1、Table of Contents UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549Form 20-F(Mark One)REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)OR 12(g)OF THE SECURITIES EXCHANGE ACT OF 1934or ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal y

2、ear ended December 31,2023.or TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from to or SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934Date of event requiring this shell company reportFor the

3、 transition period from to Commission file number:000-51469Baidu,Inc.(Exact name of Registrant as specified in its charter)N/A(Translation of Registrants name into English)Cayman Islands(Jurisdiction of incorporation or organization)Baidu CampusNo.10 Shangdi 10th StreetHaidian District,Beijing 10008

4、5The Peoples Republic of China(Address of principal executive offices)Rong Luo,Chief Financial OfficerTelephone:+(86 10)5992-8888Email:Facsimile:+(86 10)5992-0000Baidu CampusNo.10 Shangdi 10th Street,Haidian District,Beijing 100085The Peoples Republic of China(Name,Telephone,Email and/or Facsimile n

5、umber and Address of Company Contact Person)Securities registered or to be registered pursuant to Section 12(b)of the Act:Title of Each Class Trading Symbol Name of Each Exchange on Which RegisteredAmerican depositary shares(each American depositary share representing eight Class Aordinary shares,pa

6、r value US$0.000000625 per share)BIDU The Nasdaq Stock Market LLC(The Nasdaq Global Select Market)Class A ordinary shares,par value US$0.000000625 per share*The Nasdaq Stock Market LLC(The Nasdaq Global Select Market)Class A ordinary shares,par value US$0.000000625 per share 9888 The Stock Exchange

7、of Hong Kong Limited*Not for trading,but only in connection with the listing on The Nasdaq Global Select Market of American depositary shares.Securities registered or to be registered pursuant to Section 12(g)of the Act:None(Title of Class)Securities for which there is a reporting obligation pursuan

8、t to Section 15(d)of the Act:None(Title of Class)Indicate the number of outstanding shares of each of the Issuers classes of capital or common stock as of the close of the period covered by the annual report 2,280,411,080 Class A ordinary shares and 524,780,320 Class B ordinary shares,par valueUS$0.

9、000000625 per share,as of December 31,2023.Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No If this report is an annual or transition report,indicate by check mark if the registrant is not required to file reports pursuant t

10、o Section 13 or 15(d)of the Securities Exchange Act of 1934.Yes No Indicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the registrant was

11、 required to file suchreports),and(2)has been subject to such filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically,if any,every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of this

12、chapter)during the preceding 12 months(or for such shorterperiod that the registrant was required to submit such files).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer or an emerging growth company.See definition of“large

13、 accelerated filer,”“accelerated filer”“emerging growth company”in Rule 12b-2of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S.GAAP,indicate by check

14、mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accountingstandards provided pursuant to Section 13(a)of the Exchange Act.The term“new or revised financial accounting standard”refers to any update issued by the Financial Ac

15、counting Standards Board to its Accounting Standards Codification after April 5,2012.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of its internal control over financial reporting under Section 404(b)of the Sarb

16、anes-Oxley Act(15 U.S.C.7262(b)bythe registered public accounting firm that prepared or issued its audit report.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of

17、an error to previously issued financial statements.Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrants executive officers during the relevant recovery period pursuant to240

18、.10D-1(b).Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:U.S.GAAP International Financial Reporting Standards as issued by the International Accounting Standards Board Other If“Other”has been checked in response to

19、 the previous question,indicate by check mark which financial statement item the registrant has elected to follow.Item 17 Item 18 If this is an annual report,indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No(APPLICABLE ONLY TO ISSUE

20、RS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12,13 or 15(d)of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed

21、 by a court.Yes No Table of ContentsTABLE OF CONTENTS INTRODUCTION 1 FORWARD-LOOKING INFORMATION 2 PART I 3 Item 1.Identity of Directors,Senior Management and Advisers 3 Item 2.Offer Statistics and Expected Timetable 3 Item 3.Key Information 3 Item 4.Information on the Company 88 Item 4A.Unresolved

22、Staff Comments 151 Item 5.Operating and Financial Review and Prospects 151 Item 6.Directors,Senior Management and Employees 185 Item 7.Major Shareholders and Related Party Transactions 200 Item 8.Financial Information 202 Item 9.The Offer and Listing 204 Item 10.Additional Information 205 Item 11.Qu

23、antitative and Qualitative Disclosures about Market Risk 219 Item 12.Description of Securities Other than Equity Securities 220 PART II 224 Item 13.Defaults,Dividend Arrearages and Delinquencies 224 Item 14.Material Modifications to the Rights of Security Holders and Use of Proceeds 224 Item 15.Cont

24、rols and Procedures 225 Item 16A.Audit Committee Financial Expert 225 Item 16B.Code of Ethics 225 Item 16C.Principal Accountant Fees and Services 226 Item 16D.Exemptions from the Listing Standards for Audit Committees 226 Item 16E.Purchases of Equity Securities by the Issuer and Affiliated Purchaser

25、s 226 Item 16F.Change in Registrants Certifying Accountant 227 Item 16G.Corporate Governance 227 Item 16H.Mine Safety Disclosure 227 Item 16I.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 227 Item 16J.Insider Trading Policies 227 Item 16K.Cybersecurity 227 PART III 228 Item 17.

26、Financial Statements 228 Item 18.Financial Statements 228 Item 19.Exhibits 228 SIGNATURES 241 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS F-1 iTable of ContentsINTRODUCTIONIn this annual report,except where the context otherwise requires and for purposes of this annual report only:“ADSs”refer to our

27、American depositary shares,each ADSs representing eight Class A ordinary shares;“China”or“PRC”refers to the Peoples Republic of China,including Hong Kong,Macau and Taiwan;and“mainland China”refers to thePeoples Republic of China,excluding Hong Kong,Macau and Taiwan;“Class A ordinary shares”refer to

28、Class A ordinary shares of the share capital of our company with a par value of US$0.000000625 each,conferring a holder of a Class A ordinary share one vote per share on all matters submitted for voting at general meetings of our company;“Class B ordinary shares”refer to Class B ordinary shares of t

29、he share capital of our company with a par value of US$0.000000625 each,conferring weighted voting rights in our company such that a holder of a Class B ordinary share is entitled to 10 votes per share on allmatters submitted for voting at general meetings of our company;“Hong Kong”or“HK”or“Hong Kon

30、g S.A.R.”refers to the Hong Kong Special Administrative Region of the PRC;“Hong Kong Listing Rules”refer to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited,asamended or supplemented from time to time;“Hong Kong Share Registrar”refers to Computershare Hong Kon

31、g Investor Services Limited;“Hong Kong Stock Exchange”refers to The Stock Exchange of Hong Kong Limited;“Main Board”refers to the stock market(excluding the option market)operated by the Hong Kong Stock Exchange which is independentfrom and operated in parallel with the Growth Enterprise Market of t

32、he Hong Kong Stock Exchange;“MAU”,or monthly active user,refers to the number of mobile devices that launched our mobile apps during a given month;“our company”refers to Baidu,Inc.,which is not a PRC operating company but a Cayman Islands holding company with operationsprimarily conducted through(i)

33、our mainland China subsidiaries and(ii)contractual arrangements with the variable interest entities,or theVIEs,based in mainland China.This structure entails unique risks to investors,see“Item 3.D.Key InformationRisk FactorsRisksRelated to our Corporate Structure”for more details;“RMB”or“Renminbi”re

34、fers to the legal currency of mainland China;“SFO”refers to the Securities and Futures Ordinance(Chapter 571 of the Laws of Hong Kong),as amended or supplemented from time totime;“shares”or“ordinary shares”refer to our ordinary shares,which include both Class A ordinary shares and Class B ordinary s

35、hares;“user traffic”or“traffic”refers generally to page views of a website,with“page views”measuring the number of web pages viewed byinternet users over a specified period of time except that multiple page views of the same page viewed by the same user on the same dayare counted only once;“U.S.GAAP

36、”refers to generally accepted accounting principles in the United States;“we,”“us,”“our,”or“Baidu”refers to Baidu,Inc.,its subsidiaries,and,in the context of describing our operations and consolidatedfinancial information,the variable interest entities established in mainland China and other consoli

37、dated affiliated entities in which we donot have any equity ownership but 1Table of Contents whose financial results have been consolidated into our consolidated financial statements based solely on contractual arrangements inaccordance with U.S.GAAP.These variable interest entities include,but are

38、not limited to,Beijing Baidu Netcom Science TechnologyCo.,Ltd.,or Baidu Netcom,Beijing Perusal Technology Co.,Ltd.,or Beijing Perusal,Beijing iQIYI Science&Technology Co.,Ltd.,orBeijing iQIYI.See“Item 4.Information on the CompanyC.Organizational Structure”for an illustrative diagram of our corporate

39、structure;“iQIYI”refers to iQIYI,Inc.,a company incorporated in the Cayman Islands listed on Nasdaq under the symbol“IQ”and one of oursubsidiaries;“$,”“dollars,”“US$”or“U.S.dollars”refers to the legal currency of the United States;and all discrepancies in any table between the amounts identified as

40、total amounts and the sum of the amounts listed therein are due torounding.On March 1,2021,Baidu,Inc.effected a change to its authorized share capital by 1-to-80 subdivision of shares.Concurrently,Baidu,Inc.effecteda proportionate change in ADS to Class A ordinary share ratio from 10 ADSs representi

41、ng 1 Class A ordinary share to each ADS representing 8 Class Aordinary shares,or the Share Subdivision.Such changes been reflected retroactively throughout this document.FORWARD-LOOKING INFORMATIONThis annual report on Form 20-F contains forward-looking statements that reflect our current expectatio

42、ns and views of future events.Thesestatements are made under the“safe harbor”provisions of the U.S.Private Securities Litigation Reform Act of 1995.You can identify these forward-looking statements by terminology such as“may,”“will,”“expect,”“anticipate,”“future,”“intend,”“plan,”“believe,”“estimate,

43、”“is/are likely to”orother similar expressions.We have based these forward-looking statements largely on our current expectations and projections about future events andfinancial trends that we believe may affect our financial condition,results of operations,business strategy and financial needs.The

44、se forward-lookingstatements include,but are not limited to:our operations and business prospects;our business and operating strategies and our ability to implement such strategies;our ability to develop and manage our operations and business;competition for,among other things,capital,technology and

45、 skilled personnel;our ability to control costs;our ability to identify and conduct investments and acquisitions,obtain regulatory approvals from government authorities,as well asintegrate acquired target(s);changes to regulatory and operating conditions in the industry and geographical markets in w

46、hich we operate;our dividend policy;and all other risks and uncertainties described in“Item 3.D.Key InformationRisk Factors.”We would like to caution you not to place undue reliance on these forward-looking statements and you should read these statements in conjunctionwith the risk factors disclosed

47、 in“Item 3.D.Key InformationRisk Factors.”Those risks are not exhaustive.We operate in a rapidly evolvingenvironment.New risks emerge from time to time and it is impossible for our management to predict all risk factors,nor can we assess the impact of allfactors on our business or the extent to whic

48、h any factor,or combination of factors,may cause actual results 2Table of Contentsto differ from those contained in any forward-looking statement.We do not undertake any obligation to update or revise the forward-looking statementsexcept as required under applicable law.Unless otherwise noted,all tr

49、anslations from Renminbi to U.S.dollars and from U.S.dollars to Renminbi in this annual report are made at a rateof RMB7.0999 to US$1.00,the exchange rate in effect as of December 29,2023 as set forth in the H.10 statistical release of The Board of Governors ofthe Federal Reserve System.We make no r

50、epresentation that any Renminbi or U.S.dollar amounts could have been,or could be,converted into U.S.dollars or Renminbi,as the case may be,at any particular rate,or at all.PART I Item 1.Identity of Directors,Senior Management and AdvisersNot applicable.Item 2.Offer Statistics and Expected Timetable

51、Not applicable.Item 3.Key InformationOur Corporate Structure and Contractual Arrangements with the Variable Interest EntitiesBaidu,Inc.is not a PRC operating company but a Cayman Islands holding company with operations primarily conducted through(i)oursubsidiaries incorporated in mainland China,or m

52、ainland China subsidiaries,and(ii)contractual arrangements with the variable interest entities based inmainland China.Our internet content services,value-added telecommunication-based services,internet map services,online audio and video servicesand mobile application distribution businesses in main

53、land China have been conducted through the applicable VIEs in order to comply with the laws andregulations of mainland China,which restrict and impose conditions on foreign direct investment in companies involved in the provision of suchbusinesses.Accordingly,we operate these businesses in mainland

54、China through the variable interest entities,and rely on contractual arrangementsamong Baidu,Inc./iQIYI,Inc.,our mainland China subsidiaries,the variable interest entities and their nominee shareholders to control the businessoperations of the variable interest entities.External revenues contributed

55、 by the variable interest entities accounted for 44%,47%and 45%of our totalexternal revenues for the years ended December 31,2021,2022 and 2023,respectively.As used in this annual report,“our company”refers to Baidu,Inc.,whereas“we,”“us,”“our,”or“Baidu”refers to Baidu,Inc.,its subsidiaries,and,in th

56、e context of describing our operations and consolidatedfinancial information,the variable interest entities in mainland China and all of the variable interest entities are domestic companies incorporated inmainland China in which we do not have any equity ownership but whose financial results have b

57、een consolidated into our consolidated financialstatements based solely on contractual arrangements in accordance with U.S.GAAP.Investors in our ADSs are not purchasing equity interest in thevariable interest entities in mainland China but instead are purchasing equity interest in a holding company

58、incorporated in the Cayman Islands.Baidu,Inc./iQIYI,Inc.,our mainland China subsidiaries,the variable interest entities and their nominee shareholders have entered into a series ofcontractual agreements.These contractual arrangements:enable us to receive the economic benefits that could potentially

59、be significant to the variable interest entities in consideration for theservices provided by our subsidiaries;effectively assigned all of the voting rights underlying the nominee shareholders equity interest in the variable interest entities to us;andenable us to hold an exclusive option to purchas

60、e all or part of the equity interests in the variable interest entities when and to the extentpermitted by the laws of mainland China.3Table of ContentsThese contractual arrangements generally include shareholder voting rights trust agreements or proxy agreements,exclusive equity purchase andtransfe

61、r option agreements or exclusive purchase option agreements,loan agreements,operating agreements or business operation agreements,exclusivetechnology consulting and services agreements,and equity pledge agreements,as the case may be.As for some of the variable interest entities,oursubsidiaries have

62、entered into additional business cooperation agreements,power of attorney,license agreements and/or commitment letters(as the casemay be)with these variable interest entities and their respective shareholders.Terms contained in each set of contractual arrangements with the variableinterest entities

63、and their respective shareholders are substantially similar.As a result of the contractual arrangements,the shareholders of the variableinterest entities effectively assigned all of their voting rights underlying their equity interest in the variable interest entities to the primary beneficiariesof

64、these companies,which gives our company or its subsidiaries/iQIYI the power to direct the activities that most significantly impact the variableinterest entities economic performance.The nominee shareholders of Baidu Netcom,Beijing Perusal and Beijing iQIYI,the variable interest entities,are directo

65、rs or members of senior management of us or iQIYI.We or iQIYI consider such people suitable to act as the nominee shareholders of thesevariable interest entities because of,among other considerations,their contribution to us or iQIYI,their competence and their length of service with andloyalty to us

66、 or iQIYI.For more details of these contractual arrangements,see“Item 4.Information on the CompanyC.Organizational StructureContractual Arrangements with the Variable Interest Entities and Other Consolidated Affiliated Entities and their Shareholders.”However,the contractual arrangements may not be

67、as effective as direct ownership in providing us with control over the variable interest entitiesand we may incur substantial costs to enforce the terms of the arrangements.If the variable interest entities or the nominee shareholders fail to performtheir respective obligations under the contractual

68、 arrangements,we could be limited in our ability to enforce the contractual arrangements thateffectively assigned us the voting rights in the variable interest entities,and these agreements have not been tested in the courts of mainland China.Furthermore,if we are unable to maintain such effective a

69、ssignment,we would not be able to continue to consolidate the financial results of theseentities in our financial statements.See“Item 3.D.Key InformationRisk FactorsRisks Related to Our Corporate StructureOur contractualarrangements with the variable interest entities in mainland China and the indiv

70、idual nominee shareholders may not be as effective in providing controlover these entities as direct ownership”and“Item 3.D.Key InformationRisk FactorsRisks Related to Our Corporate StructureThe individualnominee shareholders of the variable interest entities may have potential conflicts of interest

71、 with us,which may adversely affect our business.We donot have any arrangements in place to address such potential conflicts.”There are also substantial uncertainties regarding the interpretation and application of current and future laws,regulations and rules of mainlandChina regarding the status o

72、f the rights of our Cayman Islands holding company with respect to its contractual arrangements with the variable interestentities and their nominee shareholders.It is uncertain whether any new laws or regulations of mainland China relating to variable interest entitystructures will be adopted or if

73、 adopted,what they would provide.If we or any of the variable interest entities is found to be in violation of any existingor future laws or regulations of mainland China,or fail to obtain or maintain any of the required permits or approvals,the PRC regulatory authoritieswould have broad discretion

74、in accordance with the applicable laws and regulations to take action in dealing with such violations or failures.See“Item3.D.Key InformationRisk FactorsRisks Related to Our Corporate StructureLaws and regulations of mainland China governing our businessesand the validity of certain of our contractu

75、al arrangements are uncertain.If we are found to be in violation,we could be subject to sanctions.In addition,changes in the laws and regulations of mainland China or changes in interpretations thereof may materially and adversely affect our business.”Our operations are primarily conducted in mainla

76、nd China through(i)our mainland China subsidiaries and(ii)contractual arrangements with thevariable interest entities based in mainland China,and revenues are primarily generated from mainland China.Though the PRC Foreign Investment Lawdoes not explicitly classify contractual arrangements as a form

77、of foreign investment,the definition of“foreign investment”thereunder is relatively wideand contains a catch-all provision which includes investments made by foreign investors through 4Table of Contentsmeans stipulated in laws or administrative regulations or other methods prescribed by the State Co

78、uncil.Therefore,there is no assurance that foreigninvestment via contractual arrangement would not be interpreted as a type of indirect foreign investment activities in the future.If any of the variableinterest entities were deemed as a foreign-invested enterprise under any such future laws,administ

79、rative regulations or provisions and any of ourbusiness would be included in any negative list or other form of restrictions on foreign investment,we may need to take further actions to comply withsuch future laws,administrative regulations or provisions.Such actions may have a material and adverse

80、impact on our business,financial condition,result of operations and prospects.In addition,if the PRC regulatory authorities were to find our legal structure and contractual arrangements to be inviolation of any laws,administrative regulations or provisions of mainland China,we are uncertain what imp

81、act of above PRC regulatory authoritiesactions would have on us and our ability to consolidate the variable interest entities in the consolidated financial statements.For more details,see“Item3.D.Key InformationRisk FactorsRisks Related to Doing Business in ChinaUncertainties exist with respect to t

82、he interpretation andimplementation of the PRC Foreign Investment Law and its implementation regulations and how it may impact the viability of our current corporatestructure,corporate governance and business operations.”Our corporate structure is subject to risks associated with our contractual arr

83、angements with the variable interest entities.Our company and itsinvestors may never have a direct ownership interest in the businesses that are conducted by the variable interest entities.Uncertainties in the PRC legalsystem could limit our ability to enforce these contractual arrangements,and thes

84、e contractual arrangements have not been tested in a court of law.If thePRC government finds that the agreements that establish the structure for operating our business in mainland China do not comply with the laws andregulations of mainland China,or if these regulations or the interpretation of exi

85、sting regulations change or are interpreted differently in the future,weand the variable interest entities could be subject to severe penalties or be forced to relinquish our interests in those operations.This would result in thevariable interest entities being deconsolidated.The majority of our ass

86、ets,including the necessary licenses to conduct business in mainland China,areheld by the variable interest entities.A significant part of our revenues are generated by the variable interest entities.An event that results in thedeconsolidation of the variable interest entities would have a material

87、effect on our operations and result in the value of the securities of our companydiminish substantially or even become worthless.Our company,our mainland China subsidiaries and the variable interest entities,and investors of ourcompany face uncertainty about potential future actions by the PRC gover

88、nment that could affect the enforceability of the contractual arrangements withthe variable interest entities and,consequently,significantly affect the financial performance of the variable interest entities and our company as awhole.Baidu,Inc.may not be able to repay its indebtedness,and the Class

89、A ordinary shares or ADSs of our company may decline in value or becomeworthless,if we are unable to assert our contractual control rights over the assets of our mainland China subsidiaries and the variable interest entitiesthat conduct all or substantially all of our operations.For a detailed descr

90、iption of the risks associated with our corporate structure,please refer to risksdisclosed under“Item 3.D.Key InformationRisk FactorsRisks Related to Our Corporate Structure.”Our company and the variable interest entities face various risks and uncertainties related to doing business in China.For ex

91、ample,we face risksassociated with regulatory approvals on offshore offerings,antimonopoly regulatory actions,and oversight on cybersecurity and data privacy.Theserisks could result in a material adverse change in our operations and the value of our ADSs,significantly limit or completely hinder our

92、ability tocontinue to offer securities to investors,or adversely affect the value of such securities.For a detailed description of risks related to doing business inChina,see“Item 3.D.Key InformationRisk FactorsRisks Related to Doing Business in China.”PRC governments certain administrative measures

93、 in regulating(i)our operations and(ii)offerings conducted overseas by,and foreigninvestment in,China-based issuers,could significantly limit or completely hinder our ability to offer or continue to offer securities to investors.Implementation of industry-wide regulations,including data security or

94、anti-monopoly related regulations,in this nature may result in adverse effect onthe value of such securities.For more details,see“Item 3.D.Key InformationRisk FactorsRisks 5Table of ContentsRelated to Doing Business in ChinaFailure to meet the PRC governments complex regulatory requirements on our b

95、usiness operation could have amaterial adverse effect on our operations and the value of our securities.”Risks and uncertainties arising from the PRC legal system,including risks and uncertainties regarding the enforcement of laws and quicklyevolving rules and regulations in mainland China,could res

96、ult in a material adverse change in our operations and the value of our ADSs.For moredetails,see“Item 3.D.Key InformationRisk FactorsRisks Related to Doing Business in ChinaUncertainties exist with respect to theinterpretation and implementation of the PRC Foreign Investment Law and its implementati

97、on regulations and how it may impact the viability of ourcurrent corporate structure,corporate governance and business operations.”The Holding Foreign Companies Accountable ActPursuant to the Holding Foreign Companies Accountable Act,which was enacted on December 18,2020 and further amended by theCo

98、nsolidated Appropriations Act,2023 signed into law on December 29,2022,or the HFCAA,if the Securities and Exchange Commission,or the SEC,determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspections by the Public CompanyAccounting

99、Oversight Board,or the PCAOB,for two consecutive years,the SEC will prohibit our shares or the ADSs from being traded on a nationalsecurities exchange or in the over-the-counter trading market in the United States.On December 16,2021,the PCAOB issued a report to notify the SECof its determination th

100、at the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainlandChina and Hong Kong,including our auditor.In April 2022,the SEC conclusively listed us as a Commission-Identified Issuer under the HFCAAfollowing the filing of our annual report o

101、n Form 20-F for the fiscal year ended December 31,2021.On December 15,2022,the PCAOB issued a reportthat vacated its December 16,2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable toinspect or investigate completely registered public account

102、ing firms.For this reason,we were not identified as a Commission-Identified Issuer under theHFCAA after we filed our annual report on Form 20-F for the fiscal year ended December 31,2022 and do not expect to be so identified after we filethis annual report on Form 20-F for the fiscal year ended Dece

103、mber 31,2023.Each year,the PCAOB will determine whether it can inspect andinvestigate completely audit firms in mainland China and Hong Kong,among other jurisdictions.If the PCAOB determines in the future that it nolonger has full access to inspect and investigate completely accounting firms in main

104、land China and Hong Kong and we use an accounting firmheadquartered in one of these jurisdictions to issue an audit report on our financial statements filed with the SEC,we would be identified as aCommission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fi

105、scal year.There can be no assurance that wewould not be identified as a Commission-Identified Issuer for any future fiscal year,and if we were so identified for two consecutive years,we wouldbecome subject to the prohibition on trading under the HFCAA.See“Item 3.D.Key InformationRisk FactorsRisks Re

106、lated to Doing Business inChinaThe PCAOB had historically been unable to inspect our auditor in relation to their audit work performed for our financial statements and theinability of the PCAOB to conduct inspections of our auditor in the past has deprived our investors with the benefits of such ins

107、pections.”and“Item3.D.Key InformationRisk FactorsRisks Related to Doing Business in ChinaOur ADSs may be prohibited from trading in the United States underthe HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China.The delisting or prohibition of tra

108、dingof the ADSs,or the threat of their being delisted or prohibited from trading,may materially and adversely affect the value of your investment.”Permissions Required from the PRC Government Authorities for Our OperationsWe conduct our business primarily through our subsidiaries and the variable in

109、terest entities in mainland China.Our operations in mainland Chinaare governed by the laws and regulations of mainland China.As of the date of this annual report,our mainland China subsidiaries and the variableinterest entities have obtained the requisite licenses and permits from the PRC government

110、 authorities that are material for the business operations of oursubsidiaries and the variable interest entities in mainland China,including,among others,the Value-Added Telecommunication Business OperatingLicense,the Internet News Information Service License,the 6Table of ContentsShort Messaging Se

111、rvice Access Code Certificate,the Online Audio/Video Program Transmission License,the Radio and Television ProgramProduction License,the Surveying and Mapping Qualification Certificate for internet map services,the Internet Culture Business Permit,the PublicationBusiness Operating License,the Filing

112、 Certificate for Internet Drug and Medical Devices Information Services/the Qualification Certificate for InternetDrug Information Services,the Human Resource Services License,the Filing Certificate for the Online Transaction Platform,the Filing Certificate forBusiness of Category II Medical Devices

113、,the Registration Certificate for Medical Devices,the Food Business License,the Medicine Business License,the Filing Certificate for the Online Publication Transaction Platform,the Internet Domain Name Services License,the Medical Device OperationLicense,the Medical Device Production License,the Fil

114、ing Certificate for Third-Party Platform Provider of Online Trading Service for Drugs and theFiling Certificate for Third-Party Platform Provider of Online Trading Service for Medical Device,the Practice License of Medical Institutions,theInternet Religious Information Service License,the Filing Cer

115、tificate of Artworks Operators,the Filing Information Form of Third Party PlatformProviders of Online Food Trading,the Aquatic Wildlife Operation and Utilization License,the Online Taxi-Hailing Operation License and certainpermits for road testing and demonstration application and/or commercial oper

116、ations of autonomous driving vehicles.Given the uncertainties ofinterpretation and implementation of relevant laws and regulations and the enforcement practice by the government authorities,we may be required toobtain additional licenses,permits,filings or approvals for our businesses and services i

117、n the future.For more detailed information,see“Item 3.D.KeyInformationRisk FactorsRisks Related to Doing Business in ChinaWe may be adversely affected by the complexity,uncertainties and changes inthe regulations of internet and related business and companies in mainland China.”Furthermore,in connec

118、tion with our historical issuance of securities to foreign investors,we,our mainland China subsidiaries and the variableinterest entities,(i)are not required to obtain permission from the China Securities Regulatory Commission,or the CSRC,(ii)are not required to gothrough a cybersecurity review by t

119、he Cyberspace Administration of China,or the CAC,and(iii)have not been asked to obtain permission by any PRCgovernment authority.However,the PRC government has promulgated certain regulations and rules to exert more oversight and control over offerings that are conductedoverseas and/or foreign inves

120、tment in China-based issuers.On February 17,2023,the CSRC released the Trial Administrative Measures of OverseasSecurities Offering and Listing by Domestic Companies and five supporting guidelines,or,collectively,the Filing Rules,which took effect onMarch 31,2023.According to the Filing Rules,domest

121、ic companies in mainland China that directly or indirectly offer or list their securities in anoverseas market are required to file with the CSRC.In addition,an overseas listed company must also submit the filing with respect to its follow-onofferings,issuance of convertible corporate bonds and exch

122、angeable bonds,and other equivalent offering activities,within a specific time framerequested under the Filing Rules.Therefore,we will be required to file with the CSRC for our overseas offering of equity and equity linked securities inthe future within the applicable scope of the Filing Rules.For m

123、ore detailed information,see“Item 3.D.Key InformationRisk FactorsRisks Relatedto Doing Business in ChinaThe approval of and/or filing with the CSRC or other PRC government authorities may be required in connection with ouroffshore offerings under the laws of mainland China,and,if required,we cannot

124、predict whether or for how long we will be able to obtain such approvalor complete such filing.”Cash Flows through Our OrganizationBaidu,Inc.is a holding company with no operations of its own.We conduct our operations in mainland China primarily through our subsidiariesand the variable interest enti

125、ties in mainland China.As a result,although other means are available for us to obtain financing at the holding companylevel,Baidu,Inc.s ability to pay dividends to the shareholders and to service any debt it may incur may depend upon dividends paid by our mainlandChina subsidiaries and license and

126、service fees paid by the variable interest entities.If any of our subsidiaries incurs debt on its own behalf,theinstruments governing such debt may restrict its ability to pay dividends to Baidu,Inc.In addition,our mainland China subsidiaries are permitted to paydividends to Baidu,Inc.only out of th

127、eir retained earnings,if any,as determined in accordance with PRC accounting standards and 7Table of Contentsregulations.Further,our mainland China subsidiaries and the variable interest entities are required to make appropriations to certain statutory reservefunds or may make appropriations to cert

128、ain discretionary funds,which are not distributable as cash dividends except in the event of a solventliquidation of the companies.For more details,see“Item 5.B.Operating and Financial Review and ProspectsLiquidity and Capital ResourcesHolding Company Structure.”Under the laws and regulations of mai

129、nland China,our mainland China subsidiaries and the variable interest entities are subject to certainrestrictions with respect to paying dividends or otherwise transferring any of their net assets to us.Remittance of dividends by a wholly foreign-ownedenterprise out of mainland China is also subject

130、 to examination by the banks designated by State Administration of Foreign Exchange,or SAFE.Theamounts restricted include the paid-up capital and the statutory reserve funds of our mainland China subsidiaries and the net assets of the variableinterest entities in which we have no legal ownership,tot

131、aling RMB45.9 billion,RMB47.3 billion and RMB48.0 billion(US$6.8 billion)as ofDecember 31,2021,2022 and 2023,respectively.For risks relating to the fund flows of our operations in mainland China,see“Item 3.D.KeyInformationRisk FactorsRisks Related to Doing Business in ChinaOur subsidiaries and the v

132、ariable interest entities in mainland China aresubject to restrictions on paying dividends and making other payments to our holding company.”From 2021 to 2023,certain of our mainland China subsidiaries have declared and distributed profits earned to Baidu(Hong Kong)Limited for anaggregate amount of

133、RMB23.1 billion(US$3.2 billion);the dividend payments are subject to withholding tax.We have made tax provisions based onthe corresponding tax rate.If our mainland China subsidiaries further declare and distribute profits earned after January 1,2008 in the future,thedividend payments will be subject

134、 to withholding tax,which will increase our tax liability and reduce the amount of cash available to our company.Forthe potential distributable profits to be distributed to our qualified Hong Kong incorporated subsidiary,the deferred tax liabilities are accrued at a 5%withholding tax rate.For more i

135、nformation on related risks,please see“Item 3.D.Key InformationRisk FactorsRisks Related to Doing Business inChinaIf our mainland China subsidiaries declare and distribute dividends to their respective offshore parent companies,we will be required to paymore taxes,which could have a material and adv

136、erse effect on our result of operations.”Under the laws of mainland China,Baidu Inc.may provide funding to our mainland China subsidiaries only through capital contributions or loans,and to the variable interest entities only through loans,subject to satisfaction of applicable government registratio

137、n and approval requirements.For the years ended December 31,2021,2022 and 2023,Baidu,Inc.provided loans with principal amount of RMB14.5 billion,RMB11.0 billionand RMB24.4 billion(US$3.4 billion),respectively,to its subsidiaries,and the subsidiaries repaid principal amount of RMB4.9 billion,RMB12.6

138、billion and RMB27.1 billion(US$3.8 billion),respectively,to Baidu,Inc.For the years ended December 31,2021,2022 and 2023,the subsidiaries of Baidu,Inc.provided loans with principal amount of RMB3.1 billion,RMB22.3 billion and RMB21.4 billion(US$3.0 billion),respectively,to Baidu,Inc.and Baidu,Inc.re

139、paid principal amount of RMB3.0 billion,RMB3.1 billion and RMB23.3 billion(US$3.3 billion),respectively,to its subsidiaries.For the years ended December 31,2021,2022 and 2023,loans for the amounts of RMB409 million,RMB65 million and RMB58 million(US$8million),respectively,were provided to the nomine

140、e shareholders to fund the capitalization of the variable interest entities for which the Company doesnot intend to seek repayment,and nil was repaid by the nominee shareholders.For the years ended December 31,2021,2022 and 2023,the variable interest entities received RMB6.9 billion,RMB5.4 billion a

141、ndRMB1.5 billion(US$218 million),respectively,as capital contributions or loans from the subsidiaries of Baidu,Inc.and the variable interest entitiesrepaid principal amount of nil,RMB6.5 billion and RMB5.2 billion(US$725 million),respectively,to the subsidiaries.8Table of ContentsFor the years ended

142、 December 31,2021,2022 and 2023,the variable interest entities provided loans with principal amount of RMB450 million,nil and nil,respectively,to the subsidiaries of Baidu,Inc.and the subsidiaries repaid principal amount of RMB10 million,RMB200 million andRMB345 million(US$49 million),respectively,t

143、o the variable interest entities.Baidu,Inc.has not declared or paid any cash dividends,nor does it has any present plan to pay any cash dividends on its ordinary shares in theforeseeable future.We currently intend to retain most,if not all,of our available funds and any future earnings to operate an

144、d expand our business.See“Item 8.Financial InformationA.Consolidated Statements and Other Financial InformationDividend Policy.”For mainland China and UnitedStates federal income tax considerations of an investment in our ADSs,see“Item 10.Additional InformationE.Taxation.”A.ReservedThe following tab

145、le presents the selected consolidated financial information for our company.The selected consolidated statements ofcomprehensive income data and cash flow data for the three years ended December 31,2021,2022 and 2023 and the consolidated balance sheets data asof December 31,2022 and 2023 have been d

146、erived from our audited consolidated financial statements,which are included in this annual reportbeginning on page F-1.The selected consolidated statements of comprehensive income data and cash flow data for the years ended December 31,2019and 2020 and the selected consolidated balance sheets data

147、as of December 31,2019,2020 and 2021 have been derived from our audited consolidatedfinancial statements for the years ended December 31,2019,2020 and 2021,which are not included in this annual report.Our historical results do notnecessarily indicate results expected for any future periods.The selec

148、ted consolidated financial data should be read in conjunction with,and arequalified in their entirety by reference to,our audited consolidated financial statements and related notes and“Item 5.Operating and Financial Reviewand Prospects”below.Our audited consolidated financial statements are prepare

149、d and presented in accordance with U.S.GAAP.Year Ended December 31,2019 2020 2021 2022 2023 RMB RMB RMB RMB RMB US$(In millions,except per share and per ADS data)Consolidated Statements of Comprehensive Income Data:Revenues:Online marketing services 78,093 72,840 80,695 74,711 81,203 11,437 Others 2

150、9,320 34,234 43,798 48,964 53,395 7,521 Total revenues 107,413 107,074 124,493 123,675 134,598 18,958 Operating costs and expenses:Cost of revenues 62,850 55,158 64,314 63,935 65,031 9,159 Selling,general and administrative 19,910 18,063 24,723 20,514 23,519 3,314 Research and development 18,346 19,

151、513 24,938 23,315 24,192 3,407 Total operating costs and expenses 101,106 92,734 113,975 107,764 112,742 15,880 Operating profit 6,307 14,340 10,518 15,911 21,856 3,078 Total other(loss)income,net (6,647)8,750 260 (5,799)3,342 472 (Loss)income before income taxes (340)23,090 10,778 10,112 25,198 3,5

152、50 Income taxes 1,948 4,064 3,187 2,578 3,649 514 Net(loss)income (2,288)19,026 7,591 7,534 21,549 3,036 Less:Net(loss)income attributable to non-controlling interests (4,345)(3,446)(2,635)(25)1,234 175 Net income attributable to Baidu,Inc.2,057 22,472 10,226 7,559 20,315 2,861 9Table of Contents As

153、 of December 31,2019 2020 2021 2022 2023 RMB RMB RMB RMB RMB US$(In millions)Consolidated Balance Sheets Data:Cash and cash equivalents 33,443 35,782 36,850 53,156 25,231 3,554 Restricted cash 996 758 10,821 11,330 11,503 1,620 Short-term investments,net(1)112,924 126,402 143,243 120,839 168,670 23,

154、757 Total assets 301,316 332,708 380,034 390,973 406,759 57,291 Short-term loans 2,618 3,016 4,168 5,343 10,257 1,445 Long-term loans,current portion 737 7,427 2 2 Long-term loans 7,804 12,629 13,722 14,223 2,003 Notes payable,current portion 5,219 10,505 6,904 6,029 849 Notes payable 38,090 48,408

155、43,120 39,893 34,990 4,928 Convertible senior notes,current portion(2)4,752 8,305 2,802 395 Convertible senior notes(2)12,297 11,927 12,652 9,568 8,144 1,147 Total liabilities 128,501 140,865 156,082 153,168 144,151 20,304 Total Baidu,Inc.shareholders equity 163,599 182,696 211,459 223,478 243,626 3

156、4,314 (1)We adopted Accounting Standards Update(ASU)No.2016-13,Financial Instruments-Credit Losses(Topic 326):Measurement of Credit Losses on Financial Instruments onJanuary 1,2020,which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost.AS

157、U 2016-13 replaces the existing incurred lossimpairment model with an expected loss methodology,resulting in more timely recognition of credit losses.(2)We adopted ASU No.2020-06,Accounting for Convertible Instruments and Contracts in an Entitys Own Equity on January 1,2022 using a modified retrospe

158、ctive transition method.Following the adoption of ASU 2020-06,all of the proceeds received from the issuance of the existing notes have been recorded as a liability on the balance sheet in accordance withASC 470-20.The difference between the principal amount of each of the existing notes and net pro

159、ceeds from the issuance is considered debt discount and is amortized at theirrespective effective interest rates to accrete the carrying value of the existing notes to its face value on the respective put dates of the existing notes.Year Ended December 31,2019 2020 2021 2022 2023 RMB RMB RMB RMB RMB

160、 US$(In millions)Consolidated Cash Flow Data:Net cash provided by operating activities 28,458 24,200 20,122 26,170 36,615 5,157 Net cash used in investing activities (19,974)(27,552)(31,444)(3,944)(50,397)(7,098)Net cash(used in)/provided by financing activities (3,873)5,665 23,396 (6,390)(14,162)(1

161、,995)Net increase/(decrease)in cash,cash equivalents and restricted cash 4,612 2,101 11,131 17,565 (27,662)(3,896)Financial Information Related to the Variable Interest EntitiesThe following tables present the condensed consolidating schedule of financial performance,financial position and cash flow

162、s for Baidu,Inc.,itswholly owned subsidiaries that are the Primary Beneficiaries of the VIEs under U.S.GAAP,or the Primary Beneficiaries of VIEs excluding Baidu,Inc.,its other subsidiaries that are not the Primary Beneficiaries of VIEs,or the“Other Subsidiaries,the VIEs and VIEs subsidiaries that we

163、 consolidate forthe periods and as of the dates presented.“Baidu Inc.”is our holding company in the Cayman Islands,and the primary beneficiary of the VIEs including Beijing Baidu NetcomScience Technology Co.,Ltd.,or Baidu Netcom,and Beijing Perusal Technology Co.,Ltd.,or Beijing Perusal,and other VI

164、Es.“PrimaryBeneficiaries of VIEs excluding Baidu,Inc.”mainly refer to iQIYI,Inc.,the primary beneficiary of Beijing iQIYI Science&TechnologyCo.,Ltd.,Beijing iQIYI,and other iQIYI VIEs.“Other Subsidiaries”refer to the sum of non-VIE subsidiaries,which mainly include Baidu Online Network Technology(Be

165、ijing)Co.,Ltd.,or Baidu Online,Baidu(China)Co.,Ltd.,or Baidu China,10Table of Contents B Times Technology(Beijing)Co.,Ltd.,or Baidu Times,Beijing QIYI Century Science&Technology Co.,Ltd.,or Beijing QIYICentury,a wholly-owned foreign enterprise of iQIYI,Inc.,and other wholly-owned subsidiaries,which

166、mainly provide online marketingservices to external customers.In addition,as instructed by the primary beneficiaries of the VIEs,certain wholly-owned subsidiariesincluding Baidu Online and Beijing QIYI Century also provide long-term loans to the nominee shareholders of the VIEs to fund thecapitaliza

167、tion of these entities as well as exclusive technology consulting and services to the VIEs.“VIEs and VIEs subsidiaries”refer to the sum of Baidu Netcom,Beijing Perusal,Beijing iQIYI and other iQIYI VIEs,and other VIEs.Selected Condensed Consolidating Statements of Comprehensive Income Information Fo

168、r the Year Ended December 31,2023 Baidu Inc.Primary Beneficiaries of VIEs excluding Baidu,Inc.Other Subsidiaries VIEs and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Revenues 22 92,326 67,001 (24,751)134,598 Share of income of the VIEs and VIEs subsidiaries 4,021 501 (4,522)Ne

169、t income 20,315 1,819 19,235 4,202 (24,022)21,549 For the Year Ended December 31,2022 Baidu Inc.Primary Beneficiaries of VIEs excluding Baidu,Inc.Other Subsidiaries VIEs and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Revenues 14 82,471 62,121 (20,931)123,675 Share of income o

170、f the VIEs and VIEs subsidiaries 158 164 (322)Net income(loss)7,559 (272)11,640 212 (11,605)7,534 For the Year Ended December 31,2021 Baidu Inc.Primary Beneficiaries of VIEs excluding Baidu,Inc.Other Subsidiaries VIEs and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Revenues 4

171、83,424 61,380 (20,315)124,493 Share of loss of the VIEs and VIEs subsidiaries (276)(2,067)2,343 Net income(loss)10,226 (6,248)16,330 (220)(12,497)7,591 11Table of ContentsSelected Condensed Consolidating Balance Sheets Information As of December 31,2023 Baidu,Inc.Primary Beneficiaries of VIEs exclud

172、ing Baidu,Inc.Other Subsidiaries VIEs and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Assets Cash and cash equivalents 5,463 406 14,524 4,838 25,231 Short-term investments,net 4,338 159,277 5,055 168,670 Accounts receivable,net 3,206 7,642 10,848 Others 13 42 17,165 8,286 25,5

173、06 Total current assets 9,814 448 194,172 25,821 230,255 Fixed assets,net 217 18,659 9,084 27,960 Intangible assets,net 46 835 881 Licensed copyrights,net 5,016 1,951 6,967 Produced content,net 1,028 12,349 13,377 Long-term investments,net 423 354 29,752 17,428 47,957 Long-term time deposits and hel

174、d-to-maturity investments 2,528 21,808 330 24,666 Investments in subsidiaries 298,642 958 (299,600)Contractual interests in the VIEs and VIEs subsidiaries(1)3,654 23,859 (27,513)Operating lease right-of-use assets 4,610 6,241 10,851 Others 152 32,427 11,266 43,845 Total non-current assets 305,464 1,

175、464 137,205 59,484 (327,113)176,504 Amounts due from the entities within Baidu(2)24,823 (24,823)Total assets 315,278 26,735 331,377 85,305 (351,936)406,759 Liabilities Accounts payable and accrued liabilities 572 41 20,719 16,385 37,717 Customers deposits and deferred revenue 6,620 8,007 14,627 Oper

176、ating lease liabilities 225 2,883 3,108 Others 6,029 2,802 5,387 6,781 20,999 Total current liabilities 6,601 2,843 32,951 34,056 76,451 Operating lease liabilities 120 4,920 5,040 Others 49,115 8,144 3,568 1,833 62,660 Total non-current liabilities 49,115 8,144 3,688 6,753 67,700 Amounts due to the

177、 entities within Baidu(2)15,936 696 13,985 (30,617)Total liabilities 71,652 10,987 37,335 54,794 (30,617)144,151 Redeemable noncontrolling interests 6,090 3,261 114 9,465 Equity Total Baidu shareholders equity(3)243,626 3,060 290,746 27,513 (321,319)243,626 Noncontrolling interests 6,598 35 2,884 9,

178、517 Total equity 243,626 9,658 290,781 30,397 (321,319)253,143 Total liabilities,redeemable noncontrolling interests andequity 315,278 26,735 331,377 85,305 (351,936)406,759 12Table of Contents As of December 31,2022 Baidu,Inc.Primary Beneficiaries of VIEs excluding Baidu,Inc.Other Subsidiaries VIEs

179、 and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Assets Cash and cash equivalents 18,691 4,351 26,333 3,781 53,156 Short-term investments,net 5,485 110,704 4,650 120,839 Accounts receivable,net 3,325 8,408 11,733 Others 48 18,587 8,487 27,122 Total current assets 24,176 4,399

180、158,949 25,326 212,850 Fixed assets,net 225 16,124 7,624 23,973 Intangible assets,net 45 1,209 1,254 Licensed copyrights,net 4,889 1,952 6,841 Produced content,net 468 12,534 13,002 Long-term investments,net 365 36,775 18,157 55,297 Long-term time deposits and held-to-maturity investments 23,329 300

181、 23,629 Investments in subsidiaries 274,483 243 (274,726)Contractual interests in the VIEs and VIEs subsidiaries(1)884 23,778 (24,662)Operating lease right-of-use assets 4,905 5,460 10,365 Others 152 32,781 10,829 43,762 Total non-current assets 275,592 760 143,094 58,065 (299,388)178,123 Amounts du

182、e from the entities within Baidu(2)22,648 3,206 (25,854)Total assets 299,768 27,807 305,249 83,391 (325,242)390,973 Liabilities Accounts payable and accrued liabilities 616 167 21,482 15,749 38,014 Customers deposits and deferred revenue 5,729 7,387 13,116 Operating lease liabilities 255 2,554 2,809

183、 Others 6,904 8,305 5,804 4,678 25,691 Total current liabilities 7,520 8,472 33,270 30,368 79,630 Operating lease liabilities 245 4,565 4,810 Others 53,614 9,568 3,448 2,098 68,728 Total non-current liabilities 53,614 9,568 3,693 6,663 73,538 Amounts due to the entities within Baidu(2)15,156 18,743

184、(33,899)Total liabilities 76,290 18,040 36,963 55,774 (33,899)153,168 Redeemable noncontrolling interests 5,604 2,678 111 8,393 Equity Total Baidu shareholders equity(3)223,478 1,041 265,640 24,662 (291,343)223,478 Noncontrolling interests 3,122 (32)2,844 5,934 Total equity 223,478 4,163 265,608 27,

185、506 (291,343)229,412 Total liabilities,redeemable noncontrolling interests andequity 299,768 27,807 305,249 83,391 (325,242)390,973 Note:(1)It represents the elimination of the contractual interests in the VIEs and VIEs subsidiaries,which includes contractual interests in the VIEs through loans tono

186、minee shareholders or capital contributions and the primary beneficiaries share of income(loss)from the VIEs and VIEs subsidiaries.13Table of Contents(2)It represents the elimination of intercompany balances among Baidu,Inc.,the primary beneficiaries,other subsidiaries and the VIEs and VIEs subsidia

187、ries.Theshort-term loans and long-term loans provided to the VIEs and VIEs subsidiaries were RMB9.9 billion(US$1.4 billion)and RMB3.4 billion(US$479 million),respectively,as of December 31,2023 and RMB8.8 billion and RMB8.1 billion,respectively,as of December 31,2022.(3)The loans provided to the nom

188、inee shareholders were RMB19.2 billion(US$2.7 billion)and RMB19.1 billion as of December 31,2023 and 2022,respectively,which will mature from 2027 to 2047.The loans provided to the nominee shareholders were to fund the capitalization of the VIEs for which the Company does notintend to seek repayment

189、.The term of all such loans provided to the nominee shareholders has historically been extended prior to their respective original maturitydates,and we will continue to extend the term of all outstanding loans before they become due.Selected Condensed Consolidating Cash Flows Information For the Yea

190、r Ended December 31,2023 Baidu,Inc.Primary Beneficiaries of VIEs excluding Baidu,Inc.Other Subsidiaries VIEs and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Net cash(used in)/provided by operating activities (2,012)(361)33,660 5,328 36,615 Net cash provided by/(used in)investi

191、ng activities 2,592 237 (41,608)(2,381)(9,237)(50,397)Including:Cash contribution to VIEs and VIEssubsidiaries(1)(2)(58)58 Loans provided to VIEs and VIEs subsidiaries(3)(1,492)1,492 Loans repayments from VIEs and VIEssubsidiaries(3)5,150 (5,150)Net cash used in financing activities (13,881)(3,863)(

192、3,657)(1,998)9,237 (14,162)Including:Cash contribution to VIEs and VIEssubsidiaries(1)(2)58 (58)Loans provided to VIEs and VIEs subsidiaries(3)1,492 (1,492)Loans repayments from VIEs and VIEssubsidiaries(3)(5,150)5,150 14Table of Contents For the Year Ended December 31,2022 Baidu,Inc.Primary Benefic

193、iaries of VIEs excluding Baidu,Inc.Other Subsidiaries VIEs and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Net cash(used in)/provided by operating activities (2,418)(161)25,664 2,938 147 26,170 Net cash provided by/(used in)investing activities 2,753 (2,773)(21,268)(1,898)19,2

194、42 (3,944)Including:Cash contribution to VIEs and VIEssubsidiaries(1)(2)(65)65 Loans provided to VIEs and VIEs subsidiaries(3)(5,313)5,313 Loans repayments from VIEs and VIEssubsidiaries(3)6,480 (6,480)Net cash provided by/(used in)financing activities 6,054 5,580 1,429 (64)(19,389)(6,390)Including:

195、Cash contribution to VIEs and VIEssubsidiaries(1)(2)65 (65)Loans provided to VIEs and VIEs subsidiaries(3)5,313 (5,313)Loans repayments from VIEs and VIEssubsidiaries(3)(6,480)6,480 15Table of Contents For the Year Ended December 31,2021 Baidu,Inc.Primary Beneficiaries of VIEs excluding Baidu,Inc.Ot

196、her Subsidiaries VIEs and VIEs subsidiaries Eliminations Consolidated Total RMB (In millions)Net cash(used in)/provided by operating activities (1,853)(371)18,080 4,121 145 20,122 Net cash used in investing activities (16,183)(3,564)(25,522)(7,551)21,376 (31,444)Including:Cash contribution to VIEs a

197、nd VIEssubsidiaries(1)(2)(1,408)1,408 Loans provided to VIEs and VIEs subsidiaries(3)(5,520)5,520 Net cash provided by/(used in)financing activities 25,628 (272)15,562 3,999 (21,521)23,396 Including:Cash contribution to VIEs and VIEssubsidiaries(1)(2)1,408 (1,408)Loans provided to VIEs and VIEs subs

198、idiaries(3)5,520 (5,520)Note:(1)For the years ended December 31,2021,2022 and 2023,the primary beneficiaries designated its subsidiaries to provide loans totaling RMB409 million,RMB65 million and RMB58 million(US$8 million),respectively,to the nominee shareholders to fund the capitalization of the V

199、IEs and VIEs subsidiaries forwhich the primary beneficiaries do not intend to seek repayment,and nil was repaid by the nominee shareholders.(2)For the years ended December 31,2021,2022 and 2023,the VIEs and VIEs subsidiaries received RMB1.0 billion,nil and nil,respectively,as capital contributionfro

200、m other subsidiaries.(3)For the years ended December 31,2021,2022 and 2023,the VIEs and VIEs subsidiaries received RMB5.5 billion,RMB5.3 billion and RMB1.5 billion(US$210million),respectively,as loans from other subsidiaries and the VIEs and VIEs subsidiaries repaid principal amounts of nil,RMB6.5 b

201、illion and RMB5.2 billion(US$725 million),respectively,to other subsidiaries.16Table of ContentsB.Capitalization and IndebtednessNot applicable.C.Reasons for the Offer and Use of ProceedsNot applicable.D.Risk FactorsSummary of Risk FactorsAn investment in our ADSs or Class A ordinary shares involves

202、 significant risks.Below is a summary of material risks we face,organized underrelevant headings.All the operational risks associated with being based in and having operations in mainland China also apply to operations in HongKong.With respect to the legal risks associated with being based in and ha

203、ving operations in mainland China,the laws,regulations and the discretion ofmainland China government authorities discussed in this annual report are expected to apply to mainland China entities and businesses,rather thanentities or businesses in Hong Kong which operate under a different set of laws

204、 from mainland China.These risks are discussed more fully in Item 3.D.Key InformationRisk Factors.Risks Related to Our Business and Industry If we fail to retain existing customers or attract new customers for our online marketing services,our business,results of operations andgrowth prospects could

205、 be seriously harmed;Our business and results of operations could continue to be materially and adversely affected by the challenging macroeconomicenvironment impacting online marketing demand;Our business depends on a strong brand,and if we are unable to maintain and enhance our brand,our business

206、and results of operationsmay be harmed;We face risks arising from our termination of the share purchase agreement for our proposed acquisition of YY Live;We face significant competition and may suffer from loss of users and customers as a result;If our expansions into new businesses are not successf

207、ul,our results of operation and growth prospects may be materially and adverselyaffected;We have made significant investments in foundation models and generative AI and may face uncertainties with respect to theircommercialization and the evolving laws and regulations applicable to us;We have experi

208、enced slowdowns and declines in our revenues,and we may sustain net loss from time to time,and we may experiencedownward pressure on our operating and profit margins in the future;Potential issues in the adoption and use of artificial intelligence in our product offerings may result in reputational

209、harm or liability;and If we fail to continue to innovate and provide products,services and high-quality internet experience that attract and retain users,we maynot be able to remain competitive;we may expend significant resources in order to remain competitive.17Table of ContentsRisks Related to Our

210、 Corporate Structure Our company is a Cayman Islands holding company with no equity ownership in the variable interest entities and we conduct ouroperations in mainland China through(i)our mainland China subsidiaries and(ii)the variable interest entities with which we havemaintained contractual arra

211、ngements.Investors in our Class A ordinary shares or the ADSs thus are not purchasing equity interest in thevariable interest entities in mainland China but instead are purchasing equity interest in a Cayman Islands holding company.If the PRCgovernment deems that our contractual arrangements with th

212、e variable interest entities do not comply with mainland Chinas regulatoryrestrictions on foreign investment in the relevant industries,or if these regulations or the interpretation of existing regulations change or areinterpreted differently in the future,we could be subject to severe penalties or

213、be forced to relinquish our interests in those operations.Ourholding company in the Cayman Islands,the variable interest entities,and investors of our company face uncertainty about potential futureactions by the PRC government that could affect the enforceability of the contractual arrangements wit

214、h the variable interest entities and,consequently,significantly affect the financial performance of the variable interest entities and our company as a group;Our contractual arrangements with the variable interest entities in mainland China and the individual nominee shareholders may not be aseffect

215、ive in providing control over these entities as direct ownership;and We are in the process of registering the pledges of equity interests by nominee shareholders of some of the variable interest entities,and wemay not be able to enforce the equity pledges against any third parties who acquire the eq

216、uity interests in good faith in the relevant variableinterest entities before the pledges are registered.Risks Related to Doing Business in China Changes in Chinas economic,political or social conditions or government policies could have a material and adverse effect on ourbusiness and operations;Th

217、e approval of and/or filing with the CSRC or other PRC government authorities may be required in connection with our offshoreofferings under the laws of mainland China,and,if required,we cannot predict whether or for how long we will be able to obtain suchapproval or complete such filing;There are u

218、ncertainties regarding the interpretation and enforcement of PRC laws,rules and regulations;We may be adversely affected by the complexity,uncertainties and changes in the regulations of internet and related business andcompanies in mainland China;Failure to meet the PRC governments complex regulato

219、ry requirements on our business operation could have a material adverse effect onour operations and the value of our securities;Any failure or perceived failure by us to comply with the enacted Guidelines to Anti-Monopoly in the Field of Internet Platforms and otheranti-monopoly laws and regulations

220、 may result in governmental investigations or enforcement actions,litigation or claims against us andcould have an adverse effect on our business,financial condition and results of operations;It may be difficult for overseas regulators to conduct investigation or collect evidence within mainland Chi

221、na;The PCAOB had historically been unable to inspect our auditor in relation to their audit work performed for our financial statements andthe inability of the PCAOB to conduct inspections of our auditor in the past has deprived our investors with the benefits of suchinspections;and Our ADSs may be

222、prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect orinvestigate completely auditors located in China.The delisting or 18Table of Contents prohibition of trading of the ADSs,or the threat of their being delisted or prohibited from trading,may

223、 materially and adversely affect thevalue of your investment.Risks Related to our ADSs and Class A Ordinary Shares The trading price of our ADSs and/or our Class A ordinary shares has been and is likely to continue to be volatile regardless of ouroperating performance;We adopt different practices as

224、 to certain matters as compared with many other companies primarily listed on the Hong Kong StockExchange;Substantial future sales or perceived potential sales of our Class A ordinary shares and/or ADSs in the public market could cause the priceof our Class A ordinary shares and/or ADSs to decline;a

225、nd The different characteristics of the capital markets in Hong Kong and the U.S.may negatively affect the trading prices of our Class Aordinary shares and/or ADSs.Risks Related to Our Business and IndustryIf we fail to retain existing customers or attract new customers for our online marketing serv

226、ices,our business,results of operations and growthprospects could be seriously harmed.We generate a substantial majority of our revenues from online marketing services.Our online marketing customers will not continue to dobusiness with us if their investment does not generate sales leads and ultimat

227、ely consumers,or if we do not deliver their web pages in an appropriate andeffective manner.Our online marketing customers may choose to discontinue their business with us,which are not subject to fixed-term contracts.Inaddition,third parties may develop and use certain technologies to block the dis

228、play of our customers advertisements and other marketing products onour Baidu platform,which may in turn cause us to lose customers and adversely affect our results of operations.Furthermore,as our P4P services enableour customers to bid for priority placement of their paid sponsored links,we may lo

229、se customers if they find the bidding mechanism not cost effective orotherwise not attractive.Additionally,if our users do not increase their engagement on our platform,or our content ecosystem fails to offer rich andquality content that meets users tastes and preferences,or our users spend more tim

230、e with or otherwise satisfy their content consumption demands oncompeting platforms,or we otherwise experience user traffic decline due to any reason,it would be difficult for us to attract new customers or retainexisting customers.If our customers determine that their expenditures on our platform d

231、o not generate the returns they expect,they may allocate agreater portion or all of their advertising budgets to other advertising channels,such as other online marketing platforms,television and outdoor media,and reduce or discontinue business with us.Since most of our customers are not bound by lo

232、ng-term contracts,they may amend or terminate theiradvertising arrangements with us with little advance notice under certain circumstances.Failure to retain our existing customers or attract newcustomers for our online marketing services could seriously harm our business,results of operations and gr

233、owth prospects.We have recorded substantialcustomer deposits and deferred revenue,which mainly consist of deposits received from certain customers of our online marketing services.If we areunable to fulfill our obligation in respect of such customer deposits and deferred revenue,we may have to refun

234、d the balance to our customers and ourcash flow and liquidity position would be materially adversely affected.We have in the past removed,and may in the future again remove,questionable listings or advertisements to ensure the quality and reliability ofour search results and/or information feed.Such

235、 removal,whether temporary or permanent,may cause affected customers to discontinue their businesswith us or negatively impact our relationships with affected Baidu Union partners.We also examine the relevant business licenses and bank accounts ofprospective customers prior to business engagement,as

236、 a quality control measure.In addition,we have taken steps to implement measures requested byPRC regulatory authorities,such as modifying paid search practices and limiting the displays of advertisements in connection with certain industries.Wehave also proactively implemented numerous additional me

237、asures to deliver a better user experience and build a safer and 19Table of Contentsmore trustworthy platform for users.Such measures have had a negative impact on the number of customers and our revenues,although we believe suchimpact is likely to be temporary.Regulations on online marketing servic

238、es in mainland China are evolving,and uncertainties remain with respect to theimplementation of and compliance with new regulations that may emerge,which in turn may have a material adverse impact on our business,results ofoperations and growth prospects.Our business and results of operations could

239、continue to be materially and adversely affected by the challenging macroeconomic environmentimpacting online marketing demand.Online marketing services continue to be a primary source of our revenues.While revenues from online marketing services increased in 2021 and2023,they declined in 2020 and 2

240、022 mainly due to the weakness in online advertising demand as our customers faced a challenging macroeconomicenvironment in their respective industries and in the general economy,in part due to the significant adverse impact of the COVID-19 pandemic.Ourbusiness and results of operations could conti

241、nue to be materially and adversely affected by the challenging macroeconomic environment as well as bytrends in online marketing through internet searches or feeds.With the evolution of the internet in China,customers have many channels to conductonline marketing and promotions.As users may not spen

242、d as much time on search-plus-newsfeed as they do on other types of internet platforms,manycurrent and potential customers may not allocate as much of their marketing budgets to online marketing through search-plus-newsfeed,as compared toother methods of online marketing.Our ability to increase reve

243、nue and profitability from online marketing may be adversely impacted by a number offactors,many of which are beyond our control,including but not limited to:difficulties associated with developing and maintaining a larger user base with demographic characteristics attractive to online marketingcust

244、omers and maintaining and increasing user engagement;increased competition and potential re-allocation of marketing budgets and downward pressure on online marketing prices,for example,resulting from an oversupply of advertising inventory released into the market;higher customer acquisition costs du

245、e in part to the limited experience of small to medium-sized enterprises,or SMEs,with the internet asa marketing channel or due to competition;decreased use of our search and paid click because search queries are increasingly being undertaken via voice-activated smart devices,apps,social media or ot

246、her online platforms;ineffectiveness of our online marketing delivery,tracking and reporting systems;decreased use of internet or online marketing in China;and tightened regulatory environment in mainland Chinas internet space.Our business depends on a strong brand,and if we are unable to maintain a

247、nd enhance our brand,our business and results of operations may beharmed.We believe that our brand“Baidu”has contributed significantly to the success of our business.We also believe that maintaining and enhancing the“Baidu”brand is critical to increasing the number of our users,customers,Baidu Union

248、 partners and content providers,as well as to expanding ourdeveloper communities and to attracting and retaining enterprise and public sector customers and partners.We have conducted various marketing andbrand promotion activities,but we cannot assure you that these activities will achieve the brand

249、 promotion effect that we expect.If we fail to maintainand further promote the“Baidu”brand,or if we incur excessive expenses in this effort,our business and results of operations may be materially andadversely affected.In addition,any negative publicity about us,our products and services,our employe

250、es,our business practices,our search results or the platform towhich our search results link,regardless of its veracity,could harm 20Table of Contentsour brand image and in turn adversely affect our business and results of operations.We cannot assure you that we will be able to defuse negativepublic

251、ity to the satisfaction of our investors,users,customers and business partners.From time to time,there has been negative publicity about us,ourbrand image,our value proposition and our business practice,which has adversely affected our public image and reputation during certain periods ofintense neg

252、ative publicity.Moreover,our platform and services by nature may from time to time be related to,or perceived to be related to,certaincontroversial public events or discussion,leading to public criticism against us.The negative publicity surrounding similar incidents have resulted insignificant adve

253、rse impact on our public image and reputation.Intense negative publicity may divert our managements attention and may adverselyimpact our business.We cannot assure you that our brand,public image and reputation will not be materially and adversely affected in the future.We face risks arising from ou

254、r termination of the share purchase agreement for our proposed acquisition of YY Live.Baidu(Hong Kong)Limited,our wholly-owned subsidiary,entered into definitive agreements with JOYY Inc.and certain of its affiliates,whichare collectively referred to as JOYY,to acquire JOYYs domestic video-based ent

255、ertainment live streaming business in China,known as YY Live,onNovember 16,2020,and subsequently amended and supplemented the share purchase agreement,including on February 7,2021.The closing of thisacquisition was subject to certain conditions,including,among others,obtaining necessary regulatory a

256、pprovals from government authorities,and theshare purchase agreement was subject to termination by either party if the closing did not occur by the long stop date.We have paid an aggregate ofUS$1.9 billion,after considering working capital adjustment of US$0.1 billion,to JOYY and its designated escr

257、ow account,and deposited an aggregateof US$1.6 billion into several escrow accounts,in accordance with the terms and schedule set forth in the share purchase agreement.Despite good faithefforts,the closing conditions provided for in the share purchase agreement had not been fully satisfied as of Dec

258、ember 31,2023,the long stop date,andon January 1,2024,we exercised our right to terminate the share purchase agreement based on the terms of the share purchase agreement.As a result ofthe termination,we are not able to achieve the intended objectives,benefits or opportunities associated with the pro

259、posed acquisition,despite thesignificant diversion of resources and management attention to date.We are in discussion with JOYY on the next steps following the termination of theshare purchase agreement.However,there is no guarantee that a mutually satisfactory solution can be reached between both p

260、arties.If no mutuallysatisfactory solution is reached by both parties,we may be subject to claims,disputes or legal proceedings in connection with this transaction.Resolvingsuch claims,disputes or legal proceedings could be time-consuming and would divert the attention and efforts of our management.

261、There is no guaranteethat we will prevail in these claims,disputes or legal proceedings.There may be uncertainties related to our recovery as to our payments and depositsheld in escrow accounts.As a result,our business,prospects,reputation,liquidity,financial condition and operating results and the

262、value of oursecurities could be materially and adversely affected.We face significant competition and may suffer from loss of users and customers as a result.We face significant competition in almost every aspect of our business.For our Baidu Core businesses,our primary competitors are mainlyinterne

263、t companies,online marketing platforms in China and other search engines.We compete with these entities for both users and customers on thebasis of user traffic,cyber security quality(relevance)of search(and other marketing and advertising)results,availability and user experience productsand service

264、s,distribution channels and the number of associated third-party websites.iQIYI competes with other internet media and entertainmentservices,such as internet and social platforms and short-form video platforms,as well as major TV stations.iQIYI competes with these market playersfor both users and ad

265、vertising customers,and primarily on the basis of obtaining IP rights to popular content,conducting brand promotions and othermarketing activities,and making investments in and acquisitions of business partners.See“Item 4.B.Information on the CompanyBusiness OverviewCompetition.”Some of our competit

266、ors have significant financial resources and long operating histories and are experienced in attracting andretaining their users,21Table of Contentsaccommodating their users habits and preferences and managing customers.They may use their experience and resources to compete with us in avariety of wa

267、ys,including competing for users and their time,customers,third-party agents,content,strategic partners and networks of third-partywebsites/wapsites,investing more heavily in research and development and making investments and acquisitions.Our business environment is rapidlyevolving and competitive.

268、Our business faces changing technologies,shifting user needs,and frequent introductions of rival products and services.Some of our competitors in the search sector may have innovative business models,extensive distribution network or proprietary content ortechnologies that may provide users with bet

269、ter user experience and customers with better services.They may use their resources in ways that couldaffect our competitive position,including developing new products,making acquisitions,continuing to invest heavily in research and development andin talent,and continuing to compete aggressively for

270、 users,advertisers,customers,the acquisition of traffic and content.If any of our competitorsprovides comparable or better Chinese language search and feed experience or internet video services,our user traffic could decline significantly.Additionally,if the channels and properties that we use to di

271、stribute services or products to our users and customers are no longer available to us,wemay experience a decline in user traffic.Any such decline in traffic could weaken our brand and result in loss of users and customers,which could havea material and adverse effect on our results of operations.Th

272、ere are vertical service providers in the forms of mobile apps and/or websites that allow users to search within their closed ecosystems.Theseplayers often purchase traffic from search engines and try to retain their users by offering comprehensive services on their platforms.As these verticalservic

273、e providers expand,though they will continue to acquire traffic from search engines,their reliance on search engines may decline,especially ifthey can consolidate their industry verticals.We also face competition from other types of advertising media,including traditional advertising media,such as n

274、ewspapers,magazines,yellowpages,billboards,other forms of outdoor media,television and radio,mobile apps,webcasting and online video.Large companies in China generallyallocate,and may continue to allocate,a limited portion of their budgets to online marketing,as opposed to traditional advertising an

275、d other forms ofadvertising media.If these companies do not devote a larger portion of their marketing budgets to online marketing services provided by us,or if ourexisting customers reduce the amount they spend on online marketing,our results of operations and growth prospects could be adversely af

276、fected.If our expansions into new businesses are not successful,our results of operation and growth prospects may be materially and adversely affected.As part of our growth strategy,we enter into new businesses from time to time to generate additional revenue streams and through ourdevelopment of ne

277、w business lines or strategic investments in or acquisitions of other businesses.Expansions into new businesses may presentoperating,marketing and compliance challenges that differ from those that we currently encounter.We have invested significant resources in the research and development of AI tec

278、hnology and have made significant progress in thecommercialization of AI-enabled offerings,including in-app services,cloud services and solutions,intelligent driving services and solutions and smartdevices and services.We plan to continue to invest capital and other resources into our AI-enabled bus

279、iness operations,in particular,generative AI andfoundation models.However,AI technology is rapidly evolving with significant uncertainties,and we cannot assure you that our investment andexploration in AI technology and AI-enabled products and services will be successful.Our operating results may al

280、so suffer if our innovation is notresponsive to the needs of our users,customers and partners,inappropriately timed with market opportunities,or marketed ineffectively.For example,we have limited experience with operating and scaling AI-enabled business,including cloud services and solutions,intelli

281、gent driving services andsolutions and smart devices and services,which could subject us to various challenges and risks,including developing and managing relationships withenterprises and public sector customers and partners,who are likely to have different needs and preferences from our existing c

282、ustomers,users andpartners,highly competitive procurement processes,instances of corrupt practices or other illegal gains,22Table of Contentslonger receivable payment cycles and lower collection rates.We also may not alter our business practices in time to avoid or reduce adverse effects fromany of

283、the foregoing risks.In addition,our AI-enabled business requires very different products and services,sales and marketing channels and internaloperational systems and processes.These requirements could disrupt our current operations and harm our financial condition and operating results,especially d

284、uring the initial stage of investment,development and scaling of our new AI-enabled offerings.We may also enter into other markets and industries/industry verticals that are new to us through organic business initiatives or investment andacquisitions,such as generative AI,robotaxis,intelligent elect

285、ric vehicles,e-commerce,short-video,and healthcare vertical including internet hospital,which may subject us to different and unforeseen risks.However,we cannot assure you that such efforts will be successful due to various factors such aspotential regulatory actions taken by government authorities

286、in these new markets.For these new markets and industries/industry verticals,we may nothave sufficient experience and may not be able to navigate the rapidly evolving regulatory environment or forecast and meet the continually changingdemands and preferences for products and services.Some of these n

287、ew markets and industries/industry verticals are emerging with relatively novel anduntested business models.Any of the foregoing could pose significant challenges to us.We may not realize the anticipated benefits of our investments oracquisitions due to the uncertainties related to the performance a

288、nd valuation of the relevant targets,or failure to integrate the targets into our existingbusiness,or difficulty in operating the acquired business with our existing expertise and resources.See also“Our strategy of investments andacquiring complementary businesses and assets may fail.”It is uncertai

289、n whether our strategies will attract users and customers or generate the revenue required to succeed.If we fail to generate sufficientusage of our new products and services,we may not grow revenue in line with the significant resources we invest in these new businesses.This maynegatively impact gro

290、ss margins and operating income.Commercial success of our expansion into new business areas depends on many factors,including innovativeness,competitiveness,effectiveness of distribution and marketing,and pricing and investments strategies,especially in the earlystage of competition for market share

291、.For example,the smart transportation industry is highly competitive and fragmented.Our current and potentialcompetitors in this industry range from large and established technology companies to emerging start-ups.Some competitors have longer operatinghistories in the sector.They can use their exper

292、ience,resources and network in ways that could affect our competitive position,including makingacquisitions,continuing to invest heavily in research and development and in talents,aggressively initiating intellectual property claims(whether or notmeritorious),and continuing to compete aggressively f

293、or customers,partners and investees.Our competitors may be able to innovate and provideproducts and services faster than we can or may foresee product-and-service needs before we do.As a result,we may not achieve significant revenuesfrom our new business areas for several years,or at all,and may inc

294、ur significant losses during the process and fail to recoup our investments.On theother hand,market conditions and general acceptance of products and services could be adversely impacted if other players in the market fail to adoptappropriate business and operational model,develop and offer successf

295、ul products and services and develop and adapt appropriate technologies andinfrastructure.If the markets of our new businesses,such as intelligent driving and electric vehicle,do not develop and grow as we anticipate,we mayincur significant loss from our new businesses and our growth prospects may b

296、e materially adversely impacted.In addition,we may encounter regulatory uncertainties related to new business areas that we enter into.The laws and regulations related to AItechnology and products are at an early stage of development and still evolving in mainland China.The effects of such laws and

297、regulations remainunclear and may add uncertainties to the development and operation of our AI-related business.For example,as mainland Chinas regulatory frameworkon autonomous driving evolves,we may be required to comply with approval and other compliance requirements for autonomous driving road te

298、st,operation and commercialization,internet security and related data collection and sharing promulgated by PRC government authorities from time totime.See“Item 4.B.Information on the CompanyBusiness OverviewRegulationsRegulations on Artificial Intelligence.”We may confront otherchallenges as we ent

299、er new business domains,including the lack of adoption of new products and services,the 23Table of Contentslack of management talent in the new business,cost management and other factors required for the expansion of new businesses.We have made significant investments in foundation models and genera

300、tive AI and may face uncertainties with respect to their commercializationand the evolving laws and regulations applicable to us.Foundation models and generative AI technologies have developed rapidly in recent years.For instance,the ChatGPT,a chatbot developed byOpenAI,has been tested by people all

301、 over the world since its launch in November 2022.We have made significant investments in foundation modelsand generative AI and have also allocated significant resources in these areas,including human resources and infrastructure updates.However,foundation models and generative AI are in the initia

302、l stages of development and there is no proven business model for commercializing the newtechnologies.We also face intense competition in these fields as many players in these fields have also devoted significant resources in the research anddevelopment of these technologies.In addition,the regulato

303、ry and legal framework on generative AI of mainland China is also evolving rapidly.Inrecent years,the PRC government authorities have released a series of laws and regulations related to generative AI services,including theAdministration Provisions on Algorithmic Recommendation of Internet Informati

304、on Services,the Administrative Provisions on Deep Synthesis ofInternet Information Services and the Interim Measures on the Management of Generative AI Services.See“Item 4.B.Information on the CompanyBusiness OverviewRegulationsRegulations on Artificial IntelligenceRegulations on Generative AI.”Howe

305、ver,these laws and regulations relatedto generative AI services are relatively new,and the competent government authorities of mainland China may introduce additional or more detailedlaws and regulations to oversee the generative AI services.Therefore,we may need to comply with more compliance requi

306、rements in the field ofgenerative AI,which may increase our compliance costs.We also face uncertainties with respect to such evolving laws and regulations as well as theirinterpretations and our business operations and development may be affected as a result.We have experienced slowdowns and decline

307、s in our revenues,and we may sustain net loss from time to time,and we may experience downwardpressure on our operating and profit margins in the future.From 2019 to 2023,we experienced a slow-down in revenue growth,including decreases from 2019 to 2020 and again from 2021 to 2022,due tovarious fact

308、ors such as macroeconomic environment and the impact of the COVID-19 pandemic.We could continue to experience a decline in ourrevenues,as a result of a number of factors,including changes in the mix of products and services,customer demographics,industry and channel,changes in policy or policy imple

309、mentation,increase in market competition for marketing and/or new AI offerings,and decrease in pricing arising froman oversupply of advertising inventory in the market,which has been witnessed since 2019.We may also experience a decline in our revenue or revenuegrowth rate,if there is a decrease in

310、the rate of adoption for our products,services and technologies,or deceleration or decline in demand for platformsused to access our services,among other factors.Our operating margin and net income attributable to us as a percentage of revenue fluctuated notably from 2019 to 2023 due to various fact

311、orssuch as the macroeconomic environment and the impact of the COVID-19 pandemic.We may experience downward pressure on our operating marginfrom increasing competition,revenue growth slower than expenses,and increased costs and expenses from many aspects of our business,includingwithin online market

312、ing where revenue growth does not keep up with traffic cost growth and related infrastructure costs to support our online properties,such as Baidu App,video-related and other products requiring huge data transmission and computing power.We may also pay increased fees for ourdistribution channels,as

313、well as increased content acquisition costs to content providers.Additionally,an increase in personnel-related costs,an increasein spending to promote new products and services,and the expiration of temporary tax exemptions or reductions may dampen our operating margin.Wemay also experience downward

314、 pressure on our operating margin resulting from a variety of factors,such as the expansion of our business into newareas,including generative AI,foundation models,AI cloud,intelligent driving,voice assistant&smart device,all of which have margins much lowerthan that of online marketing.Our operatin

315、g margin may also be 24Table of Contentsnegatively impacted from a greater proportion of revenue contributed by new business areas,which has grown faster than online marketing.In addition,we may also sustain net loss from time to time due to investment impairment and foreign currency fluctuation.The

316、 decliningoperating margin and investment impairment have led to our experiencing net losses in several quarters since 2020,and there is no guarantee that wewill not experience loss in the future.Due to these factors and the evolving nature of our business,our historical revenue growth rate,historic

317、al operating margin and historicalprofitability may not be indicative of our future performance.Potential issues in the adoption and use of artificial intelligence in our product offerings may result in reputational harm or liability.We are building AI,including foundation models and generative AI,i

318、nto many of our product offerings and we expect this element of ourbusiness to be a driver for our future growth.We envision a future in which AI operates in our services and applications,such as search-plus-feed,cloudservices and solutions,intelligent driving services and solutions and Xiaodu smart

319、 devices and services,and the cloud helps our customers become moreproductive.As with many disruptive innovations,AI presents risks and challenges that could affect its adoption,and,therefore,our business.Ourproducts and services based on AI may not be adopted by our users or customers.AI algorithms

320、 may be flawed.Datasets may be insufficient or containbiased information.Inappropriate or controversial data practices by us or others could impair the acceptance of our AI solutions.Our AI-generatedcontent offerings may not be able to compete against those of our competitors.In addition,AI services

321、 may involve complex intellectual property issues.However,the laws and regulations in mainland China are still evolving and are subject to further interpretation and implementation.Therefore,AI-generated content could lead to copyright and other legal disputes.Such deficiencies could undermine the d

322、ecisions,predictions or analysis producedby AI applications,subjecting us to legal liability and potential harm to our brand or reputation.The laws and regulations in mainland China regardingAI are gradually improving,and they require AI service providers or technology supporters to avoid such defic

323、iencies to the maximum extent possible.Although we believe that we have taken necessary measures according to the applicable laws,we cannot guarantee that we will always meet theregulatory requirements in the future.If we fail to meet legal and regulatory requirements,we may be subject to penalties.

324、In addition,some AIscenarios present ethical issues.If we enable or offer AI solutions that are controversial because of their impact on human rights,privacy,employment,or other social issues,we may experience reputational harm or be exposed to liability.If we fail to continue to innovate and provid

325、e products,services and high-quality internet experience that attract and retain users,we may not beable to remain competitive;we may expend significant resources in order to remain competitive.Our success depends on providing products and services to attract users and enable users to have a high-qu

326、ality internet experience.In order toattract and retain users and compete against our competitors,we must continue to invest significant resources in research and development to enhanceour AI or other new technologies,improve our existing products and services,and introduce additional high-quality p

327、roducts and services.If we areunable to anticipate user preferences or industry changes,enhance the quality of our products and services on a timely basis or fail to provide sufficientcontent,or provide other consumer-facing services and products,including our maps and smart devices,to our users sat

328、isfaction,we may suffer adecline in the size of our user base.Our results of operations may also suffer if our innovations do not respond to the needs of our users,are notappropriately timed with market opportunities or are not effectively brought to market.As search,marketing and AI technologies an

329、d new forms ofdevices and apps continue to develop,we may expend significant resources in research and development and strategic investments and acquisitions inorder to remain competitive.25Table of ContentsIf we fail to keep up with technological advancements and upgrades,our business,results of op

330、erations and financial condition may be materiallyand adversely affected.Our businesses operate in industries that are subject to rapid technological advancements,upgrades and changing consumer needs.Our successwill depend on our ability to keep up with the latest developments in technology innovati

331、ons and commercialization and if we fail to do so successfully,the demand for our products,solutions and services may decline.For instance,applications of technologies similar to ChatGPT to our products andservices to cater to consumer needs may be essential for us to remain competitive in the marke

332、t.In addition,research and development of technologicalchanges and innovations will typically require substantial capital expenditures as well as upgrades of products or services.Furthermore,we may notexecute successfully on our development strategy,including because of challenges with regard to tec

333、hnical hurdles that we fail to overcome in a timelyfashion.In addition,changes in user behavior resulting from technological developments may also adversely affect us.For example,the number ofpeople accessing the internet through mobile devices and internet of things,or IoTs,such as smartphones,tablets and smart(voice-activated internet)home devices,has increased in recent years,and we expect this