Chinese search giant Baidu doubles down on smart cars as revenue stalls
- Founder Robin Li says the company plans to launch a new electric vehicle with Geely in three years
- Baidu’s total revenue in the fourth quarter rose 5 per cent from a year earlier, but online marketing revenue dropped 5 per cent for the full year of 2020
Chinese internet search giant Baidu plans to launch a new smart car model under a joint venture with leading Chinese carmaker Zhejiang Geely Holding Group in about three years, said Baidu CEO and founder Robin Li Yanhong on Thursday.
“We will try to beat the market to launch this new car as soon as we can,” said Li during a conference call with analysts after the company’s fourth-quarter earnings announcement. He indicated that the company envisioned an “intelligent” vehicle with autonomous driving technology and better in-car entertainment services, he said.
Baidu, which is trying to remake itself from an internet search service provider into a leader in artificial intelligence and autonomous driving, entered an agreement last month with Geely to produce smart electric vehicles. Under the deal, Baidu will provide intelligent driving technologies to power passenger vehicles produced by Geely, owner of Volvo Cars and shareholder of German carmaker Daimler AG.
Li said the joint venture partners have found a CEO for the joint venture and selected the brand under which the new vehicle model will be sold, without elaborating.
Baidu’s smart car initiative has come as the company pushes to monetise the autonomous driving technologies that it has been developing for years under its autonomous driving unit Baidu Apollo. The company is also reportedly applying for a secondary listing on the Hong Kong stock market. Since its US share price fell to under US$90 last March, it has more than tripled in 11 months to above US$300.
The company’s revenue in the quarter ended December reached US$4.6 billion, up 5 per cent from a year ago. But online marketing revenue, traditionally Baidu’s primary sales source, remained largely flat from the same period in 2019. For the whole of 2020, Baidu’s online marketing revenue fell 5 per cent from a year earlier.
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Baidu sees huge potential in monetising its user base through other forms such as “live streaming, subscriptions and e-commerce”, said Li, in a reference to YY Live’s planned business model after its integration with Baidu’s mobile ecosystem.
“We basically view live-streaming as another form of monetisation,” said Li.
Baidu’s revenue from its loss-making long-format video-streaming platform iQiyi declined 1 per cent year on year in the fourth quarter, even though its number of subscribers rose to 101.7 million in December.
Baidu booked a total revenue of 107.1 billion yuan (US$16.6 billion) in 2020, flat from the previous year.
