news flash·2025-05-22 06:42Core Viewpoint - Bank of America has lowered its target price for Baidu to HKD 98 due to downward pressure on advertising from accelerated AI search [1] Financial Performance - Baidu's core business revenue for Q1 2025 is projected to be RMB 25.5 billion, representing a 7% year-on-year growth, exceeding market expectations [1] - The strong growth in cloud business, which accelerated from 26% in Q4 to 42% year-on-year, is a key driver of this performance [1] Business Segments - The growth in cloud business is fueled by surging demand for artificial intelligence and Baidu's competitive pricing for industry-leading models and AI solutions [1] - Baidu's Robotaxi business has achieved 100% fully autonomous driving in mainland China and is expanding into multiple overseas markets with a light-asset cooperation model [1] Profit Forecasts - The company has adjusted its net profit forecasts for 2025 and 2026 down by 6% and 4% respectively [1] - The target price based on discounted cash flow has been revised from HKD 101 to HKD 98, and from USD 104 to USD 100 for Baidu [1] Investment Rating - Despite the anticipated larger decline in advertising revenue, the faster growth in cloud business partially offsets this impact [1] - The company maintains a "Buy" rating based on its leadership in artificial intelligence technology and relatively low valuation [1]