Options Bulls Blast 2 China Stock After Revenue Beats

Xpeng (XPEV) shares are surging, up 12.8% and on pace for their best day since February, after the China-based company reported narrower-than-expected quarterly losses and beat revenue expectations for Q1. Baidu (BIDU) also beat revenue expectations due to strength in AI cloud services but reversed earlier gains, last seen down 0.8%; options activity is high for both stocks, with traders targeting the weekly 5/23 $22-strike call for XPEV and the weekly 5/30 $100-strike call for BIDU.

Analysis

U.S.-listed shares of Xpeng Inc (XPEV) and Baidu Inc (BIDU), both China-based companies, exhibited divergent market reactions despite both reporting first-quarter revenue beats. Xpeng saw its shares surge 12.8% to $22.20, on track for its best day since February and trading at its highest level since March, driven by narrower quarterly losses and strong revenue. This upward movement is supported by a bounce off its 80-day moving average, with the stock having added 156% over the last 12 months and reportedly 89.6% higher in 2025. In contrast, Baidu, after initially gaining on the news of strong AI cloud services revenue, reversed to trade 0.8% lower at $88.61. Baidu's stock, while up 10.1% year-over-year, faces significant overhead pressure at the $95 level, which also approximates its 320-day moving average and has capped advances since late March, following a rebound from its April 9 two-year low of $74.71. Both equities are experiencing a substantial increase in options activity, trading at approximately eight times their intraday average volume. For Xpeng, the most active contract is the weekly 5/23 22-strike call, while for Baidu, it is the weekly 5/30 100-strike call, with new positions reportedly being opened at both, indicating heightened speculative interest.

Key Decisions for Investors

• Investors should note Xpeng's strong fundamental report and positive share price momentum, supported by its 80-day moving average, though continued outperformance may depend on sustaining levels above recent highs amidst high options volume targeting the $22 strike.
• For Baidu, while the Q1 revenue beat driven by AI cloud services is positive, the immediate challenge is the $95 resistance level and its 320-day moving average; a breakout above this could signal further upside, whereas continued rejection might indicate prolonged consolidation.
• The significant spike in options volume for both XPEV and BIDU suggests increased near-term volatility and speculative interest, warranting careful risk management and position sizing for investors considering exposure to these names.