Baidu, Inc. · Q2 2026
Consensus vs reported
QoQ and YoY are measured on the same basis as each panel's own consensus, so no panel compares two different measures.
The quarter in short
Revenue $4.62B, up 1.1% year over year and down 0.7% on the quarter. NON-GAAP PER ADS EPS $1.06, down 46.8% year over year and 40.1% on the quarter. GAAP EPS $0.85. Free cash flow −$1.17B, down 79.6% year over year and 149.6% on the quarter. NON-GAAP PER ADS EPS missed consensus by 27%. Rule of 40 score −24.
Reported this quarter
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What we learned
- The score fell 18.2 points and 15 of them were capex. Free cash flow of −RMB 7,954M is the deepest hole in the tracked window, on capital expenditure of RMB 11,390M — 3.0x the prior-year quarter and 93% above last quarter alone .
- The transformation completed and the top line cannot show it. Core AI-powered business reached RMB 12.5B, +25% — exactly half of Baidu General Business against 38% a year ago, while the legacy half fell 23% .
- Baidu borrowed for the build rather than funding it. Short-term loans went from RMB 7,626M to RMB 26,311M in six months and lease right-of-use assets doubled to RMB 18,574M, with financing contributing +RMB 17.4B against a RMB 9.2B outflow a year earlier.
- Our own growth number is a currency artefact and we are saying so. The renminbi moved from RMB 7.163 to RMB 6.785 per dollar between the two June quarters, so the same quarter reads +1.09% in dollars and −4.2% in renminbi . Take five points off the score for the renminbi view.
- Thirteen points of gross margin is the price of the mix, and it is mostly paid. From 52.5% three years ago to 39.0% now, because RMB 7.3B of cloud infrastructure carries a cost of revenue that the same renminbi of search advertising did not.
Coverage around this release
Estimate against reported
| Quarter | Estimate | Reported | Surprise |
|---|---|---|---|
| 2024 Q3 | — | $3.08 | — |
| 2024 Q4 | — | $1.95 | — |
| 2025 Q1 | — | $2.98 | — |
| 2025 Q2 | — | $2.84 | — |
| 2025 Q3 | — | −$4.76 | — |
| 2025 Q4 | — | $0.53 | — |
| 2026 Q1 | — | $1.27 | — |
| 2026 Q2 | $1.44 | $1.06 | −27% |
Estimates are the consensus we published on our own preview for that quarter; quarters we did not preview carry the reported figure only. Where a consensus was set on a non-GAAP basis, the reported column shows that same measure.