China's Baidu (NASDAQ:BIDU) reported its second-quarter results today, missing Wall Street estimates as continued weakness in its advertising business overshadowed growth in artificial intelligence.
Baidu reported second-quarter earnings per share of RMB7.22, missing the ****** yst estimate of RMB9.84. Meanwhile, revenue came in at RMB31.33 billion, down 4% year-over-year.
Baidu's traditional mainstay, online marketing revenue, was down 19% to 13.1 billion yuan compared to a year earlier due to cautious advertisers amid a stagnant macroeconomic environment.
Underneath the advertising decline, the company's AI-related businesses stood out. Baidu's AI Cloud Infrastructure revenue rose 50% year-over-year to RMB7.3 billion. GPU Cloud revenue within that segment shot up 283% year-over-year backed by rising demand for public cloud-based AI computing, up from 184% growth in the prior quarter.
AI applications rose 3% to 2.5 billion yuan, while AI marketing services were flat at 2.6 billion yuan. According to Baidu founder and CEO Robin Li Yanhong, the growing momentum in Baidu's core AI-powered business reaffirms its transition from an internet-centric company to an AI-first company.

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