Sealand: Initiate coverage of BIDU-SW (09888) with a "buy" rating, AI SaaS promotes the improvement of cloud services.

Sealand released a research report stating that it initiated coverage of BIDU-SW (09888) with a "buy" rating for the first time. It is estimated that the company's revenue for the years 2025 to 2027 will be 1309.73 billion, 1356.68 billion, and 1443.07 billion Yuan respectively, with non-IFRS net profits of 166.00 billion, 198.64 billion, and 235.48 billion Yuan, corresponding to non-IFRS EPS of 6.04, 7.22, and 8.56 Yuan. The company is one of the few in the world that provides four-layer full-stack AI, and its unique breadth and depth of AI capabilities provide a differentiated technological foundation for all its businesses. Baidu's AI transformation is accelerating, with the proportion of AI-generated results on its mobile search results page continuously increasing. Users who use AI have higher user activity and retention rates, indicating that the company's products are driving higher user satisfaction. The company is also actively transitioning from general search results to personalized pages, generating customized responses based on individual user situations to better match users with the services they need. The bank pointed out that with full-stack AI capabilities, the company can provide cost-effective end-to-end AI cloud products and solutions. The company can provide economically efficient, reliable, and scalable cloud services, enabling enterprises to easily adopt AI technology and extend it to actual business impact. Looking ahead, the company is expected to lead the transformation of the domestic AI ecosystem. Furthermore, Baidu is a global leader in Robotaxi and is actively accelerating its global expansion. The company has established a global leading position in the Robotaxi market. In the left-hand driving market, the company is the first to achieve UE breakeven, and currently all of the company's operations in mainland China are fully driverless. In the right-hand driving market, the company has expanded its testing range, with its technology stack and operational expertise having high transferability across regions, enabling the company to adapt to new markets and regulatory environments.