Tech sector sees mixed analyst outlooks for Baidu and AMD

Major financial institutions have issued contrasting outlooks for leading technology companies involved in the artificial intelligence sector.

Morgan Stanley has downgraded Baidu Inc. from ‘equal weight’ to ‘underweight,’ significantly lowering its price target from 130 USD to 80 USD. Analyst Gary Yu noted that while AI cloud infrastructure revenue is accelerating, the company’s core online advertising business remains under pressure. The bank expressed concern that growth in AI activities may not be sufficient to offset declining advertising revenues and rising AI-related investments.

Conversely, BMO Capital has initiated coverage on Advanced Micro Devices Inc. (AMD) with an ‘outperform’ rating and a price target of 550 USD. Analyst Harsh Kumar suggests AMD is undergoing a strategic shift from a component provider to a full-scale AI infrastructure provider. The bank highlighted the potential of the new Helios rack system to challenge competitors like NVIDIA at the system level within the growing AI data center market.