Will Baidu’s Uber Deal Jumpstart Its Stock?

Chinese search engine behemoth Baidu’s stock (NASDAQ: BIDU) stock surged by close to 9% in Tuesday’s trading. The gains follow the announcement of a multi-year partnership with ride-hailing leader Uber. Under the deal, Baidu will deploy thousands of its Apollo Go autonomous vehicles on Uber’s platform in regions outside China and the United States. Investor enthusiasm around autonomous taxis has been growing, led by Google’s Waymo and Tesla’s Robotaxi initiatives. Baidu’s deal with Uber could make it a credible part of that global narrative. That said, will this move be enough to breathe new life into the stock, which has traded sideways over the past year amid ongoing challenges in its core search business?

Image by Mohamed Hassan from Pixabay

Ride Hailing A Big Catalyst? 

The partnership marks a major step in globalizing Baidu’s autonomous driving ambitions, which have largely been confined to China thus far. Initial rollouts with Uber are expected in Asia and the Middle East by the end of this year, giving Uber users the ability to hail self-driving taxis. There are also reports of planned expansion into Europe, as the company continues to look beyond China to scale its technology.

Baidu’s Apollo Go unit has been gaining traction. In Q1 2025 alone, it completed over 1.4 million rides, up roughly 75% year-over-year. Its fleet now exceeds 1,000 fully driverless vehicles across 15 cities, including Chinese hubs such as Shenzhen and Wuhan. Partnering with Uber could significantly accelerate global distribution, tapping into a massive market. See How Waymo and Other Bets Can 2x Alphabet Stock

So how big is the potential opportunity? Uber handled over 230 million rides per week in Q4 2024, translating to a $375 billion annual revenue pool for just human-driven rides. Autonomous could be even bigger. Robotaxis such as Waymo have reported better customer retention and far fewer crashes than the average, and as more users experience the convenience of autonomous ride-hailing, adoption could surge. If the current ride-hailing market doubles a $750 billion market opportunity could very well be possible. Of course, scaling globally will require Baidu to navigate complex regulatory landscapes and the U.S. market – which is the likely the largest – will probably remain shut for the company.

What Has Weighed On Baidu Stock? 

A couple of trends have impacted Baidu stock in recent years. China’s post-Covid economic recovery has been weaker than expected, leading to sluggish domestic consumption and lower advertising revenue in Baidu’s core search business. Additionally, the rise of generative AI has created uncertainty for traditional search. While Baidu has aggressively invested in AI tech – launching tools such as its Ernie chatbot – monetization remains unclear. Generative AI offers limited scope for traditional ad placements, and user behavior is shifting toward direct answers instead of clicking on search results. Competition in the space is intensifying as well, with Chinese tech giants like Alibaba and Tencent developing rival models that can be used for search, threatening Baidu’s dominance in the space.

A Value Buy 

At around $90 per share, we think Baidu looks like a value bet. The stock trades at roughly 10x consensus 2025 earnings, well below the nearly 40x multiple it commanded during the Covid-19 pandemic. Additionally, Baidu held nearly $22 billion in net cash as of Q1 2025 – that’s approximately 65% of its current market cap. See our analysis of Baidu Revenue and Baidu Valuation for more details on how the company’s revenues are trending and how its valuation compares with peers. AI has been the center of investor attention, and Baidu stock may be an under-the-radar way to play that trend. China’s growing strength in AI is likely to attract more global capital, and Baidu with notable progress in areas like its Ernie Bot and autonomous driving could be a key player. As one of the few publicly traded companies offering direct exposure to China’s AI ecosystem, Baidu could see increased interest from investors.

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