Chinese tech heavyweight Baidu Inc will roll out the latest version of its large language model, Ernie 4.0 — seen as a potential rival to ChatGPT — by the end of this year, and further intensify its efforts in generative artificial intelligence technology, said the company's top executive.

The company unveiled its LLM Ernie 3.5 last quarter, and it has been embedding the Ernie AI model into its products, including search engines and the online marketing business, said Robin Li, co-founder and CEO of Baidu, during an earnings conference call with investors on Tuesday.

"Generative AI and large language models hold immense transformative power in numerous industries, presenting a significant market opportunity for us," Li said, while emphasizing that Baidu is committed to building new growth momentum around generative AI and LLMs to drive sustainable long-term development.

Generative AI refers to algorithms that are trained with huge amounts of data and are capable of generating content such as images, text, audio and video. It is the key technology underpinning ChatGPT, an AI chatbot developed by US-based AI research company OpenAI.

Li said the company is still awaiting Chinese regulatory approval for large-scale rollout of its Ernie bot to the public, but "we have observed that the Chinese government has been increasingly supportive of the development of generative AI and LLM".

Last month, Chinese authorities issued a 24-item guideline for managing generative AI services. The country will encourage the innovative development of generative AI and supervise the technology using methods compatible with innovation and development, according to interim measures.

Li said he is quite optimistic about the future of the regulatory environment in China. Moreover, Baidu is working hard to build Ernie-powered applications and solutions for different industries and scenarios, and empower more enterprises to create industry-specific AI models and applications, he added.

Luo Rong, chief financial officer of Baidu, said the company has invested in AI for over a decade and is well-positioned to capitalize on opportunities arising from generative AI and LLM. Looking ahead, Baidu will continue to steadfastly invest in AI, LLMs and generative AI, in particular during the upcoming quarters, Luo said.

Pan Helin, co-director of the Digital Economy and Financial Innovation Research Center at Zhejiang University's International Business School, said the process of training large AI models necessitates higher requirements for computing capacity and algorithms, while Baidu has accumulated some advantages in comprehensive AI technological capabilities, such as algorithm models, innovation capability and industrial coverage.

Pan said Chinese AI companies should pool more resources into improving computing power, algorithms and quality of data, and ramp up investment in basic scientific research to gain a competitive edge in the global AI chatbot race.

Baidu reported on Tuesday that its revenue reached 34.1 billion yuan ($4.7 billion) during the April-June period, an increase of 15 percent year-on-year. Its non-GAAP (generally accepted accounting principles) net profit stood at 8.0 billion yuan in the second quarter, surging 44 percent year-on-year.

As of May, China had developed at least 79 AI LLMs, according to a report released by the Institute of Scientific and Technical Information of China.