JPMorgan sees an AI-powered future ahead for Chinese internet services provider Baidu . The bank upgraded the Chinese internet services stock to an overweight rating from neutral. It also hiked its price target for U.S.-domiciled shares to $188 from $110, which signals 69% upside ahead. BIDU YTD mountain BIDU YTD chart Analyst Alex Yao‘s upgrade comes as cloud and AI are set to become Baidu’s growth engines and value drivers. He believes that the market is underestimating this transition and suggested investors buy into Baidu now to capture the valuation rerating. Yao sees Baidu’s cloud revenue growth accelerating to around 61% in 2026, versus 23% in 2025. He attributed this to a surge in sales of Kunlun AI chips. “We believe domestic demand for AI compute in China remains intense, and hyperscalers are increasingly sourcing from local solution providers,” he said. “In addition, we expect GPU compute revenue will maintain triple‐digit growth given enterprise mania for model training, fine-tuning and inference.” Yao also sees rapid expansion ahead for Baidu’s AI-native marketing services. He believes that revenue from this business could growth 55% year-over-year in 2026. “While Baidu’s AI-marketing revenue is growing strongly, there are two caveats,” he added. “First, the expansion in AI‐based ad services is likely to cannibalize the legacy search advertising business. Second, there remains uncertainty around when and at what level traditional search ads will stabilize.” Baidu’s U.S.-listed stock has risen 32% this year and gained more than 3% in the premarket following the upgrade. Most analysts are bullish Baidu. Of the 33 who cover it, 24 rate it a buy or strong buy, per LSEG.
JPMorgan: Chinese Internet Stock to Benefit From AI
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