Kingsoft Cloud Holdings reported second-quarter 2026 revenue of CNY 3.07 billion, a 31% increase from the same period last year and a 40% rise from the prior quarter. The figure exceeded the CNY 2.678 billion forecast, marking the first time quarterly revenue surpassed CNY 3 billion. Shares of the Hong Kong-listed company fell 4.75% to $5.62 in after-hours trading, following a prior close of $5.90.
Public cloud revenue reached CNY 2.36 billion, up 45% year-over-year, while enterprise cloud revenue declined 1% to CNY 740 million. AI cloud gross billings surged 82% to CNY 1.33 billion, accounting for 56% of public cloud revenue compared with 31% a year earlier. Model-as-a-Service revenue expanded more than twelvefold from the first quarter.
Adjusted gross margin improved to 15.4%, up 2.4 percentage points from the prior quarter. The company posted its first adjusted operating profit of CNY 124 million, compared with a loss of CNY 166 million a year ago. Adjusted operating margin stood at 4.0%, narrowing from -7.1% in the second quarter of 2025 and -2.2% in the first quarter of 2026. Adjusted net loss narrowed sharply to CNY 6 million from CNY 300 million a year earlier, while non-GAAP EBITDA rose 171% to CNY 1.1 billion.
Chairman and CEO Zou Tao highlighted the growth of the open-source model ecosystem as a driver for neutral cloud providers. CFO Li Yi noted that fixed costs are being diluted as the AI business scales. The company maintained its full-year 2026 capital expenditure plan at CNY 15 billion, with CNY 6.2 billion spent in the first half, exceeding 75% of the annual target.
Ecosystem revenue from Xiaomi and Kingsoft reached CNY 810 million, up 28% year-over-year and representing 26% of total revenue. Revenue from the top five non-ecosystem customers increased 51% year-over-year. In June, shareholders approved raising the annual caps for connected transactions with Xiaomi to CNY 10 billion for 2026 and 2027, a 39% increase from prior limits.
The company reported earnings per share of -$0.0233 for the quarter.
