Baidu 4Q15 Earnings Call Notes

Robin Li – Co-Founder, Chairman and Chief Executive Officer

Service and domestic consumption are growing faster in China

“Even as China’s overall gross slows, service and domestic consumption are growing faster. This growth in service is outpacing overall GDP in 2015. Providing an additional tailwind is the Chinese government’s Internet Plus initiative, which is pushing traditional industries to work more closely with Internet companies, bringing structural change to those sectors.”

Baidu largely services these growing sectors

“Baidu largely services these growing sectors. With our top revenue verticals by broad classification including retail ecommerce, local services, healthcare, financial services and education. We are confident in our outlook for Baidu and China’s growing sectors. Baidu plays a vital role as the platform to connect users and merchants in these verticals. ”

Investing in autonomous driving

“We see a very bright future for autonomous driving, especially here in China where we face severe pollution, frequent traffic jams and high mortality rates from traffic accidents. Baidu believes, we can transform transportation as we know it. We’ll keep you updated with new divestments from this exciting area.”

Search algorithm is pretty much all machine learning today

“Our machine learning is a fundamental technology to (40:20). Five years ago, search was pretty much based on statistical tactics. These days, the search algorithm itself is pretty much machine learning. So far, a lot of our existing products and services including the algorithmic search, pay search, the query side based on voice, based on images, those are all very heavily driven by machine learning, especially deep learning technologies. And I’m actually very proud of our speech recognition capability.”

Self driving car can probably become a commercial product within five years

I think self-driving car can become a commercial product probably within the next five years. So that is very dependent on our machine learning and artificial intelligence capabilities.”