KINGSOFT CLOUD (KC.US, 03896.HK) announced the issuance of 18.5 million ADS to enhance infrastructure upgrades and develop artificial intelligence businesses.

On April 16th, KINGSOFT CLOUD (KC.US, 03896.HK) announced that it will publicly issue 18,500,000 American Depositary Shares (ADS), with each ADS representing 15 ordinary shares of the company. At the same time, KINGSOFT CLOUD also granted the underwriters of the ADS the option to purchase additional American Depositary Shares within a 30-day period. Additionally, for the convenience of investors in both Hong Kong and the United States, investors can choose to trade ordinary shares on the Hong Kong Stock Exchange in this issuance instead of ADS. This financing received support from strategic shareholders. In addition to the above-mentioned number of shares issued, KINGOFT Group will subscribe for an additional 20% of the total issuance size (public offering portion + KINGOFT Group subscription portion). This not only reflects the support of eco-enterprises for the company's business development but also demonstrates shareholders' confidence in the long-term development of KINGSOFT CLOUD. This financing will enhance KINGSOFT CLOUD's financial strength, improve its capital structure, and help the company better seize growth opportunities. The announcement indicates that the proceeds from this ADS issuance by KINGSOFT CLOUD are planned to be used for investing in upgrading and expanding infrastructure, investing in technology and product development, and for general corporate and working capital purposes. Driven by the development of artificial intelligence, the cloud computing business is currently in a phase of rapid development. With over a decade of experience in cloud computing, KINGSOFT CLOUD has established a unique position in the industry and technological service first-mover advantage. As a result, in 2024, KINGSOFT CLOUD's business performance is strong, with total revenue for the year growing by over 10% year-on-year, and the revenue mix healthy, with AI billing revenue accounting for 34% of public cloud in Q4, a nearly 500% year-on-year growth, leading the industry. KINGSOFT CLOUD's high-quality and sustainable development strategy has achieved initial results, with annual gross profit margin increasing by over 5 percentage points year-on-year. The adjusted operating profit margin turned positive for the first time in Q4. This has laid a solid foundation for the continuous improvement of profitability in the future. Given the strong and highly visible market demand in the field of artificial intelligence, KINGSOFT CLOUD actively embraces artificial intelligence, continues to focus on core technology capacity building, and has fully upgraded its intelligent computing capability system around basic cloud, intelligent computation network, and intelligent computation platform. Currently, KINGSOFT CLOUD already supports DeepSeek-R1/V3 in public cloud scenarios and state-owned cloud/government cloud scenarios, and has completed adaptation of the full-blood version of DeepSeek based on domestically produced chips. As the only strategic cloud platform within the ecosystem, KINGSOFT CLOUD will continue to benefit from the demand increment brought by the ecosystem customers' artificial intelligence business layout. Guided by a high-quality sustainable development strategy, KINGSOFT CLOUD's business fundamentals have been comprehensively improved, and the business has entered a new development cycle. After this transaction, KINGSOFT CLOUD will continue to focus on high-quality business growth and create value for existing and new shareholders.