A woman walks past Baidu’s booth at the China International Technology Fair in Shanghai.
STR | AFP | Getty images
GUANGZHOU, China – Baidu has raised money for its semiconductor artificial intelligence (AI) business worth $ 2 billion, a person familiar with the matter told CNBC.
It comes as the Chinese search giant tries to diversify its revenue streams.
The funding round was led by CPE, a Chinese wealth management and private equity firm, the person said. Venture capital companies IDG and Legend Capital were also involved. A fund under Chinese investment company Oriza Holdings also took part in the round.
“Baidu’s Kunlun chip company recently completed a funding round. We will release more information in due course,” said a Baidu spokesperson, without providing any details.
Kunlun is the name of Baidu’s AI chip company. It wasn’t immediately clear how much money Baidu raised, but the source said the post-financing valuation of the chip business was $ 2 billion.
Reuters first reported news about the funding.
CNBC reported last month that Baidu wanted to raise money for a standalone AI chip company.
Now that the Kunlun company has raised money, it could pave the way for the unit’s split-off, but no final decision has yet been made, the source said.
AI chips are designed to process massive amounts of data that can be used in artificial intelligence applications. An injection of cash for Baidu’s business could help the company bring the technology to market.
It’s part of a broader diversification of Baidu, where the company set up a standalone electric vehicle business with Geely and raised money for a biotech company. Best known as a Chinese search giant, Baidu still relies heavily on ad revenue.
Semiconductors and artificial intelligence are two key technologies that China hopes to increase its expertise and strength.