Baidu Reports Q2 2025 Revenue and Profit Decline

Baidu (BIDU.US) announced its second quarter 2025 financial results, with total revenues reaching RMB32.7 billion ($4.57 billion), a 4% decrease year-over-year. Non-GAAP net income attributable to Baidu was RMB4.8 billion ($669 million), marking a 35% year-over-year decline. Non-GAAP diluted earnings per ADS were RMB13.58 ($1.90), falling short of the analyst EPS estimate of $1.74.

Key Business Drivers

Baidu Core's non-online marketing revenue reached RMB10.0 billion ($1.40 billion), growing 34% year-over-year, primarily driven by the AI Cloud business. This performance helped to offset a 15% year-over-year decrease in online marketing revenue, which stood at RMB16.2 billion ($2.27 billion). The AI transformation of Baidu Search has progressed rapidly, with over 50% of mobile search results containing AI-generated content by the end of June 2025.

Apollo Go, Baidu's autonomous ride-hailing service, provided over 2.2 million fully driverless rides in Q2 2025, a substantial 148% year-over-year increase. Apollo Go expanded its global footprint to 16 cities and entered strategic partnerships with Uber Technologies, Inc. and Lyft, Inc. for deployment in international and European markets respectively. Baidu also open-sourced its ERNIE 4.5 series, an advanced family of foundation models, and launched MuseSteamer, a proprietary video generation model, further strengthening its AI capabilities.

Operational and Financial Shifts

Total costs and expenses increased by 5% year-over-year to RMB29.4 billion ($4.11 billion), driven primarily by increased costs related to the AI Cloud business and content costs. Despite this, research and development expenses decreased by 13% year-over-year to RMB5.1 billion ($715 million), mainly due to a decrease in personnel-related expenses. Baidu has returned US$677 million to shareholders since the beginning of Q1 2025 through its share repurchase program.