Kingsoft

Kingsoft traces its roots to 1988 and is a Hong Kong listed Chinese software company (03888).  Its principal place of business is in Beijing, and the group is led by Chairman Lei Jun and CEO Tao Zou.  Kingsoft’s core businesses sit in two pillars: office software and services, plus online games through subsidiaries such as Kingsoft Office and Seasun Holdings.

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The office segment is built around WPS Office and enterprise offerings like WPS 365 and WPS AI.  By the end of 2024, WPS reported 632 million monthly active devices globally, 41.70 million accumulated paying subscribers in mainland China over the prior 12 months, and over 100 million daily active devices for WPS PC in China.

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In 2024, Kingsoft reported revenue of RMB 10.3 billion, split roughly evenly between office software and services and online games, with 21% year on year growth.  Alongside the two main pillars, Kingsoft holds a large equity stake in Kingsoft Cloud, which management frames as central to its broader cloud strategy.  The group reported over 8,000 employees worldwide.

Kingsoft generates revenue from two operating segments: office software and services and online games and others. In Q3 2025, total revenue was RMB 2,419.2 million, with RMB 1,521.3 million from office software and services and RMB 897.9 million from online games and others.

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How the company makes money
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1. Office software and services (WPS ecosystem)
   This segment monetizes a large user base through paid subscriptions, premium features, and enterprise offerings such as WPS 365, alongside related services. In September 2025, WPS Office reported 669 million global monthly active devices, and accumulated paying subscribers in mainland China (past 12 months) were 41.79 million as of 30 June 2025.
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2. Online games and others (Seasun-led publishing and operations)
   The games business earns revenue from in-game monetization and content releases tied to long-running IP and live-ops updates. Results can swing by quarter due to title timing and content cycles, visible in 2025 where office grew faster while games revenue declined year on year in the first half and third quarter.
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3. Strategic equity value through stakes in listed tech assets
   Kingsoft owns a controlling stake in Kingsoft Office (listed in mainland China) and holds an equity interest in Kingsoft Cloud, which adds financial exposure beyond the two reporting segments.
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Market position

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• China’s office suite challenger with scale: WPS sits as a mainstream productivity choice for consumers and organizations, competing most directly with Microsoft’s Office stack and domestic collaboration suites. Scale is reinforced by hundreds of millions of active devices globally.
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• AI feature rollout as a monetization lever: In 2025, management highlighted WPS AI 3.0 and “agent” style workflows inside WPS, aiming to lift conversion and ARPU through premium tiers and enterprise attach.
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• Two-engine revenue mix with different risk profiles: Office is subscription-heavy and tends to be steadier, while games are hit-driven. In 2024, revenue was almost evenly split between office (RMB 5,121.1 million) and games (RMB 5,196.8 million). In 2025, office became the larger contributor in reported quarters.
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• Strong software economics and balance sheet buffer: 2024 gross margin was 83%, reflecting the high-margin nature of software. As of 30 September 2025, cash and bank deposits were RMB 22.68 billion, supporting continued product and content investment.

China remains Kingsoft’s core market, led by its WPS productivity franchise and supported by a large installed base. By the end of 2024, WPS PC in the domestic market exceeded 100 million daily active devices, reflecting broad penetration across workplaces and consumers.  In Kingsoft’s Q3 2025 update, the company reported 41.79 million accumulated paying individual subscribers in Mainland China over the prior 12 months (as of 30 June 2025).

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Enterprise demand in China has been driven by “localization” projects and the push to standardize software stacks across large organizations. In Q3 2025, office software and services revenue rose 26% year on year to RMB 1,521.3 million, with management pointing to strong localization orders and faster growth in WPS 365 among private firms and local state-owned enterprises.  The company has also launched government-focused offerings, including WPS AI government editions and related deployment across agencies.

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The games business is also China-heavy but more cyclical. In Q3 2025, games revenue fell to RMB 897.9 million, driven by lower contributions from several existing titles.

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Key strategic drivers in China include:

1. Domestic replacement and compliance needs that favor local productivity stacks over Microsoft.
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2. WPS 365 expansion into collaboration and AI-enabled enterprise workflows.
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3. Localization project momentum across government and regulated industries like finance, energy, and telecom.

Kingsoft is shifting its growth mix toward office software, with AI features as the main monetization lever and enterprise deployment as the scaling path. In Q3 2025, office software and services revenue rose to RMB 1,521.3 million, up 26% year on year, supported by WPS software, rapid growth in WPS 365, and steady WPS individual business momentum.  In H1 2025, office software and services revenue reached RMB 2,657.1 million, up 10% year on year, while the company rolled out WPS AI 3.0 and its “WPS Lingxi” intelligent agent to embed AI deeper into office workflows.

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Key growth drivers include

1. AI-led conversion and ARPU uplift in the WPS user base
   Management links growth in WPS individual business to rollout and promotion of AI-powered products, with increases in WPS AI monthly active users, paying subscribers, and user value.
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2. Enterprise expansion via Kingsoft Office and WPS 365
   WPS 365 is being positioned as a collaboration and AI suite, with customer base expansion among private firms and local state-owned enterprises, supported by solution replication and client co-creation.
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3. Localization projects and government-facing deployments
   Kingsoft cites accelerated progress in localization projects and continued deployment of AI-enabled products for government scenarios across agencies, tied to domestic adoption and compliance-driven procurement.
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4. Internationalization of the WPS product stack
   The company is building a new WPS International Edition to migrate domestic high-value features into overseas markets, aiming to lift monetization in higher-value regions.
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5. Games pipeline reset plus global publishing
   The online games unit is pushing genre expansion and global reach, highlighted by the global launch of Mecha BREAK, while licensed titles like Goose Goose Duck and Angry Birds are framed as upcoming launches in China.
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Challenges ahead

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• Games volatility and title timing: Q3 2025 games revenue was RMB 897.9 million, down sharply year on year, and management noted new games were still early in market build-out.
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• AI economics and competitive pressure: monetizing AI features while defending price points against Microsoft productivity bundles and other suites.
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• Procurement and policy cycles in China: localization wins depend on tender cadence, product certification requirements, and shifting customer IT standards.
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Over the next 12 to 24 months, the most important swing factors are sustained WPS 365 enterprise penetration, steady AI-driven conversion in the WPS individual base, and stabilization of game revenue around durable franchises like JX3 Online and Snowbreak: Containment Zone while new genres scale.