On 18 February, Chinese tech giant Baidu released its annual report which covers Q4 2024 and the full year’s financial results. The company earned 133.1 billion RMB (18.35 billion USD) last year, down 1% year-on-year (YoY), while Baidu’s core business earnings was 104.7 billion RMB (14.35 billion USD), up 1% from 2023. The adjusted EBITDA of 2024 was 33.1 billion RMB (4.53 billion USD), while the adjusted EBITDA profit margin was 25%. The report came a day after the share price of Baidu dropped 7% on Monday.
Some pundits speculate that Baidu’s founder and CEO Robin Li Yanhong’s absence at the meeting between Chinese officials, including President Xi Jinping and private sector business leaders like Jack Ma, was the reason for the drop on Monday. Others point to Baidu’s recent announcement of making ERNIE Bot, its AI model, free from 1 April. The decision was viewed as an admission of defeat after the release of the open-source DeepSeek AI.
In fact, Baidu is among the many platforms in China to deploy DeepSeek AI, regardless of whether they have a proprietary AI model. On the same day Baidu released its annual report, Baidu’s search engine launched an AI search function called “AI+” powered by DeepSeek-R1, a day after the tech company announced the partnership. Baidu also used some of its own technology to optimise the model on its website. This move is comparable to WeChat’s deployment and would truly democratise AI to most Chinese netizens.
Baidu’s revenue from its AI Cloud service grew 26% YoY in Q4. The company states that 2024 marked Baidu’s shift from an internet-centric business to an AI-centric one. How to balance DeepSeek and its own proprietary model, is a question for Baidu in the future and for most tech companies in China.
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