Yahoo Finance

• Total Revenue: RMB2.2321 billion, a 29.6% year-over-year increase.

• Public Cloud Revenue: RMB1.4098 billion, up 34% year over year.

• Enterprise Cloud Revenue: RMB822.3 million, up 22.7% year over year.

• Non-GAAP Operating Profit: Turned positive for the first time, with a margin of 1.1%.

• Non-GAAP Gross Profit: RMB427.7 million, up 63% year over year.

• Non-GAAP Gross Margin: 19.2%.

• Non-GAAP EBITDA Margin: 16.1%, a year-over-year increase of 17.7 percentage points.

• AI-Related Business Revenue: RMB474 million, nearly 500% year-over-year growth.

• Revenue from Xiaomi Kingsoft Ecosystem: RMB493 million, up 78% year over year.

• Cash and Cash Equivalents: RMB2.6488 billion as of December 31, 2024.

• Operating Cash Flow: Net inflow of RMB570.2 million.

• Warning! GuruFocus has detected 3 Warning Signs with KC.

Release Date: March 19, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Kingsoft Cloud Holdings Ltd (NASDAQ:KC) achieved a significant milestone by turning non-GAAP operating profits positive for the first time since its inception in 2012.

• The company reported a 30% year-over-year increase in total revenue for Q4 2024, reaching RMB2.23 billion, outpacing other listed public internet cloud companies.

• AI-related business saw substantial growth, with gross billing increasing by nearly 500% year-over-year, contributing 34% to public cloud revenue.

• Revenues from the Xiaomi Kingsoft ecosystem increased by 78% year-over-year, highlighting strong strategic partnerships and growth potential.

• The company has made significant advancements in AI, with AI-related business contributing significantly to revenue and positioning Kingsoft Cloud as a leader in the AI cloud computing industry.

Negative Points

• Despite the positive financial performance, Kingsoft Cloud Holdings Ltd (NASDAQ:KC) faces challenges in scaling AI inference demand outside the Xiaomi and Kingsoft ecosystem.

• The company has not yet seen large-scale single customer demands for AI services, which could impact future revenue growth.

• There are concerns about the potential impact of stringent supply-side restrictions on the company's capital expenditure plans.

• The pricing strategy for AI-related services remains sensitive and confidential, which may create uncertainty for investors.

• The company is still in the early stages of transitioning from traditional IT cloud services to AI cloud and solution services, which may involve risks and challenges.

Q & A Highlights

Q: Could management share views on how recent AI trends are impacting the cloud computing industry and what opportunities and challenges Kingsoft Cloud faces? Also, provide an update on the 2025 capital expenditure plan. A: (Tao Zou, CEO) The AI advancements, particularly with DeepSeek, have proven that Chinese tech companies can achieve global impact, benefiting Kingsoft Cloud by reducing deployment costs and increasing share value. AI has removed the glass ceiling for cloud businesses, accelerating large language model deployment in China. (Haijian He, CFO) Our AI investment is split between operational expenses and capital expenditures. We've spent RMB8-10 billion in the past year, and expect to continue significant investment in 2025, supported by partnerships and alternative financing arrangements.