Baidu (BIDU) Stock Jumps 3.50% as Company Moves to Monetize Kunlunxin Amid China’s Chip Surge

Baidu's stock surged as the tech giant pivots to capitalize on its semiconductor unit—just as China's domestic chip industry heats up.

Monetizing the Silicon

Baidu isn't just building AI—it's building the hardware to run it. The push to monetize Kunlunxin, its AI chip arm, signals a strategic shift from pure software to owning the silicon stack. It's a move that could unlock massive value, turning an internal cost center into a potential revenue engine.

Riding the National Wave

The timing isn't accidental. With China aggressively pushing for semiconductor self-sufficiency, Baidu is positioning Kunlunxin to catch the wave of government support and domestic demand. Every percentage point of market share gained in China's chip race translates directly to the bottom line—and investors are taking notice.

The 3.50% stock bump is more than a daily win; it's a bet that Baidu can transform from an AI software leader into a full-stack tech powerhouse. Because in today's market, sometimes the smartest algorithm is the one that sells the shovels during a gold rush—even if half the analysts are still trying to figure out what a 'neural processing unit' actually does.

TLDRs;

• Baidu explores Kunlunxin spin-off with potential Hong Kong IPO unlocking AI chip value.

• Investor optimism lifts Baidu stock 3.5% amid strong semiconductor market momentum.

• China’s AI chip market surges as domestic makers benefit from US restrictions.

• Kunlunxin poised for growth with new orders and rising domestic demand.

Baidu Inc. (NASDAQ: BIDU) saw its shares rise 3.50% on Monday, fueled by investor excitement over the potential spin-off and Hong Kong listing of its semiconductor subsidiary, Kunlunxin Technology.

The search engine giant confirmed that the chip unit is “in the process of the proposed spin-off and listing in Hong Kong,” with an initial public offering (IPO) expected no earlier than the first quarter of 2026. However, Baidu emphasized there is “no assurance” that the plan will proceed.

Baidu, Inc., BIDU

Investors appear optimistic that a successful IPO could unlock significant value in Baidu’s artificial intelligence chip business. On Monday, Baidu shares opened at HK$125.60, extending gains recorded last week, as the market reacted to the company’s push to commercialize Kunlunxin.

The chip unit recently completed a fundraising round that valued it at roughly 21 billion yuan (US$2.97 billion), highlighting strong investor interest in China’s domestic semiconductor sector.

Domestic Chip Market Momentum

The surge in Baidu’s stock comes amid a broader wave of Optimism for China’s semiconductor industry. Following the blockbuster Shanghai debut of Moore Threads Technology, dubbed “China’s little Nvidia,” investors have been eager to back domestic chipmakers.

Moore Threads’ shares soared fivefold on their initial trading day, signaling renewed confidence in the country’s ambition to reduce reliance on foreign AI chip suppliers.

Other companies, such as MetaX Integrated Circuits, are also advancing IPO plans in Shanghai, reflecting growing market demand and investor enthusiasm for local AI chip technologies.

Baidu’s MOVE aligns with Beijing’s strategy to strengthen domestic semiconductor capabilities and foster technological self-reliance in the face of ongoing US export restrictions on advanced AI chips.

Kunlunxin’s Roadmap and Commercial Traction

Kunlunxin’s journey began as an internal Baidu initiative in 2011, focusing on intelligent chip development. The unit launched its first product, the XPU, in 2017, followed by the Kunlun AI chip in 2018, which CEO Robin Li described as China’s “first cloud-to-edge” AI processor. Kunlunxin was spun off as an independent company in April 2021, with Baidu retaining a majority stake of 59.45%.

The company has announced ambitious product plans, including the M100 chip in 2026 for inference tasks and the M300 chip in 2027, capable of both training and inference. These chips will be clustered into high-performance Tianchi nodes to enhance AI computing capabilities.

Early commercial orders, including projects tied to China Mobile, indicate strong market traction and the potential for rapid revenue growth. Analysts forecast Kunlunxin’s revenue could increase roughly sixfold by 2026, reaching around 8 billion yuan.

AI Ambitions and Strategic Positioning

Beyond hardware, Baidu is expanding its AI ecosystem, including new supernode products that LINK multiple chips to overcome individual performance limits. These initiatives aim to strengthen China’s domestic AI infrastructure while monetizing cloud and computing assets.

The company’s Ernie large language model has also been upgraded to handle advanced text, image, and video analysis, further integrating hardware and software capabilities.

As Baidu explores the potential Hong Kong IPO, investor attention remains high. The company’s plans highlight China’s broader goal of establishing self-sufficient AI and semiconductor capabilities, providing domestic alternatives to US technology while capturing emerging market opportunities in the AI chip space.