Baidu, Inc. (BIDU) has a forward 12-month price-to-earnings (P/E) ratio below its five-year average, currently at a discount compared to the broader tech sector (26.22X) and competitors like Alibaba (10.96) and Tencent (16). Baidu’s shares have increased by 1.8% this year, while Alibaba and Tencent have grown by 40.8% and 24.2%, respectively.
Baidu’s AI Cloud revenue surged 42% year-over-year to RMB 6.7 billion in Q1 2025, now comprising 26% of its Core revenue. The autonomous driving service, Apollo Go, provided approximately 1.4 million rides in Q1 2025, marking a 75% increase year-over-year. However, Baidu reported negative free cash flow of RMB 8.9 billion, primarily due to significant AI investments.
Analysts have lowered their earnings per share (EPS) estimates for Baidu in recent weeks, amid concerns over the company’s ability to monetize its AI-driven initiatives and cope with increasing competition from Alibaba and Tencent. Baidu currently holds a Zacks Rank of #4 (Sell).
