BIDU(09888) 西南证券·2024-05-23 04:02Investment Rating - The report maintains a "Buy" rating for Baidu Group-SW (9888.HK) [1] Core Insights - Baidu Group reported a revenue of 31.5 billion RMB in Q1 2024, representing a year-on-year growth of 1%. The Non-GAAP net profit reached 7 billion RMB, showing a year-on-year increase of 22% [2] - The growth in profit outpaced revenue growth, primarily driven by high-quality growth in AI business and improved operational efficiency [2] - Core online advertising revenue was 17 billion RMB in Q1 2024, up 3% year-on-year, with an increase in user engagement on Baidu APP, which reached 676 million monthly active users, a 3% increase year-on-year [2] - Non-marketing revenue, driven by intelligent cloud services, reached 6.8 billion RMB, a 6% year-on-year growth, with significant advancements in smart driving capabilities [2] - The AI tools have been updated to enhance development efficiency, with the Wenxin large model user base exceeding 200 million and daily API calls reaching 200 million [2] Financial Forecasts - The adjusted EPS for Baidu Group is projected to be 10.56 RMB, 11.10 RMB, and 11.69 RMB for the years 2024, 2025, and 2026 respectively [3] - Non-GAAP net profit is expected to continue growing over the next three years, with the company actively building an AI ecosystem to empower its advertising, intelligent cloud, and smart driving businesses [3] - Revenue forecasts for 2024 to 2026 are 143.6 billion RMB, 153.2 billion RMB, and 162.3 billion RMB respectively, with growth rates of 6.69%, 6.71%, and 5.91% [4]