Baidu Updates Roadmap on Autonomous Driving Plans and AI Cloud Development at Baidu World

We virtually attended Baidu World 2022 on July 21 where the forum mainly focused on the rollout of its robotaxi business, Apollo Go, and AI cloud solutions. Management struck a positive tone on the future adoption of Apollo Go to expand its paid services outside of its current 10 so far and expects to roll out the robotaxi service globally by 2025. The company proclaimed that itself and Waymo are the current leaders right now as both are in operational phases. Regarding AI cloud solutions, management shared examples of how Baidu AI cloud empowers industrial institutions to digitally transform their infrastructure. Despite providing a timeline for the global launch of Apollo Go, additional operational details were not announced, and our investment thesis remains unchanged as we view Baidu as a leader in China’s autonomous driving and AI cloud industries. Our fair value estimate remains USD 183, or HKD 180, as the current price suggests that Baidu remains undervalued.