Baidu’s Q3 revenue drops 7% as advertising weakness overshadows AI, Cloud momentum

The company posted revenue of 31.17 billion yuan, slightly above estimates of 30.7 billion yuan

by e4m Staff
Published: Nov 19, 2025 11:55 AM | 2 min read

Baidu has reported a 7% year-on-year decline in its third-quarter revenue, underscoring the strain on its core advertising business as China’s economic slowdown continues to curb marketing budgets.

The company has posted revenue of 31.17 billion yuan, slightly above estimates of 30.7 billion yuan, but still weighed down by shrinking ad demand in a market affected by weak consumer spending and prolonged pressure on key sectors.

The company remained heavily exposed to reductions in advertising outlays, with its search-led marketing business recording a steep fall. Baidu’s online advertising revenue stood at 15.3 billion yuan, an 18% drop from the previous year. The downturn contributed to a net loss of 11 billion yuan, a reversal from the profit it recorded in the same quarter last year, driven largely by asset write-downs.

Despite the softness in ads, the company’s artificial intelligence and cloud operations delivered robust growth. Baidu reported 6.2 billion yuan in AI cloud revenue for the quarter, marking a 21% increase, as enterprises accelerated adoption of AI agents and large language model tools. The company said revenue from AI-related businesses crossed 10 billion yuan, reflecting rising reliance on Baidu’s expanding AI ecosystem.

Baidu has invested more than 100 billion yuan in artificial intelligence since launching its first chatbot service in early 2023, and continues to integrate AI across its platforms, including its search engine. The latest version of its Ernie model, new AI chips scheduled for release between 2025 and 2027, and growing interest in its Apollo Go robotaxi service which is averaging over 250,000 weekly rides that highlight ongoing efforts to expand its technology footprint.

With competition intensifying from Alibaba, DeepSeek, ByteDance and other Chinese tech players, Baidu said it will continue elevated but disciplined spending on AI, viewing the technology as central to its long-term growth strategy.