Chinese web giant Baidu has recently disclosed its strategic planning, acknowledging the potential unavailability of cutting-edge GPUs in the long term. However, the company asserts that it can outperform local competitors through its advanced software stack.

During Baidu’s Q4 2023 earnings call, CEO Robin Li emphasized the company’s confidence in its ability to maintain a superior user experience despite potential limitations in accessing state-of-the-art GPUs. Li highlighted the minimal short-term impact of US chip sanctions, citing Baidu’s existing chip reserves and procurement capabilities as sufficient for numerous AI-native applications.

Furthermore, Li underscored Baidu’s position as having the most powerful foundation model in China, supported by its AI chip reserve, which enables ongoing enhancements to ERNIE, Baidu’s ChatGPT challenger. He emphasized the potential for innovation across various layers of the AI architecture and highlighted the competitive advantage derived from the company’s ability to leverage less advanced chips for efficient model training and inferencing.

When questioned about Baidu’s competitiveness against overseas cloud providers, Li focused his response on the company’s ability to outperform domestic rivals, all of which are expected to face similar constraints in accessing Nvidia’s most powerful products. He also asserted that Baidu possesses China’s most cost-efficient AI infrastructure for model training and inferencing, positioning the company to navigate the uncertainties of the Chinese macro environment while capitalizing on emerging opportunities.

This disclosure from Baidu sheds light on the company’s proactive approach to addressing potential challenges in accessing leading-edge GPUs, emphasizing its confidence in its software capabilities and commitment to maintaining a competitive edge in the rapidly evolving AI landscape.