Baidu’s 0.31% Rally Fails to Offset 27.22% Trading Volume Drop to 383rd as Earnings and Core Business Pressures Rise

On August 18, 2025, Baidu (BIDU) closed with a 0.31% gain, while its trading volume of $0.25 billion ranked 383rd in the market, a 27.22% decline from the previous day. The stock is set to report Q2 2025 earnings on August 20, with analysts forecasting revenue of $4.06 billion and earnings of $1.74 per share, both reflecting year-over-year declines. Despite beating consensus estimates in the past four quarters, the company faces challenges in core segments like online marketing and iQIYI, which have seen revenue declines in Q1 and are expected to remain under pressure due to weak macro conditions and rising operational costs.

Key drivers for the upcoming report include AI Cloud momentum and Apollo Go’s expansion into Dubai, Abu Dhabi, and Hong Kong. However, these initiatives are unlikely to offset revenue declines in advertising and streaming. Product launches such as ERNIE 4.5 Turbo and PaddlePaddle 3.0 are in early adoption phases and expected to contribute minimally. Elevated investment spending and aggressive pricing strategies may further constrain profitability and free cash flow. The Zacks model highlights a negative outlook for Baidu, with an Earnings ESP of 0.00% and a Zacks Rank of #4 (Sell), indicating limited upside potential ahead of the earnings release.

A strategy of buying the top 500 stocks by daily trading volume and holding them for one day from 2022 to 2025 generated total profits of $10,720, with a cumulative return of 1.08 times the initial investment. The approach leveraged liquidity and momentum in high-volume stocks, though returns remained moderate amid market fluctuations.