Kingsoft Cloud Holdings Ltd (3896) AI Stock Analysis

• Market Cap: HK$32.40B
• Dividend Yield: N/A
• Average Volume (3M): 111.61M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.25
• Revenue Growth: 23.96%
• EPS Growth: 55.68%
• 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$9.55
• Price Target Upside: 33.57% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 54 Neutral
• Price Target: HK$7.50 ▲(4.90% Upside)

Overall score reflects improving cash flow and modest revenue growth but persistent losses and high leverage (largest negative factor). Technicals are supportive with strong upward momentum, though elevated RSI suggests near-term extension. Valuation provides limited support given negative earnings and no dividend yield data.

Positive Factors

Improving free cash flow

An 80.87% TTM free cash flow surge signals materially improving cash generation. Durable FCF growth can fund AI infrastructure, working capital and operating needs, lower reliance on dilutive financing, and provide buffer during scaling toward sustained profitability.

AI business contribution

AI contributing ~31% of public cloud revenue (RMB362m) shows a structural shift to higher-value services. A growing AI mix can improve long-term ARPU, drive product differentiation versus commodity IaaS, and support higher margins if the company scales its AI offerings and wins enterprise workloads.

Directed capital to AI

Management earmarked 80% of an HK$2.802B placing to expand AI capabilities, reflecting a strategic, durable capital allocation. Directed funding for infrastructure and service enhancement can accelerate capture of AI-driven demand and shorten the timeline to higher-margin AI offerings.

Negative Factors

Persistent negative profitability

Sustained negative net and EBIT margins and a negative ROE reflect an ongoing inability to translate revenue into profit. Structurally, this limits internal funding for expansion, raises the need for external capital, and means the company must materially improve margins or scale to achieve durable profitability.

High leverage

A debt-to-equity ratio of 1.30 denotes elevated leverage for a growth cloud provider. High leverage raises interest and refinancing risk, reduces financial flexibility for capex or pricing competition, and increases the chance of dilution or constrained investment if cash flows underperform expectations.

Low gross margin

A 16.21% gross margin in cloud services suggests heavy infrastructure or pass-through costs and limited pricing power. Structurally low gross margins compress operating leverage, making it harder for revenue growth to translate into profitable EBITDA without meaningful cost efficiency gains or a shift to higher-margin services.

Kingsoft Cloud Holdings Ltd Business Overview & Revenue Model

Company Description

Kingsoft Cloud Holdings Limited provides cloud services to businesses and organizations in China. The company's products portfolio includes cloud products, including infrastructure as a service (IaaS) infrastructure, platform as a service (PaaS) middleware, and software as a service (SaaS) applications that primarily consist of cloud computing, storage, and delivery solutions. It offers research and development services, as well as enterprise digital solutions and related services. The company also provides public cloud services to customers in various verticals, including video, game, entertainment, e-commerce, education, traveling, advertising, intelligent mobility, office automation, artificial intelligent, and mobile internet; and enterprise cloud services to customers in financial service, public service, and healthcare businesses. Kingsoft Cloud Holdings Limited was incorporated in 2012 and is headquartered in Beijing, the People's Republic of China.

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

Mixed fundamentals: modest TTM revenue growth (6.87%) and strong free cash flow growth (80.87%), but profitability remains weak with negative net margin (-10.78%), negative EBIT margin (-8.34%), and negative ROE (-16.46%). Leverage is elevated (debt-to-equity 1.30), adding financial risk despite a reasonable equity ratio (26.28%).

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: Positive
• Last Price: 7.15
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• 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 Positive. The current price of 7.15 is above the 20-day moving average (MA) of 6.48, above the 50-day MA of 6.20, and above the 200-day MA of 6.92, indicating a bullish trend. The MACD of 0.36 indicates Negative momentum. The RSI at 60.21 is Neutral, neither overbought nor oversold. The STOCH value of 73.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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	HK$858.20M	10.33	23.35%	9.81%	-6.93%	-18.99%
1675	71 Outperform	HK$8.07B	18.52	6.90%	3.47%	-17.90%	56.67%
9899	62 Neutral	HK$38.04B	13.34	24.41%	―	-4.23%	108.65%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
0863	61 Neutral	HK$13.32B	423.23	4.01%	―	115.40%	―
3896	54 Neutral	HK$32.40B	-26.31	-15.92%	―	23.96%	55.68%
0909	43 Neutral	HK$5.83B	-87.43	-1.31%	3.10%	-17.48%	83.80%

Kingsoft Cloud Holdings Ltd Corporate Events

Kingsoft Cloud Grants RSUs Equal to 0.10% of Share Capital to 104 Employees

Kingsoft Cloud Holdings Limited has granted 4,402,557 restricted share units (RSUs), equivalent to about 0.10% of its issued share capital or roughly 293,503 ADSs, to 104 employees under its 2021 Share Incentive Plan. The awards, priced at US$0.01 per share, feature varying vesting schedules ranging from one to five years, with some tranches having vesting periods of less than 12 months to align with the company’s centralized grant calendar, and are not tied to performance targets; a clawback mechanism allows the board to cancel or reclaim awards and related shares in cases of misconduct, termination for cause, or regulatory penalties, underscoring tighter governance around equity incentives and employee alignment with shareholder interests.

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 Updates Nomination Committee Charter to Strengthen Board Governance

Kingsoft Cloud Holdings Ltd has amended its Nomination Committee Charter, emphasizing the importance of evaluating and recommending board candidates to align with the company’s corporate strategy. The committee will focus on maintaining a diverse and independent board, ensuring effective governance and strategic oversight, which could enhance the company’s market positioning and stakeholder confidence.

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 Releases Q3 2025 Financial Results

Kingsoft Cloud Holdings Limited announced its unaudited financial results for the third quarter ending September 30, 2025. The results, prepared in accordance with U.S. GAAP, highlight the company’s financial performance and are intended to comply with both U.S. and Hong Kong regulatory requirements. The announcement may impact stakeholders’ perception of the company’s financial health and strategic direction.

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.