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How Baidu Got a Piece of Walmart’s Business

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Jan. 21 2019, Updated 10:30 a.m. ET

Baidu’s Apollo to power Walmart’s autonomous delivery fleet

Baidu’s (BIDU) technology has been adopted to power the driverless vans that will be used to deliver groceries to Walmart (WMT) customers in parts of the United States, CNN has reported.

Udelv, a California-based developer of self-driving vehicles, is working with Walmart on a pilot program involving the delivery of fresh groceries to customers using self-driving vans. The fleet of vans that Udelv will use for the Walmart delivery pilot is based on Baidu’s open-source autonomous driving platform known as Apollo.

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Exporting self-driving buses to Japan

Baidu created Apollo to help speed up its development of self-driving vehicles. Baidu itself developed a self-driving shuttle bus called Apolong, which it hopes to start exporting to Japan in partnership with SoftBank (SFTBY) this year, according to a report by the Nikkei Asian Review. Alibaba (BABA) and Tencent (TCEHY) are other Chinese technology companies that are developing self-driving vehicles as they seek to create new revenue sources.

In addition to Udelv, Walmart is working with Ford Motor Company (F) on a pilot program that involves the use of self-driving vehicles to deliver packages to customers. Ford is one of Baidu’s self-driving associates, suggesting that its partnership with Walmart could unlock more business opportunities for Baidu with the American retailer.

Baidu’s revenue jumped 27%

Baidu currently relies on advertising for the majority of its revenue. Baidu’s revenue rose 27% YoY (year-over-year) to $4.1 billion in the third quarter of 2018. Yandex (YNDX), Facebook (FB), and Alphabet (GOOGL), three other mostly ad-funded companies, grew their revenues 39%, 33%, and 21% YoY, respectively, in the quarter.

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