Baidu was tipped to expand its hardware portfolio, with voice assistant unit Xiaodu to introduce a smartphone in China sporting its AI technology later in the month, China Daily reported.

The internet giant released few details on the planned device: it will enter the fiercely competitive smartphone market at a time of sliding demand.

IDC senior analyst Guo Tianxiang told China Daily Xiaodu’s handset could target students and integrate Baidu’s capabilities in large language models, but noted it will be difficult for a newcomer to compete with established players.

In its 2022 earnings release, Baidu stated Xiaodu ranked top by smart speaker shipments in China in the first nine months of 2022, citing data from IDC, Strategy Analytics and Canalys.

Baidu makes smartwatches, earbuds, tablets and TVs, all running DuerOS, software Xiaodu developed for Baidu’s AI-powered voice assistant.

The company launched its generative AI product Ernie Bot in March, making its one of the first in China to join the crowd.

Smartphone shipments in China registered a fifth consecutive quarter of double-digit declines in Q1, data from IDC showed.