Kingsoft (3888) investor relations material

Executive summary

• Revenue for Q2 2026 rose 9% year-over-year to RMB2,510.4 million, with office software and services up 25% and online games down 15%.

• Operating profit increased 9% year-over-year to RMB418.7 million; adjusted net profit attributable to owners rose 37% to RMB330.5 million.

• For H1 2026, revenue grew 6% year-over-year to RMB4,927.1 million, with office software and services up 25% and online games down 19%.

• Profit attributable to owners for H1 2026 more than doubled year-over-year to RMB1,639.3 million.

Financial highlights

• Q2 2026 gross profit margin was 79%, down one percentage point year-over-year.

• R&D costs for Q2 2026 increased 9% year-over-year to RMB930.9 million, reflecting continued AI investment.

• Adjusted net profit margin for Q2 2026 was 13%, up from 10% in Q2 2025.

• H1 2026 adjusted net profit attributable to owners was RMB580.6 million, down 13% year-over-year.

• Cash resources at end of Q2 2026 totaled RMB27,156.6 million.

Outlook and guidance

• AI remains the core strategic direction, with ongoing investment in AI-driven product innovation across office, games, and cloud.

• Office business to focus on AI-native products and commercialization; online games to prioritize core IPs and ecosystem development.

• Cloud business to enhance AI computing power and expand customer base, leveraging ecosystem synergies.