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<Research> Citi Raises Kingsoft Cloud (KC.US) TP to USD22, Optimistic on Strong AI Demand Driving Growth
Recommend 20 Positive 28 Negative 10 |
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Citi released a research report indicating that Kingsoft Cloud (03896.HK) delivered solid results in the fourth quarter of last year, with total revenue growing by 24% year-on-year to RMB2.76 billion, slightly above market expectations. This growth was primarily driven by strong AI demand, which boosted public cloud service revenue by 35% year-on-year. The bank expects that, benefiting from the parent company's continued promotion of AI development and the strong demand for AI computing across various vertical industries, Kingsoft Cloud's public cloud service growth momentum will further accelerate this year. Meanwhile, industry cloud service revenue is likely to remain relatively stable year-on-year, with limited growth. With the strong operating leverage brought by rapid revenue growth, the gross profit margin is estimated to remain largely stable year-on-year, and the adjusted operating profit is expected to break even this year. Considering the strong demand for AI computing, Citi raised its revenue forecasts for Kingsoft Cloud for this year and next by 14% and 19%, respectively. The target price for Kingsoft Cloud (KC.US) in the US market was raised from USD20 to USD22, maintaining a "Buy" rating. The company is seen as having a stable revenue outlook, with industry price increases and further progress in Xiaomi's AI as key catalysts. (hc/j) Auto-translated by third-party software This translation was auto-generated by third-party software. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. More Details
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