Baidu Reports 4% Revenue Decline Amid Ai Transition Challenges

Baidu, the Chinese tech giant, has reported a significant decline in its quarterly revenue, marking a 4% drop for the fourth quarter of 2025, totaling 32.74 billion yuan ($4.8 billion). This decline is attributed to persistent weaknesses in its core advertising business, which has struggled amid a challenging economic environment in China. CEO Robin Li stated, "2025 marked a pivotal year as AI became the new core of Baidu," highlighting the company's shift towards artificial intelligence to mitigate losses from traditional revenue streams. Despite the downturn, Baidu's AI business saw a remarkable growth, with revenue from its AI-powered operations reaching 11 billion yuan, accounting for 43% of total business revenue, a notable increase from 39% in the previous quarter. However, the overall sentiment remains negative as the company faces a 66% drop in net profit year-over-year, amounting to 1.78 billion yuan, which fell short of analyst expectations of 2.56 billion yuan (Morningstar, Business Recorder).