(Yicai Global) June 28 -- Chinese tech giant Baidu has spun out its smart chip business to become an independent subsidiary ahead of its expected Kunlun 2 chip launch this year.

The subsidiary will be named Kunlun Chip Beijing Technology, according to business registration data. Ouyang Jian, chief chip architect, will serve the new unit as its chief executive.

Last March, the chip unit completed its first round of financing to reach a valuation of USD2 billion, the Beijing-based search engine behemoth said in its first-quarter earnings report. Currently, Baidu China has a 76 percent stake in the subsidiary, according to the registration.

The 7-nanometer Kunlun 2 is expected to be mass-produced in the second half of this year, and its computing power is expected to be three times higher than that of Kunlun 1, a Baidu executive told Yicai Global earlier. Kunlun 2 could be used in search, industrial internet, and intelligent transport, the person added.

Baidu revealed its first self-developed artificial intelligence chip, Kunlun 1, in 2018. It started mass-producing the technology last year. The chip is used in Baidu's search engine business and among cloud partners.

The tech titan's AI ambitions run deep. Baidu is developing a voice chip called Honghu, applicable to smart home, autonomous driving, and Internet of Things devices, Yicai Global learned. Last April, the company said it will work with partners to build an AI center by using Kunlun chips in central China’s Hubei province.

Editor: Emmi Laine, Xiao Yi