From search engines to smart clouds, companies continue to climb the innovation curve to increase investment in technological innovation, and artificial intelligence innovation continues to catalyze performance growth. Q1 revenue in 22 years reached 28.411 billion yuan, exceeding market expectations, of which non-advertising revenue reached 5.7 billion, an increase of 35% over the same period last year. The company continues to grow from the search business to a company with forward-looking innovation strength and a leading position in artificial intelligence. Non-advertising business is mainly driven by intelligent cloud business. In 21 years, the company's intelligent cloud business increased by 64% year on year, reaching about 15.1 billion yuan. In 22 years, Q1 increased by 45%. The company's intelligent cloud business growth was higher than that of the industry.
Smart driving business provides the company with growth certainty and continuous improvement Baidu, Inc. smart driving has three bright spots: smart car solution (Auto Solution), radish fast running and concentration. The company said at 22Q1 that contract orders related to smart driving solutions (including ASD-Apollo self-driving and DuerOS, etc.) accumulated more than 10 billion yuan, compared with 8 billion yuan at 21Q4.
1) Smart car solutions provide products such as AVP,ANP, HD maps, and DuerOS operating systems for cars. Among them, the Apollo ANP pilot assist system and AVP autonomous parking system are intelligent products with a combination of software and hardware launched by Baidu, Inc. Apollo. Developers can program the ACU hardware that supports ANP and AVP systems (the product form is a box with chips inside, such as NVIDIA Corp's OrignSoC) on the Apollo open source ecological platform. In addition to ACU, the full set of ANP and AVP systems will also include cameras, sensors and other hardware, and will cooperate with Baidu, Inc. 's high-precision map to give drivers a L3-L4-level autopilot experience. High-precision map is an important auxiliary tool for intelligent driving, and DuerOS provides an operating system-level solution for smart cars.
2) radish fast running is Baidu, Inc. 's self-driving platform, which is expected to become a self-driving version of the "taxi-hailing software platform". Radish fast running service platform has cars equipped with Baidu, Inc. 's intelligent driving software and hardware equipment (ANP,AVP, high-precision map). Radish Express 22Q1 has provided about 200,000 ride services and landed in Beijing, Shanghai, Guangzhou, Shenzhen, Chongqing, Wuhan and other places. It has reached cooperation with BYD and plans to cooperate with Dongfeng. Turnip Express has also obtained China's first license to provide unmanned travel services on open roads in Beijing.
3) Jidu is a joint venture car brand between Baidu, Inc. and Geely. In June, 22, ROBO-01, the first "car robot" concept car, was launched. The design adheres to the futuristic and highly integrated design scheme, abandons redundant physical keying, and has a very strong deformable structure, including lidar and tail lift, U-shaped steering wheel folding and so on.
The advertising market is under pressure, and the users of the company strive for progress in the process of ecological stability.
22Q1 Baidu, Inc. Mobile Ecological MAU reached 632 million (YoY 13%), of which about 83% are daily login users. Baidu, Inc. Intelligent Mini Program (SMP), MAU reached 508 million (YoY22%), and the number of Mini Program increased by 26% compared with the same period last year. In the quarter, the managed page business in the online marketing section of Baidu, Inc. 's core business generated 31% revenue from the same period last year, accounting for 47% of the core business online marketing.
Investment suggestion
The company is an established Internet manufacturer with significant technological advantages. Multi-point layout of high-tech tracks, including intelligent cloud, intelligent driving, intelligent hardware equipment, new business continues to create value for customers, is expected to open up room for revenue growth for the company. It is estimated that in 22-23-24, the company will have operating income of 129.53 billion / 149.29 billion / 173.09 billion, net profit of 16.49 billion / 23.69 billion / 287.4 billion (Non-GAAP) and PE21.9 Xmax of 15.2 x 12.5 X. According to the SOTP valuation method, the company has a reasonable market capitalization of HK $517.7 billion (RMB 442.5 billion) and a reasonable share price of HK $187.3 (RMB 160.1). It is covered for the first time and is given a "buy" rating.
Risk hint
Internet advertising business faces competition from short video platforms; the pace of consumer recovery is lower than expected; the offline development of cloud computing business is affected by the epidemic; the speed of commercialization of smart driving business is lower than expected; and the number of new entrants to smart driving business is increasing.