This article first appeared on GuruFocus.
Baidu (NASDAQ:BIDU) shares jumped about 3% in premarket trading Monday after the company said it is reviewing a possible spinoff of its AI chip unit, Kunlunxin.
In a regulatory filing, Baidu confirmed it is evaluating a separation and potential listing of the business. The company cautioned that the review is ongoing and there is no guarantee the plan will move ahead.
The statement follows reports that Kunlunxin is preparing an IPO in Hong Kong, with sources saying the unit could file as early as the first quarter of 2026. The AI chip arm recently raised capital at a valuation of around 21 billion yuan, according to people familiar with the matter.Those sources also noted the group had initially targeted an IPO by early 2027.
Analysts said a spinoff could help Baidu unlock value in its semiconductor operations as China’s AI hardware competition accelerates.