--- title: "Earnings | Baidu 2023 Revenue ¥134.598B — AI Transforming the Full Business" author: "Unique Research" sourcePublication: "Unique Research (FFCAP English library)" originalPublishedAt: "2024-05-22T17:00:00+08:00" canonical: "https://ffcap.cn/en/research/20240522a078n400" source: "https://ffcap.cn/en/research/20240522a078n400" language: "en" cnSourceUrl: "https://view.inews.qq.com/a/20240522A078N400" --- # Earnings | Baidu 2023 Revenue ¥134.598B — AI Transforming the Full Business _Unique Research · Insight · May 22, 2024_ Baidu, a leading Chinese internet technology company founded in **2000**, built its foundation on search. Over the years it has expanded into search, cloud computing, artificial intelligence, autonomous driving and more — a diversified business stack underpinned by deep technical investment. Charts and tables from the CN original — attach on ingest (**12** images). ## Earnings overview Baidu’s 2023 results beat market expectations on both revenue and profit. Full-year total revenue was **¥134.598 billion**. Baidu Core revenue reached **¥103.465 billion**, up **8.8%** year over year. Gross margin was **51.7%**; ROE **8.3%**; R&D spend **¥24.2 billion** (**18%** of revenue). Debt-to-assets **35%**; total-asset turnover **33%**; receivables days **29**. **Revenue mix.** Online marketing **¥75.1 billion** (+**8%** YoY). Non-online marketing **¥28.4 billion** (+**9%**). **Costs.** Cost of sales **¥65.0 billion** (+**2%**). Selling & admin **¥23.5 billion** (+**15%**), reflecting channel and brand investment. R&D **¥24.2 billion** (+**4%**). **Profit.** Operating profit (non-GAAP) **¥28.4 billion**; Baidu Core operating profit (non-GAAP) **¥24.7 billion**, operating margin (non-GAAP) **24%**. Net income attributable to Baidu (GAAP) **¥28.7 billion** (+**39%** YoY). Baidu Core net income (non-GAAP) **¥27.4 billion**, net margin (non-GAAP) **26%** (+**38%** YoY). In 2023, after four years of iteration, **ERNIE Bot / Wenxin** reached version **4.0**, with user scale past **100 million** — capability Baidu positions as comparable to OpenAI’s ChatGPT-4-class products. Baidu expects ERNIE Bot to contribute **tens of billions of RMB** in incremental revenue in **2024**. After public opening, ERNIE Bot users grew quickly to **70 million**; AI is becoming a growth engine. In Q4, ERNIE contributed about **¥660 million** of incremental cloud revenue. Vertical integration across chips, frameworks, models and apps has cut operating cost: weekly average training efficiency above **98%**; training GPU effective bandwidth about **95%**. As of December 2023, Baidu App MAU reached **667 million**. Self-built deep-learning platform **PaddlePaddle (飞桨)** serves **10.7 million** developers and **230,000+** enterprises/institutions, with **860,000** models created on the platform. Through the **Xinghe** co-creation community, ERNIE-based innovative apps exceed **4,000**, spanning marketing, education and more. ## Earnings read-through **Ads growth was modest.** In Q4, core ads rose **6.4%** YoY, while the share of higher-margin managed-page ads slipped. Despite a typical e-commerce Q4, soft macro and weaker-than-hoped Double 11 merchant spend weighed on intensity. Mobile Baidu App MAU rose only **4 million** QoQ in Q4 to **667 million**. As internet “walls” open and that dividend fades, Baidu faces both pressure and opportunity — needing stronger product and UX innovation to hold share. Within non-ads, **Intelligent Cloud** is nearly **80%** of that revenue; the remaining ~**20%** is mainly autonomous-driving tech solutions and smart speakers. Q4 “other” revenue was **¥8.3 billion** (+**8.9%** YoY), a rebound. In Q4 2022, ACE within Intelligent Cloud had fallen YoY as smart-transport deals with local governments shrank with tighter budgets. In Q4 2023, strong AI demand added GPU rental and ERNIE API call revenue — still relatively small, around **¥200 million**. By year-end, PaddlePaddle hosted **860,000** AI models from developers. After negative growth in Q3, cloud returned to **+11%** in Q4 2023. Remaining other businesses grew only **4%** — a clear slowdown; autonomous driving advanced steadily, with soft spots likely in other smart peripherals. Autonomous ride-hailing brand **Apollo Go (萝卜快跑)** delivered **839,000** rides in Q4 2023 (+**49%** YoY). In Wuhan, fully driverless orders reached **45%** of the mix. ## AI transforming Baidu’s full business Through 2023 Baidu pushed an “AI-native rebuild” across products and services — shipping New Search, New Wenku, and AI marketing tools such as **Qingge (轻舸)** and brand Agents. Qingge, from Baidu Marketing, is positioned as the world’s first AI-native marketing platform: industrial knowledge-enhanced Wenxin models plus generative AI across campaign expression and ad optimization. Features include cross-account one-tap trial, dual deep/shallow bidding, and 7-day budgets, plus Prompt analytics and reporting for clearer ROI decisions. AI also cuts ops cost. Baidu AI Cloud’s **Qianfan AppBuilder** and **Qianfan ModelBuilder** raise AI-native app and model development speed, shortening cycles and lowering R&D cost — attractive for enterprises seeking digital transformation. On the **February 28** earnings call, founder, chairman and CEO **Robin Li (李彦宏)** said Baidu has made strategic investments in text-to-video and related areas. Q4 Intelligent Cloud revenue was **¥8.4 billion**, of which large models contributed about **¥660 million** incremental. Inference cost for Wenxin is now only **1%** of the March-prior-year version. Daily Wenxin calls exceed **50 million** (+**190%** QoQ); about **26,000** enterprises are calling the model. On **August 14, 2023**, Baidu and Geely launched the **Jiyue 01 (极越01)** — a premium intelligent “auto-robot” brand under Geely Holding, powered by Baidu cabin, driving, and ERNIE capabilities. On **February 23, 2024**, Baidu and Jiyue released China’s first pure-vision OCC. On **March 8, 2024**, Jiyue received Optics Valley’s first L3 autonomous-driving test license for conditional road testing in designated zones. Apollo Go’s Q4 rides (+49% to 839,000; Wuhan fully driverless 45%) were reiterated on the call. At Baidu’s AI Developer Conference in Shenzhen on **April 16, 2024**, Robin Li said Apollo Go covers more than **3,000 km²** and **7.7 million** people in Wuhan — among the world’s largest continuous autonomous ops footprints. As one of the world’s largest AV ride-hailing operators, Apollo Go has opened passenger testing in Beijing, Shanghai, Guangzhou, Shenzhen, Chongqing, Wuhan, Changsha, Chengdu and more. ## ERNIE Bot vs peer models ERNIE Bot (Baidu), Hunyuan (Tencent), and Tongyi Qianwen (Alibaba Cloud) are leading Chinese LLMs with distinct tech, architecture, and user profiles. ### ERNIE Bot (文心一言) A knowledge-enhanced LLM in the Wenxin family: dialogue, Q&A, and assisted creation, trained on trillions of data tokens and hundreds of billions of knowledge units, with supervised fine-tuning, RLHF, and prompting — emphasizing knowledge, retrieval, and dialogue enhancement. Strong representation learning via large-scale pretraining and efficient self-attention; strong transfer across NLP tasks. **Wenxin 4.0** lifts understanding, generation, logic, and memory — Baidu states overall capability is competitive with GPT-4. Scenes span text generation, Q&A, translation, intelligent CS, and sentiment monitoring. Distinctives include online Prompt scoring/diagnosis and expanding preset / industry scene models. ### Tongyi Qianwen (通义千问) Alibaba Cloud’s ultra-large LLM, opened to the public on **September 13, 2023**. Transformer-based MaaS foundation trained on broad web text, books, and code; parameter scales include **1.8B / 7B / 14B / 72B** and VLa variants. Capabilities: multi-turn chat, copywriting, reasoning, multimodal understanding, multilingual support. Timeline: invite tests from **April 7, 2023**; unveiled at Alibaba Cloud Summit **April 11**; DingTalk integration **April 18**; public open after filing **September 13**; open-sourced **72B** on **December 1**; on **December 22** among the first four domestic models to pass “LLM standard conformity” evaluation. Strong natural-language Q&A and image understanding — reportedly ahead of many peers on image comprehension. ### Hunyuan (混元) Tencent’s full-stack general LLM with 100B+-class parameters and pretrain corpus over **2 trillion** tokens — covering NLP, CV, multimodal, text-to-image, and industry task models. From **April 2022** it topped five major cross-modal benchmarks including MSR-VTT and MSVD; HunYuan-NLP1T later topped China’s CLUE NLU leaderboard. Strengths: Chinese understanding/creation, logic, task execution. Applied across NLP, translation, speech, vision, and video understanding inside Tencent’s product surfaces; can detect “language traps,” refuse sensitive induction, generate multi-thousand-character longform, and reason in applied scenes. Ecosystem push via open platforms for developers. ### Comparative notes All three use advanced deep learning with different design emphasis: ERNIE on Chinese processing; Hunyuan on multimodal fusion; Tongyi on generality and cross-domain tasks. Application tilt: ERNIE toward literary/news-style generation; Hunyuan toward meetings, docs, and ads; Tongyi toward Q&A, generation, and translation. User fit follows: ERNIE for Chinese fluency; Hunyuan for multi-type info workers; Tongyi for cross-domain NLP needs. ## Risk tips Despite progress, AI R&D and deployment remain uncertain. Baidu faces rapid tech iteration plus safety/quality challenges for generated content — requiring continued investment in algorithms, models, and data while protecting compliance. Emerging competitors in generative AI and foundation models raise the bar on product innovation; Baidu must keep R&D intensity and flexible product strategy to hold advantage. ## Summary & outlook ERNIE Bot is a structural upgrade for Baidu and China’s AI industry — a foundation for Baidu’s AI ecosystem and a growth amp for Intelligent Cloud, autonomous driving / robotaxi, and Xiaodu hardware as second-curve businesses. More ERNIE-based apps joining the community push cloud from digital to intelligent. Investment logic is shifting from classic search/ads toward an AI-centric diversified stack — often compared in narrative to NVIDIA’s role in AI compute, with Baidu’s full-stack AI layout as the parallel. Per Wind, year-to-date more than **100** institutions rated Baidu Group-SW “Buy,” and **30+** gave “Accumulate” or “Outperform.” Top houses including BNP Paribas, Citi, UBS, Goldman Sachs, Bank of America, and JPMorgan issued Buy ratings. JPMorgan’s target was **$215** — implying nearly **100%** upside versus the **February 27** close. Wenxin has been public for under a year; 2023 revenue growth is an early read on its potential, with more to release over time. _Author: Jerry · Editor: Qiuping_ --- Editorial English edition published on UniqueCapital: https://ffcap.cn/en/research/20240522a078n400 On-site reading page: https://ffcap.cn/en/research/20240522a078n400