Chinese tech giant Baidu (BIDU) beat Wall Street’s second-quarter earnings estimates on Tuesday despite several headwinds in the Chinese economy. Baidu’s Apollo Go, its robotaxi business, has unveiled its next-generation autonomous electric vehicle, the Apollo RT6, as the service surpasses one million rides.
Like Google in the United States, Baidu dominates the search market in China with a market share of three quarters (75.5%).
Although Baidu‘s cloud business stole the show in the second quarter, growing 31% year-over-year, the company is doubling down on its self-driving program.
Baidu partnered with Chinese automaker Geely in 2021 to collaborate on a smart electric vehicle venture. With Geely’s automotive expertise and Baidu’s advanced software, JIDU, the autonomous electric vehicle startup, was born in March 2021.
Since its founding, JIDU has unveiled several electric vehicle concepts, starting with the ROBO-01. State-of-the-art Nvidia Drive Orin computer chips power JIDU’s ROBO-01 (also powering EV smart cars from automakers like Nio and Li Auto).
Earlier this summer in June, Baidu unveiled its plans for the future with its 6th generation AV, the Apollo RT6. The tech giant has teamed up with several major automakers to push the project forward, including Ford, Toyota and Geely.
JIDU has ambitious plans to deliver 800,000 autonomous electric vehicles each year by 2028. That being said, Baidu’s second-quarter results show the tech giant moving forward to meet its target as Apollo Go takes off.
Baidu Q2 2022 Earnings Highlights: Apollo Go Takes Flight
Although several Chinese companies suffered a growth stunt caused by lockdowns and a tech crackdown last year, Baidu for the most part overcame these challenges.
Baidu’s total revenue fell 5% from 2021 to 29.6 billion yuan ($4.43 billion), its first slowdown in two years. However, analysts predicted a slowdown and Baidu delivered better than expected results.
The company cut costs by 5% to save money, but maintained R&D spending to accelerate its self-driving electric vehicle business, Apollo Go. Meanwhile, the program achieved several milestones this year, including:
- 287,000 trips were made in the second quarter, exceeding one million trips in total on July 20, 2022.
- On August 8, Apollo Go launched fully driverless rides, making it the first to do so in China.
- The self-driving service also began charging fees after receiving a permit on July 20.
Apollo Go is now available in more than 10 cities, including all major Chinese cities (Beijing, Shanghai, Guangzhou, Shenzhen).
So far, the program is progressing rapidly, and Baidu appears to have a first-mover advantage in China. With strong partnerships and industry ties, it will be exciting to watch the standalone business grow, especially as the all-electric Apollo RT6 begins to roll out.
Baidu’s second quarter earnings indicate that the company is not slowing down and that as the Chinese economy reopens, Apollo Go will likely continue to enjoy strong demand.
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