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Fitch Revises Down BIDU-SW Rating Outlook to Negative
Recommend 5 Positive 8 Negative 7 |
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Fitch Ratings revised the Outlook on BIDU-SW (09888.HK)'s Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDRs) down to Negative, from Stable, and affirmed the IDRs at A. Fitch also affirmed the foreign-currency senior unsecured rating at A. Fitch stated that the negative outlook reflected the sequential slump in Baidu's core search business's market share in the online advertising sector, as it faced pressure from competing platforms. Meanwhile, the business was challenged by the transition to AI search; and sustained EBITDA growth due to successful monetization of AI products would be key to retain an A rating. Baidu's core EBITDA and EBITDA margin in 2025 and 2026 were expected to be notably below Fitch's previous expectations and also lower than the actual data from 2021-2024. Furthermore, the weak profitability of iQIYI (IQ.US), in which Baidu holds a 45% stake, will continue to dampen Baidu's overall performance. AASTOCKS Financial News Website: www.aastocks.com |
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