Webscale Playbook: Baidu, 2018 - R&D Binge to Continue as Baidu Banks on Long-Term Bets in AI and Autonomous Vehicles for Competitive Edge - ResearchAndMarkets.com

February 12, 2019

DUBLIN--(BUSINESS WIRE)--Feb 12, 2019--The “Webscale Playbook: Baidu” report has been added to ResearchAndMarkets.com’s offering.

The objective of this report is to assess Baidu’s:

Latest quarterly key performance indicators including revenues, capex, opex, R&D, etc. Top 3 spending-related (capex and R&D) priorities Network vendor relationships, M&A, and partnerships across different network product categories Network-related strategy Disruptive impact on the network infrastructure market

Baidu, often referred to as China’s Google, is embarking on a new journey to pursue growth outside its core search and advertising business. That’s vital as the online advertising business is maturing, yet Baidu continues to rely heavily on it (80% of 2017 revenues). Adding to the woes is the increased rivalry from local peers, Alibaba and Tencent, in the core advertising and online content segments, tied with macro-economic risks arising from rigid ad-related policies/regulations and US-China trade war. These factors have thumped Baidu’s 4Q18 topline guidance.

Fortunately, Baidu realizes its position, and is already channeling greater focus on newer sustainable markets that include AI (DuerOS-powered smart devices, smart cities, blockchain) and autonomous vehicles (Apollo program, driverless vehicles). The company is also on a non-core divestiture spree aimed at freeing up money and resources for these newer markets. As Baidu builds its portfolio of new markets, the company’s R&D outlays have held steady at around 15% of revenues since 2015.

Below are a few highlights from the report:

Baidu has been spending more on R&D than capex, as it ramps up its pursuits in AI and connected cars. Capex spend, currently 7% of revenues, is likely to remain well below 10% as Baidu prioritizes research activities and relies on partners for much of its cloud infrastructure. Baidu’s open-source platform for autonomous vehicles, Apollo, is key to its long-term success as it builds out an extensive web of partners for the platform; that includes more than 100 auto and tech firms, such as Ford, Microsoft, NVIDIA, Intel, and Bosch. Baidu is also developing its own AI chip (Kunlun) and building cloud capabilities to support its AI-driven businesses, particularly autonomous vehicles.

Topics Covered

1. Latest earnings takeaways

2. Revenue analysis

3. Capex & R&D: Spend analysis

4. Baidu’s project Apollo

5. Baidu’s funding in AV startups

6. Other key spending avenues

7. Key technology relationships

8. Baidu’s network strategy

List of Exhibits

Baidu Revenues: 2Q17-3Q18 YoY Growth Rate (CAPEX vs OPEX): 2Q17-3Q18 Profitability Margins: 2Q17-3Q18 Revenues (Annualized & Single Quarter), & YoY Growth FY2017 Revenue Split Annualized Capex and R&D, % Revenues Baidu’s annualized share of WNO network & IT capex

Companies Mentioned

Alibaba Alphabet Amazon Apple Baidu Facebook Microsoft Tencent Ford Microsoft NVIDIA Intel Bosch Du Xiaoman Financial Blackberry Waymo Velodyne LiDAR BMW iDriverPlus SmarterEye NIO Hesai Tech ZTE China Telecom Xilinx AMD

For more information about this report visit https://www.researchandmarkets.com/research/dnw3dr/webscale?w=4

View source version on businesswire.com:https://www.businesswire.com/news/home/20190212005528/en/

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PUB: 02/12/2019 08:52 AM/DISC: 02/12/2019 08:52 AM


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