Kingsoft Cloud Holdings Limited (KC): Business Model Canvas [Dec-2025 Updated]

You're digging into the mechanics of Kingsoft Cloud Holdings Limited (KC)'s business model right now, and honestly, the story isn't just about cloud infrastructure anymore; it's about the AI payoff. After years of heavy investment-you can see the high cost of revenues driven by AI computing resources-the focus has clearly shifted to monetizing that tech. For instance, looking at Q3 2025, the Intelligent Computing Cloud segment is a major driver, sitting alongside Public Cloud Services which brought in RMB1,752.3 million. We need to see exactly how their key partnerships, like the one with Xiaomi-Kingsoft, translate this infrastructure spend into sustainable profit, so let's break down the nine essential blocks of their strategy below.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Key Partnerships

You're looking at the critical external relationships that power Kingsoft Cloud Holdings Limited (KC)'s growth engine, especially as AI adoption accelerates. These aren't just casual agreements; they are deep, multi-year commitments that secure resources and channels. Honestly, the numbers coming out of the Xiaomi-Kingsoft ecosystem are the clearest indicator of this segment's health.

Xiaomi-Kingsoft Ecosystem for Strategic Cloud Services

The strategic collaboration with the Xiaomi-Kingsoft ecosystem is a major revenue driver. Kingsoft Cloud entered into a 2025 Xiaomi Cooperation Framework Agreement on July 29, 2025. This deal secures IDC-related services for an initial term of three years starting from that date, and network hardware equipment for an initial term of one year. This arrangement is designed to leverage Xiaomi's infrastructure for stable, high-quality sourcing and operational efficiency.

The financial contribution from this partnership has been substantial throughout 2025:

For the first nine months of 2025 (January to September), the total revenue from this ecosystem reached RMB 1.82 billion. In Q2 2025, the first half revenue of RMB 1.13 billion accounted for 40% of the total annual cap of related product transactions for 2025. The Q3 2025 results specifically showed an 83.8% rise in revenue from this partnership, which is defintely a strong signal.

Kingsoft Office for Government AI All-in-One Server Solutions

Kingsoft Cloud's relationship with Kingsoft Office supports the expansion into specialized government AI solutions. Kingsoft Office itself reported strong performance in Q3 2025, achieving revenue of RMB 1.521 billion, a year-on-year increase of 25.33%. Their AI-enabled products for government scenarios are reportedly in the implementation and promotion phase, building on ecosystem readiness.

Key indicators of this collaboration's reach include:

• Kingsoft Office WPS monthly active devices totaled 669 million as of September 30, 2025.
• Kingsoft Office completed product compatibility with over 400 domestic office ecosystem partners.

Global Hardware Vendors for AI Computing Power Procurement

The massive AI push requires significant capital expenditure (CapEx) and procurement from global hardware vendors. Kingsoft Cloud's annual CapEx guidance remains at approximately RMB 10 billion. This investment directly fuels the AI business, which saw its gross billing grow by 120% year-over-year in Q3 2025, reaching RMB 782.4 million.

To put the AI demand into perspective:

• Q2 2025 AI gross billing was RMB 728.7 million, up over 120% YoY.
• Q1 2025 AI gross billing jumped 228% YoY to RMB 72.4 million.
• Total cost of revenues in Q3 2025 was RMB 2,097.1 million, up 32.5% YoY, mainly due to AI computing resource investment.

System Integrators for External Enterprise Project Delivery

System integrators are essential for delivering Kingsoft Cloud's enterprise solutions externally. While specific revenue figures tied directly to system integrator contracts aren't broken out, the overall Enterprise Cloud Services segment generated revenue of RMB 725.7 million in Q3 2025. This segment saw a year-over-year increase of 5% compared to the same quarter last year.

IDC Providers for Data Center Resources (e.g., Xiaomi 2025 Agreement)

Beyond the Xiaomi agreement, Kingsoft Cloud relies on a broader network of IDC providers. IDC costs for the company in Q3 2025 were RMB 775.7 million, marking a 15% year-over-year increase from RMB 673.8 million. This reflects the growing need for infrastructure to support the AI surge, even as the company optimizes procurement.

For comparison, IDC costs in Q1 2025 were RMB 722.5 million, which was a 6.0% decrease year-over-year, showing a shift in resource strategy between quarters.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Key Activities

Developing and deploying Intelligent Computing Cloud infrastructure.

• AI gross billing reached RMB782.4 million in the third quarter of 2025.
• AI-related sales represented 31% of the group-level top line in the second quarter of 2025.
• Capital expenditure for the third quarter of 2025, including financed amounts and lease liabilities, totaled RMB 2,787.8 million.
• IDC costs for the first half of 2025 were RMB1,525.9 million (US$213.0 million), reflecting infrastructure growth for AI expansion.
• The company is delivering an 'even larger cluster for Xiaomi's computing power demand.'

Investing in AI computing resources and technology development.

• Kingsoft Cloud Holdings announced a plan to allocate 80% of proceeds from a recent share offering towards AI expansion, including infrastructure, to be utilized by the end of 2028.
• A specific follow-on equity offering raised HK$2.80 billion, with 80% earmarked for upgrading AI infrastructure and cloud services.
• The company launched its model API service, strengthening the [StarFlow] platform capability.

Providing IT delivery services for enterprise cloud projects.

Optimizing cost structure and controlling operating expenses.

• Total operating expenses for the first half of 2025 were RMB1,218.4 million (US$170.1 million), up from RMB1,163.3 million in the first half of 2024.
• The company cited 'strict control over costs and expenses' as a factor in its profitability improvement.
• Non-GAAP gross margin for the first half of 2025 was 15.7%, compared to 17.0% in the same period of 2024.
• Adjusted EBITDA margin reached 33.4% in the third quarter of 2025, a significant increase from 9.8% in the third quarter of 2024.

Maintaining and upgrading core IaaS, PaaS, and SaaS platforms.

• Total Revenues for the third quarter of 2025 reached RMB2,478.0 million (US$348.1 million), a year-over-year increase of 31.4%.
• Revenues from public cloud services in Q3 2025 were RMB1,752.3 million (US$246.1 million), showing a 49.1% year-over-year increase.
• The company is continuing to enhance the technology of its intelligent computing cloud.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Key Resources

You're looking at the core assets Kingsoft Cloud Holdings Limited is using to compete in the cloud space as of late 2025. These aren't just abstract concepts; they are concrete investments driving their current performance.

Proprietary cloud platform and extensive data center network.

Kingsoft Cloud Holdings Limited operates a comprehensive and reliable cloud platform. The scale of the underlying physical infrastructure is evidenced by the capital deployed to support its AI-focused growth. For instance, in the third quarter of 2025, the company's capital expenditure, which included assets obtained via finance leases, totaled RMB2,787.8 million. This heavy investment is directly tied to expanding the infrastructure supporting the intelligent cloud business. Furthermore, the associated costs reflect this scale; IDC costs for Q3 2025 were RMB775.7 million, a 15% year-over-year increase, driven by purchasing racks for the expanding intelligent cloud and basic cloud demand.

High-performance AI computing clusters and infrastructure.

The focus on AI is resource-intensive, which you can see in the balance sheet and operational metrics. The company's investment in AI infrastructure led to a jump in depreciation costs to RMB649.7 million in Q3 2025, reflecting newly acquired and leased servers allocated to this segment. The success of this investment is reflected in the gross billings for intelligent computing, which reached RMB782.4 million in Q3 2025, marking a year-over-year growth of around 120%. This AI-related business accounted for 45% of the public cloud revenue for the quarter.

RMB3,954.5 million in cash and cash equivalents (as of Q3 2025).

Liquidity remains a key resource for funding ongoing capital expenditure, especially in infrastructure. As of September 30, 2025, Kingsoft Cloud Holdings Limited held RMB3,954.5 million in cash and cash equivalents. This figure represented a decrease from RMB5,464.1 million as of June 30, 2025, with the reduction attributed mainly to infrastructure investment for the intelligent cloud.

Specialized R&D talent focused on AI and cloud-native tech.

Talent is being strategically positioned to support the AI pivot. Kingsoft Cloud Holdings Limited is building out its R&D capabilities through organizational development at its dual R&D centers in Beijing and Wuhan. The company maintains a sustained investment intensity in the intelligent computing field. To illustrate the growth in this talent pipeline, the number of employees at the Wuhan center is 2.8x the headcount recorded in 2022 when the Wuhan strategy was first launched.

Here are some key operational metrics tied to the AI and cloud services that this talent supports:

• Public cloud services revenue in Q3 2025: RMB1,752.3 million.
• Year-over-year increase in public cloud revenue (Q3 2025): 49.1%.
• Adjusted gross profit for Q3 2025: RMB392.6 million.
• Adjusted gross margin for Q3 2025: Increased year-over-year by 27.6%.

Strategic relationship and ecosystem access to Xiaomi and Kingsoft.

The embedded nature within the Kingsoft and Xiaomi ecosystem provides a reliable base of demand and revenue. Kingsoft Cloud Holdings Limited is the sole strategic cloud platform for this ecosystem. The financial contribution from these key partners is significant and growing.

This relationship is a core asset, providing a solid foundation for the company's continued expansion, especially as ecosystem customers enhance their own R&D and cloud spending.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Value Propositions

High-performance Intelligent Computing Cloud for AI training/inference

The value proposition centers on providing the necessary infrastructure for the burgeoning AI sector. This is evidenced by the rapid scaling of AI-related billings.

• AI business gross billing reached RMB782.4 million in the third quarter of 2025.
• This AI gross billing represented a year-over-year growth rate of around 120% in Q3 2025.
• For the second quarter of 2025, AI gross billing was RMB728.7 million.

Comprehensive IaaS, PaaS, and SaaS offerings for diverse industries

Kingsoft Cloud Holdings Limited delivers a broad portfolio of services, with public cloud services showing substantial growth, indicating strong demand across IaaS, PaaS, and application layers.

• Revenues from public cloud services totaled RMB1,752.3 million in the third quarter of 2025.
• This public cloud revenue marked a significant year-over-year increase of 49.1% in Q3 2025.
• In the second quarter of 2025, public cloud services revenue was RMB1,625.3 million, up 31.7% year-over-year.

Hybrid Cloud solutions integrating local IT, private, and public cloud

While specific hybrid cloud adoption rates aren't detailed, the overall cloud service structure supports diverse deployment needs, complemented by enterprise cloud service revenue.

• Revenues from enterprise cloud services were RMB723.9 million in the second quarter of 2025.
• Enterprise cloud services revenue increased by 10.1% year-over-year in Q2 2025.

The company is clearly driving value through its integrated service stack, as shown by the overall financial performance in late 2025.

Full-stack AI capabilities, including large language model services

Kingsoft Cloud Holdings Limited positions itself as an end-to-end AI technology enabler, providing everything from raw compute to application-level services.

• In Q2 2025, AI gross billing accounted for 44.8% of public cloud services revenue.
• The company offers turnkey solutions spanning computing resources, PaaS platforms, and applications.

High-quality, reliable cloud services for the Xiaomi-Kingsoft ecosystem

The strategic collaboration with the Xiaomi-Kingsoft ecosystem is a significant value driver, showing robust, high-quality service demand from this captive base.

• Revenue contribution from ecosystem customers surged to RMB690.8 million in the third quarter of 2025.
• This represented an 83.8% year-on-year increase for the quarter.
• For the first half of 2025, ecosystem revenue reached RMB1,125.0 million.

The company's financial stability supporting these services is reflected in its balance sheet, with cash and cash equivalents at RMB3,954.5 million as of September 30, 2025.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Customer Relationships

You're looking at how Kingsoft Cloud Holdings Limited (KC) manages its connections with its diverse customer base, which spans from massive ecosystem partners to individual public cloud users. It's a multi-pronged approach, definitely. Here's the quick math on how those relationships translate into revenue as of the third quarter of 2025.

The customer relationship strategy is segmented to match the consumption model, which makes sense given the different needs of their client types. For instance, the high-growth AI business requires a very different touchpoint than a standard pay-as-you-go public cloud customer.

Dedicated account management for large enterprise clients.

For your larger, stickier enterprise customers, especially those in sectors like gaming, healthcare, and finance, the relationship is clearly high-touch. This segment, which brought in RMB725.7 million in revenue for Q3 2025, requires dedicated attention to ensure complex deployments stick. The growth here was more measured at 2.2% year-over-year compared to public cloud, suggesting a focus on deepening existing relationships and ensuring high-value project success rather than rapid new customer acquisition.

Co-creation model for AI and industry-specific cloud solutions.

This is where the heavy lifting is happening in terms of partnership innovation. Kingsoft Cloud Holdings Limited is actively co-creating, particularly around AI. The gross billing for the AI business hit RMB782.4 million in Q3 2025, surging about 120% year-on-year. This AI-driven intelligent computing now accounts for roughly 45% of the total public cloud revenue. Management is focused on turning specific 'inference scenarios' into new revenue streams, which implies close, collaborative development cycles with clients needing to deploy large language models.

Automated self-service portals for basic public cloud consumption.

For the foundational, less customized public cloud consumption, the relationship is transactional and automated. This is the volume driver, with revenue reaching RMB1,752.3 million in Q3 2025, a massive 49.1% jump from the prior year. The expectation here is that customers use automated portals for standard consumption, only escalating to dedicated support for complex issues or high-volume scaling needs. It's about efficiency at scale.

Strategic, long-term collaboration with ecosystem partners.

The relationship with the Xiaomi-Kingsoft ecosystem is a cornerstone, acting almost as a captive, high-growth customer segment. Revenue from this strategic collaboration was RMB690.8 million in Q3 2025, marking an 83.8% year-on-year surge. For the first nine months of 2025, the cumulative revenue from this ecosystem hit RMB1.82 billion. This long-term, embedded relationship is key to their sustainable growth story, and they are optimistic about increasing the connected transaction quota for 2026.

Professional service system for hybrid cloud migration support.

Given that industry data suggests about 92% of organizations run hybrid or multi-cloud environments as of late 2025, Kingsoft Cloud Holdings Limited must have a robust professional service offering. This system is designed to help enterprises move workloads between their on-premises infrastructure and the cloud, or between different cloud platforms. While specific service revenue isn't broken out, this support system is essential for converting enterprise clients who need help navigating complex, mixed-IT environments.

Finance: draft 13-week cash view by Friday.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Channels

You're looking at how Kingsoft Cloud Holdings Limited moves its services to market as of late 2025. It's a mix of direct enterprise focus and leveraging its powerful ecosystem ties. Honestly, the numbers show where the real action is right now.

Direct sales force for external enterprise cloud services

The direct sales motion targets external enterprise cloud services. This segment, which includes project delivery work, saw its revenue hold steady in the third quarter of 2025. For the quarter ended September 30, 2025, revenues from enterprise cloud services hit RMB 725.7 million. This compares to RMB 710.0 million in the same quarter last year. It's a smaller piece of the overall pie, but it represents direct customer acquisition and project execution.

Here's a quick look at the revenue contribution from the main segments for Q3 2025:

The direct sales team is definitely focused on closing those enterprise deals. If onboarding takes 14+ days, churn risk rises.

Xiaomi-Kingsoft ecosystem for internal and related party transactions

This is a major, high-growth channel for Kingsoft Cloud Holdings Limited, driven by continuing connected transactions. The strategic cooperation with the Xiaomi-Kingsoft ecosystem is soaring. In Q3 2025, the revenue contribution from this ecosystem surged to RMB 690.8 million, which is an 83.8% year-over-year increase. That single stream accounted for 28% of the total revenue for the quarter.

The commitment to this related party channel is substantial, as shown by the cumulative figures:

• Ecosystem Revenue (Q3 2025): RMB 690.8 million
• Ecosystem Revenue YoY Growth (Q3 2025): 83.8%
• Ecosystem Revenue Proportion (Q3 2025): 28%
• Cumulative Ecosystem Revenue (Jan-Sep 2025): RMB 1.82 billion

They anticipate fulfilling the annual quota for these transactions this year, so expect this channel to remain a solid foundation.

Online cloud marketplace and developer platforms for public cloud

The growth in public cloud services is where the marketplace and developer platforms play a key role, especially with the AI boom. Public cloud services revenue for Q3 2025 was RMB 1,752.3 million, a significant 49.1% jump year-over-year. The engine behind this is the intelligent computing cloud, or AI cloud business.

The AI focus is clear from the gross billing numbers:

• AI Gross Billing (Q3 2025): RMB 782.4 million
• AI Gross Billing YoY Growth (Q3 2025): Around 120%
• AI Billing as a percentage of Public Cloud Revenue (Q3 2025): Approximately 44.6% (based on RMB 782.4M / RMB 1,752.3M)

To support developer needs, Kingsoft Cloud Holdings Limited launched the model API service and initiated a data annotation and dataset marketplace this quarter. These platforms help turn inference scenarios into new revenue entrants.

System integrators and channel partners for project delivery

While the search results don't isolate revenue specifically from third-party system integrators (SIs) separate from the Enterprise Cloud segment, the delivery of external enterprise projects is a key component of that channel. In Q2 2025, enterprise cloud revenue growth was explicitly attributed to the 'accelerated completion of project delivery in this quarter.' This suggests SIs and partners are integral to fulfilling these external enterprise contracts.

The Enterprise Cloud Services revenue for Q3 2025 was RMB 725.7 million. The success of project delivery through partners directly impacts this figure. The company is also proactively laying out a strategic foundation for the in-depth integration of AI within industry clouds, which often requires a strong SI network for deployment.

Finance: draft 13-week cash view by Friday.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Customer Segments

You're looking at the core customer groups Kingsoft Cloud Holdings Limited serves as of late 2025, based on their Q3 2025 performance. This is where the money is coming from right now.

Xiaomi-Kingsoft Ecosystem (strategic, high-growth revenue)

This group represents a foundational, high-growth revenue stream for Kingsoft Cloud Holdings Limited. The strategic collaboration with the Xiaomi-Kingsoft ecosystem is definitely paying off. In the third quarter of 2025, revenue contribution from this ecosystem surged by 83.8% year-over-year, reaching RMB690.8 million. This segment's revenue proportion in the total sales further rose to 28% in Q3 2025. For the first nine months of 2025, the cumulative revenue from this ecosystem hit RMB1.82 billion. Kingsoft Cloud Holdings Limited continues to provide high-quality services to both Xiaomi and Kingsoft entities.

AI/Internet Enterprises (top customers with large training/inference demands)

Top-tier AI and Internet enterprises are driving significant demand, primarily through the intelligent computing cloud offering. The robust demand from these customers fueled the AI business. The gross billing of the AI business in Q3 2025 reached RMB782.4 million, marking a year-over-year growth rate of around 120%. Kingsoft Cloud Holdings Limited successfully supported the large-scale training and inference demands for many of these top internet customers. This AI-related revenue expansion is a key driver for the overall accelerated revenue growth.

Here's a quick look at the Q3 2025 revenue split between the two main cloud service types:

The public cloud segment, heavily influenced by AI demands, saw revenue increase by 49.1% year-over-year to RMB1,752.3 million in Q3 2025.

Large and medium-sized enterprises seeking hybrid cloud solutions.

This group falls largely under the Enterprise Cloud Services revenue line. Revenues from enterprise cloud services were RMB725.7 million in the third quarter of 2025. The growth here is attributed to expanding demands for software IT services and accelerated project delivery for external enterprise projects. These enterprises are likely the ones seeking the in-depth integration of AI and industry clouds, a strategic focus for Kingsoft Cloud Holdings Limited.

Public services sector (e.g., government) for AI-enabled solutions.

While specific revenue figures for the public services sector aren't broken out, the overall strategy mentions proactively laying out the foundation for deep integration of AI in industry clouds. The company has rapidly advanced the expansion of intelligent computing within public cloud services, which serves government and public entities needing AI-enabled infrastructure.

Customers in gaming, video, and real-time communications verticals.

Kingsoft Cloud Holdings Limited offers its public cloud, enterprise cloud, and AI-powered solutions across several industries. These verticals are key consumers of the company's cloud infrastructure. The company serves customers in:

• Gaming
• Video
• Real-time communications
• Healthcare
• Finance

The growth in AI infrastructure and products is boosting service delivery across these diverse verticals.

Finance: review the Q4 2025 guidance for Enterprise Cloud revenue growth by end of January 2026.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Cost Structure

The Cost Structure for Kingsoft Cloud Holdings Limited is heavily weighted toward infrastructure and the massive computational power required to support its AI-driven growth strategy.

High cost of revenues, primarily due to investment in AI computing resources, is a defining feature of the current cost base. For the third quarter ended September 30, 2025, the Cost of revenues reached RMB2,097.1 million. This represented a significant year-over-year increase of 32.5% from RMB1,582.2 million in the same quarter of 2024, directly attributed to the investment into AI computing resources. The gross billing of the AI business in Q3 2025 achieved RMB782.4 million, showing the scale of the underlying resource consumption.

A major component driving this cost is the significant IDC costs (Internet Data Center costs). For Q3 2025, IDC costs were reported at RMB775.7 million, a 15.1% increase year-over-year from RMB673.8 million. This increase was mainly due to the purchase of racks to serve the expanding AI business, alongside basic computing and storage cloud demands driven by AI. To put this in context with earlier in the year, Q1 2025 IDC costs were RMB722.8 million.

The commitment to future capacity is evident in the capital expenditure for infrastructure expansion. For the first quarter of 2025, Kingsoft Cloud Holdings Limited reported a total CapEx of RMB605 million. This spending supports the necessary physical assets for the growing intelligent cloud business.

Operating expenses also reflect investment in personnel and technology, though some areas showed cost control efforts:

• R&D expenses for product development and technology enhancement in Q3 2025 were RMB199.6 million, a year-over-year decrease of 15.4% from RMB235.9 million in Q3 2024.
• Adjusted R&D expenses for Q3 2025 were RMB188.4 million.
• Selling and marketing expenses to expand the external customer base were reported as RMB152.2 million in Q3 2025.
• Adjusted selling and marketing expenses for Q3 2025 were RMB127.6 million, an increase of 50% year-over-year.

Here is a breakdown of key cost components for Q3 2025:

The company also incurred significant non-cash charges related to asset utilization:

• Depreciation and amortization costs for Q3 2025 reached RMB649.7 million, up from RMB297.5 million in Q3 2024, primarily due to the depreciation of newly acquired and leased servers and network equipment allocated to the intelligent cloud business.
• Solution development and services cost for Q3 2025 was RMB595.9 million, a 19% year-over-year increase from RMB499 million in Q3 2024.

For infrastructure investment planning, the Q1 2025 Capital Expenditure figure of RMB605 million shows the scale of upfront spending on assets like servers and network equipment.

Finance: draft 13-week cash view by Friday.

Kingsoft Cloud Holdings Limited (KC) - Canvas Business Model: Revenue Streams

You're looking at how Kingsoft Cloud Holdings Limited (KC) actually brings in the money as of late 2025. It's all about scaling their cloud infrastructure, especially with the AI boom driving demand.

The revenue streams are clearly segmented, showing a strong pivot toward high-demand, high-growth areas like intelligent computing. Here's the quick math on the top-line performance from the third quarter of 2025:

The growth story in Q3 2025 is definitely the intelligent computing cloud business. That gross billing figure of RMB 782.4 million represented about 45% of the total Public Cloud revenue for the quarter. That's a massive shift in the revenue mix, showing where the capital expenditure is going.

The specific mechanisms for charging customers map directly to these service lines:

• Usage-based fees (pay-as-you-go) for IaaS/PaaS consumption.
• Fixed-price contracts for enterprise project delivery and IT services.
• Revenue from the Xiaomi and Kingsoft ecosystem, which hit RMB 690.8 million, increasing 83.8% year-over-year.

To be fair, the high growth in the AI-driven Public Cloud segment, which includes those usage-based fees, is what drove the overall revenue acceleration. The Enterprise Cloud Services, which likely house more of those fixed-price contracts, still grew, but at a much slower pace, reaching RMB 725.7 million.

Finance: draft 13-week cash view by Friday.