Shares of Baidu Group-SW (09888) surged more than 5% in early trading. At the time of writing, the stock was up 5.15% to HK$116.30, with a turnover of HK$407 million.

Market reports on July 6 indicated that Kunlunxin, Baidu's AI chip subsidiary, is targeting a market valuation of approximately $50 billion. This figure significantly exceeds the market capitalization of its parent company, Baidu, which is estimated between $35.5 and $38 billion. Qi Wei, Vice President of R&D at Kunlunxin, previously disclosed that the scale of commercialization for external customers is continuously expanding, with external business now surpassing the volume of supplies to Baidu's internal operations. External clients already include major state-owned enterprises such as China Mobile, China Merchants Bank, and State Grid.

A research report from Macquarie noted that AI-related businesses now contribute over half of the group's revenue, and management is confident in the long-term value of AI. It is anticipated that the rapidly growing infrastructure business will gradually offset pressures from the traditional search segment. The report forecasts that Kunlunxin's revenue for the 2026 fiscal year will more than double year-on-year to approximately RMB 8.5 billion, with steadily expanding profit margins. Macquarie assigns Kunlunxin a valuation of around $48 billion. Baidu's 59% stake is equivalent to an equity value of $82.5 per share, and significant value is expected to be unlocked following a potential public listing.