Nomura: Baidu's third-quarter advertising revenue may further decline. Maintaining a buy rating, but lowering the target price to HK$92.00.

The Daiwa analyst report pointed out that Baidu's advertising business revenue may further decline in the third quarter, as Baidu's AI search monetization process remains cautious. Although its AI cloud and autonomous driving taxi commercialization continue to make steady progress, Baidu's advertising business faces "increasing pressure". These analysts pointed out that the large-scale monetization of AI search is expected to be achieved by the end of 2025. Daiwa expects that Baidu's year-on-year decline in core marketing revenue for the third quarter will expand from 15% in the second quarter to 24%, thereby pushing down its core operating profit to 2.1 billion yuan, the lowest level in six years. Daiwa maintains a buy rating on Baidu, but lowers its target price from 93.00 Hong Kong dollars to 92.00 Hong Kong dollars.