BIDU earnings name for the interval ending December 31, 2024.
Picture supply: The Motley Idiot.
Baidu (BIDU -7.51%)
This autumn 2024 Earnings Name
Feb 18, 2025, 7:30 a.m. ET
Contents:
- Ready Remarks
- Questions and Solutions
- Name Members
Ready Remarks:
Operator
Howdy, and thanks for standing by for Baidu’s fourth quarter and financial yr 2024 earnings convention name. At the moment, all members are in listen-only mode. After administration’s ready remarks, there shall be a question-and-answer session. As we speak’s convention is being recorded.
You probably have any objections, you might disconnect presently. I wish to flip the assembly over to your host for at this time’s convention, Juan Lin, Baidu’s director of investor relations.
Juan Lin — Director, Investor Relations
Howdy, everybody, and welcome to Baidu’s fourth quarter and financial yr 2024 earnings convention name. Baidu’s earnings launch was distributed earlier at this time, and yow will discover a duplicate on our web site in addition to on Newswire companies. On the decision at this time, we have now Robin Li, our co-founder and CEO; Julius Rong, our EVP answerable for Baidu Cell Ecosystem Group, MEG; Dou Shen, our EVP answerable for Baidu AI Cloud, ACG; and Jackson Junjie He, our interim CFO. After our ready remarks, we are going to maintain a Q&A session.
Please notice that the dialogue at this time will include forward-looking statements made below the protected harbor provisions of the U.S. Securities Litigation Reform Act of 1995. Ahead-looking statements are topic to dangers and uncertainties which will trigger precise outcomes to vary materially from our present expectations. For detailed discussions of those dangers and uncertainties, please confer with our newest annual report and different paperwork filed with the SEC and Hong Kong Inventory Trade.
Baidu doesn’t undertake any obligation to replace any forward-looking statements besides as required below relevant legislation. Our earnings press launch and this name embrace discussions of sure unaudited non-GAAP monetary measures. Our press launch incorporates a reconciliation of the unaudited non-GAAP measures to be audited most immediately comparable GAAP measures and is out there on the IR web site at ir.baidu.com. As a reminder, this convention shall be recorded.
As well as, the webcast of this convention name shall be obtainable on Baidu’s IR web site. I’ll now flip the decision over to our CEO, Robin.
Robin Li — Co-Founder and Chief Government Officer
Howdy, everybody. Baidu core complete income for the fourth quarter noticed a slight year-over-year enhance, reaching RMB 27.7 billion. Our AI cloud enterprise demonstrated sturdy momentum with income progress accelerating to 26% yr over yr, offsetting the softness in our on-line advertising enterprise. The expansion was primarily pushed by broad market recognition of our AI capabilities wherein we are going to proceed to speculate to verify we keep on the forefront of this expertise megatrend.
2024 marked a pivotal yr as Gen-AI demonstrated sturdy market demand. We see this momentum mirrored within the real worth we created for our clients via our AI merchandise and options, in addition to AI cloud companies. This progress reveals how enterprises have woke up to AI’s transformative potential, catalyzing broader adoption throughout numerous eventualities, whereas affirming the market’s belief in Baidu’s technical capabilities and AI experience. As we proceed to cement our management place as an AI innovator, our imaginative and prescient is progressively coming to fruition on a number of fronts.
Our strategic AI investments are displaying significant progress throughout our key companies. Our cloud enterprise demonstrated strengthening momentum towards the tip of the yr with each sturdy income progress and margin enlargement as we continued to rebuild your complete product portfolio of our cell ecosystem with AI, most notably in Baidu search. In the meantime, Baidu’s autonomous ride-hailing service, Apollo Go has confirmed the viability of its enterprise mannequin, strengthening our confidence in pursuing world enlargement and exploring asset-light enterprise fashions. ERNIE has demonstrated industry-leading capabilities in instruction following and state-of-the-art iRAG expertise that minimizes hallucination.
This best-in-class capabilities have pushed widespread adoption throughout varied eventualities, resulting in considerably rising API prices. In December, ERNIE dealt with roughly 1.65 billion API prices each day. We witnessed a very sturdy exterior demand with exterior API prices rising 178% quarter over quarter. We noticed speedy progress throughout varied enterprise sectors akin to schooling, e-commerce, leisure, and recruitment.
The sturdy progress in exterior API value is pushed by two causes. First, companies are discovering sufficient worth from integrating ERNIE into their each day operations. Second, value issues. Because the inference value goes down, adoption goes up fairly shortly.
We not too long ago made a major strategic determination to open supply our upcoming ERNIE 4.5 sequence and make ERNIE Bot free for finish customers, which we consider will additional broaden market consciousness of ERNIE’s capabilities and allow broader adoption throughout an growing array of industries. Reflecting this rising market recognition, our AI cloud enterprise delivered a strong efficiency. In This autumn, we have now partnered with main enterprises throughout numerous sectors, serving to them handle particular operational challenges utilizing our AI merchandise and options. We collaborated with State Grid Company of China to develop a tailor-made AI resolution primarily based on ERNIE and our MaaS platform, [Inaudible].
Now we have developed complete AI options that permeate key operational processes. From energy dispatching and tools situation prognosis to procurement, security supervision, advertising, and workplace methods. Our options have demonstrated outstanding effectiveness in boosting operational reliability. Impressed by these outcomes, State Grid has elevated its spending on our AI cloud companies, additional deepening its collaboration with us.
We additionally collaborated with [Inaudible], a number one recruitment firm to undertake [Inaudible] ERNIE-powered outbound calling product for campus recruitment, that includes extremely humanlike voice with pure conversational talents. The product permits refined multi-round interactions. ERNIE’s superior capabilities ensured correct gauging of candidates’ curiosity in job alternatives whereas constantly protecting conversations on monitor. With this product, [Inaudible] achieved a 50% greater acceptance fee for job truthful invites and 70% decrease labor prices.
The rising market recognition and adoption bolstered our confidence, and we’re optimistic that the expansion momentum we witnessed at this time is only a begin. As enterprises proceed to find novel methods to harness ERNIE and our AI cloud potential, we foresee an ever-expanding horizon of prospects unfolding earlier than us. On the consumer-facing product, Baidu Wenku is a shining instance. In This autumn, Wenku’s subscription income grew 21% yr over yr.
In December, Wenku’s month-to-month energetic consumer of AI-enabled options reached 94 million, virtually doubling quarter over quarter, making Wenku one of many world’s largest AI merchandise by the variety of paying customers. This quarter, we built-in Baidu Wenku with Baidu Drive, enhancing Wenku as an AI-powered creativity platform. This integration permits Wenku to mix private cloud storage with AI-powered search and document-creation capabilities, whereas enabling customers to streamline their workflow from looking out, accessing information to creating and sharing, all inside a unified seamless platform. Moreover, Wenku launched Free Canvas in January, which transforms content material creation by enabling customers to prepare numerous codecs, textual content, slides, audio, movies, and even web site hyperlinks on a unified canvas.
Free Canvas additionally integrates with Wenku’s present AI capabilities, together with AI editor and AI-powered PowerPoint options, permitting customers to entry our full suite of AI enhancing instruments and save or share their work in any desired format through Baidu Drive. Leveraging ERNIE, Wenku is reworking right into a next-generation clever creativity platform that redefines how customers create, collaborate, and produce their concepts to life. Now, turning to look, our largest consumer-facing product, which stands as one other compelling testomony to our AI transformation. Over the previous a number of quarters, we have now aggressively leveraged ERNIE to rework search.
This has been a difficult however deeply significant journey like pioneers crossing unfamiliar waters, we embraced the uncertainties that include beginning new territories. After in depth exploration, we have now outlined our path ahead in leveraging the ability of language fashions to current the multimedia content material in search outcomes. At the moment, 22% of our search consequence pages include AI-generated content material. Through the quarter, we primarily targeted on redefining and enhancing the standard of our AI-generated search outcomes.
By way of ERNIE’s superior capabilities in content material era, we will ship limitless high-quality content material on demand, vastly increasing the depth and breadth of our search outcomes. This quarter, we expanded past textual content era to generate numerous content material codecs, together with brief movies, nodes, brokers, digital people and dwell streaming. By way of this extra dynamic and diverse content material combos, customers can now uncover a broader vary of data that was beforehand inaccessible, offered in additional participating ways in which’s aligned with evolving consumer preferences. Because of this, we have now achieved substantial enhancements throughout three dimensions of our search ends in high quality, amount, and format range.
Alongside this, we additional enhanced the search expertise by optimizing the matching between queries and search outcomes. By analyzing the character and intent of every question, the Gen-AI-enabled search can decide the optimum content material format and presentation type akin to delivering AI-generated brief movies for queries, producing comparative charts for analysis-focused searches, and dynamically organizing content material sequences. This clever matching ensures that customers obtain not simply probably the most related outcomes however in the best and easy-to-understand format. The effectiveness of this transformation is mirrored in our improved consumer metrics.
On Baidu App, customers uncovered to AI-generated search outcomes demonstrated greater engagement ranges, performed extra search queries, and confirmed greater retention charges and longer time spent. We’re inspired to see each day search queries per consumer elevated by 2% yr over yr in December. Throughout our AI transformation of search, we positioned sturdy emphasis on brokers as we envision brokers will develop into one of the essential types of AI-native purposes. Our brokers have now transcended their preliminary chatbot origins via convergence with digital human expertise, evolving into embodied clever entities with vivid visible presence, due to our industry-leading digital human expertise.
This represents a strong innovation path we pioneered, breaking new floor in how brokers work together with customers. Taking our newly launched lawyer brokers for instance. These embodied lawyer brokers can rework authorized experience and {industry} know-how into participating multimodal content material, that includes attorneys’ precise look in dwell streaming and AI-generated brief movies. By way of these brokers, we will effectively generate high-quality authoritative content material at scale for Baidu search and feed whereas pioneering modern codecs of content material and consumer engagement.
Furthermore, these brokers additionally create important worth for attorneys by serving to them construct private manufacturers, improve engagement with potential shoppers, and enhance lead conversion. Such brokers have gotten a compelling new addition to Baidu’s content material ecosystem, creating new prospects whereas additional diversifying our content material panorama. Within the discipline of clever driving, our continued investments in AI are additionally propelling important progress in our Robotaxi enterprise. In This autumn, Apollo Go delivered outstanding outcomes that bolstered our place because the world’s prime autonomous ride-hailing service supplier.
Our home operations proceed to indicate sturdy momentum, and we have now efficiently validated our pioneering enterprise mannequin via years of operations and established a path to profitability within the autonomous driving {industry}. Importantly, our unrelenting give attention to security stays on the core of our efforts as we broaden our companies. So far, Apollo Go fleets have accrued greater than 130 million autonomous kilometers with an impressive security report, underscoring our industry-leading requirements. This operational and security monitor report has paved the way in which for additional scaling and operational enhancement.
Constructing on this achievement, we’re assured in increasing past Mainland China as we enter the following section of progress. In November 2024, Apollo Go secured permits to conduct testing on open roads in Hong Kong, making us the one firm to obtain Robotaxi testing authorization within the area. Notably, Hong Kong represents our first entry right into a right-hand drive left-hand site visitors market, showcasing our capacity to undertake our autonomous driving expertise to totally different site visitors methods whereas sustaining rigorous security requirements. This achievement acknowledges our deep experience in autonomous driving operations as we’re dedicated to increasing our footprint and bringing protected, dependable, and handy autonomous drive hailing companies to extra cities and areas worldwide.
Now, let me evaluation the important thing highlights for every enterprise for the fourth quarter. AI cloud income reached RMB 7.1 billion in This autumn, delivering a powerful year-over-year enhance of 26% with increasing non-GAAP working margins. This quarter, we doubled the dimensions of our unified GPU cluster, but nonetheless achieved a 99% legitimate coaching time, a outstanding achievement enabled by our sooner and extra superior community structure. Our community has confirmed the potential to allow GPUs throughout totally different geographical areas to work collectively seamlessly with minimized efficiency loss and mechanically resolve for the frequent community points inherent in large-scale computing with virtually unperceivable impression to our shoppers, demonstrating our capacity to ship peak efficiency at an enormous scale.
We proceed to boost [Inaudible], our MaaS platform, which improves the mannequin and app growth expertise for our clients and companions. Our platform options the early household of fashions and gives entry to a choice of high-quality fashions throughout the globe with DeepSeek being one in every of our newest additions. We provide post-train, SFT, information labeling and preparation for our fashions hosted on [Inaudible], enabling us to ship probably the most appropriate fashions and instruments to enterprise shoppers in any respect scales. The growing market recognition of our AI experience continues to drive sturdy momentum in our enterprise consumer pipeline.
Now we have established deep partnerships with main enterprises, together with Xiaomi and [Inaudible], additional highlighting the rising belief in Baidu AI Cloud. Moreover, we’re more and more changing into the popular selection for mid-tier companies. This displays the strengthening competitiveness of our AI infrastructure and marks a wholesome evolution and diversification of our buyer portfolio. For our cell ecosystem, our present precedence is to additional improve the consumer expertise and refine our product options.
We’ll discover monetization alternatives after our Gen-AI-enabled search product options and framework develop into sufficiently refined. Moreover, we proceed to see brokers rising as a promising avenue for monetization, which represents significant progress potential for our promoting enterprise. In December, over 27,000 advertisers have been producing advert spending via ERNIE brokers each day with speedy progress in healthcare, authorized, schooling, and B2B sectors. This speedy adoption stems from brokers’ distinctive capacity to deal with their particular ache factors.
Brokers can shortly grasp advanced non-standardized service portfolios, a activity that historically requires prolonged coaching for human customer support individuals, whereas effectively qualifying these from normal buyer inquiries via clever multi-round interactions. For clever driving, in This autumn, Apollo Go offered roughly 1.1 million rides to the general public nationwide, representing a year-over-year progress of 36%. In January, the cumulative rides offered to the general public exceeded 9 million. Additionally, we reached one other milestone not too long ago with the profitable transition to 100% absolutely collaborative operations nationwide.
Constructing on this sturdy momentum and with an unwavering dedication to security as our prime precedence, we anticipate to see even sooner progress in our trip volumes, with a major acceleration anticipated in 2025 as we additional scale our operations. We proceed to enhance the expertise as we scale up, mixed with our validated enterprise mannequin and preliminary steps in increasing world footprint. We consider we’re nicely positioned to create substantial worth and reshape the way forward for mobility. Pushed by our deep-rooted perception in expertise and conviction in AI long-term worth creation potential, we are going to proceed to speculate to verify we stand on the forefront of cutting-edge AI expertise and deploy that to all our merchandise throughout the board.
With that, let me flip the decision over to Jackson to undergo the monetary outcomes.
Junjie He — Interim Chief Monetary Officer
Thanks, Robin. Now, let me stroll via the small print of our fourth quarter and full yr 2024 monetary outcomes. Complete revenues within the fourth quarter had been RMB 34.1 billion, lowering 2% yr over yr. Complete revenues for the complete yr 2024 had been RMB 133.1 billion, lowering 1% yr over yr.
Baidu Core’s This autumn revenues had been RMB 27.7 billion, growing 1% yr over yr. In 2024, Baidu Core generated RMB 104.7 billion in income, growing 1% yr over yr. Baidu Core on-line advertising income decreased 7% yr over yr to RMB 17.9 billion in This autumn, accounting for 65% of Baidu Core’s complete revenues. Baidu Core on-line advertising income decreased by 3% yr over yr in 2024.
Baidu Core’s non-online advertising income was RMB 9.8 billion, up 18% yr over yr. For the complete yr 2024, non-online advertising enterprise elevated 12% yr over yr. The rise in non-online advertising enterprise was primarily pushed by AI cloud enterprise. Income from iQIYI was RMB 6.6 billion in This autumn, lowering 14% yr over yr.
Income from iQIYI was RMB 29.2 billion in 2024, lowering 8% yr over yr. Price of revenues was RMB 18 billion in This autumn, growing 3% yr over yr, primarily because of the enhance in site visitors acquisition prices, prices associated to AI cloud enterprise, and a one-time write-down of inventories, partially offset by a lower in personnel-related bills and content material prices. Price of income was RMB 66.1 billion in 2024, growing 2% yr over yr, primarily resulting from a rise in site visitors acquisition prices, bandwidth prices, and server custody charges, partially offset by a lower in personnel-related bills and content material prices. Working bills had been RMB 12.2 billion in This autumn, which remained flat in comparison with the identical interval final yr, primarily resulting from a rise in anticipated credit score losses, server depreciation bills, and server custody charges, which is for Gen-AI analysis and growth enter and the channel spending and promotional advertising bills, partially offset by a lower in personnel-related bills.
RMB561 million of the rise in anticipated credit score losses was pertaining to a one-time accrual. Working expense was RMB 45.8 billion in 2024, lowering 4% yr over yr, primarily resulting from a lower in personnel-related bills. Working revenue was RMB 3.9 billion in This autumn, in comparison with RMB 5.4 billion for a similar interval final yr. Baidu Core working revenue was RMB 3.6 billion, and Baidu Core working margin was 13% in This autumn, in comparison with RMB 4.7 billion and 17% for a similar interval final yr.
The lower was resulting from one-time losses of RMB 1 billion, together with accrual of credit score losses, write-down of inventories, and others. Working revenue was RMB 21.3 billion in 2024. Baidu Core working revenue was RMB 19.5 billion, and Baidu Core working margin was 19% in 2024. Non-GAAP working revenue was RMB 5 billion in Q3.
Non-GAAP Baidu Core working revenue was RMB 4.6 billion, and non-GAAP Baidu Core working margin was 17% in This autumn. Non-GAAP working revenue was RMB 26.2 billion in 2024. Non-GAAP due Baidu Core working revenue was RMB 23.9 billion, and non-GAAP Baidu Core working margin was 23% in 2024. In This autumn, complete different revenue internet was RMB 2.7 billion, in comparison with complete different loss internet of RMB 2.5 billion for a similar interval final yr, primarily resulting from a rise in internet international alternate achieve arising from alternate fee fluctuation between Renminbi and U.S.
greenback and a lower in pickup of losses from an fairness methodology funding, which modified sure phrases of its most popular shares and resulted in important loss pickup in 2023. Earnings tax expense was RMB1.6 billion. In 2024, complete different revenue internet was RMB 7.4 billion, growing 120% yr over yr, primarily resulting from a lower in pickup losses. Earnings tax expense was RMB 4.4 billion.
In This autumn, internet revenue attributable to Baidu was RMB 5.2 billion, and diluted earnings per ADS was RMB 14.26. Web revenue attributable to Baidu Core are RMB 5.3 billion, and internet margin for Baidu Core was 19%. Non-GAAP internet revenue attributable to Baidu was RMB 6.7 billion. Non-GAAP diluted earnings per ADS was RMB 19.19.
Non-GAAP internet revenue attributable to Baidu Core was RMB 3.7 billion, and non-GAAP internet margin for Baidu Core was 24%. In 2024, internet revenue to Baidu is up 23.8 billion, and diluted earnings per ADS was RMB 65.91. Web revenue attributable to Baidu Core was RMB 23.4 billion, and internet margin for Baidu Core is 22%. Web non-GAAP internet revenue attributable to Baidu was RMB 27 billion.
Non-GAAP diluted earnings per ADS was RMB 76.85. Non-GAAP internet revenue attributable to Baidu Core was RMB 26.3 billion. And non-GAAP internet margin for Baidu Core was 25%. As of December thirty first, 2024, money, money equivalents, residual money, and short-term investments had been RMB 139.1 billion, and money, money equivalents, restricted money, and short-term investments, excluding iQIYI, had been RMB134.7 billion.
Free money movement was RMB 23million, and free money movement, excluding iQIYI, was RMB 11.1 billion in 2024. We outline internet money place as money and money equivalents plus complete restricted money, deposits, and others, much less complete loans, convertible senior notes, and notes payable. As of December thirty first, 2024, internet money place for Baidu was RMB 170.5 billion. Baidu Core had roughly 31,000 staff as of December thirty first, 2024.
With that, operator, let’s now open the decision to questions.
Questions & Solutions:
Operator
Women and gents, we are going to now start the question-and-answer session. [Operator instructions] Your first query comes from Alicia Yap with Citigroup. Please go forward.
Alicia Yap — Analyst
Hey, thanks. Good night, administration. Thanks for taking my questions. My query is on the newest scorching subject.
So, we have now seen DeepSeek gaining lots of consideration recently and Baidu latest announcement for the open sourcing, the upcoming ERNIE 4.5-series and likewise making ERNIE Bot free of charge. So, might administration share with us the strategic considering behind this transfer? And in addition, how will we view the present aggressive panorama of the inspiration fashions? How does Baidu plan to remain forward of this evolving market? Thanks.
Robin Li — Co-Founder and Chief Government Officer
Hello, Alicia. Let me reply your questions. The Gen-AI and basis mannequin market remains to be nascent however transferring at a really quick tempo. The DeepSeek success story will definitely speed up the adoption fee of basis fashions.
As basis fashions develop into extra accessible and reasonably priced, I consider we’re coming into a really transformative section. We’re seeing an explosion of recent AI purposes and use instances that may open up unimaginable alternatives and push the boundaries of what is attainable with AI. One factor we discovered from DeepSeek is that open sourcing the most effective fashions can vastly assist adoption. When the mannequin is open supply, individuals naturally need to attempt it out of curiosity, which helps drive broader adoption.
ERNIE 4.5 shall be our greatest fashions ever. And we wish to have our customers and clients attempt them out extra simply than earlier than. So, our determination to open supply ERNIE 4.5 sequence can be backed by our deep confidence in our expertise management. This conviction stems from our decade-long dedication to R&D funding, our steady technological innovation, and our distinctive place as one of many few firms worldwide with full stack AI capabilities.
ERNIE has already demonstrated sturdy market traction with each day API prices surging from 50 million to 1.65 billion in only one yr. So, via open sourcing, we consider extra builders and customers will acknowledge ERNIE’s true worth, driving even broader adoption and increasing its impression throughout extra eventualities. Equally, making ERNIE Bot free will allow extra customers to check our basis fashions with different fashions on an apple-to-apple foundation as a result of they do not cost. Final time we had a significant improve of ERNIE was in October 2023.
So, it is a very long time in the past. So, keep tuned for ERNIE 4.5 within the subsequent couple of months. Having stated that, I need to emphasize one essential level. Irrespective of open supply or shut supply, basis fashions develop into actually priceless solely after they can successfully handle real-world issues at scale.
Now we have been dedicated to an application-driven strategy in repeatedly iterating ERNIE. With this mindset, since launching, we have now been utilizing ERNIE to renovate our merchandise whereas serving enterprise clients. Internally, we have leveraged ERNIE to efficiently rework our consumer-facing merchandise like Baidu Search and Baidu Wenku. Externally via our MaaS platform, [Inaudible], we’re enhancing the mannequin and utility growth expertise for enterprise shoppers.
ERNIE’s industry-leading capabilities in instruction following and state-of-the-art retrieval augmented era expertise minimizes hallucinations, have enabled large adoption throughout varied eventualities. And [Inaudible] complete software chain permits our clients to customise any mannequin for their very own utility eventualities. Going ahead, we plan to speed up ERNIE’s iteration primarily based on the efficiency enchancment and cost-cutting potential. We’ll proceed evolving it in areas with the best potential for real-world impression.
We’re excited concerning the new chapter of AI growth, and we sit up for seeing AI expertise convey extra groundbreaking purposes which have lasting worth for the society. Thanks.
Operator
Thanks. Your subsequent query comes from Lincoln Kong from Goldman Sachs. Please go forward.
Lincoln Kong — Goldman Sachs — Analyst
Thanks for taking my query. So, my query is concerning the search enterprise. So, following latest quarters of search revamp, so how ought to we take into consideration the long run adjustment or modifications? So, what is the present mixture of the Gen-AI consequence, and what’s our goal combine? And in addition, as AI integration continued to deepen, might you share extra colour across the consumer metrics? On condition that AI chatbot akin to DeepSeek and [Inaudible] additionally providing search functionality, so how do you view the competitiveness or the competitors dynamics between Baidu search and people AI chatbots? Thanks.
Rong Luo — Government Vice President
Hello, Lincoln. Let me reply questions. At the moment, round 22% of all search consequence pages have contained AI-generated content material. Nevertheless, there may be way more premium itemizing.
Now we have basically reworked search and making extra highly effective and environment friendly than ever earlier than. After which as Robin stated within the ready remarks, with ERNIE, we have now increasing the search past textual content, hyperlinks to supply numerous content material codecs, together with brief movies, dwell streaming, brokers, nodes, and brief performs. And these totally different codecs will be dynamically mixed to create a personalised search experiences. As we proceed to rework search, we’re additionally creating capabilities which permit for the deep personalization adapting to every customers’ habits and desire.
And our efforts have led to the higher consumer outcomes. In January, we will see the quantity month-to-month energetic customers who conduct a search on Baidu App, 83% engaged with the generative AI content material. What’s much more encouraging is that in December, the search queries per consumer on the Baidu App grew by 2% yr over yr. We give attention to steady enchancment in consumer experiences, increasing AI’s position as we see more and more constructive consumer engagements.
Constructing on this, let me share a small case of how ERNIE brokers can create values for our advertisers. Throughout this previous Chinese language New Yr vacation, whereas many small and medium enterprises are closed for one week and buyer demand in sure {industry} truly peak, our ERNIE brokers successfully bridge this hole. For instance, listening to an organization ought to enhance inquiries as a household reunited and chat on aged dad and mom’ well being wants. However their clients — however their very own customer support crew truly had been away as a result of they had been on vacation.
By way of ERNIE brokers, we have now the corporate successfully determine and qualify the extremely related gross sales leads, enabling them to effectively movement up and serve their clients seamlessly even with a diminished vacation. And relating to your query about AI chatbots and search, we consider that we’re nonetheless within the very early stage of the AI revolution pushed by the inspiration fashions. Whether or not it is AI-native chatbot like DeepSeek or our AI-driven merchandise, these form of efforts, this all symbolize alternative ways to discover AI potential. Because the chief in China’s search market with a whole bunch of hundreds of thousands of customers, we keep agility and holistic market view by inserting the most effective improvements and incorporating the actually modern AI options.
We proceed to pioneer AI transformations and enhancing the search experiences for our huge consumer base. Additionally, search by its nature is deeply rooted in language and textual content understanding, which aligns completely with the big language mannequin capabilities, which place us nicely to steer within the AI-powered search transformation. We consider search is evolving into an built-in platform that transcend the AI chatbots and one which not solely gives the sensible solutions but in addition guides customers via their in journey from discovering solutions to offering in-depth evaluation to finishing duties and in the end to delivering the excellent companies and options. Whereas AI chatbot represents an essential early section AI utility growth, the [Inaudible] at this time has not but emerged.
And for us, the secret is to take care of this speedy and decided tempo of the AI transformation, specializing in discovering what customers actually want and one from the following era of search. Thanks, Lincoln.
Operator
Thanks. Your subsequent query comes from Alex Yao from JPMorgan. Please go forward.
Alex Yao — Analyst
Hey, administration, thanks for taking my query. So, might you touch upon Core advert progress outlook for first quarter ’25 and full yr 2025? What are the macro assumptions you made underlying this outlook because the promoting enterprise actually bottomed out in 4Q ’24 and began to get well? Lastly, what are the potential alternatives for monetizing Gen-AI search, and what’s the anticipated timing? Thanks.
Rong Luo — Government Vice President
Thanks, Alex. That is Julius. Let me reply your query. Sure, we’re seeing the totally different sorts of seamless insurance policies rolling out prior to now few months just like the financial easing of fiscal stimulus and buying and selling insurance policies — whereas we consider that these measures will finally will profit the economic system, they usually want a while to movement via.
On condition that our promoting enterprise is very correlated with the small and medium enterprises who’re significantly delicate to macro situations, plus is persistently difficult aggressive panorama. And we’ve not actually seen any enhancements in This autumn but. Regardless of the near-term pressures, our efforts to rework search with monetary fashions are progressing steadily. And we consider that this AI transformations will proceed to boost the consumer experiences and create new alternatives.
This quarter, we additional deepened AI transformation of search, and we’re seeing encouraging enhancements in consumer metrics as we talked about within the ready remarks. And we consider it will assist drive income progress and open new monetization alternatives in the long term. Additionally, we’ve not began to monetize our search outcomes at scale but, which is round 22 % of the overall queries. As soon as our AI-powered search options are sufficiently refined, we are going to transfer ahead with monetization.
With greater high quality consumer merchandise, we’re seeing alternatives for future progress. Based mostly on these components, we predict that we’re reaching the purpose of our commercial companies. We anticipate our app companies to progressively enhance with the primary half of the yr performing higher than This autumn and the second half of the yr displaying additional enchancment over the primary half. Thanks, Alex.
Operator
Thanks. Your subsequent query comes from Gary Yu from Morgan Stanley. Please go forward.
Gary Yu — Morgan Stanley — Analyst
Thanks for the chance. So, my query is relating to AI cloud. Given the sturdy progress of your AI cloud enterprise this quarter, can we anticipate a continued constructive trajection going into 2025 and each by way of income and likewise profitability? What are the primary drivers behind this momentum? And moreover, might administration share your outlook on the AI cloud market in 2025? How ought to we strategy enterprise cloud demand, and what incremental alternatives does AI convey to this section? Thanks.
Dou Shen — Government Vice President and Head, AI Cloud
Thanks, Gary, in your query. So, as Robin talked about, our AI cloud income progress accelerated to 26% yr over yr in This autumn, contributing to a full-year income progress of 17% in ’24. Notably, Gen-AI-related income almost tripled yr over yr in 2024. So, this progress was fueled by rising demand for ERNIE and our AI infrastructure and scoring the market’s sturdy recognition of our technological management.
So, in consequence, we have now efficiently attracted a various buyer base and constructed a strong pipeline of alternatives. So, for the AI infrastructure, we have now established partnerships throughout numerous sectors, together with Web, automotive, sensible gadgets, manufacturing, power, finance, utilities, and plenty of AI GC start-ups. Our buyer base continues to develop healthily with sturdy positive aspects amongst each top-tier and mid-tier clients, demonstrating our increasing market share in China’s cloud market. On the MaaS platform, [Inaudible], it gives complete basis fashions with the industry-leading value and efficiency.
So, we supplied the ERNIE household of fashions from flagship to light-weight variants designed to fulfill numerous wants. And apart from ERNIE, we additionally present entry to a variety of high-quality third-party basis fashions, together with DeepSeek’s V3 and R1 fashions. Because of our full stack AI capabilities and end-to-end optimization, we will guarantee optimum efficiency and stability for any mannequin hosted on our platform, whereas sustaining extremely aggressive presence. So, along with that, [Inaudible] gives a full sight of instruments for fine-tuning fashions and constructing AI-native apps in order that our clients can simply work out options catering for their very own particular wants.
So, by way of the AI cloud market, we consider it’s going to develop quickly in 2024 — 2025. On one hand, through the latest Chinese language New Yr vacation, giant language fashions grew to become a extensively mentioned subject. This not solely additional elevated public consciousness in basis fashions, but in addition encourage extra individuals to suppose merely about leverage them to enhance their very own companies. Then again, we’re assured that the efficiency of basis fashions will proceed to enhance whereas the fee will steadily decline.
Absolutely, now, it will additional decrease the barrier to make the most of these fashions. So, in consequence, we consider extra enterprises will combine basis fashions into each facet of their enterprise operations from R&D to manufacturing and to gross sales, which can drive explosive progress in API value. Thereafter, we anticipate elevated spending on Baidu AI Cloud as we have now noticed a transparent pattern prior to now that the customers who adopted basis fashions via API prices on our [Inaudible] MaaS platform additionally tended to extend their spending on our AI cloud companies. On the revenue facet, our non-GAAP working margin continued to broaden yr over yr in This autumn as we targeted on high-value alternatives that align with our strategic priorities, which drives sustainable, sturdy progress.
So, trying into 2025, we’re assured that our AI cloud income progress will keep sturdy momentum whereas persevering with to generate constructive working revenue. Thanks, Gary.
Operator
Thanks. Your subsequent query comes from Xiong Wei from UBS. Please go forward.
Wei Xiong — Analyst
Hello, administration. Good night. Thanks for taking my query. I need to ask about our margin pattern.
So, given the near-term headwinds in core advertisements and the growing mixture of cloud income, how ought to we take into consideration the core margin ranges within the first quarter and likewise full yr 2025? Is there any room to additional optimize our working effectivity? And in addition, are there any funding plans for the complete yr that we should always concentrate on? Thanks.
Junjie He — Interim Chief Monetary Officer
Thanks, Wei, in your query. That is Jackson. So, regardless of the near-term stress, so we stay optimistic that our strategic AI funding will ship extra sustainable impression. So, we keep targeted on bettering resilience throughout all points of our enterprise operations and see encouraging progress throughout our companies.
First, for our on-line advertising enterprise. We anticipate our promoting income to progressively enhance, pushed by our plan to monetize our AI-generated search outcomes at scale and likewise our revenues to seize progress alternatives when the macro improves. Secondly, for our AI cloud enterprise, it has already demonstrated sturdy progress with continued margin enchancment, pushed by our rising market presence and the aggressive benefit in our distinctive self-developed four-layer AI structure and full stack AI capabilities. So, we stay assured in sustaining this sturdy momentum going ahead.
Third, for our complete driving enterprise, significantly Robotaxi, Apollo Go, we stay targeted on narrowing losses with higher operational effectivity and improved UE. We’re additionally exploring modern operational fashions, together with asset-light fashions. As you requested for the investments and optimization in 2025, we are going to keep optimum useful resource allocation to high-growth alternatives whereas keep aligned with our long-term technique. Our investments will proceed to give attention to initiatives that provide each great future alternatives and powerful ROI potential, together with additional advancing ERNIE’s capabilities, deepening the AI transformation search, enhancing our AI cloud choices, and increasing our autonomous driving initiatives.
As we transfer ahead with these initiatives, we stay dedicated to enhancing operational effectivity and fostering synergies throughout enterprise group to maximise the impression of those strategic investments. Thanks.
Operator
Thanks. Your subsequent query comes from Miranda Zhuang from Financial institution of America Securities. Please go forward.
Miranda Zhuang — Financial institution of America Merrill Lynch — Analyst
Good night. Thanks, administration, for taking my query. My query is concerning the Robotaxi enterprise. Can administration present updates to the progress of the Robotaxi enterprise heading into 2025? What different targets for fleet dimension unit economies and worth proposition for our Robotaxi enterprise? What do you suppose the {industry} is approaching? Are we reaching an inflection level, and what’s your view concerning the competitors dynamics as we’re seeing that China’s Robotaxi opponents leveraging ecosystem methods with automakers and likewise ride-hailing platforms? So, questioning what’s Baidu’s strategy to compete and scale? Thanks.
Robin Li — Co-Founder and Chief Government Officer
Yeah, that is Robin. We have invested in autonomous driving expertise for over a decade. Now we have turned our massive imaginative and prescient into actuality. By way of Apollo Go, we established ourselves as a number one world participant in autonomous driving expertise.
We function in one of the difficult environments globally. China’s site visitors situations are among the many world’s most advanced resulting from its huge inhabitants, numerous street situations, dynamic site visitors eventualities, and sophisticated city layouts. The value for trip hailing in China it is about like one-seventh of that within the U.S. So, our profitable operation right here demonstrates our distinctive technological and operational capabilities.
We designed the RT6, our sixth-generation autonomous automobile, from the bottom up. It’s the most cost-effective Robotaxi automobile the world has ever seen. With this energy, we have efficiently validated our enterprise mannequin and laid a powerful basis for additional scaling and world enlargement. In This autumn, Apollo Go offered roughly 1.1 million rides nationwide.
That is a 36% enhance yr over yr. And in January, the cumulative rides offered to the general public exceeded 9 million. Moreover, as I discussed, we have achieved 100% absolutely driverless operations in China, which implies that we have no security drivers on the autos anymore. So, it is a new {industry} benchmark, and it reinforces our management on this space.
As I discussed earlier, in November of final yr, Apollo Go acquired the inexperienced gentle to start out open street testing in Hong Kong. And this is a crucial step as a result of Hong Kong is our first right-hand drive and right-hand site visitors market. It reveals our capacity to adapt our autonomous driving expertise to totally different site visitors methods, opening doorways for enlargement into different markets with related driving setups. This yr shall be a paramount yr for our enlargement, we anticipate to develop our fleet dimension and trip volumes sooner than ever.
As we push ahead, we’re additionally actively searching for cooperation alternatives. Now we have recognized quite a lot of potential companions, together with mobility service suppliers, native taxi firms, third-party fleet operators and different potential companions. This asset-light strategy will permit us to scale up effectively whereas sustaining flexibility. By working with a various vary of companions, we intention to strengthen our place out there and produce autonomous driving to much more individuals.
Wanting on the broader market. As I discussed in our final earnings name, because the market remains to be in its infancy, competitors truly helps speed up market growth and foster a extra pleasant pro-innovation regulatory setting. And on this rising market, our mission stays clear: delivering safer, extra handy, and extra snug mobility expertise for extra customers. Thanks.
Operator
Thanks. Your subsequent query comes from Thomas Chong from Jefferies. Please go forward.
Thomas Chong — Analyst
Hello, good night. Thanks, administration, for taking my questions. Wanting into 2025, what shall be Baidu’s strategic focus for enterprise investments. Particularly, how will sources be allotted throughout search, autonomous driving, cloud companies, and basis fashions? Moreover, what’s administration’s outlook on full-year 2025 capital expenditures in addition to shareholders’ returns.
Thanks.
Junjie He — Interim Chief Monetary Officer
Thanks, Thomas. That is Jackson. So, as we consider our capital allocation alternatives in 2025, so our strategy are guided by the next strategic issues. So, we are going to proceed to spend money on advancing our AI capabilities as a long-term strategic precedence.
So, with that, we are going to additional deepen the AI transformation throughout our product portfolio, significantly search. For AI cloud, we intention to drive the adoption of our AI infrastructure, our MaaS platform, [Inaudible], and the ERNIE amongst enterprise clients, assembly their rising demand for our AI merchandise and options, in addition to AI cloud companies. In autonomous driving, we’re specializing in scaling home operations, exploring modern operational mannequin, and increasing our worldwide presence, whereas guaranteeing disciplined ROI administration and efficient loss management. For capex, two key priorities drive our choices: to strengthening our expertise management and accelerating the adoption of our AI merchandise and AI cloud companies throughout totally different sectors.
As you requested for shareholder returns, we repurchased over $1 billion because the starting of 2024, which is considerably greater than our complete buybacks in 2023. So, in complete, we have now repurchased $1.7 billion below our $5 billion buy program, which runs via December 2025. So, going ahead, we plan to speed up our buyback program as a part of our ongoing efforts to return worth to our shareholders for his or her enduring belief and help. Thanks.
Operator
Women and gents, that’s on a regular basis we have now for questions. That does conclude our convention for at this time. [Operator signoff]
Length: 0 minutes
Name members:
Juan Lin — Director, Investor Relations
Robin Li — Co-Founder and Chief Government Officer
Junjie He — Interim Chief Monetary Officer
Alicia Yap — Analyst
Lincoln Kong — Goldman Sachs — Analyst
Rong Luo — Government Vice President
Alex Yao — Analyst
Gary Yu — Morgan Stanley — Analyst
Dou Shen — Government Vice President and Head, AI Cloud
Wei Xiong — Analyst
Miranda Zhuang — Financial institution of America Merrill Lynch — Analyst
Thomas Chong — Analyst
