the revised 208,000 from the previous week, indicating a return to holiday season trends [2] - Continuing Claims decreased to 1.833 million from a revised 1.864 million, marking the lowest level since January and significantly below the 1.9 million range seen for most of 2025 [3] Earnings Reports - Celsius Holdings (CELH) reported a positive earnings surprise of +38.4% at 26 cents per share, up from 14 cents year-over-year, with revenues increasing by +13.1% to $721.63 million, claiming 20% of the U.S. energy drink market, leading to a 15% rise in shares [5] - Shake Shack (SHAK) exceeded earnings estimates by a penny at 37 cents per share, with shares rising by 11.8% in pre-market trading, adding to a year-to-date gain of +13.5% [6] - Baidu (BIDU) reported earnings of $1.52 per share, surpassing expectations of $1.47, but shares fell by 3% due to declining sales, resulting in a year-to-date loss after a previous +48% growth [7] - Dell Technologies (DELL) is expected to report strong Q4 results with estimated earnings growth of +32% and revenue growth of +33.3%, having beaten earnings estimates in three of the last four quarters [8]

Earnings Reports - Celsius Holdings (CELH) reported a positive earnings surprise of +38.4%, with earnings per share at 26 cents, up from 14 cents in the same quarter last year. Revenues increased by +13.1% to $721.63 million, and the company now holds 20% of the U.S. energy drink market. Shares rose by +15% following the announcement [5]. - Shake Shack (SHAK) exceeded earnings estimates by a penny, reporting 37 cents per share. The hiring of a new CFO contributed to a pre-market share increase of +11.8%, adding to a year-to-date gain of +13.5% [6]. - Baidu (BIDU) reported earnings of $1.52 per share, surpassing expectations of $1.47, resulting in a +3.4% earnings surprise. Despite beating revenue estimates, shares fell by -3% due to declining sales, reversing a year-to-date growth of +48% [7]. - Dell Technologies (DELL) is expected to report strong growth in Q4, with earnings and revenues projected to increase by +32% and +33.3%, respectively [8].

Group 1: Financial Performance - Baidu reported total revenue of 129.1 billion yuan for 2025, with AI business revenue reaching 40 billion yuan [1] - In Q4 2025, Baidu's total revenue was 32.7 billion yuan, representing a year-on-year growth of 5%, with AI business revenue accounting for 43% of Baidu's general business revenue, exceeding market expectations [1][2] Group 2: AI Business Strategy - Baidu's CEO emphasized that application is more important than the model itself, stating that the value of models is realized through applications, which drives the upgrades of the Wenxin model [3] - The company has restructured its R&D teams to focus on both foundational model capabilities and specific business needs, aiming to enhance efficiency and effectiveness in AI applications [4] Group 3: Cloud Business Growth - Baidu's intelligent cloud revenue reached 30 billion yuan in 2025, with a 34% year-on-year growth in infrastructure revenue, outperforming the industry average [5] - The AI accelerator infrastructure subscription revenue grew by 143% year-on-year in Q4, becoming a key growth driver for the cloud business [5] Group 4: AI Business Segments - Baidu's AI business revenue exceeded 11 billion yuan in Q4, accounting for 43% of the company's main business revenue, indicating a rapid increase in this segment's contribution [7] - The AI business includes intelligent cloud infrastructure, AI applications, autonomous driving services, and digital marketing services, all of which are strategically positioned to create value for customers [7][8] Group 5: Capital Allocation and Shareholder Returns - The company announced a new stock buyback plan of 5 billion USD and introduced a dividend policy to enhance shareholder returns [10] - Baidu is preparing for the spin-off of Kunlun Chip, which is a core component of its AI infrastructure, aiming to unlock significant value for the company [10] Group 6: Autonomous Driving Strategy - Baidu's Apollo Go service has completed over 20 million rides, with a leading safety record and a global expansion strategy covering 26 cities [11] - The company aims to leverage partnerships with firms like Uber to accelerate its global market presence in autonomous driving [12] Group 7: AI Product Development - Baidu's flagship C-end product, Wenxin Yiyan, has surpassed 200 million monthly active users, with significant improvements in user interaction and service capabilities [14][15] - The company is focused on enhancing product quality and user experience, believing that commercialization will follow as products mature [15] Group 8: Investment in AI - Baidu has invested over 10 billion yuan in AI since March 2023 and plans to maintain this investment level while ensuring positive cash flow [16] - The company is exploring diverse financing options to support its AI investments while maintaining a healthy financial structure [16]

Market Performance - The U.S. stock market opened mixed with the Dow Jones up by 0.38%, while the Nasdaq and S&P 500 indices were down by 0.24% and 0.04% respectively. As of the report, the Dow Jones was up by 0.27%, the Nasdaq down by 0.84%, and the S&P 500 down by 0.36% [2] - A total of 2,712 stocks rose while 2,381 stocks fell [2] Company Specifics - Nvidia's earnings report exceeded expectations but received a lukewarm response, leading to a stock price drop of over 3.6% [2] - Major Chinese concept stocks mostly declined, with BeiGene down by 6.56%, Beike down by 5.85%, Baidu down by 4.83%, and Luckin Coffee down by 4.71% [3][4] - Baidu reported a year-over-year revenue decrease of 3% for the fiscal year 2025 [3] Commodity Market - International silver prices continued to decline, with COMEX silver futures dropping over 5% and spot silver down by over 3%. As of the report, COMEX silver futures were down by 4.6% and spot silver by 2.55% [7] - Gold prices also saw a slight drop, with COMEX gold futures falling by over 1% [7] Geopolitical Developments - The third round of indirect negotiations between Iran and the U.S. began in Geneva, focusing on nuclear issues. Iran expressed readiness to engage in discussions regarding sanctions and nuclear rights [9][10] - The outcome of these negotiations could significantly impact regional tensions, with potential for either a temporary agreement or a shift towards military options if core disagreements persist [10]

Market Performance - The three major US stock indices opened mixed, with the Dow Jones up by 0.38%, while the Nasdaq and S&P 500 saw declines of 0.24% and 0.04% respectively. As of the report, the Dow was up 0.27%, the Nasdaq down 0.84%, and the S&P 500 down 0.36% [1] - A total of 2,712 stocks advanced while 2,381 stocks declined [1] Company-Specific Developments - Nvidia's earnings report exceeded expectations but received a lukewarm response, leading to a stock price drop of over 3.6% [1] - Among popular Chinese concept stocks, the majority experienced declines, with BeiGene down 6.56%, Beike down 5.85%, Baidu down 4.83%, and Luckin Coffee down 4.71% [5][6] Commodity Market - On February 26, international silver prices continued to decline, with COMEX silver futures dropping over 5% at one point, and spot silver down over 3%. As of the report, COMEX silver futures were down 4.6% and spot silver down 2.55% [9] - Gold prices also saw a slight drop, with COMEX gold futures down over 1% [9] - WTI crude oil fell nearly 3%, while Brent crude oil dropped over 2% [11] Geopolitical Developments - The latest round of US-Iran negotiations began in Geneva, focusing on nuclear issues, with Iran expressing a willingness to discuss sanctions relief and nuclear rights [14] - The negotiations are at a critical stage, with potential for a temporary or phased agreement to ease regional tensions, but failure to resolve core differences could lead to a breakdown in diplomatic efforts and increased military risks [15]

Core Viewpoint - The global capital market's investment logic in the AI industry has shifted significantly as of 2026, moving from a "storytelling" phase to a "practical verification" phase, with a focus on tangible profitability rather than just high capital expenditures [1][2] Group 1: Baidu's Financial Performance - Baidu's Q4 and full-year 2025 financial report has become a focal point for the market, showcasing its AI commercialization capabilities and serving as a key window to observe the efficiency of leading AI companies in transitioning from technical value to commercial value [1][2] - Baidu reported a total revenue of 129.1 billion yuan for 2025, with AI business revenue reaching 40 billion yuan, and AI revenue accounting for 43% of its general business revenue in Q4, exceeding market expectations [1][2] Group 2: AI Business Model and Growth - The significant AI revenue share indicates that Baidu's "technology-business" closed loop has been initially validated, marking a transition from a "cost investment phase" to a sustainable "revenue realization phase" [2][3] - Baidu's AI growth is not reliant on short-term traffic or subsidies but is driven by actual payments from enterprises and users for real value, reflecting the health of its AI business model and internal growth momentum [2][3] Group 3: Strategic Positioning and Competitive Advantage - Baidu's success in AI commercialization is attributed to its differentiated and systematic development path, with a full-stack self-research layout across "chip-cloud-model-intelligent body," achieving significant synergy effects [3][4] - The company has chosen a pragmatic development path focused on the large-scale application of AI technology and deep industry integration, positioning itself as a leader in AI commercialization in China [4][5] Group 4: Business Growth and Market Position - Baidu's AI cloud revenue grew by 34% year-on-year in 2025, with Q4 AI high-performance computing subscription revenue increasing by 143% [6] - The user base for Baidu's AI applications has expanded significantly, with the Wenxin Assistant surpassing 200 million monthly active users, indicating strong market recognition [6][7] Group 5: Global Expansion and Future Prospects - Baidu's Robotaxi service, "萝卜快跑," achieved over 3.4 million global ride services in Q4 2025, reflecting a growth of over 200% year-on-year, with plans for expansion in international markets [8][9] - The global Robotaxi market is projected to grow from $290 million in 2025 to $35.26 billion by 2035, positioning Baidu to benefit significantly from this growth [8][9] Group 6: Valuation and Market Recognition - Baidu's recent actions, including a $5 billion share buyback plan and the announcement of its first dividend, signal a commitment to shareholder value and a new phase of profitability [10][11] - Analysts have raised Baidu's target stock price, with Benchmark setting it at $215 and Morgan Stanley at $200, reflecting confidence in Baidu's position as a core beneficiary of the AI infrastructure wave [12][13]