The company touts the current fourth version of its GPT-like large-scale language model Ernie as comparable to OpenAI's GPT-4.
China's Baidu (9888.HK) said on Thursday that artificial intelligence could lead to future sales after reporting only 1% revenue growth in the first quarter as China's weak economic growth made advertisers cautious. He said he was confident that the company would contribute to promoting profits.
The company touts the current fourth version of its GPT-like large-scale language model Ernie (which has gone through several improvements since it was announced last March) to be comparable to OpenAI's GPT-4. are doing.
Robin, co-founder and CEO, said: “While we operate our traditional business in a challenging environment and expect revenue growth to slow in the short term, we believe that AI will help us in the long term. We continue to believe that this will help sustain revenue and profit growth.” Lee said on a call with analysts.
The company, China's largest search engine provider, still derives most of its revenue from online ad sales, which have been squeezed by slowing economic growth in China.
The company reported sales of 31.51 billion yuan ($4.37 billion) for the three months ended March 31 on Thursday, compared with the average estimate of 31.21 billion yuan by analysts according to LSEG data.
“Microeconomic weakness has led to a downturn in our advertising business,” Lee said.
“Our advertisers come from a wide range of industries, and the majority are SMEs (small and medium-sized enterprises). This means our advertising revenue is very sensitive to the micro-environment.”
Baidu's US-listed shares fell 4.8% at the start of the US market.
Related article: Baidu announces AI chatbot “Erniebot” has attracted 200 million users
On Thursday's earnings call, Lee said daily usage of Arnie by cloud customers reached 200 million, up from 50 million in the final quarter of 2023.
AI-related revenue accounted for 6.9% of the total reported cloud business, increasing 12% to 4.7 billion yuan.
Last month, the company announced that its AI chatbot Ernie Bot has more than 200 million users, nearly doubling since its last update in December.
Baidu started charging users 59.9 yuan a month in November and also aims to use AI to power its online search and cloud computing services.
The company's online marketing revenue increased 3% to 17 billion yuan in the quarter.
In addition to AI, Baidu's diversification efforts away from online search also include strengthening its self-driving business.
Baidu announced this week that it will launch a new version of its robotaxi service, the sixth generation, in Wuhan. Chief Executive Officer Lee reiterated that the company aims to make its self-driving car business profitable next year.
The company reported adjusted net profit of 7 billion yuan for the quarter, beating analysts' average estimate of 5.57 billion yuan, according to LSEG data.
