Q4 2025 Kingsoft Cloud Holdings Ltd Earnings Call Transcript
Key Points
- Kingsoft Cloud Holdings Ltd (KC) achieved a historical high quarterly revenue of RMB2.76 billion, marking a 22% year-over-year growth.
- Revenues from public cloud services increased by 35% to RMB1.9 billion, driven by strong demand for intelligent computing services.
- The company reported a significant 95% year-over-year growth in AI business gross billing, contributing 49% of public cloud services revenue.
- Profitability improved with an adjusted gross margin of 17.1% and an adjusted operating margin of 2.0%, achieving operating level profitability for two consecutive quarters.
- KC's ecosystem partnerships, particularly with Xiaomi and Kingsoft, remain strong, with related party transactions reaching 94% of the net annual cap for 2025.
- Total cost of revenues increased by 27% year-over-year, primarily due to investments in infrastructure to support intelligent cloud business growth.
- Depreciation and amortization costs rose significantly due to newly acquired and leased servers and network equipment.
- The sequential decrease in adjusted EBITDA margin was attributed to a high baseline set by a one-time recurring subsidiary received in the previous quarter.
- Despite strong revenue growth, the adjusted operating profit margin was only 2%, indicating room for improvement in profitability.
- The company faces challenges from market uncertainties and supply chain dynamics, which could impact future growth and profitability.
Good day, and thank you for standing by. Welcome to the Kingsoft Cloud's fourth-quarter and full-year 2025 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded.
I would now like to hand the conference over to your speaker today, Nicole Shan, IRD of Kingsoft Cloud. Please go ahead.
Thank you, operator. Hello, everyone, and thank you for joining us today. Kingsoft Cloud's fourth quarter and fiscal year 2025 earnings release was distributed earlier today and is available on our IR website at ir.ksyun.com as well as on PR Newswire services.
On the call today from Kingsoft Cloud, we have our Chairman and CEO, Mr. Zou tao; CFO, Li Yi; Senior Vice President, Mr. Liu Tao; Senior Vice President, Mr. He Haijian; Vice President, Ms. [Wang Ja]; and Associate Vice President, Mr. Kaiyan Tian. Mr. Zou will review our business strategies, operations and other company highlights, followed by Ms. Li, who will discuss the financial
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