Kingsoft Cloud Holdings Ltd (3896) AI Stock Analysis

• Market Cap: HK$28.87B
• Dividend Yield: N/A
• Average Volume (3M): 111.61M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.26
• Revenue Growth: 23.85%
• EPS Growth: 55.65%
• Country: HK
• Employees: 12,335
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.00
• Shares Outstanding: 4,531,784,700
• 10 Day Avg. Volume: 82,679,101
• 30 Day Avg. Volume: 111,609,710
• PEG Ratio: 0.60
• Price to Book (P/B): 2.63
• Price to Sales (P/S): 1.74
• P/FCF Ratio: -4.45
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: HK$9.56
• Price Target Upside: 49.61% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 51 Neutral
• Price Target: HK$7.50 ▲(17.37% Upside)

Kingsoft Cloud Holdings Ltd's overall stock score is driven by strong revenue growth and positive earnings call highlights, particularly in AI and cloud segments. However, financial performance is hindered by profitability challenges and high leverage. Technical indicators suggest bearish momentum, and valuation metrics indicate the stock may be overvalued.

Positive Factors

AI-Driven Success

The significant growth in AI billings highlights Kingsoft Cloud's strong position in the AI sector, which is expected to drive long-term demand and revenue growth as AI adoption continues across industries.

Xiaomi and Kingsoft Ecosystem

The robust growth from strategic partnerships with Xiaomi and Kingsoft enhances Kingsoft Cloud's ecosystem, providing a competitive edge and diversified revenue streams, supporting sustainable growth.

Public Cloud Revenue Growth

Strong growth in public cloud revenue underscores Kingsoft Cloud's effective market penetration and service expansion, positioning it well for continued success in the expanding cloud services market.

Negative Factors

Gross Margin Pressure

Ongoing pressure on gross margins due to high service costs and price competition may impact profitability, challenging Kingsoft Cloud's ability to maintain cost efficiency and margin stability.

High CapEx and Indebtedness

Substantial capital expenditures and rising indebtedness could strain financial resources, limiting flexibility for future investments and potentially affecting long-term financial health.

Supply Chain Uncertainty

Geopolitical tensions affecting chip supply pose a risk to Kingsoft Cloud's operations, potentially disrupting service delivery and increasing costs, impacting long-term strategic planning.

Kingsoft Cloud Holdings Ltd Business Overview & Revenue Model

Company Description

Kingsoft Cloud Holdings Ltd (3896) is a leading cloud service provider in China, specializing in providing a wide range of cloud computing services and solutions to businesses of all sizes. The company operates in various sectors, including public cloud, private cloud, and hybrid cloud services, and offers core products such as cloud storage, cloud databases, artificial intelligence, and big data analytics. Kingsoft Cloud aims to empower enterprises by delivering scalable, secure, and efficient cloud solutions that enhance productivity and drive digital transformation.

How the Company Makes Money

Kingsoft Cloud generates revenue primarily through its cloud computing services, which include infrastructure as a service (IaaS), platform as a service (PaaS), and software as a service (SaaS) offerings. Key revenue streams include subscription fees from cloud services, usage-based charges for storage and computing power, and additional fees for value-added services such as data analytics and security solutions. The company has established significant partnerships with other technology firms and enterprises, which contribute to its customer base and revenue growth. Additionally, Kingsoft Cloud benefits from the increasing demand for cloud services in China as businesses shift towards digital solutions, providing a favorable environment for revenue expansion.

Kingsoft Cloud Holdings Ltd Financial Statement Overview

Summary

Kingsoft Cloud Holdings Ltd shows positive trends in revenue and cash flow growth, but profitability remains a challenge. High leverage and negative returns on equity highlight financial risks. Improvements are noted, but profitability issues need addressing.

Income Statement

Kingsoft Cloud Holdings Ltd has shown a modest revenue growth rate of 6.87% in the TTM period, indicating some recovery. However, the company continues to struggle with profitability, as evidenced by negative net profit margins (-10.78%) and EBIT margins (-8.34%). The gross profit margin is relatively low at 16.21%, suggesting challenges in cost management. Overall, while there is some revenue growth, the persistent losses and low margins weigh down the income statement's performance.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio of 1.30, indicating significant leverage, which could pose risks if not managed properly. The return on equity is negative (-16.46%), reflecting ongoing losses. However, the equity ratio stands at 26.28%, suggesting a reasonable proportion of equity financing. The balance sheet reflects a mixed picture with high leverage but a decent equity base.

Cash Flow

The cash flow statement reveals a strong free cash flow growth rate of 80.87% in the TTM period, a positive sign of improving cash generation. The operating cash flow to net income ratio is 0.32, indicating some ability to convert income into cash. However, the free cash flow to net income ratio is negative (-0.10), highlighting ongoing challenges in profitability. Overall, the cash flow statement shows improvement but still faces profitability hurdles.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.02B	7.79B	7.05B	8.18B	9.06B	6.58B
Gross Profit	1.46B	1.34B	850.17M	429.54M	351.29M	356.98M
EBITDA	1.59B	443.80M	-1.08B	-1.37B	-668.37M	-449.21M
Net Income	-972.95M	-1.97B	-2.18B	-2.66B	-1.59B	-962.20M
Balance Sheet
Total Assets	25.65B	17.59B	15.07B	17.32B	21.08B	11.96B
Cash, Cash Equivalents and Short-Term Investments	3.95B	2.74B	2.26B	4.67B	6.71B	6.12B
Total Debt	8.75B	5.91B	1.72B	1.69B	1.62B	612.27M
Total Liabilities	18.58B	12.09B	7.82B	7.73B	9.59B	3.72B
Stockholders Equity	6.74B	5.17B	6.89B	8.80B	10.60B	8.24B
Cash Flow
Free Cash Flow	3.33B	-3.05B	-2.13B	-1.25B	-1.44B	-1.88B
Operating Cash Flow	3.33B	628.42M	-169.07M	188.97M	-708.87M	-290.43M
Investing Cash Flow	-5.44B	-3.62B	-673.19M	-32.87M	-421.62M	-4.31B
Financing Cash Flow	4.47B	3.26B	-227.85M	-1.15B	2.21B	6.12B

Kingsoft Cloud Holdings Ltd Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.39
• 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:3896, the sentiment is Negative. The current price of 6.39 is above the 20-day moving average (MA) of 6.20, below the 50-day MA of 6.98, and below the 200-day MA of 7.45, indicating a bearish trend. The MACD of -0.14 indicates Negative momentum. The RSI at 42.14 is Neutral, neither overbought nor oversold. The STOCH value of 55.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HK:3896.

Kingsoft Cloud Holdings Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
0536	72 Outperform	€826.42M	9.95	23.35%	9.71%	-6.93%	-18.99%
9899	62 Neutral	HK$50.86B	17.85	24.41%	―	-4.23%	108.65%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
1675	61 Neutral	€8.36B	19.19	6.90%	3.13%	-17.90%	56.67%
0863	59 Neutral	HK$13.26B	421.46	4.01%	―	115.40%	―
3896	51 Neutral	HK$28.87B	-10.89	-15.93%	―	23.85%	55.65%
0909	43 Neutral	HK$6.17B	-92.46	-1.31%	3.17%	-17.48%	83.80%

Kingsoft Cloud Holdings Ltd Corporate Events

Kingsoft Cloud Grants Over 16 Million RSUs to Employees

Kingsoft Cloud Holdings Ltd announced the grant of 16,205,511 restricted share units (RSUs) to 352 employees under its 2021 Share Incentive Plan. This grant represents approximately 0.36% of the company’s total issued shares. The RSUs will vest over a period from the first to the third anniversary of the vesting commencement date, with some having a shorter vesting period. The company has implemented a clawback mechanism for the RSUs in cases of misconduct or breach of the incentive plan.

The most recent analyst rating on (HK:3896) stock is a Hold with a HK$7.50 price target. To see the full list of analyst forecasts on Kingsoft Cloud Holdings Ltd stock, see the HK:3896 Stock Forecast page.

Kingsoft Cloud Completes HK$2.8 Billion Share Placement to Boost AI and Cloud Services

Kingsoft Cloud Holdings Ltd has successfully completed the placement of 338 million new shares, raising approximately HK$2.8 billion. The proceeds will be used to support the company’s AI business and enhance its cloud service capabilities, as well as for general corporate purposes. This strategic move aims to strengthen Kingsoft Cloud’s market position in the cloud computing industry by expanding its infrastructure and service offerings.

The most recent analyst rating on (HK:3896) stock is a Buy with a HK$11.00 price target. To see the full list of analyst forecasts on Kingsoft Cloud Holdings Ltd stock, see the HK:3896 Stock Forecast page.

Kingsoft Cloud Announces Strategic Share Placement to Boost AI and Cloud Services

Kingsoft Cloud Holdings Ltd has announced a placement of 338,000,000 new shares under a general mandate, representing approximately 8.06% of the existing issued shares. The shares are priced at HK$8.29 each, reflecting a discount to recent market prices. The proceeds from this placement are intended to support the company’s AI business expansion and enhance its cloud service capabilities, with 80% allocated to these efforts and the remaining 20% for working capital and other corporate purposes. This strategic move is expected to bolster Kingsoft Cloud’s market position in the cloud computing industry.

The most recent analyst rating on (HK:3896) stock is a Buy with a HK$11.00 price target. To see the full list of analyst forecasts on Kingsoft Cloud Holdings Ltd stock, see the HK:3896 Stock Forecast page.

Kingsoft Cloud Announces New Share Placement to Boost AI and Cloud Services

Kingsoft Cloud Holdings Ltd has announced a proposed placement of 282 million new shares to non-U.S. persons in offshore transactions, with Morgan Stanley Asia Limited as the placing agent. The proceeds from this placement will primarily support the company’s AI business expansion and infrastructure enhancement, with a smaller portion allocated to working capital and other corporate purposes. This strategic move aims to strengthen Kingsoft Cloud’s market position in the cloud services industry.

The most recent analyst rating on (HK:3896) stock is a Buy with a HK$11.00 price target. To see the full list of analyst forecasts on Kingsoft Cloud Holdings Ltd stock, see the HK:3896 Stock Forecast page.