BIDU(US:BIDU) Sou Hu Cai Jing·2025-08-21 12:43Core Insights - Baidu's Q2 2025 earnings report led to adjustments in target prices and ratings from major international investment institutions [2][3] - Core advertising revenue declined by 15% year-on-year due to the acceleration of AI transformation in search business [2][3] - UBS expects further pressure on core advertising revenue, forecasting a 22% decline in Q3, with gradual improvement in Q4 [2] Revenue Performance - Baidu's total revenue for Q2 2025 met market expectations but showed a 4% year-on-year decline [2][3] - AI cloud revenue increased by 27% to 6.5 billion yuan, with stable growth in adjusted operating profit [3] - The revenue from AI advertising agents grew by 50% quarter-on-quarter, contributing over 13% to core advertising revenue [3] Profitability Outlook - UBS revised down the target price from $105 to $103, reflecting weakened profit expectations [2] - The non-GAAP operating profit margin for Q3 was adjusted down by 5.8 percentage points to 8.5% [2] - CICC lowered its profit forecasts for 2025 and 2026 by 8% and 10% respectively, due to the increasing proportion of low-margin cloud revenue [4] Business Developments - Baidu's autonomous driving service, "Luo Bo Kuaipao," saw a significant increase in orders, up 148% to 2.2 million [4] - The company expanded its autonomous driving testing areas in Hong Kong and initiated open road testing in the UAE [4] - Strategic partnerships with international ride-hailing platforms like Uber and Lyft were established to deploy thousands of autonomous vehicles in key markets [4]