Baidu's second quarter financial results have been released, with total revenue reaching 26.3 billion yuan. The AI cloud business showed significant growth, and non-online marketing revenue surpassed 5 billion yuan for the first time. The meeting emphasized that in the face of rapid technological changes, Baidu will continue to deepen its research and development of basic models, explore the forefront of AI, and drive long-term value with technology.

Through the application-driven approach, Baidu has applied AI technology to search and digital human technology, achieving industry-leading results. Taking digital human technology as an example, with the help of the Ernie model, digital human technology has reached new heights in realism and capabilities, even surpassing humans in some scenarios. In addition, Baidu's 4-layer AI architecture has become a core competitive advantage, especially in the field of AI cloud services, by breakthroughs in system engineering to improve inference efficiency, concurrency, and resource utilization, while reducing costs. The continuous optimization of the Qian Fan platform provides a more comprehensive model repository and toolchain, supporting enterprises in building models and developing AI applications, further solidifying Baidu's leading position in the AI cloud platform.

Apollo Gold has made significant progress in both domestic and international markets, establishing strategic partnerships with global platforms such as Uber to accelerate its international expansion, particularly in the Asian, Middle Eastern, and European markets. The company continues to maintain a leading position in the industry in terms of technology, operational experience, and safety record, with a focus on providing safe, comfortable, and cost-effective autonomous driving services for global users.

Baidu search is innovating through AI technology, accelerating the replacement of static text links with intelligent, structured, and multimodal AI-generated content to enhance user search experience. AI-generated content covers a wide range, including videos, images, and the quality continues to improve. In addition, Baidu Cloud business has achieved significant growth, especially in enterprise AI products and services, achieving double growth in revenue and profit. By optimizing resource management, Baidu Cloud provides more efficient and cost-effective solutions, solidifying its leading position in the Chinese AI cloud market.

The dialogue elaborated on how enterprises can use AI technology to enhance internal development efficiency, including AI-assisted coding and no-code application creation, as well as the global layout and cooperative promotion of autonomous driving technology, demonstrating the potential of AI in enhancing internal productivity and popularizing applications. It also emphasized the safety and market expansion strategy of autonomous driving technology, showcasing the company's leading position and future growth confidence in the global market.

Against the backdrop of rapid changes in the mobile internet market, Baidu continues to accelerate the transformation of AI in the search field, achieving significant growth in advertising revenue through innovative ad models such as digital human and AI-driven live streaming. In the second quarter, agency advertising revenue increased by 13% year-on-year, while digital human advertising revenue increased by 55% month-on-month, leading to an increase in the proportion of Baidu's core online marketing revenue. In the future, Baidu will continue to focus on AI innovation and transform it into tangible value.

Baidu's financial results for the second quarter were introduced, with total revenue of 2.27 billion RMB, a year-on-year decline. Online marketing revenue decreased, while non-online marketing revenue increased, mainly driven by AI cloud business. Operating costs rose, but personnel-related expenses decreased. Net profit was 730 million RMB, and diluted earnings per share increased. Baidu's core business non-GAAP net profit was 480 million RMB, with net cash flow of 15.5 billion RMB. The total number of employees is approximately 31,000.

Under the background of accelerating AI model iteration, the discussion focuses on adopting an application-driven innovation strategy in enterprises, concentrating on key areas that can create value, such as AI search transformation and hyper-realistic digital human technology. The plan is to launch a new generation flagship model, continuously optimize existing models, closely monitor industry trends, and ensure that the technological roadmap aligns with market opportunities.

Discussions on the progress of AI search in enhancing user experience, user behavior changes, and future commercial potential, as well as the structure of AI cloud service revenue, marginal profit, and its future development trends.

The report points out that the enterprise cloud business continues to show strong growth momentum, especially in AI infrastructure based on subscriptions, with an annual growth rate exceeding 50%. This trend not only reflects the company's focus on high-value services, but also demonstrates in-depth exploration of the mid-sized customer group. Despite fluctuations in project-based revenue, the company is seeking to improve revenue stability through streamlining project portfolios. Although individual cloud business is relatively small, it aims to enhance user stickiness through free access to AI functions, laying the foundation for long-term profitability. Overall, non-GAAP operating profit achieved year-on-year growth, and the company is steadily moving towards optimizing revenue structure and enhancing market competitiveness.

The conversation discussed the commercial testing of AI search, emphasizing its significant potential for expanding advertising inventory, as well as the transition from CPC to CPS in the long-term profit model. It will cautiously advance in the early stage to ensure user experience, and it is expected that revenue pressure will persist in the short term, but there are optimistic about the growth opportunities brought by AI search in the long term.

Discussed the sustainability of AI-driven cloud service demand in the context of economic weakness and intensifying market competition, emphasizing the widespread application of AI technology in various industries and cost-effective solutions. At the same time, explore how companies protect profit margins in the face of pressure on advertising revenues and AI investment needs through internal efficiency improvements and resource optimization, looking ahead to future profit potential and asset value realization strategies.

Discussed Apollo's competitiveness in the global autonomous driving sector, emphasizing its advantages in technology, investment, and execution, as well as its expansion strategy driven by the RT6 model and global partnerships. At the same time, outlined Apollo's roadmap for achieving sustainable profitability, including cost efficiency, market expansion, and accelerating global partnerships.