Baidu AI Sales Eclipse Waning Legacy Ads for the First Time

Baidu Inc. posted a better-than-feared 1% drop in revenue after growth in nascent AI businesses offset a steady decline in traditional internet revenue, buying the search leader time to catch rivals such as Alibaba Group Holding Ltd. in the post-ChatGPT era.

Sales for the three months ended March slipped to 32.1 billion yuan ($4.7 billion), extending revenue declines into a fourth consecutive quarter. AI segments such as cloud services contributed more than half of Baidu’s core revenue for the first time in the quarter, up from roughly 40% in 2025. Excluding Netflix-like streaming platform iQiyi Inc., the company returned to growth, thanks to surging demand for graphic-card rentals. Its US depositary receipts gained 1.8% on Monday.