Chinese internet search giant Baidu has taken a decisive step toward unlocking value from its artificial intelligence hardware ambitions, confirming that its AI chip unit Kunlunxin has confidentially filed for a listing on the Hong Kong stock exchange.
The Chinese search and AI giant said Kunlunxin submitted its application to the Hong Kong Exchanges and Clearing on January 1, laying the groundwork for a spin-off and separate public listing. While the offering size, valuation range, and timetable have yet to be finalized, the filing formalizes months of market expectations around Kunlunxin’s capital-raising plans.
Reuters previously reported that Kunlunxin was preparing for a Hong Kong IPO after a fundraising round that valued the business at about 21 billion yuan ($3 billion), suggesting that Baidu and its backers see growing investor appetite for domestic AI hardware platforms. The confidential filing route gives Baidu flexibility to test market sentiment while shielding sensitive financial and operational details during the early stages of the process.
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Kunlunxin was founded in 2012 as an internal Baidu unit focused on developing custom AI chips to support the company’s search, cloud computing, and artificial intelligence workloads. Over time, it evolved into a more independently run business, although Baidu has retained a controlling stake and said Kunlunxin will remain a subsidiary after the proposed spin-off.
That structure mirrors a broader trend among Chinese internet and technology groups, which are increasingly carving out capital-intensive hardware units to give them clearer governance, access to dedicated funding, and strategic focus. For Baidu, separating Kunlunxin also allows investors to more directly value its chip ambitions, which require sustained spending on research, manufacturing partnerships, and ecosystem development.
While Baidu remains Kunlunxin’s largest customer, the chipmaker has expanded external sales over the past two years, supplying processors to other technology companies and data-center operators. That shift is important in the context of an IPO, as it signals a move beyond captive demand toward a more diversified revenue base. It also positions Kunlunxin as a potential national supplier at a time when Chinese companies face uncertainty over access to advanced foreign chips.
The listing plan comes against the backdrop of escalating U.S. export controls on advanced semiconductors, which have limited Chinese firms’ access to high-performance AI processors from companies such as Nvidia. In response, Beijing has intensified policy support for domestic alternatives, encouraging investment, public listings, and consolidation across the chip sector.
Several Chinese AI and semiconductor firms have recently moved toward public markets. Earlier this week, AI startup MiniMax said it expects to raise up to HK$4.19 billion ($538 million) in its Hong Kong offering. Semiconductor designer Shanghai Biren Technology raised HK$5.58 billion in its IPO, according to exchange filings. Other chip specialists, including OmniVision Integrated Circuits and GigaDevice Semiconductor, have begun bookbuilding, each targeting roughly $600 million.
This wave of listings has helped revive Hong Kong’s equity capital markets. According to LSEG data, the city raised $36.5 billion from 114 new listings in 2025, its strongest year since 2021 and more than three times the $11.3 billion raised in 2024. The rebound reflects a combination of pent-up demand from issuers, improved liquidity, and renewed interest in Chinese technology assets after a prolonged downturn.
The IPO could provide fresh capital for Kunlunxin to accelerate chip design, expand production capacity through foundry partners, and invest in software ecosystems that support AI workloads. Competition in China’s AI chip market is intensifying, with players such as Huawei’s Ascend unit and a range of startups vying to fill the gap left by restricted U.S. exports. Sustained funding will be critical for Kunlunxin to keep pace in performance, energy efficiency, and developer adoption.
The move underscores what central AI infrastructure has become to Baidu’s long-term strategy. As generative AI applications proliferate across search, cloud services, and enterprise software, control over underlying hardware is increasingly viewed as a strategic advantage rather than a cost center. Spinning out Kunlunxin allows Baidu to pursue that ambition while sharing the financial burden with public-market investors.
Although the timeline remains uncertain, the confidential filing signals confidence that market conditions are supportive enough to move forward. If successful, Kunlunxin’s listing would add to a growing roster of Chinese AI and semiconductor companies turning to Hong Kong to fund the next phase of development, reinforcing the city’s role as a key financing hub for China’s technology ambitions.