Chinese search engine group Baidu , said on Tuesday that the success of AI company DeepSeek had inspired it to embrace an open source model, under which the source code of its upcoming generative AI chatbot release will be publicly available.

Chinese internet giant Baidu said its core business saw declining profits in the fourth quarter as online marketing revenue growth slowed even as its AI cloud business grew.

The broader rally in Chinese tech stocks highlights how DeepSeek's cost-efficient model could spur developments in China's AI sector.

Chinese search engine giant Baidu said on Friday it would make its next-generation artificial intelligence model Ernie open-source from June 30, a major shift in strategy as competition heats up.

Asian equities were largely higher overnight despite the U.S. dollar strengthening overnight. Hong Kong led the push higher on very high volumes, the Philippines and Pakistan outperformed, while Mainland China underperformed after afternoon profit-taking.

Now, Baidu has finally bought the business, known as YY Live, after Beijing softened its stance towards the tech sector following a regulatory crackdown four years ago. JOYY had received about $1.86 billion in February 2021 as part of the original agreement and an additional cash of about $240 million on Tuesday.

From April 1, the Ernie Bot platform will be free to use and provide access to Baidu’s Ernie large language models.

Asian equities were mixed but mostly lower overnight as Korea and Japan outperformed and Hong Kong and Mainland China underperformed.

The Beijing-based internet company said Tuesday that fourth-quarter revenue fell 2.4%, better than analysts’ estimates.

Apple's leaning on companies including Chinese tech giants Alibaba and Baidu to adapt its artificial intelligence system to meet regulatory requirements, according to Bloomberg.

Baidu plans to launch its advanced AI model, Ernie 5.0, in the second half of 2025, offering it for free and aiming to compete with US companies.

The rise of China's DeepSeek AI model is boosting Chinese tech firms including Alibaba, Baidu, and Xiaomi.