KINGSOFT CLOUD announced the issuance of an additional 18.5 million ADS to enhance infrastructure upgrades and the development of artificial intelligence business

According to Zhitong Finance APP, on April 16, Kingsoft Cloud (KC.US, 03896.HK) announced that it will publicly issue 18,500,000 American Depositary Shares (ADS), with each ADS representing 15 shares of the company's common stock. At the same time, Kingsoft Cloud also granted the ADS underwriters a 30-day option to purchase additional American Depositary Shares. Furthermore, to facilitate subscription for investors in both Hong Kong and the U.S. stock markets, investors can choose to trade common shares instead of ADS on the Hong Kong Stock Exchange during this issuance.

This financing has received support from strategic shareholders. In addition to the aforementioned number of shares issued, Kingsoft Software Group will additionally subscribe for 20% of the total issuance scale (public issuance portion + Kingsoft Software Group subscription portion). This not only reflects the support of ecological 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 Kingsoft Cloud plans to use the proceeds from this ADS issuance to invest in upgrading and expanding infrastructure, investing in technology and product development, and for general corporate and operational capital purposes.

Driven by the development of artificial intelligence, the cloud computing business is currently in a phase of rapid historical growth. With over a decade of deep engagement in cloud computing, Kingsoft Cloud has established a unique position and first-mover advantage in technical services within the industry. Benefiting from this, Kingsoft Cloud's business performance is strong in 2024, with total annual revenue increasing by over 10% year-on-year, and a healthy revenue mix, with Q4 single-quarter AI billing revenue accounting for 34% of public cloud revenue, a year-on-year increase of nearly 500%, placing it at an industry-leading level. Kingsoft Cloud's high-quality sustainable development strategy has achieved phased results, with annual gross profit margin increasing by over 5 percentage points year-on-year. The adjusted operating profit margin for Q4 turned positive for the first time. This lays a solid foundation for the continued improvement of profitability.

In light of the strong and highly visible market demand in the artificial intelligence field, Kingsoft Cloud actively embraces artificial intelligence, continuously focusing on core technology for capability building, and has comprehensively upgraded its intelligent computing capability system around basic cloud, intelligent computing network, and intelligent computing platform. Currently, Kingsoft Cloud supports DeepSeek-R1/V3 in public cloud scenarios and state-owned cloud/government cloud scenarios, and has completed the adaptation of the full-blooded version of DeepSeek based on domestic chips. As the only strategic cloud platform within the ecosystem, Kingsoft Cloud will continue to benefit from the demand increment brought by the artificial intelligence business layout of ecological customers.

Under the guidance of the 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, continuously creating value for existing and new shareholders