A general view of the Baidu logo is seen at the Shanghai New Expo Center during the World Artificial Intelligence Conference 2025 in Shanghai, China, on July 28, 2025.<\/p>\n
Ying Tang | Nurphoto | Getty Images<\/p>\n
Chinese tech giant Baidu<\/a> plans to spin off its artificial intelligence chip subsidiary, Kunlunxin, and list it in Hong Kong, as more domestic chipmakers seek funds amid Beijing’s push for semiconductor self-sufficiency.<\/p>\n The company said in an\u00a0announcement<\/a>\u00a0Friday that\u00a0it had confidentially filed a listing application on the Hong Kong Stock Exchange, though details of the offering, including size and structure, remain undecided.<\/p>\n The move would still require regulatory approvals, including from China’s securities watchdog. Baidu emphasized there is no guarantee the spin-off will proceed. The company reportedly <\/a>owns about 59% of Kunlunxin.<\/p>\n Baidu, a major player in China’s growing AI space, is both a buyer of specialized AI chips for data centers and cloud computing, as well as a designer of them through Kunlunxin.<\/p>\n The firm said that the spin-off would align with its strategy to highlight Kunlunxin’s standalone potential, attract sector-specific investors, and expand financing options. Kunlunxin would remain a Baidu subsidiary, it added.<\/p>\n The move comes against a backdrop of intensifying U.S.-China tech tensions. Both Washington and Beijing have imposed various restrictions on Chinese AI companies’ access to leading-edge AI chips from California-based Nvidia<\/a>.<\/p>\n Meanwhile, Beijing has increasingly encouraged domestic chip purchases and mobilized billions in public funds towards development. <\/p>\n In recent months, several Chinese chipmakers have\u00a0announced plans to list<\/a>, including Moore Threads<\/a> and Biren Technology.<\/p>\n A Growing Business Focus<\/p>\n Founded in 2012, Kunlunxin is central to Baidu’s ambition to become a “full stack<\/a>” AI company, spanning hardware, servers and data centers, as well as AI models and applications.<\/p>\n While Baidu still relies heavily on Nvidia’s chips for AI computing power, Kunlunxin has enabled the company to increasingly use a mix of its self-developed chips in data centers running its Ernie AI<\/a> models.<\/p>\n Kunlunxin has also shifted to operate as a separate entity, expanding its sales to third-party customers outside Baidu.<\/p>\n “In the market, Kunlunxin is seen as one of the most practical and widely used AI chips in China,” Brady Wang, associate director at Counterpoint Research, told CNBC. <\/p>\n He added that one of the chipmaker’s main strengths is in software. “Instead of forcing users to adopt a closed system, Kunlunxin works well with common AI frameworks and makes it easier to move workloads from [Nvidia].” <\/p>\n Reuters previously reported <\/a>that Kunlunxin’s revenue is projected to exceed 3.5 billion yuan ($500 million) last year, reaching break-even. External sales were expected to account for more than half of its revenue in 2025, the report added.\u00a0<\/p>\n In another sign of strength last year, Kunlunxin won orders<\/a> worth over 1 billion yuan from suppliers to China Mobile<\/a>, one of the country’s biggest mobile carriers.<\/p>\n China Mobile also participated in the entity’s latest funding, which had raised over 2 billion yuan and valued the unit at about 21 billion yuan, according to Reuters.<\/p>\n In its announcement, Baidu said its plans to spin off and list Kunlunxin would better tie management incentives with performance and elevate the unit’s market presence.<\/p>\n Late last year, JPMorgan analysts forecast that Kunlunxin’s chip sales would increase sixfold to 8 billion Chinese yuan in 2026.<\/p>\n However, while Kunlunxin may help reduce China’s reliance on chips from Nvidia, it cannot fully replace them, Counterpoint’s Wang said, citing Beijing’s ongoing constraints in advanced chip manufacturing. <\/p>\n “[Kunlunxin’s chips] work best for inference and other workloads that are easier to move, especially for government, telecom, and state-owned cloud users, where stable supply and lower cost matter more than top performance,” he said. <\/p>\n