Kingsoft (3888) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue was RMB2,307.4 million, down 7% year-over-year, with office software and services up 14% and online games down 26% due to a high base effect.

• Profit attributable to owners for Q2 2025 was RMB532.4 million, up from RMB393.4 million in Q2 2024.

• Office business advanced AI integration, launching WPS AI 3.0 and WPS Lingxi, and expanded internationally.

• Online games expanded flagship IPs and new genres, with Mecha BREAK launching globally but underperforming initial expectations.

• Gross profit margin decreased to 80% in Q2 2025, with increased R&D and marketing investments, especially in AI and new game genres.

Financial highlights

• Q2 2025 gross profit was RMB1,853.6 million, down 9% year-over-year; gross margin decreased to 80%.

• Office software and services revenue reached RMB1,355.7 million, up 14% year-over-year.

• Online games revenue fell 26% year-over-year to RMB951.8 million.

• Net other gains in Q2 2025 were RMB442.9 million, mainly from gain on deemed disposal of Kingsoft Cloud.

• Cash and bank deposits as of June 30, 2025, were RMB22,594.0 million, representing 60% of total assets.

Outlook and guidance

• Continued investment in AI-driven features and international expansion for office software in H2 2025.

• Online games to focus on refining core products, premium titles, and global expansion.

• Management is confident in maintaining growth rates for office software and WPS 365 in the second half.