Baidu Reportedly Overhauling Flagship Search Engine Amid Slump In Ad Revenue

Chinese technology company Baidu Inc. (BIDU) reportedly announced on Wednesday that it is revamping its flagship search engine by leveraging artificial intelligence and adding a voice function. 

A Bloomberg report stated that the overhaul was announced during a media event in Beijing. Baidu said the upgrade is the most comprehensive in years.

Following the news, Baidu stock inched 0.5% higher in Wednesday's premarket session.

Zhao Shiqi, the executive leading Baidu’s search division, explained that the company plans to shift from traditional keyword-based search to a smarter, AI-powered approach. 

The redesigned system will support natural, conversational input and voice searches, including those spoken in multiple Chinese dialects.

Users can pose queries through spoken language, produce visuals or text-based content, and organize tasks, essentially transforming the app into a digital assistant. 

With these enhancements, the report noted that Baidu aims to reengage its user base and reverse its slump in digital advertising revenue, which has been dropping for the past four quarters.

In the first-quarter (Q1), Baidu’s online marketing revenue slipped 6% year-on-year (YoY) to RMB16 billion ($2.21 billion).

However, the company’s Q1 Core’s revenue rose by 7%, fueled by a 42% YoY jump in its rapidly expanding AI Cloud division.

Baidu has experienced a decline in user engagement as rivals, such as ByteDance Ltd.’s Douyin and AI-centric web browsers, have gained traction. 

At the Beijing event, company leaders acknowledged that Baidu’s search platform had become too complex and required simplification. The tech firm also debuted a new image-to-video generation model on Wednesday, designed to help brands produce short-form visual content for Baidu’s feeds. 

According to a Reuters report, MuseSteamer is a business-focused image-to-video generator. The model produces brief video clips, lasting up to 10 seconds, and is available in three versions: Turbo, Pro, and Lite. 

This release represents Baidu’s continued effort to tap into AI’s business value and stay competitive with other major Chinese tech firms.

On Stocktwits, retail sentiment around Baidu improved to ‘bullish’ from ‘bearish’ territory with ‘high’ message volume levels.

Baidu stock has gained 2% in 2025 and has lost nearly 1% in the last 12 months.

Also See: Apple Stock Back In Favor? iPhone Sales Surprise Prompts Analyst Upgrade, Fuels Hopes For Earnings Beat

For updates and corrections, email newsroom[at]stocktwits[dot]com.