Arete Research has upgraded Baidu from a sell rating to a buy rating, with a price target of $143

Baidu has surged by nearly 16% to HKD$131, the most it has jumped in more than three years in Hong Kong, in the wake of its AI chip potential growth. The company has also added $6.4 billion in market value.

The AI tech firm’s price has also increased by more than 49% in the past month and roughly 57.7% in the past twelve months. Optimism about the company’s core search and AI ambitions has gained traction in the market and pushed its stock price higher.

Baidu’s AI ambition gains traction

Baidu's going vertical now. Chinese tech shares surge 4% on Wednesday pic.twitter.com/aqAoCd6l1b

— David Ingles (@DavidInglesTV) September 17, 2025

Baidu’s options bets also soared, with roughly 170,000 contracts changing hands on Wednesday, more than triple the 20-day average. The firm’s derivatives have surged in recent days, reaching a record number of trades last week.

The increased growth stems from Arete Research Services LLP’s lifting its rating on Baidu’s American depositary receipts to buy from sell. The company had only held the sell recommendation on the stock since it downgraded it last May. 

Arete analysts Shawn Yang and Richard Kramer argued that Baidu’s chip venture has the potential to more than offset the drag from its struggling online advertising business. The brokerage currently prices Baidu’s target at $143, suggesting a potential upside of 17.45% from its current price.

Citigroup and Goldman Sachs Group analysts also published bullish views on Baidu on Wednesday, noting its growth potential in the Cloud business and its latest reasoning model update. On Monday, the company also partnered with China Merchants Group to achieve resource sharing and common development in AI technologies.

Citigroup analyst Alicia Yap acknowledged that the initiative could be a multi-year contract to boost Baidu’s cloud revenue. The chief executive officer of the Kunlun unit, Robin Li, said on Tuesday that its latest chip version has achieved mass production.

Li also mentioned in August that the AI-focused firm had secured orders from China Mobile to power its servers. He also revealed that the value of Baidu’s contracts is larger than that of its rivals.

The tech executive argued that the company had gone through a few funding rounds in recent years to power its development of AI chips. According to Goldman Sachs analysts, Baidu’s latest AI model, Ernie X1.1, showed huge improvements surpassing a DeepSeek model.

Baidu launches pricing of its notes offering

The Chinese tech company also launched the pricing of its offering of CNY4.4 billion with an aggregate principal amount of 1.90% senior unsecured notes. The notes were sold to non-U.S. persons and will be due by 2029.

The AI company said it will use the revenue from the notes for general corporate purposes, such as repaying certain debts, paying interest, and general corporate purposes. Baidu also limits the offering and selling of the notes to any U.S. citizen due to Regulation S under the Securities Act. U.S. persons can be exempted from a transaction that’s not subject to the regulation. The notes will also be listed on the Hong Kong Stock Exchange.

As Cryptopolitan reported, Baidu released positive Q2 results, with total revenues surging by 4% YoY to $4.56 billion. The firm’s non-online marketing revenue also rose by 34% year-over-year and exceeded RMB 10 billion for the first time.

“In the second quarter, our AI Cloud business continued to deliver robust and healthy revenue growth, supported by our strengthening full-stack AI capabilities and comprehensive end-to-end AI products and solutions.”

–Robin Li, Co-founder and CEO of Baidu.

Li revealed that the Chinese tech firm intensified its AI transformation of  “Search” to boost user experience and establish a stronger foundation for long-term growth. He added that Baidu remains focused on AI initiatives that offer the greatest long-term value creation potential.

If you're reading this, you’re already ahead. Stay there with our newsletter.