Kuaishou Technology’s Q1 2025 Earnings: Growth and AI Success

Kuaishou Technology Class B ((HK:1024)) has held its Q1 earnings call. Read on for the main highlights of the call.

Kuaishou Technology’s Q1 2025 earnings call painted a generally positive picture, underscoring substantial revenue growth, successful AI integration, and the first operational profit from its overseas ventures. Despite facing increased expenses and challenges in consumer demand, the company’s strategic initiatives and technological advancements suggest a promising future.

Record Revenue and Profit

Kuaishou Technology reported a notable increase in total revenue for Q1 2025, achieving a 10.9% year-on-year growth to RMB32.6 billion. The company also recorded an adjusted net profit of RMB4.6 billion, marking a 14% adjusted net margin. This financial performance underscores Kuaishou’s robust revenue-generating capabilities and efficient cost management.

Overseas Business Achievement

In a significant milestone, Kuaishou’s overseas business delivered its first-ever quarter of operating profit in Q1 2025. Revenue from overseas operations rose by an impressive 32.7% to RMB1.32 billion, highlighting the company’s successful international expansion strategy.

AI Integration and Growth

Kuaishou’s integration of AI technology has proven to be a key growth driver, generating RMB150 million in revenue in Q1. The AI initiatives have enhanced operational efficiency and user engagement across various business segments, with significant contributions from consumer subscriptions and corporate clients.

E-commerce Growth

The company’s e-commerce segment experienced a healthy growth trajectory, with GMV increasing by 15.4% year-on-year to RMB332.3 billion. The number of e-commerce monthly average active paying users reached 135 million, reflecting Kuaishou’s strong position in the digital commerce space.

Live Streaming Revenue Increase

Kuaishou’s live streaming revenue returned to positive growth, increasing by 14.4% year-on-year to RMB9.8 billion. This rebound indicates a revitalization of user engagement and monetization in the live streaming sector.

Increased Expenses

The company reported a rise in expenses, with R&D costs increasing by 16% year-on-year to RMB3.3 billion and administrative expenses surging by 79.2% to RMB828 million. These increased expenses reflect Kuaishou’s commitment to innovation and operational expansion.

Lower Consumer Demand

Despite the positive financial results, Kuaishou acknowledged ongoing challenges in consumer demand, which could potentially impact future growth. The company remains vigilant in addressing these challenges through strategic initiatives.

Forward-Looking Guidance

Kuaishou Technology’s forward-looking guidance remains optimistic, driven by robust financial performance and strategic AI integration. The company reported a record average daily active users (DAUs) of 408 million and a gross profit margin nearing 55%. Kling AI continues to be a key growth driver, maintaining global leadership in technology and commercialization. The overseas business’s first operating profit and a 15.4% year-on-year GMV growth to RMB332.3 billion further bolster the company’s future prospects.

In conclusion, Kuaishou Technology’s Q1 2025 earnings call highlighted a positive outlook, with significant achievements in revenue growth, AI integration, and international expansion. Despite challenges in consumer demand and increased expenses, the company’s strategic focus on AI and e-commerce positions it well for future success.