Daily Management Review

Chinese Tech Companies Surge Ahead Despite Regulatory Crackdown


Chinese Tech Companies Surge Ahead Despite Regulatory Crackdown
At the end of a Series B financing round, the market value of the artificial intelligence (AI) voice assistant Xiaodu Technology, owned by Chinese tech giant Baidu Inc, was fixed at $5.1 billion, the Chinese tech giant said on Tuesday,.
This successful funding round was conducted in the backdrop of severe regulatory crackdown in China on the domestic tech companies which has caused an upheaval in many sectors including as e-commerce, ride-hailing and cryptocurrency.
DuerOS, a voice assistant system that is based on artificial intelligence that supports television, speakers and other smart home appliances, has been developed by Xiaodu. Its earlier funding round was in November of 2020, when it successfully completed its Series A funding and had achieved a post-money valuation of $2.9 billion, Baidu said.
The artificial intelligence based chip unit Kunlun of Baidu had earlier this year successfully completed a round of fundraising, Baidu had announced in March this year, which had valued the firm at about $2 billion, according to ot reports quoting information from sources with direct knowledge of the matter.
Baidu would remain a majority shareholder in Xiaodu Technology, the company said on Tuesday that after the transaction.
On the other hand, consumers in China continued to shop online during the second quarter even months after pandemic induced restrictions were eased in the country which prompted the Chinese e-commerce platform Pinduoduo Inc to report a quarterly profit on Tuesday.
Founded in 2015, the business approach of mixing social media with online shopping to offer attractive discounts to consumers has made Pinduoduo a competitive player in China's burgeoning e-commerce sector.
The strong quarterly results reported by the company also comes as a relief for investors in the wake of strict clamp down and greater scrutiny of domestic Chinese tech companies by the regulators of the country over concerns of data privacy and security and anti-competitive practices followed by them.
A net income attributable to ordinary shareholders of 2.41 billion yuan was posted by the interactive shopping platform compared to a net loss of 899.3 million yuan for the same quarter a year ago.
The company reported total revenue of 23.05 billion yuan ($3.56 billion) for its second quarter ended June 30, which was below analysts’ estimates of 26.44 billion yuan, according to Refintiv-IBES data.