Kingsoft (3888) AI Stock Analysis

• Market Cap: $46.63B
• Dividend Yield: 0.48%
• Average Volume (3M): 18.49M
• Price to Earnings (P/E): 24.5
• Beta (1Y): 1.22
• Revenue Growth: -0.11%
• EPS Growth: 12.80%
• Country: HK
• Employees: 8,047
• Sector: Communication Services
• Sector Strength: 97
• Industry: Electronic Gaming & Multimedia
• EPS (TTM): 0.17
• Shares Outstanding: 1,400,425,800
• 10 Day Avg. Volume: 28,842,110
• 30 Day Avg. Volume: 18,494,799
• PEG Ratio: 0.12
• Price to Book (P/B): 1.96
• Price to Sales (P/S): 4.27
• P/FCF Ratio: 10.58
• Enterprise Value/Market Cap: 0.75
• Enterprise Value/Revenue: 3.38
• Enterprise Value/Gross Profit: 4.08
• Enterprise Value/Ebitda: 9.10
• 1Y Price Target: $40.23
• Price Target Upside: 38.73% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 62 Neutral
• Price Target: HK$30.00 ▲(3.45% Upside)

Kingsoft's overall stock score reflects a balance of strong financial health and operational efficiency against bearish technical indicators and a mixed earnings outlook. The company's robust office software growth is offset by challenges in the gaming segment and increased expenses, leading to a moderate valuation.

Positive Factors

Strong Financial Health

Kingsoft's strong financial health, highlighted by robust profitability margins and a solid balance sheet, provides a stable foundation for long-term growth and resilience against market fluctuations.

Growth in Office Software

The significant growth in the office software segment, driven by WPS software and services, indicates strong product demand and successful market penetration, supporting sustained revenue expansion.

Low Leverage

Kingsoft's minimal leverage, as indicated by its low debt-to-equity ratio, enhances financial flexibility and reduces risk, allowing for strategic investments and stability during economic downturns.

Negative Factors

Decline in Total Revenue

The decline in total revenue reflects challenges in maintaining growth momentum, potentially impacting the company's ability to invest in new opportunities and sustain long-term profitability.

Decrease in Online Games Revenue

The significant drop in online games revenue suggests competitive pressures and market saturation, which could hinder future growth and diversification efforts in this segment.

Increased Expenses

Rising expenses, particularly in R&D, may strain profitability if not matched by revenue growth, potentially affecting cash flow and investment capacity in the long term.

Kingsoft Business Overview & Revenue Model

Company Description

Kingsoft Corporation Limited (3888.HK) is a leading Chinese software and internet services company, primarily engaged in the development and provision of office productivity software, cloud services, and mobile applications. The company operates in several sectors, including software development, online gaming, and cloud computing, with core products such as WPS Office, a popular office suite; Kingsoft Cloud, which offers cloud computing solutions; and various online games that have garnered substantial user bases.

How the Company Makes Money

Kingsoft generates revenue through multiple streams, with significant contributions from its software licensing, cloud services, and online gaming sectors. The company's WPS Office suite earns money through subscription models, software sales, and advertisements. Kingsoft Cloud provides cloud infrastructure and services, generating revenue through usage-based billing and long-term contracts with enterprise clients. Additionally, its online gaming division earns from in-game purchases, subscriptions, and advertising. Partnerships with other tech firms and enterprises further enhance its revenue potential, along with continuous innovation and expansion into new markets.

Kingsoft Financial Statement Overview

Summary

Kingsoft demonstrates strong financial health with robust profitability margins and a solid balance sheet. While recent revenue and free cash flow declines pose challenges, the company maintains operational efficiency and low leverage, positioning it well for future growth opportunities.

Income Statement

Kingsoft's income statement shows strong gross profit margins consistently above 80%, indicating effective cost management. However, the recent TTM data reflects a slight revenue decline of 1.58%, contrasting with previous growth trends. Net profit margins have improved to 16.32% in the TTM, showing recovery from past losses. EBIT and EBITDA margins remain robust, suggesting operational efficiency.

Balance Sheet

The balance sheet is solid with a very low debt-to-equity ratio of 0.0013 in the TTM, indicating minimal leverage and financial stability. Return on equity has improved to 7.34%, reflecting better profitability. The equity ratio is strong, showcasing a well-capitalized position with a significant portion of assets funded by equity.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth by 8.47% in the TTM, which could be a concern. However, the operating cash flow to net income ratio is healthy at 0.77, indicating good cash generation relative to net income. The free cash flow to net income ratio of 0.88 suggests efficient cash conversion.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	10.35B	10.32B	8.53B	7.64B	6.37B	5.59B
Gross Profit	8.57B	8.58B	7.03B	6.18B	5.21B	4.68B
EBITDA	3.84B	3.83B	1.90B	1.65B	1.50B	2.67B
Net Income	1.69B	1.55B	483.46M	-6.05B	395.33M	10.05B
Balance Sheet
Total Assets	37.47B	38.28B	35.19B	31.89B	36.54B	35.04B
Cash, Cash Equivalents and Short-Term Investments	25.15B	26.58B	23.86B	21.33B	19.09B	17.96B
Total Debt	32.53M	3.02B	2.84B	2.80B	2.45B	2.42B
Total Liabilities	6.28B	9.87B	8.62B	7.73B	7.74B	6.82B
Stockholders Equity	25.12B	22.46B	21.29B	19.50B	24.78B	24.66B
Cash Flow
Free Cash Flow	3.41B	4.16B	3.01B	2.06B	1.92B	2.46B
Operating Cash Flow	3.88B	4.59B	3.49B	2.57B	2.22B	2.99B
Investing Cash Flow	181.50M	-8.52B	-6.48B	4.42B	-1.61B	-7.57B
Financing Cash Flow	-1.89B	-1.08B	655.86M	-619.04M	-479.61M	1.88B

Kingsoft Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 29.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:3888, the sentiment is Negative. The current price of 29 is below the 20-day moving average (MA) of 29.17, below the 50-day MA of 31.44, and below the 200-day MA of 35.44, indicating a bearish trend. The MACD of -0.82 indicates Negative momentum. The RSI at 43.33 is Neutral, neither overbought nor oversold. The STOCH value of 68.72 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:3888.

Kingsoft Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
2660	72 Outperform	HK$2.40B	7.21	12.02%	15.02%	-27.66%	-51.96%
0799	70 Outperform	$4.26B	7.43	17.91%	3.88%	4.02%	-23.98%
9626	65 Neutral	HK$93.72B	405.65	5.32%	―	16.59%	―
3888	62 Neutral	$46.63B	24.51	6.19%	0.48%	-0.11%	12.80%
2400	61 Neutral	HK$34.02B	22.49	57.06%	1.23%	51.87%	4031.49%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
0302	39 Underperform	HK$1.15B	-0.41	-57.29%	―	-36.80%	-666.80%

Kingsoft Corporate Events

Kingsoft Reports Decline in Q3 2025 Financials but Growth in WPS Office Users

Kingsoft Corporation Limited reported its unaudited financial results for the three months ending September 30, 2025, showing a decline in revenue and profits compared to the previous year. Despite a 17% year-on-year decrease in revenue and a 76% drop in operating profit, the company saw a 9% increase in the monthly active devices of WPS Office globally, indicating growth in its user base.

Kingsoft Establishes Nomination Committee to Strengthen Governance

Kingsoft Corporation Limited has announced the establishment of a Nomination Committee, which will be responsible for overseeing the nomination of board members. The committee is tasked with reviewing the board’s structure, identifying qualified candidates for directorships, assessing the independence of non-executive directors, and making recommendations on appointments and succession planning. This move is expected to enhance the company’s governance and strategic alignment.

Kingsoft Schedules Board Meeting to Review Quarterly Results

Kingsoft Corporation Limited has announced a board meeting scheduled for November 19, 2025, to review and approve the unaudited quarterly results for the period ending September 30, 2025. This meeting is crucial for stakeholders as it will provide insights into the company’s financial performance and strategic direction.

Kingsoft Office Reports Strong Financial Growth in 2025

Kingsoft Corporation Limited announced key financial results for its subsidiary, Beijing Kingsoft Office Software, Inc., for the nine months ending September 30, 2025. The report highlights a significant increase in revenue and profits, with revenue rising by 15.21% to RMB 4,178,385 thousand and net profit attributable to shareholders increasing by 13.32% to RMB 1,178,438 thousand. The company’s total assets grew by 4.53% compared to the end of last year, indicating a strong financial performance and positive cash flow from operations. These results suggest a robust market position and potential positive implications for stakeholders.