Baidu Q3 Earnings & Revenues Beat Estimates Despite Y/Y Decline

Baidu, Inc. BIDU reported third-quarter 2025 non-GAAP earnings of $1.56 per ADS (American Depositary Share), which surpassed the Zacks Consensus Estimate by 30%. The figure decreased 34.2% year over year. In domestic currency (Renminbi), the company reported earnings of RMB 11.12, down 33% year over year.Revenues of $4.38 billion fell 8.4% year over year. The figure beat the Zacks Consensus Estimate by 1.7%. In domestic currency, revenues increased to RMB 31.17 billion, down 7.1% year over year.Revenues from the Baidu Core segment declined 7% year over year to RMB 24.66 billion ($3.46 billion).Under this segment, online marketing revenues declined 18% to RMB 15.3 billion ($2.16 billion), and non-online marketing revenues rose 21% year over year to RMB 9.3 billion ($1.31 billion), supported primarily by strong growth in the AI Cloud business. Revenues from the iQIYI segment declined 8% from the prior-year quarter to RMB 6.68 billion ($939 million).Baidu, Inc. Price, Consensus and EPS Surprise Baidu, Inc. price-consensus-eps-surprise-chart | Baidu, Inc. QuoteBIDU’s Q3 Operating HighlightsThe SG&A expenses of the company grew 12.2% year over year to RMB 6.58 billion ($924 million) due to an increase in expected credit losses and channel spending expenses.Research and development expenses declined 3.5% from a year ago to RMB 5.18 billion ($728 million).Non-GAAP operating income of RMB 2.21 billion ($310 million) was down 68.6% year over year. The non-GAAP operating margin of 7.1% contracted 1380 basis points (bps) year over year from 20.9%.Adjusted EBITDA during the quarter was RMB 4.43 billion ($622 million), down 49.3% year over year, with adjusted EBITDA margin contracting 1180 bps to 14.2%.BIDU’s Balance Sheet & Cash FlowAs of Sept. 30, 2025, total cash and investments rose to RMB 296.4 billion ($41.64 billion), compared with RMB 124.2 billion ($17.34 billion) as of June 30, 2025.In the third quarter, net cash provided by operating activities totaled RMB 1.26 billion ($176 million), while free cash flow posted an outflow of RMB 2.15 billion ($302 million).Baidu’s Other Business UpdatesBaidu introduced a new AI-native view this quarter to better highlight the key valuation drivers across its portfolio and provide a clearer picture of the company’s evolving AI strategy. This framework cuts across traditional business segments and organizes the business by the nature of its AI-powered products and services.In the third quarter of 2025, Baidu outlined three AI-native categories that delivered meaningful revenue contributions. AI Cloud Infra generated RMB 4.2 billion, up 33% year over year, supported by strong demand for AI accelerator infrastructure, which saw 128% subscription growth. AI Applications, including products such as Baidu Wenku, Baidu Drive and Digital Employee, produced RMB 2.6 billion, a 6% increase, benefiting from sticky subscription models. Meanwhile, AI-native Marketing Services surged to RMB 2.8 billion, up 262%, as customers increasingly adopted AI-driven agents and digital humans to boost productivity and marketing performance.Baidu unveiled its new omni-modal foundation model, ERNIE 5.0, at “Baidu World” in November 2025.The company also upgraded its MaaS platform, Qianfan, to be agent-centric (for model services and agent development) to accelerate AI-native application development for enterprises.Apollo Go, Baidu’s autonomous ride-hailing service, delivered 3.1 million fully driverless rides in the third quarter of 2025, with year-over-year growth accelerating to 212%, up from 148% in the previous quarter. In October 2025, weekly fully driverless rides exceeded 250,000, and by November, total public rides surpassed 17 million. Apollo Go operated in 22 cities as of October and achieved 100% fully driverless operations across all its mainland China service areas, including major cities such as Beijing, Shanghai, Shenzhen, Wuhan, Chengdu and Chongqing.BIDU’s Zacks Rank & Stocks to ConsiderCurrently, BIDU carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the broader Zacks Computer and Technology sector are NetEase NTES, Pure Storage Inc. PSTG and Docusign DOCU, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Shares of NTES have rallied 56% year to date. It is set to report third-quarter 2025 results on Nov. 20.Shares of PSTG have risen 33.7% year to date. It is set to report third-quarter fiscal 2026 results on Dec. 2.Shares of DOCU have declined 27.1% year to date. It is set to report third-quarter fiscal 2026 results on Dec. 4.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Baidu, Inc. (BIDU): Free Stock Analysis Report NetEase, Inc. (NTES): Free Stock Analysis Report Pure Storage, Inc. (PSTG): Free Stock Analysis Report Docusign Inc. (DOCU): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks