百度 (BIDU) 2023 Q1 法說會逐字稿

Hello, and thank you for standing by for Baidu's First Quarter 2023 Earnings Conference Call. (Operator Instructions) After the management's prepared remarks, there will be a question-and-answer session. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the meeting over to your host for today's conference, Juan Lin, Baidu's Director of Investor Relations. Please go ahead.

您好，感謝您耐心等待百度2023年第一季度財報電話會議。 （操作員說明）在管理層準備好的發言後，將進行問答環節。今天的會議正在錄製中。如果您有異議，此時您可以斷開連接。現在我想把會議轉交給今天會議的主持人，百度投資者關係總監林娟。請繼續。

Hello, everyone, and welcome to Baidu's First Quarter 2023 Earnings Conference Call. Baidu's earnings release was distributed earlier today, and you can find a copy on our website as well as on Newswire services.

大家好，歡迎來到百度2023年第一季度財報電話會議。百度的收益報告已於今天早些時候分發，您可以在我們的網站和新聞專線服務上找到一份副本。

On the call today, we have Robin Li, our Co-Founder and CEO; Rong Luo, our CFO; Dou Shen, our EVP, in charge of Baidu AI Cloud Group, ACG; and Zhenyu Li, our SVP in charge of Baidu Intelligent Driving. After our prepared remarks, we will hold a Q&A session.

今天的電話會議有我們的聯合創始人兼首席執行官李彥宏；羅榮，我們的首席財務官；竇深，我們的執行副總裁，負責百度AI雲事業群、ACG；以及負責百度智能駕駛的高級副總裁李振宇。在我們準備好的發言之後，我們將舉行問答環節。

Please note that the discussion today will contain forward-looking statements made under the safe harbor provisions of the U.S. Credit Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. For detailed discussions of these risks and uncertainties, please refer to our latest annual report and other documents filed with the SEC and Hong Kong Stock Exchange.

請注意，今天的討論將包含根據 1995 年美國信用證券訴訟改革法案的安全港條款作出的前瞻性陳述。前瞻性陳述受風險和不確定因素的影響，可能導致實際結果與我們目前的結果大不相同期望。有關這些風險和不確定性的詳細討論，請參閱我們向美國證券交易委員會和香港聯交所提交的最新年度報告和其他文件。

Baidu does not undertake any obligation to update any forward-looking statements except as required under applicable law. Our earnings press release and this call includes discussions of certain unaudited non-GAAP financial measures. Our press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures and is available on our IR website at ir.baidu.com.

除適用法律要求外，百度不承擔任何更新任何前瞻性陳述的義務。我們的收益新聞稿和本次電話會議包括對某些未經審計的非 GAAP 財務措施的討論。我們的新聞稿包含未經審計的非 GAAP 措施與未經審計的最直接可比的 GAAP 措施的對賬，可在我們的 IR 網站 ir.baidu.com 上查閱。

As a reminder, this conference is being recorded. In addition, a webcast of this conference call will be available on Baidu's IR website. I will now turn the call over to our CEO, Robin.

提醒一下，這次會議正在錄製中。此外，本次電話會議的網絡直播將在百度的 IR 網站上提供。我現在將把電話轉給我們的首席執行官羅賓。

Hello, everyone. 2023 is off to a good start with our business performing well across the board and driving strong growth. In Q1, Baidu Core's revenue growth reaccelerated year-on-year and supported an improvement in our operating margin. Our online marketing business has seen a positive impact from China's overall economic improvement.

大家好。 2023 年開局良好，我們的業務全面表現良好並推動強勁增長。第一季度，百度核心的收入同比再次加速增長，支撐了我們營業利潤率的改善。我們的在線營銷業務受到中國整體經濟改善的積極影響。

After the Chinese New Year, there was a quick recovery, which was especially beneficial for many of our advertisers in offline sectors such as travel, health care, fin services and local services. Moreover, we've been working hard to intense user experience for Baidu App, and this has led to good user metrics and increased online marketing revenue for the first quarter compared to the previous year.

春節過後，恢復很快，這對我們線下行業的許多廣告主尤其有利，例如旅遊、醫療保健、金融服務和本地服務。此外，我們一直在努力提升百度應用的用戶體驗，這使得第一季度的用戶指標和在線營銷收入與去年同期相比有所增加。

Our AI Cloud achieved profitability on a non-GAAP operating level this quarter. Starting in Q2 last year, we have focused on building sustainable growth for our cloud business by phasing out low-quality projects and business. At the same time, we have been building standardized AI solutions for key use cases and replicating them from one project to another.

本季度，我們的 AI Cloud 在非 GAAP 運營水平上實現了盈利。從去年第二季度開始，我們通過逐步淘汰低質量的項目和業務，專注於為我們的雲業務建立可持續增長。同時，我們一直在為關鍵用例構建標準化的人工智能解決方案，並將它們從一個項目複製到另一個項目。

This approach has led to an increase in AI cloud margins over the past few quarters, and we have seen profitability on the non-GAAP operating level this quarter.

在過去幾個季度，這種方法導致 AI 雲利潤率增加，我們已經看到本季度非 GAAP 運營水平的盈利能力。

Today, our eyes are keenly focused on the transformative impact of generative AI. For today's call, I will first provide an update on this topic and then walk you through our operational highlights in AI Cloud, Intelligent Driving and Mobile Ecosystem.

今天，我們的目光敏銳地集中在生成式人工智能的變革影響上。在今天的電話會議中，我將首先提供有關該主題的最新信息，然後向您介紹我們在人工智能雲、智能駕駛和移動生態系統方面的運營亮點。

Generative AI represents a tremendous opportunity for us. It can be compared to the introduction of the Internet and smartphone. To capture this opportunity, we leveraged our technology capabilities and our extensive experience in search, knowledge graphs and dialogue.

生成式人工智能對我們來說是一個巨大的機會。它可以比作互聯網和智能手機的引入。為了抓住這個機會，我們利用了我們的技術能力和我們在搜索、知識圖譜和對話方面的豐富經驗。

We were able to quickly deploy ERNIE Bot in mid March, which became the first GPT model owned and operated by a public company. This launch demonstrated our significant investments and achievements in AI over the past 10 years, and it also highlights our position as the operator of China's largest search engine.

我們能夠在 3 月中旬快速部署 ERNIE Bot，這成為第一個由上市公司擁有和運營的 GPT 模型。此次發布展示了我們過去10年在人工智能領域的重大投入和成果，也彰顯了我們作為中國最大搜索引擎運營商的地位。

With our search engine, we have gathered a vast amount of data, facts and knowledge for natural language understanding, which has been critical in training our model. Baidu has established a robust range of AI capabilities powered by a 4-layered AI architecture, which encompasses cloud infrastructure, the PaddlePaddle deep learning framework, large language models, ERNIE and AI applications.

通過我們的搜索引擎，我們收集了大量數據、事實和自然語言理解知識，這對於訓練我們的模型至關重要。百度已經建立了由 4 層 AI 架構提供支持的一系列強大的 AI 功能，其中包括雲基礎架構、PaddlePaddle 深度學習框架、大型語言模型、ERNIE 和 AI 應用程序。

We have this distinctive advantage that helps us optimize in higher process and reduce costs for model training and inference. One of our significant advantages is owing PaddlePaddle, which is the leading deep learning framework in China.

我們擁有這種獨特的優勢，可以幫助我們在更高的過程中進行優化，並降低模型訓練和推理的成本。我們的顯著優勢之一是 PaddlePaddle，它是中國領先的深度學習框架。

We have developed the PaddlePaddle in a way that aligns this ERNIE Bot and this creates a strong synergy between the systems. Let me give you an example. Training and running large language models require a lot of data, which can be complex and overwhelming and demand significant computing resources. To tackle this challenge, we use our proprietary full-stack AI architecture.

我們以與 ERNIE Bot 對齊的方式開發了 PaddlePaddle，這在系統之間創造了強大的協同作用。讓我給你舉個例子。訓練和運行大型語言模型需要大量數據，這些數據可能很複雜且不堪重負，並且需要大量的計算資源。為應對這一挑戰，我們使用專有的全棧 AI 架構。

We are continuously looking for new techniques to make our 4 layers work seamlessly, which helps us achieve better performance and quicker throughput. Specifically, we have improved compatibility between PaddlePaddle, the large language model and the cloud infrastructure. As a result, since launching ERNIE Bot in March, we normalized -- our normalized queries per second have increased by almost 10x, indicating significant efficiency gains.

我們一直在尋找新技術來讓我們的 4 層無縫工作，這有助於我們實現更好的性能和更快的吞吐量。具體來說，我們改進了 PaddlePaddle、大型語言模型和雲基礎設施之間的兼容性。因此，自 3 月份推出 ERNIE Bot 以來，我們實現了標準化——我們的每秒標準化查詢增加了近 10 倍，這表明效率顯著提高。

Baidu is rapidly integrating ERNIE Bot into all of our businesses for testing. The goal is to leverage its capabilities to enhance, rebuild and create both our enterprise and consumer-facing products and services, thereby revolutionizing our business.

百度正在快速將 ERNIE Bot 集成到我們所有的業務中進行測試。目標是利用其能力來增強、重建和創建我們的企業和麵向消費者的產品和服務，從而徹底改變我們的業務。

We are also working on building an ecosystem around ERNIE Bot to promote the adoption of generated AI in a wider range of use cases. This strategy should enable us to gain market share across all sectors and achieve sustainable long-term growth.

我們還致力於圍繞 ERNIE Bot 構建一個生態系統，以促進在更廣泛的用例中採用生成的 AI。這一戰略應該使我們能夠在所有部門獲得市場份額並實現可持續的長期增長。

As more people use ERNIE Bot, more products integrate with ERNIE Bot in seamless way, we will be able to gather large-scale human feedback and iterate the model rapidly and tailored to real-life market need. On the enterprise facing business side, generative AI expanding the total addressable market of the cloud industry.

隨著越來越多的人使用 ERNIE Bot，越來越多的產品以無縫方式與 ERNIE Bot 集成，我們將能夠收集大量的人類反饋并快速迭代模型並根據實際市場需求量身定制。在企業面向業務方面，生成式人工智能擴大了雲行業的總潛在市場。

This is because cloud service providers can use generative AI to add or enhance capabilities to their current offerings, develop new solutions and applications to address unfulfilled market demand and drive productivity and efficiency. As a result, since we introduced ERNIE Bot, we have observed more and more enterprises from various industries started their model training on our cloud.

這是因為雲服務提供商可以使用生成式 AI 來添加或增強其當前產品的功能，開發新的解決方案和應用程序來滿足未滿足的市場需求並提高生產力和效率。因此，自從我們引入 ERNIE Bot 以來，我們觀察到越來越多的各行各業的企業開始在我們的雲端進行模型訓練。

Our powerful foundation model and our unique full-stack AI capabilities differentiate us from our competitors, which gives us an edge in the market. In March, sales lead increased by more than [100%] year-over-year, which is a significant achievement for us. We believe that our AI Cloud will continue to gain market share over time. I will provide some examples of how ERNIE Bot is helping our customers to gain efficiency.

我們強大的基礎模型和我們獨特的全棧人工智能能力使我們從競爭對手中脫穎而出，這使我們在市場上佔據優勢。 3 月份，銷售線索同比增長超過 [100%]，這對我們來說是一項重大成就。我們相信，隨著時間的推移，我們的 AI Cloud 將繼續獲得市場份額。我將提供一些示例，說明 ERNIE Bot 如何幫助我們的客戶提高效率。

In the financial services industry, we have partnered with a prominent domestic insurance company to help them enhance their digital experiences for employees and clients. To achieve this, we will utilize our AI capabilities, including PaddlePaddle and ERNIE on their private cloud. Additionally, we will create customized tools and technologies to assist them in training and refining models on ERNIE Bot with their unique data, and we will continuously improve the system over time.

在金融服務行業，我們與國內一家知名保險公司合作，幫助他們提升員工和客戶的數字化體驗。為實現這一目標，我們將利用我們的 AI 功能，包括在其私有云上運行的 PaddlePaddle 和 ERNIE。此外，我們將創建定制的工具和技術，以幫助他們使用他們獨特的數據在 ERNIE Bot 上訓練和改進模型，並且我們將隨著時間的推移不斷改進系統。

This model will power various applications, including helping financial advisers, analyze large amount of research reports and public information. We believe that this project has the potential to establish a new industry standard for innovation and efficiency in China's financial services sector.

該模型將為各種應用提供支持，包括幫助財務顧問、分析大量研究報告和公共信息。我們相信，該項目有潛力為中國金融服務業的創新和效率建立新的行業標準。

In the software industry, we are collaborating with some productivity software developers to test the integration of ERNIE Bot into their application with the goal of automating certain workloads and expanding the capabilities of their end users.

在軟件行業，我們正在與一些生產力軟件開發人員合作，測試將 ERNIE Bot 集成到他們的應用程序中，以實現某些工作負載的自動化並擴展其最終用戶的能力。

Additionally, we are partnering with some ERP companies who are exploring the use of ERNIE Bot to assist their programmers in writing code. In the education industry, we opened ERNIE bot to a leading online education company via model as a service, helping them fine-tune their own model on Baidu AI cloud. One of the features we're working on together is an enhanced sophisticated AI tutor, enabling them to better serve their students.

此外，我們正在與一些 ERP 公司合作，他們正在探索使用 ERNIE Bot 來幫助他們的程序員編寫代碼。在教育行業，我們通過模型即服務的方式將ERNIE bot開放給一家領先的在線教育公司，幫助他們在百度AI雲上微調自己的模型。我們正在共同開發的功能之一是增強的複雜 AI 導師，使他們能夠更好地為學生服務。

We've observed the industry is experiencing a surge in demand after the pandemic are interested in using ERNIE Bot to improve their business operations more efficiently. Online travel companies are a good example of this trend as some of the biggest players are testing the use of our ERNIE Bot to assist their customer service team in managing customer queries, suggesting trips and directing customers to relevant information.

我們觀察到，在大流行有興趣使用 ERNIE Bot 更有效地改善其業務運營之後，該行業正在經歷需求激增。在線旅遊公司是這一趨勢的一個很好的例子，因為一些最大的參與者正在測試我們的 ERNIE Bot 的使用，以協助他們的客戶服務團隊管理客戶查詢、建議旅行和引導客戶獲取相關信息。

The feedback so far has been positive, and customers are also beginning to switch their IT expenditures to our cloud. On consumer-facing businesses we are utilizing ERNIE Bot to enhance our product for the users. We're currently beta testing an upgraded version of Baidu Search, which is powered by ERNIE Bot. This version provides natural conversational interactions or more seamless search experience.

迄今為止的反饋是積極的，客戶也開始將他們的 IT 支出轉移到我們的雲上。在面向消費者的業務中，我們正在利用 ERNIE Bot 為用戶增強我們的產品。我們目前正在對由 ERNIE Bot 提供支持的百度搜索的升級版本進行 Beta 測試。此版本提供自然的對話交互或更無縫的搜索體驗。

We're also testing the integration of ERNIE bot with Baidu Wenku, our online document sharing platform to enable ERNIE Bot to work alongside users and assist with 13 summarizing and generating content using natural language. Additionally, we are incorporating ERNIE Bot into other consumer facing products such as Baidu Maps, Baidu Keyboard, Baidu Post and Xiaodu. Furthermore, we are testing a standardized application for ERNIE Bot.

我們還在測試 ERNIE bot 與百度文庫的集成，百度文庫是我們的在線文檔共享平台，使 ERNIE Bot 能夠與用戶一起工作，並協助 13 使用自然語言總結和生成內容。此外，我們正在將 ERNIE Bot 整合到其他面向消費者的產品中，例如百度地圖、百度鍵盤、百度郵政和小度。此外，我們正在測試 ERNIE Bot 的標準化應用程序。

So far, we have been encouraged by the positive user feedback at the current testing stage and look forward to bringing these experiences to more users in the coming months. In the new era, AI chatbot will become a traffic gateway for people to seek information and content. Therefore, we should continue to gain user traffic and mind share, which will drive monetization over time.

到目前為止，我們對當前測試階段的積極用戶反饋感到鼓舞，並期待在未來幾個月內將這些體驗帶給更多用戶。在新時代，人工智能聊天機器人將成為人們尋找信息和內容的流量入口。因此，我們應該繼續獲得用戶流量和思想份額，這將隨著時間的推移推動貨幣化。

We're also working to build an ecosystem around ERNIE Bot with our partners to fuel innovation and drive growth. On the regulatory front, as a leader in AI and an advocate for AI ethics, Baidu continues to promote the responsible use of AI.

我們還致力於與我們的合作夥伴圍繞 ERNIE Bot 構建一個生態系統，以推動創新和推動增長。在監管方面，作為人工智能的領導者和人工智能倫理的倡導者，百度持續推動人工智能的負責任使用。

To comply with regulatory requirements, any new technology, product or service must undergo government review and approval before large-scale deployment. We have applied for review and approval of ERNIE Bot and will roll it out at a large scale to our customers and users once we get the greenlight.

為符合監管要求，任何新技術、產品或服務在大規模部署之前都必須經過政府審查和批准。我們已經申請了 ERNIE Bot 的審查和批准，一旦獲得批准，我們將向我們的客戶和用戶大規模推廣。

Baidu has been operating search in China for more than 20 years and has extensive experience with Chinese culture and regulatory environment. which we believe will help us navigate the regulatory landscape.

百度在中國經營搜索業務已有 20 多年，對中國文化和監管環境有著豐富的經驗。我們相信這將幫助我們駕馭監管環境。

In early April, the Cyberspace Administration of China released a new draft regulation for comments on generative AI, which explicitly endorses the development of self-designed AI algorithms and deep learning frameworks. We believe that regulators' active engagement in generative AI in the early stage will raise the bar to entry and we are well positioned for that.

4月初，國家互聯網信息辦公室發布了新的生成人工智能征求意見稿，明確支持自主設計人工智能算法和深度學習框架的發展。我們相信，監管機構在早期階段積極參與生成式 AI 將提高進入門檻，我們為此做好了充分準備。

Overall, we are thrilled about the prospects that lie ahead with ERNIE Bot, and we will continue to invest in it to unlock the tremendous potential that we envision. Now let's have a look on the first quarter operational highlights.

總的來說，我們對 ERNIE Bot 的前景感到興奮，我們將繼續投資它以釋放我們設想的巨大潛力。現在讓我們來看看第一季度的運營亮點。

In Q1, revenues from AI cloud increased 8% year-on-year, which is an improvement from the 4% year-over-year growth in the fourth quarter last year. We're pleased to report that AI Cloud achieved profitability on the non-GAAP operating profit level during the quarter.

第一季度，人工智能雲收入同比增長8%，較去年第四季度4%的同比增長有所改善。我們很高興地報告，AI Cloud 在本季度實現了非 GAAP 營業利潤水平的盈利。

The margin improvement undergoes 2 points of progress. One is our ability to optimize operations and drive sustainable and healthy revenue growth. Two, is our efforts to standardize our AI solutions and applications and efficiently replicate them across different customers and sectors.

利潤率提高了 2 個百分點。一是我們優化運營和推動可持續健康收入增長的能力。第二，我們努力標準化我們的 AI 解決方案和應用程序，並在不同的客戶和行業中有效地複制它們。

Since Q2 of last year, we have phased out low-margin businesses and projects for AX Cloud, leading to a healthier business portfolio and cost structure. At the same time, we continue to standardize AI solutions for key use cases for replication.

自去年第二季度以來，我們逐步淘汰了安信雲的低利潤業務和項目，從而使業務組合和成本結構更加健康。同時，我們繼續針對複制的關鍵用例對 AI 解決方案進行標準化。

In the water industry, for example, last year, we replicated AI solutions we developed for predicting water usage and controlling water pressure from Quanzhou Water Company to Guangzhou Water Company. And in Q1, we deployed the majority of our earlier standardized solutions to the (inaudible) County Water Company in (inaudible) province. This example demonstrated the scalability and margin expansion of our standardized approach in creating AI solutions for traditional industries.

以水務行業為例，去年我們把自己開發的用於預測用水量和控制水壓的AI解決方案從泉州自來水公司複製到廣州自來水公司。在第一季度，我們將大部分早期的標準化解決方案部署到（聽不清）省的（聽不清）縣自來水公司。這個例子展示了我們在為傳統行業創建 AI 解決方案時標準化方法的可擴展性和利潤擴展。

As I mentioned earlier, generated AI is creating a host of opportunities for the cloud industry and expanding the cloud market significantly. Therefore, we will continue to invest and actively explore ways to grow our cloud services.

正如我之前提到的，生成的人工智能正在為雲行業創造大量機會，並顯著擴大雲市場。因此，我們將繼續投資並積極探索發展我們的雲服務的方法。

Moving into Intelligent Driving. We continue to make solid progress. In Q1, the number of rides provided to the public on open roads increased over threefold compared to the same period last year and reaching nearly 660,000.

進入智能駕駛。我們繼續取得堅實的進展。第一季度，在開放道路上向公眾提供的乘車次數與去年同期相比增長了三倍多，達到近 66 萬次。

Thanks to the remarkable growth in ride and our strong track record of safe operations, we have received more permits from government to offer fully driverless ride-hailing services in China.

由於乘車量的顯著增長和我們良好的安全運營記錄，我們從政府獲得了更多許可，可以在中國提供完全無人駕駛的網約車服務。

On March 17, Apollo Go was allowed to provide fully driverless ride-hailing service in Yizhuang region of Beijing. As of today, we are providing the services in 3 cities: Beijing, Wuhan and Chongqing. We are prioritizing fleet expansion and passenger adoption in regions where we can provide driverless commercial operation, meaning it's fully driverless and we can charge.

3月17日，Apollo Go獲准在北京亦莊地區提供全無人駕駛網約車服務。目前，我們在北京、武漢和重慶三個城市提供服務。我們正在優先考慮在我們可以提供無人駕駛商業運營的地區擴大車隊和乘客採用，這意味著它是完全無人駕駛的，我們可以充電。

Our efforts are yielding good results. In Wuhan, where we first received the permit to provide such services on public road last August, we now have more than 135 driverless vehicles and more than 1/3 of the paid rides Apollo Go provided were in fully driverless vehicles.

我們的努力正在產生良好的效果。在武漢，我們於去年 8 月首次獲得在公共道路上提供此類服務的許可，目前我們擁有超過 135 輛無人駕駛汽車，Apollo Go 提供的付費乘車服務中超過 1/3 是完全無人駕駛汽車。

We are confident that the number of rides provided by fully driverless vehicles will continue to increase, leading to cost optimization and creating a profitable business model. We firmly believe the demand for autonomous driving services will continue to grow at a rapid pace, and we will further dedicate our technology and operational capabilities to better provide safe and reliable services to the public.

我們相信，完全無人駕駛汽車提供的乘車次數將繼續增加，從而優化成本並創造有利可圖的商業模式。我們堅信自動駕駛服務的需求將持續快速增長，我們將進一步投入技術和運營能力，更好地為公眾提供安全可靠的服務。

Moving to mobile ecosystem. I'm pleased to report that online marketing revenue returned to positive year-over-year growth in Q1, resulting in an increase in operating margin. One contributing factor to this growth was the overall improvement in China's economic recovery and commercial environment as a result of China's reopening.

轉向移動生態系統。我很高興地報告，在線營銷收入在第一季度恢復了同比正增長，從而提高了營業利潤率。這一增長的一個促成因素是中國經濟復甦和商業環境因中國重新開放而全面改善。

As I mentioned earlier, many offline related verticals: travel, health care, business services and local services, have substantially increased their ad spending on our platform. Some of these verticals have already rebounded to above pre-pandemic levels, indicating solid signs of recovery.

正如我之前提到的，許多與線下相關的垂直行業：旅遊、醫療保健、商業服務和本地服務，都大幅增加了他們在我們平台上的廣告支出。其中一些垂直行業已經反彈至大流行前水平以上，表明復蘇跡像明顯。

Our own initiatives are aimed at improving the product experience, such as incorporating short videos and product listing information within the Baidu App also played a significant role in the revenue increase. Additionally, revenues from retail and e-commerce continue to grow, mainly driven by merchants' direct spending on our platform.

我們自己的舉措旨在改善產品體驗，例如在百度應用程序中加入短視頻和產品列表信息也對收入增長起到了重要作用。此外，零售和電子商務的收入繼續增長，主要是受到商家在我們平台上的直接消費的推動。

The quarterly GMV facilitated by Baidu Search grew by 55% year-over-year in Q1, demonstrating our continuous traction in the e-commerce sector. Our users and traffic continued to grow in the quarter with Baidu App's MAUs increased by 4% year-over-year in March and feeds distributed through Baidu App and mobile search queries, maintaining steady growth.

百度搜索促成的季度 GMV 在第一季度同比增長 55%，表明我們在電子商務領域的持續發展。我們的用戶和流量在本季度繼續增長，百度應用的月活躍用戶在 3 月份同比增長 4%，通過百度應用和移動搜索查詢分發的信息流保持穩定增長。

This reflects the high value that users place on Baidu Search as their primary source of information. During the quarter, we continued to focus on enhancing user experience and customer satisfaction. On the user side, Baidu App has a Waterfall Flow feature on the Explorer page, which is particularly attractive to young female, enabling an infinite browsing experience and catering to their diverse needs.

這反映了用戶將百度搜索作為其主要信息來源的高度重視。本季度，我們繼續專注於提升用戶體驗和客戶滿意度。在用戶端，百度App在瀏覽器頁面設置了瀑布流功能，對年輕女性尤其有吸引力，無限瀏覽體驗，滿足她們多樣化的需求。

We expanded our immersive video feature to more and more use cases on Baidu App, including incorporating Edge into search results. Additionally, we continuously improve our one-shot search result through AI to provide better search experience. These efforts have helped to increase user engagement and expand our user base.

我們將沉浸式視頻功能擴展到百度 App 上越來越多的用例，包括將 Edge 整合到搜索結果中。此外，我們通過人工智能不斷改進我們的一次性搜索結果，以提供更好的搜索體驗。這些努力有助於提高用戶參與度並擴大我們的用戶群。

On the advertiser side, since launching our AIGC capabilities late last year, we've been working with advertisers to create more effective ads. By allowing advertisers to specify their requirements, our platform generates customized options for them to choose from.

在廣告商方面，自去年底推出我們的 AIGC 功能以來，我們一直在與廣告商合作製作更有效的廣告。通過允許廣告商指定他們的要求，我們的平台生成定制選項供他們選擇。

For instance, a local travel agency turned to our AIGC capabilities to create ads. Our AI generated ad outperformed those created by the advertisers, delivering an average of about 20% higher sales lead for them.

例如，當地一家旅行社利用我們的 AIGC 功能來製作廣告。我們的 AI 生成的廣告優於廣告商創建的廣告，為他們帶來的銷售線索平均高出約 20%。

In Q1, advertisers adopting the AIGC increased their ad spending year-over-year and quarter-over-quarter on our platform, demonstrating the effectiveness of our technology in driving business results. Earlier this year, we began using our AIGC capabilities to help advertisers respond to customer inquiries on our platform.

在第一季度，採用 AIGC 的廣告商在我們平台上的廣告支出同比和環比增加，證明了我們的技術在推動業務成果方面的有效性。今年早些時候，我們開始使用我們的 AIGC 功能來幫助廣告商響應我們平台上的客戶查詢。

By harnessing the power of AI, our advertisers can provide professional and timely answers to their customer inquiries, which in turn drives an increase in sales fleet. For instance, a B2B advertiser witnessed a monthly increase of over 100% in sales fleet in March after using our AIGC technology.

通過利用人工智能的力量，我們的廣告商可以為他們的客戶查詢提供專業和及時的答复，從而推動銷售隊伍的增加。例如，一家 B2B 廣告商在使用我們的 AIGC 技術後，見證了 3 月份銷售車隊的月度增長超過 100%。

We are expanding the service to increasing number of advertisers, helping them better serve their customers and drive improved business results. These efforts have resulted in improved ROI for advertisers on our platform.

我們正在將服務擴展到越來越多的廣告商，幫助他們更好地服務客戶並推動業務成果的改善。這些努力提高了我們平台上廣告商的投資回報率。

Looking ahead, we remain committed to assisting our advertisers in reaching and converting their target audience by leveraging our cutting-edge generative AI technology.

展望未來，我們將繼續致力於通過利用我們尖端的生成人工智能技術，幫助我們的廣告商接觸和轉化他們的目標受眾。

With that, let me turn the call over to Rong to go through the financial results.

有了這個，讓我把電話轉給榮，看看財務結果。

Thank you, Robin. Now let me walk you through the details of our first quarter financial results. Total revenue was RMB 31.1 billion, increasing 10% year-over-year. Revenue from Baidu Core was RMB 23 billion, increasing 8% year-over-year.

謝謝你，羅賓。現在讓我向您詳細介紹我們第一季度的財務業績。總收入為人民幣311億元，同比增長10%。百度核心收入為人民幣230億元，同比增長8%。

Baidu Core's online marketing revenue was RMB 16.6 billion, increasing 6% year-over-year. Baidu Core's non-online marketing revenue was RMB 6.4 million, up 11% year-over-year.

百度核心網絡營銷收入166億元，同比增長6%。百度核心的非網絡營銷收入為人民幣640萬元，同比增長11%。

In Q1, AI Cloud increased by 8% year-over-year to RMB 4.2 billion. Revenue for iQIYI was RMB 8.3 billion, increasing 15% year-over-year. Cost of revenue was RMB 15.2 billion, decreasing 3% year-over-year. Baidu Core's cost of revenue was RMB 9.4 billion, decreasing 4% year-over-year.

第一季度，AI Cloud 同比增長 8% 至 42 億元人民幣。愛奇藝收入為人民幣 83 億元，同比增長 15%。營業成本為人民幣152億元，同比下降3%。百度核心的收入成本為人民幣94億元，同比下降4%。

Operating expenses were RMB 11 billion, increasing 7% year-over-year, primarily due to an increase in China spending and promotional market expenses. Baidu Core's operating expenses were RMB 9.5 billion, increasing 5% year-over-year. Baidu Core's SG&A expenses were RMB 4.5 billion, increasing 16% year-over-year.

營業費用為人民幣 110 億元，同比增長 7%，主要是由於中國支出和促銷市場費用的增加。百度核心運營費用95億元，同比增長5%。百度核心的SG&A費用為人民幣45億元，同比增長16%。

SG&A accounting for 20% of Baidu Core revenue in the quarter compared to 18% in the same period last year. Baidu Core R&D expenses were RMB 5 billion, decreasing 3% year-over-year. R&D accounting for 22% of Baidu Core revenues in the quarter and decreased from 24% in the same period last year.

SG&A 佔本季度百度核心收入的 20%，而去年同期為 18%。百度核心研發費用50億元，同比下降3%。研發佔該季度百度核心收入的 22%，低於去年同期的 24%。

Operating income was RMB 5 billion. Baidu Core's operating income was RMB 4.1 billion, and Baidu Core's operating margin was 18%, and non-GAAP operating income was RMB 6.4 billion. Non-GAAP Baidu Core's operating income was RMB 5.4 billion, and non-GAAP Baidu Core operating margin was 23%.

營業收入50億元。百度核心營業收入為人民幣41億元，百度核心營業利潤率為18%，非美國通用會計準則營業收入為人民幣64億元。非美國通用會計準則百度核心營業收入為人民幣 54 億元，非美國通用會計準則百度核心營業利潤率為 23%。

Total other income net was RMB 2.6 billion, which mainly including a fair value gain of RMB 1.5 billion from long-term investments. In the first quarter last year, we recognized a fair value loss of RMB 3 billion. A significant portion of the long-term investments include, but not limited to, investments in equity securities of public and private companies and private equity funds. This is subject to quarterly fair value adjustment, which may contribute to net income volatility in future periods.

其他收益淨額合計人民幣26億元，主要包括長期投資產生的公允價值收益人民幣15億元。去年一季度，我們確認了30億元人民幣的公允價值損失。長期投資的很大一部分包括但不限於對上市公司和私營公司的股權證券以及私募股權基金的投資。這會受到季度公允價值調整的影響，這可能會導致未來期間的淨收入波動。

Income tax expenses was RMB 1.2 billion, increasing 205% year-over-year, primarily due to an increase in profit before tax. Our net income attributable to Baidu was RMB 5.8 billion, and diluted earnings per ADS were RMB 15.92. Net income attributable to Baidu Core was RMB 5.5 billion. Non-GAAP net income attributable to Baidu was under RMB 5.7 billion.

所得稅費用12億元，同比增長205%，主要是稅前利潤增加所致。我們歸屬於百度的淨利潤為人民幣 58 億元，每股 ADS 攤薄收益為人民幣 15.92 元。歸屬於百度核心的淨利潤為人民幣55億元。歸屬於百度的非美國通用會計準則淨利潤低於 57 億元人民幣。

Non-GAAP diluted earnings per ADS was RMB 16.1, and non-GAAP net income attributable to Baidu Core was RMB 5.3 billion, and non-GAAP net margin for Baidu Core was 23%.

Non-GAAP每股ADS攤薄收益為16.1元人民幣，Non-GAAP歸屬於百度核心的淨利潤為53億元人民幣，Non-GAAP百度核心淨利潤率為23%。

As of March 31, 2023, cash, cash equivalents, restricted cash and short-term investments were RMB 194 billion, and cash, cash equivalents, restricted cash and short investments, excluding IT, were RMB 188.8 billion. Free cash flow was RMB 4.5 billion. And free cash flow, excluding IT, was RMB 3.5 billion.

截至2023年3月31日，現金、現金等價物、受限制現金和短期投資為人民幣1,940億元，現金、現金等價物、受限制現金和短期投資（不包括IT）為人民幣1,888億元。自由現金流為人民幣45億元。不包括 IT 的自由現金流為 35 億元人民幣。

Baidu Core had approximately 36,000 employees as of March 31, 2023. On a separate note in the quarter, iQIYI generated about RMB 1 billion in non-GAAP operating income and above RMB 1 billion in free cash flow.

截至 2023 年 3 月 31 日，百度核心擁有約 36,000 名員工。在本季度的單獨說明中，愛奇藝產生了約 10 億元人民幣的非美國通用會計準則營業收入和超過 10 億元人民幣的自由現金流。

With that, operator, let's now open the call to questions.

話雖如此，接線員，現在讓我們開始提問。

Ladies and gentlemen, we will now begin the question-and-answer session. (Operator Instructions) Your first question comes from Alex Yao with JPMorgan.

女士們，先生們，我們現在開始問答環節。 （操作員說明）您的第一個問題來自摩根大通的 Alex Yao。

Congrats on a strong quarter. I have a few on the advertising side of the business. What is the month-on-month trend for ad recovery since March? And how big is the vertical exposures to off-line-related verticals? How is the advertiser demand changing on your platform? And then lastly, how should we think about the full-year ad growth rate? So what is the mid- to longer-term growth potential for ads business beyond the COVID normalization?

祝賀一個強勁的季度。我在業務的廣告方面有一些。自 3 月以來廣告恢復的環比趨勢如何？與線下相關的垂直行業的垂直敞口有多大？您平台上的廣告客戶需求如何變化？最後，我們應該如何考慮全年的廣告增長率？那麼，在 COVID 正常化之後，廣告業務的中長期增長潛力是什麼？

Alex, this is Robin. Thank you for your question. We're happy to see significant progress in our online marketing business. For Q1, revenue made a remarkable comeback and returned to high single-digit growth.

亞歷克斯，這是羅賓。謝謝你的問題。我們很高興看到我們的在線營銷業務取得重大進展。第一季度，收入大幅回升，重回高個位數增長。

Recall that last year, online marketing revenue declined year-over-year for all 4 quarters. I think it was a 4% decline in Q1, 10% in Q2, 4% in Q3 and 6% in Q4. Now we are in a positive territory, and the momentum got further strengthened in Q2.

回想一下去年，在線營銷收入在所有 4 個季度都同比下降。我認為第一季度下降了 4%，第二季度下降了 10%，第三季度下降了 4%，第四季度下降了 6%。現在我們處於積極區域，第二季度勢頭進一步增強。

The Q1 growth was primarily driven by a number of verticals in the offline sector that I just mentioned during my prepared remarks. Offline sector contributes to a sizable amount of our online marketing revenue. Particularly, our largest revenue contributor, health care, has been improving and is back to the pre-pandemic level. So travel is also improving apparently and we saw the Labor Day holiday was really, really hot.

第一季度的增長主要是由我剛才在準備好的發言中提到的線下行業的一些垂直行業推動的。線下部門為我們的在線營銷收入貢獻了相當大的一部分。特別是，我們最大的收入貢獻者醫療保健一直在改善並恢復到大流行前的水平。所以旅行也明顯改善，我們看到勞動節假期真的非常熱。

The growth in our online marketing revenue have also had a positive impact on the margins of our mobile ecosystem. So the overall margin for Baidu Core got better. The success is due to our focused user and customer experience on our platform. And furthermore, we have observed a strong growth in user engagement and traffic.

我們在線營銷收入的增長也對我們移動生態系統的利潤率產生了積極影響。因此，百度核心的整體利潤率變得更好。成功歸功於我們在平台上專注於用戶和客戶體驗。此外，我們觀察到用戶參與度和流量的強勁增長。

Despite the reopening of China and people spending more time offline, our MAU for Baidu App grew 4% year-on-year in March, and our feed content distributed through Baidu App also demonstrated robust growth.

儘管中國重新開放，人們在線下的時間增加，但我們的百度應用程序 MAU 在 3 月份同比增長了 4%，我們通過百度應用程序分發的提要內容也顯示出強勁的增長。

And looking ahead, we anticipate advertisers will continue to allocate more dollars to performance-based platforms. And we believe Baidu Search is well positioned to benefit from this trend. In addition, we see generative AI as a significant opportunity that complements our search capability and drive new avenues for users to access and create content.

展望未來，我們預計廣告商將繼續向基於性能的平台分配更多資金。我們相信百度搜索已準備好從這一趨勢中受益。此外，我們將生成式 AI 視為一個重要機會，可以補充我們的搜索能力，並為用戶提供訪問和創建內容的新途徑。

As we integrate ERNIE Bot into our apps, particularly into Search, we expect user traffic and engagement will go up, thereby further supporting the growth of our online marketing revenue. ERNIE Bot can also enhance our commercial products, presenting an exciting opportunity for us to strengthen our offering.

隨著我們將 ERNIE Bot 集成到我們的應用程序中，特別是集成到搜索中，我們預計用戶流量和參與度將會上升，從而進一步支持我們在線營銷收入的增長。 ERNIE Bot 還可以增強我們的商業產品，為我們提供了一個令人興奮的機會來加強我們的產品。

With ERNIE Bot empowered commercial products, we can capture a larger market share and deliver even greater value to our advertisers. This additional dimension gives us further confidence in our online marketing business and its ability to drive sustained growth in revenue. So based on this development and our strong fundamentals, we expect our online marketing revenue to outperform the growth of China's GDP. Thank you.

借助 ERNIE Bot 授權的商業產品，我們可以獲得更大的市場份額並為我們的廣告商提供更大的價值。這個額外的維度讓我們對我們的在線營銷業務及其推動收入持續增長的能力更有信心。因此，基於這一發展和我們強大的基本面，我們預計我們的在線營銷收入將超過中國 GDP 的增長。謝謝。

Our next question comes from Alicia Yap with Citigroup.

我們的下一個問題來自花旗集團的 Alicia Yap。

My question is related to margins and (inaudible). So what would be the major margin driver this year after large scale of the cost-cutting effort last year, how should we think about core operating margin trend for the rest of -- especially given there will be a few moving factors that will impact margins, such as, for example, the potential investment related to the large language model, the autonomous and others?

我的問題與邊距和（聽不清）有關。那麼，在去年大規模削減成本之後，今年的主要利潤率驅動因素是什麼，我們應該如何考慮其餘時間的核心運營利潤率趨勢——特別是考慮到將有一些影響利潤率的因素，例如，與大型語言模型、自治等相關的潛在投資？

Alicia, let me address your questions. I think we have implemented a number of initiatives last year to improve our operational efficiency, which you can see that in the past 4 or 5 quarters. And all of them have led to a notable improvement in our overall margins. These measures have not only made the profit numbers look better, but also transformed our organization, making it leaner and more agile and we are sure that will drive the sustainable long-term growth.

艾麗西亞，讓我來回答你的問題。我認為我們去年實施了一些舉措來提高我們的運營效率，你可以在過去的 4 或 5 個季度中看到這一點。所有這些都使我們的整體利潤率有了顯著提高。這些措施不僅使利潤數字看起來更好，而且還改變了我們的組織，使其更精簡、更敏捷，我們相信這將推動可持續的長期增長。

(inaudible) as a result, you can see that our non-GAAP operating margin expanding from 17% in Q1 last year to 23% in Q1 this year, and free cash flow also grew by over 200% from 1 year ago. Notably, all of this growth was also accompanied by a (inaudible) revenue in Q1. More specifically, as (inaudible) has just mentioned, and number one, our mobile ecosystem (inaudible), which is all put together with the revenue (inaudible) marketing businesses.

（聽不清）因此，您可以看到我們的非 GAAP 營業利潤率從去年第一季度的 17% 擴大到今年第一季度的 23%，自由現金流也比一年前增長了 200% 以上。值得注意的是，所有這些增長還伴隨著第一季度的（聽不清）收入。更具體地說，正如（聽不清）剛才提到的，第一，我們的移動生態系統（聽不清），它與收入（聽不清）營銷業務放在一起。

Number 2 is we can see that for Baidu AI cloud, by focusing on carbon low-margin projects and businesses, as well as our developing more standard AI solutions for key use cases, our Baidu AI Cloud has reached the profitability on the operating level. This is a more important and significant milestone for us. And looking forward, we aim to continue enhancing the margins across all of our major operations, while at the same time, we also will continue to invest in the promising new areas, in particularly the ERNIE Bot and Intelligent Driving.

第二，我們可以看到百度AI雲，通過專注低碳低利潤的項目和業務，以及我們為關鍵用例開發更標準的AI解決方案，我們的百度AI雲已經達到了運營層面的盈利。這對我們來說是一個更重要、更有意義的里程碑。展望未來，我們的目標是繼續提高我們所有主要業務的利潤率，與此同時，我們還將繼續投資有前途的新領域，尤其是 ERNIE Bot 和智能駕駛。

Our reconstructing investments are actually quite aligned with our long-term growth objectives, which also reflect 2 areas where we have identified a significant potential opportunities. By focusing on these areas, we aim to capture the large market shares and we try to drive for the sustainable growth while we're delivering more values to our shareholders.

我們的重建投資實際上與我們的長期增長目標非常一致，這也反映了我們已經確定了重要潛在機會的 2 個領域。通過專注於這些領域，我們的目標是佔領較大的市場份額，並努力推動可持續增長，同時為股東創造更多價值。

And as for the near term, I think incremental investment in the new opportunities is also quite manageable (inaudible). Overall, our focus on disciplined execution and operational efficiency and at the same time, we try to seize the long-term growth opportunities, all of these efforts has resulted in the improvement of the overall Baidu Core margins in Q1, and this will continue in the future quarters.

至於近期，我認為對新機會的增量投資也很容易管理（聽不清）。總的來說，我們專注於紀律執行和運營效率，同時我們試圖抓住長期增長機會，所有這些努力導致了第一季度百度核心利潤率的整體改善，並將繼續未來的宿舍。

We will prudently manage our P&L and leveraging our core business improvements and further drive the sustainable growth.

我們將審慎管理我們的損益並利用我們的核心業務改進，進一步推動可持續增長。

Our next question comes from Gary Yu with Morgan Stanley.

我們的下一個問題來自摩根士丹利的 Gary Yu。

I have a question related to cloud. So on your AI cloud revenue growth, what's the expectation for growth in 2Q and rest of 2023? And could you help us quantify any incremental cloud revenue in coming quarters coming from early adoption? And a related question on cloud is on margin. With your improvement in revenue growth and margin, how should we look at the normalized revenue growth and margin for cloud going forward?

我有一個與云有關的問題。那麼關於您的 AI 雲收入增長，您對 2023 年第二季度和剩餘時間的增長有何預期？您能否幫助我們量化未來幾個季度來自早期採用的任何增量雲收入？雲上的一個相關問題是保證金。隨著您在收入增長和利潤率方面的改善，我們應該如何看待未來雲的正常收入增長和利潤率？

Okay, this is Dou. Thanks for your question on the cloud. So since the second quarter of last year, so we have made significant efforts in 3 ways trying to consistently improve our margins for the AI cloud.

好吧，這是竇。感謝您在雲上的提問。因此，自去年第二季度以來，我們在 3 種方面做出了重大努力，試圖持續提高 AI 雲的利潤率。

Firstly, we are resolute in phasing out the low-quality products and businesses. And secondly, so we are committed to building standardized AI solutions for key use cases and then efficiently replicate them across different customers. Secondly, we are continuously investing in the technical capabilities of our standard cloud offerings to reinforce their competitiveness. So as a result of the efforts, Baidu Cloud achieved a profitability on the non-GAAP operating level this quarter.

一是堅決淘汰劣質產品和劣質業務。其次，我們致力於為關鍵用例構建標準化的人工智能解決方案，然後在不同的客戶中有效地複制它們。其次，我們不斷投資於標準雲產品的技術能力，以增強其競爭力。因此，由於努力，百度雲本季度實現了非美國通用會計準則運營水平的盈利。

In addition to that, after China is reopened, now we finally can meet our clients in person to execute projects and present our proposals. And we believe AI Cloud's revenue growth since accelerated from quarter of last year, and it will continue in the coming quarters.

除此之外，在中國重新開放後，現在我們終於可以親自與客戶會面，執行項目並提出我們的建議。我們相信 AI Cloud 的收入增長自去年第四季度開始加速，並將在未來幾個季度繼續。

Moreover, we believe ERNIE Bot could provide a massive opportunity for us to gain shares in the cloud industry. Since its launch in the mid of March, we have received hundreds of thousands of beta testing requests for the ERNIE Bot from enterprise customers across a range of sectors, such as finance software, education, online travel and so on. So this overwhelming interest indicates a promising start for the ERNIE Bot's debut.

此外，我們相信 ERNIE Bot 可以為我們提供一個在雲行業獲得份額的巨大機會。自 ERNIE Bot 於 3 月中旬推出以來，我們已收到來自金融軟件、教育、在線旅遊等多個行業的企業客戶的數十萬份 ERNIE Bot Beta 測試請求。因此，這種壓倒性的興趣表明 ERNIE Bot 的首次亮相是一個充滿希望的開端。

So our customers are so eager to explore and utilize ERNIE Bot for their businesses, and we are confident that it will improve their productivity and enhance their competitive edge. Actually, now as Robin had mentioned, several customers has opted to develop their own large models on our cloud platform. We need to leverage the advantages of the 4-layered AI architecture, as Robin just mentioned in the prepared remarks.

因此，我們的客戶非常渴望在他們的業務中探索和利用 ERNIE Bot，我們相信它將提高他們的生產力並增強他們的競爭優勢。實際上，正如羅賓所說，現在有幾個客戶選擇在我們的雲平台上開發自己的大型模型。我們需要利用 4 層 AI 架構的優勢，正如 Robin 在準備好的發言中提到的那樣。

So as we look ahead, our focus will still remain on achieving healthy and sustainable revenue growth for the existing cloud business, while we are striving to improve the margins. And in the meanwhile, we will capitalize on the long-term huge market opportunity of large language models. And for sure, so we are committed to the investment and the value creation of our ERNIE Bot.

因此，展望未來，我們的重點仍將放在為現有云業務實現健康和可持續的收入增長上，同時我們正在努力提高利潤率。同時，我們將利用大型語言模型的長期巨大市場機會。可以肯定的是，我們致力於我們的 ERNIE Bot 的投資和價值創造。

So overall, we believe we will continue outgrowing our peers in cloud revenue in the long run. That's it, Gary.

因此，總的來說，我們相信從長遠來看，我們將繼續在雲收入方面超越同行。就是這樣，加里。

Our next question comes from Lincoln Kong with Goldman Sachs.

我們的下一個問題來自高盛的 Lincoln Kong。

So my question is related to ERNIE Bot. So basically, can management further elaborate a bit more on the growth and monetization opportunity for ERNIE Bot in a large enterprise model. So how should we think about ERNIE Bot will reshape our existing business and especially help us gain share in each of the business line in the markets?

所以我的問題與 ERNIE Bot 有關。所以基本上，管理層能否進一步詳細說明 ERNIE Bot 在大型企業模型中的增長和貨幣化機會。那麼我們應該如何看待 ERNIE Bot 將重塑我們現有的業務，特別是幫助我們在市場上的每個業務線中獲得份額？

Yes, ERNIE Bot has been making great progress since its launch in mid-March. For instance, we have already upgraded ERNIE Bot 4 times and we have managed to reduce the inference cost by nearly 90% since its release.

是的，自 3 月中旬推出以來，ERNIE Bot 取得了長足的進步。例如，我們已經對 ERNIE Bot 進行了 4 次升級，自發布以來我們已經成功地將推理成本降低了近 90%。

While some of our competitors are still focusing on model training, we've moved ahead with a significant reduction of our inference cost. This improvement, a result of our self-developed AI architecture with 4 layers, which sets us apart and enables us to swiftly reduce cost and enhance efficiency for model training and inference. This strong foundation will facilitate the widespread adoption of ERNIE Bot.

雖然我們的一些競爭對手仍在專注於模型訓練，但我們已經取得進展，顯著降低了推理成本。這種改進是我們自研的 4 層 AI 架構的結果，這使我們與眾不同，使我們能夠迅速降低成本並提高模型訓練和推理的效率。這一堅實的基礎將促進 ERNIE Bot 的廣泛採用。

We're using ERNIE Bot to upgrade almost all of our products and services, enhancing and rebuilding our existing offerings. This enables us to strengthen our position and gain market share in our target markets, including cloud services, online marketing and smart devices.

我們正在使用 ERNIE Bot 來升級我們幾乎所有的產品和服務，增強和重建我們現有的產品。這使我們能夠鞏固我們在目標市場的地位並獲得市場份額，包括雲服務、在線營銷和智能設備。

In AI Cloud, ERNIE Bot is being tested by more and more enterprises, as Dou just mentioned, and is proving to be beneficial to customers in all kinds of sectors, helping them solve problems and improve their productivity and efficiency. It truly demonstrates the power of generated AI and large language models.

在AI Cloud中，ERNIE Bot正在被越來越多的企業進行測試，正如竇剛提到的，並被證明對各行各業的客戶都有好處，幫助他們解決問題，提高生產力和效率。它真正展示了生成的 AI 和大型語言模型的強大功能。

Since launch, we have witnessed increasing adoption of ERNIE Bot as hundreds of thousands of enterprise business and entities queuing for testing. This is an encouraging recognition of Baidu's AI capability, particularly our powerful foundation model. To assist customers to better use ERNIE Bot, we have developed tools and technologies that support training and refining models using our customers' unique data, which also leads to continuous system improvement over time.

自推出以來，我們目睹了越來越多的 ERNIE Bot 被採用，因為成千上萬的企業業務和實體正在排隊等待測試。這是對百度人工智能能力的認可，尤其是我們強大的基礎模型。為了幫助客戶更好地使用 ERNIE Bot，我們開發了工具和技術來支持使用客戶的獨特數據來訓練和改進模型，這也導致隨著時間的推移不斷改進系統。

And customers are becoming more selective than before. When choosing a cloud provider, they take into consideration the capabilities of generative AI and large language models. We see a growing number of new customers waiting to migrate to our AI cloud. So we expect ERNIE Bot to enhance our competitiveness and our pricing power of AI account.

客戶變得比以前更有選擇性。在選擇雲提供商時，他們會考慮生成式人工智能和大型語言模型的能力。我們看到越來越多的新客戶等待遷移到我們的 AI 雲。所以我們期待ERNIE Bot能夠提升我們的競爭力和我們AI賬戶的定價能力。

In March, we saw more than 400% year-over-year growth in the sales fleet, and we anticipate more opportunities in the future. Additionally, while the cloud industry presents significant opportunity for ERNIE Bot in adoption, there are great opportunities in online market, too.

3 月份，我們看到銷售車隊同比增長超過 400%，我們預計未來會有更多機會。此外，雖然雲行業為 ERNIE Bot 的採用提供了重要機會，但在線市場也有很大機會。

As I mentioned earlier, we're utilizing ERNIE Bot to upgrade popular consumer-facing products, including Baidu App, Baidu Search and other applications within Baidu family. The initial user feedback we have received is very promising.

正如我之前提到的，我們正在利用 ERNIE Bot 來升級流行的面向消費者的產品，包括百度應用程序、百度搜索和百度家族中的其他應用程序。我們收到的初始用戶反饋非常有希望。

Upon widespread implementation, we should quickly gain user traffic and engagement, therefore, reshape the competitive landscape in China's Internet and mobile sectors.

廣泛實施後，我們應該快速獲得用戶流量和參與度，從而重塑中國互聯網和移動領域的競爭格局。

So in summary, ERNIE Bot's progress has been very encouraging, and we are excited about the future. We're pushing the boundaries of AI and exploring new avenues of growth.

所以總而言之，ERNIE Bot 的進步非常令人鼓舞，我們對未來感到興奮。我們正在突破 AI 的界限並探索新的增長途徑。

Our next question comes from Miranda Zhuang with Bank of America Securities.

我們的下一個問題來自美國銀行證券的 Miranda Zhuang。

Congratulations on the group results. My question is about competition. With many other Internet peers launching or about to launch their large language model, how to think about Baidu's competitive advantage? And how does management think about the competitive landscape in China in the near term and the long term, especially for the enterprise facing business?

恭喜小組取得成績。我的問題是關於競爭的。在眾多互聯網同行推出或即將推出大語言模型的情況下，如何看待百度的競爭優勢？管理層如何看待中國近期和長期的競爭格局，尤其是面向業務的企業？

Yes, that's a good question. AI and LLM are still in the early stage of development, and we are very happy to see the entry of more players into this field as it will help the industry to develop rapidly.

是的，這是個好問題。 AI和LLM還處於早期發展階段，我們很高興看到更多玩家進入這個領域，這將有助於行業快速發展。

Moreover, we are actively constructing an ecosystem around ERNIE Bot to attract new participants and drive innovation in the emerging direction. In our view, generative AI and the large language model present a very high barrier to entry. And very few companies possess the necessary capabilities to establish a significant presence in this market. The requirements include substantial upfront investment, robust AI capability expertise and vast amounts of data for model training.

此外，我們正在圍繞 ERNIE Bot 積極構建生態系統，以吸引新的參與者並推動新興方向的創新。在我們看來，生成式 AI 和大型語言模型存在非常高的進入門檻。很少有公司具備在這個市場上佔據重要地位的必要能力。這些要求包括大量的前期投資、強大的 AI 能力專業知識以及用於模型訓練的大量數據。

Also, extensive experience in delivering appropriate content to Chinese Internet and mobile users is crucial. Given such high requirements, we anticipate a highly concentrated market with probably 2 to 3 major players winning in the end.

此外，向中國互聯網和移動用戶提供適當內容的豐富經驗也至關重要。鑑於如此高的要求，我們預計市場高度集中，最終可能有 2 到 3 個主要參與者獲勝。

As mentioned earlier, as the first mover in China, we leveraged ERNIE Bot to upgrade and revitalize our entire product and service portfolio because we have a large product portfolio and large user base. We are able to get lots of user feedback about ERNIE Bot, which will help us further enhance our leading position in LLM. This approach allows us to convert cutting-edge technology into practical features, products and solutions that address challenges and support sustainable growth.

如前所述，作為中國的先行者，我們利用ERNIE Bot來升級和盤活我們的整個產品和服務組合，因為我們擁有龐大的產品組合和龐大的用戶群。我們能夠獲得大量關於 ERNIE Bot 的用戶反饋，這將有助於進一步提升我們在 LLM 領域的領先地位。這種方法使我們能夠將尖端技術轉化為實用的功能、產品和解決方案，以應對挑戰並支持可持續增長。

Baidu has a distinctive AI architecture consisting of 4 layers that we have developed ourselves. The architecture gives us a competitive advantage in terms of AI capability and played a crucial role in the successful early launch of ERNIE Bot.

百度有一個獨特的人工智能架構，由我們自己開發的 4 層組成。該架構為我們在 AI 能力方面提供了競爭優勢，並在早期成功推出 ERNIE Bot 方面發揮了關鍵作用。

With this architecture, we are able to quickly decrease costs and improve efficiency in both training and inferencing. For example, we have optimized the performance of PaddlePaddle for inferencing, and this optimization enables us to more effectively work between the framework layer and the model layer, which lead into a substantial efficiency improvement and cost savings.

通過這種架構，我們能夠快速降低成本並提高訓練和推理的效率。例如，我們優化了PaddlePaddle的推理性能，這種優化使我們能夠更有效地在框架層和模型層之間工作，從而帶來大幅的效率提升和成本節約。

Developing and training LLMs require significant resources, including robust cloud infrastructure. To this end, we have our own AI cloud business and have secured a substantial amount of computing power, including the most advanced GPUs to sustain the ongoing training and iteration of ERNIE Bot.

開發和培訓 LLM 需要大量資源，包括強大的雲基礎設施。為此，我們擁有自己的 AI 雲業務，並獲得了大量的計算能力，包括最先進的 GPU，以維持 ERNIE Bot 正在進行的訓練和迭代。

Another critical point is that our experience in operating China's largest search engine for over 2 decades have allowed us to build an extensive database in Chinese language, including very valuable data, facts and knowledge and enhancing our leadership position in LLP in China.

另一個關鍵點是，我們在中國最大的搜索引擎運營超過 20 年的經驗使我們能夠建立一個廣泛的中文數據庫，包括非常有價值的數據、事實和知識，並提高了我們在中國有限責任合夥企業中的領導地位。

We have extensive experience in reviewing the vast amount of content on search and within our Mobile Ecosystem. And for (inaudible), we're able to offer our customers any combination of all different layers of our AI stack. If the customer only needs infrastructure, we can provide that. If the customer needs both infrastructure and framework layer, we can provide that. If the customer needs framework layer and model layer, we have to offer those 2. And if the customer wants end-to-end solution, we have that ready.

我們在審查搜索和移動生態系統中的大量內容方面擁有豐富的經驗。對於（聽不清），我們能夠為客戶提供 AI 堆棧所有不同層的任意組合。如果客戶只需要基礎設施，我們可以提供。如果客戶同時需要基礎架構和框架層，我們可以提供。如果客戶需要框架層和模型層，我們必須提供這兩個。如果客戶想要端到端的解決方案，我們已經準備好了。

So we are uniquely positioned and very flexible in serving our cloud customers. Based on this competitive advantage, I'm confident that we will be a winner in this market. Thank you.

因此，我們在服務雲客戶方面具有獨特的定位和非常靈活的優勢。基於這種競爭優勢，我相信我們將成為這個市場的贏家。謝謝。

Our next question comes from Kenneth Fong with Credit Suisse.

我們的下一個問題來自瑞士信貸的 Kenneth Fong。

As we noted that the Cyberspace Administration of China recently released a draft regulation on the generative AI. So what sort of additional investments are needed to beat the requirement?

正如我們所注意到的，中國國家互聯網信息辦公室最近發布了一份關於生成人工智能的法規草案。那麼需要什麼樣的額外投資才能達到要求呢？

Okay. During our testing of ERNIE Bot, we have engaged in close discussions with the regulators. Through effective communication, we have found that the principles of content review for generative AI are quite similar to those applied to search.

好的。在測試 ERNIE Bot 期間，我們與監管機構進行了密切討論。通過有效的溝通，我們發現生成式 AI 的內容審查原則與應用於搜索的原則非常相似。

Baidu has been operating China's largest search engine for over 20 years, and we have extensive experience in providing appropriate online content. We also put a lot of efforts into both technology and compliance development to ensure our products and services meet applicable regulatory requirements.

百度運營中國最大的搜索引擎已有 20 多年，我們在提供合適的在線內容方面擁有豐富的經驗。我們還在技術和合規性開發方面投入了大量精力，以確保我們的產品和服務滿足適用的監管要求。

For important and sensitive topics, we have to make sure AI will not hallucinate. Given that LLM is more or less a probabilistic model, this task is not trouble at all. The requirements are not final yet. So we have to continue to update our strategy as it evolves.

對於重要和敏感的話題，我們必須確保人工智能不會產生幻覺。鑑於 LLM 或多或少是一個概率模型，這個任務一點也不麻煩。要求還不是最終的。因此，我們必須隨著戰略的發展不斷更新我們的戰略。

Furthermore, we maintain an ongoing dialogue with the relevant authorities and keep them informed about the latest technology trends. We actively share our insight supporting the responsible and beneficial growth of technology, particularly for generative AI. This proactive efforts position us well to meet the requirements and offer industry-leading generative AI solutions in China.

此外，我們與有關當局保持持續對話，並讓他們了解最新的技術趨勢。我們積極分享我們的見解，支持技術的負責任和有益的發展，特別是對於生成人工智能。這種積極的努力使我們能夠很好地滿足要求，並在中國提供行業領先的生成人工智能解決方案。

Conversely, companies which do not have extensive experience in providing appropriate online content or lacking a track record of working closely with regulators will face significant challenges in offering scalable generative AI solutions in China.

相反，在提供適當的在線內容方面沒有豐富經驗或缺乏與監管機構密切合作記錄的公司將在中國提供可擴展的生成人工智能解決方案方面面臨重大挑戰。

So here, I would like to emphasize that Baidu has been leader in AI for social good for a long time. We are one of the early adopters of AI for responsive use in China. We believe our new initiative, ERNIE Bot, is the best in its kind in China, and it has the potential to increase productivity and efficiency across various industries, which can contribute to China's economic growth and social development.

所以在這裡，我想強調的是，百度長期以來一直是人工智能造福社會的領導者。我們是在中國響應式使用人工智能的早期採用者之一。我們相信我們的新舉措 ERNIE Bot 是中國同類產品中最好的，它有可能提高各行業的生產力和效率，從而為中國的經濟增長和社會發展做出貢獻。

We expect ERNIE Bot to power agricultural enterprises to promote innovation and to optimize energy use, resource allocation and waste reduction and to improve disease diagnosis in health care industry; therefore, enhancing people's well-being and the quality of life.

我們期待 ERNIE Bot 助力農業企業推動創新，優化能源利用、資源配置和減少浪費，改善醫療保健行業的疾病診斷；因此，提高人們的福祉和生活質量。

Also, we always attach great importance to AI ethics. Back in 2018, I came up with the 4 principles of AI ethics. That's like one, AI should be safe and controllable. Two, AI should promote equal access to technologies for humanity. Three, AI should empower humanity to learn and grow instead of replacing them. And then four, AI should bring more freedom and possibilities to humanity.

此外，我們一直非常重視人工智能倫理。早在 2018 年，我就提出了人工智能倫理的 4 條原則。就像一個，AI應該是安全可控的。第二，人工智能應該促進人類平等地獲得技術。第三，人工智能應該賦予人類學習和成長的能力，而不是取代他們。第四，人工智能應該給人類帶來更多的自由和可能性。

I want to make sure that within Baidu, everyone understands these principles when it comes to new AI technologies and products, so as to enable the coexistence between AI and mankind. In addition, we also prioritize data privacy and data security in business operation and business strategy.

我要讓在百度內部，每個人在面對新的人工智能技術和產品時，都明白這些道理，讓人工智能與人類共存。此外，我們還在業務運營和業務戰略中優先考慮數據隱私和數據安全。

We have a dedicated committee to oversee data management, and we are currently establishing another committee for AI ethics. And all of these efforts are aimed at promoting AI for social good. Thank you.

我們有一個專門的委員會來監督數據管理，我們目前正在建立另一個人工智能倫理委員會。所有這些努力都是為了促進人工智能造福於社會。謝謝。

Our next question is from Wei Xiong with UBS.

我們的下一個問題來自瑞銀的 Wei Xiong。

Congrats on the good quarter. My question is about Apollo Go. So could management provide some updates on your robotaxi business in terms of your strategy and business plan for the year, especially for the fully driverless ride-hailing operation. Is there any timeline you can share regarding the scale up or the breakeven of the business? And what are some catalysts or milestone event that we could expect for Apollo Go this year?

恭喜這個好季度。我的問題是關於 Apollo Go。管理層也可以根據您今年的戰略和業務計劃提供一些關於您的機器人出租車業務的最新信息，特別是對於完全無人駕駛的乘車業務。您是否可以分享有關業務擴大或收支平衡的時間表？今年我們可以期待 Apollo Go 有哪些催化劑或里程碑事件？

Thanks, Wei Xiong. (inaudible). Our Apollo Go remains the largest autonomous ride-hailing service provider in the world. And just as Robin mentioned, in the first quarter, we offered almost 660,000 rides to public, and this number keeps growing. We aim to continuously enhance our autonomous driving technology by providing more rides to the public.

謝謝，偉雄。 （聽不清）。我們的 Apollo Go 仍然是世界上最大的自動駕駛叫車服務提供商。正如 Robin 所說，在第一季度，我們向公眾提供了近 660,000 次乘車服務，而且這個數字還在不斷增長。我們的目標是通過為公眾提供更多的乘車服務來不斷提升我們的自動駕駛技術。

In addition, we will always carry in mind the goal of achieving breakeven, gaining skill and building a sustainable business model or TAM when we make our operations.

此外，在我們開展業務時，我們將始終牢記實現收支平衡、獲得技能和建立可持續商業模式或 TAM 的目標。

To reach this objective, it's important to reduce operational costs and improve operational efficiency. On cost, we are focusing on lowering labor and hardware costs, and those are the major cost for robotaxi operation. So we are working hard to find ways to cut down on those expenses.

為實現這一目標，降低運營成本和提高運營效率非常重要。在成本方面，我們專注於降低人工和硬件成本，而這些是 Robotaxi 運營的主要成本。因此，我們正在努力尋找減少這些開支的方法。

To reduce the labor cost, we continue to drive development of fully driverless operation. As Robin mentioned in his prepared remarks, we are doing really well in getting closer to our goal and adding more wheels while we can provide fully driverless rides.

為降低人工成本，我們繼續推動完全無人駕駛的發展。正如羅賓在他準備好的發言中提到的那樣，我們在接近我們的目標和增加更多車輪方面做得非常好，同時我們可以提供完全無人駕駛的遊樂設施。

In the Yizhuang region of Beijing, (inaudible) after getting fully driverless for the testing permits. We got the green light to offer fully driverless ride-hailing services to the public on the open roads in mid of March. This progress is because of our solid record of providing mainly safe and reliable rides for the public in the past. Through that, we gained the trust from both users and the government transport.

在北京亦莊地區，（聽不清）在完全無人駕駛獲得測試許可後。 3 月中旬，我們獲准在開放道路上向公眾提供完全無人駕駛的叫車服務。這一進步是因為我們過去為公眾主要提供安全可靠的乘車服務的良好記錄。由此，我們贏得了用戶和政府交通部門的信任。

And in Wuhan, we started offering fully driverless ride-hailing services last August. Now we are still adding driverless vehicles and expanding operations. As Robin mentioned earlier, more than 1/3 of the rides provided by Apollo Go in Wuhan offer a more fully driverless vehicles. We think this number will keep going up in the future.

在武漢，我們從去年 8 月開始提供完全無人駕駛的網約車服務。現在我們仍在增加無人駕駛車輛並擴大運營。正如 Robin 之前提到的，Apollo Go 在武漢提供的遊樂設施中有超過 1/3 提供了更完全無人駕駛的車輛。我們認為這個數字在未來會繼續上升。

We will provide safety and reliability for the future fully driverless operation. For hardware costs, we believe that after the release of (inaudible) and other new models of robotaxi wheels in the future, it will continue to decrease.

我們將為未來的完全無人駕駛提供安全可靠的保障。對於硬件成本，我們相信在未來（聽不清）和其他新型號的 robotaxi 車輪發布後，它會繼續減少。

On operational efficiency, we are seeing a steady increase in the average daily ride nationwide. In the future, we will continue to automate our operational strategy to achieve long-term success in robotaxi. Thank you.

在運營效率方面，我們看到全國平均每日乘車量穩步增長。未來，我們將繼續自動化我們的運營策略，以在 Robotaxi 取得長期成功。謝謝。

Ladies and gentlemen, that concludes our conference for today. Thank you for participating. You may all disconnect your lines.

女士們，先生們，我們今天的會議到此結束。感謝您的參與。你們都可以斷開你們的線路。