Kingsoft Office Software (03888) Q3 Performance Differentiation Analysis: Office Growth Coexists with Game Business Drag

Kingsoft Office Software (03888) Q3 2025 performance shows significant differentiation characteristics [0]. In terms of revenue, the quarterly total revenue was 2.42 billion yuan, down 17% YoY but up 5% QoQ; net profit attributable to shareholders was 213 million yuan, down 48% YoY [0]. The office software segment performed strongly, with revenue of 1.52 billion yuan, up 26% YoY and 12% QoQ, and WPS monthly active devices reaching 669 million units [0,3]. However, the game business became the main drag, with revenue of 897 million yuan, plunging 47% YoY, accounting for 37% [0,2].

After the performance release, the stock price reacted sharply: it once dropped over 11%, closing at HK$27.80 on November 20, down 9.51% [0]. Trading volume increased significantly, indicating large market divergence [0]. Institutional ratings are divided: CICC lowered its target price to HK$39 [1], while CLSA maintained the “Outperform” rating but lowered its target price to HK$35.5 [0].

1. Business Structure Transformation Pressure
   : The proportion of the game business continues to decline, and office software has become the core growth engine, but in the short term, it needs to cope with the performance pressure brought by the sharp decline of the game business [0].
2. Two Sides of AI Layout
   : The AI transformation of WPS (such as WPS AI) is the focus of investors, but it has not yet fully offset the negative impact of the game business [0,4].
3. Mixed Market Expectations
   : The divergence in institutional ratings reflects the trade-off between the company’s long-term AI potential and short-term performance pressure [0,1].

• The continued downturn of the game business may further drag down overall performance [0,2];
• Intensified industry competition (such as competitors in the office software field);
• High short-term stock price volatility risk [0].

• The AI integration of WPS office software is expected to open up new growth space [0,4];
• The strong growth of the office business (continuous increase in monthly active devices) provides stable cash flow [0,3];
• The market popularity of AI concepts may bring valuation repair opportunities [0,4].

Kingsoft Office Software (03888) is currently facing a critical period of business transformation. The office software business has a good growth momentum, but the sharp decline of the game business brings challenges to short-term performance. Investors need to pay attention to the company’s adjustment strategies in the game business and the implementation progress of AI technology in the office field. The divergence in institutional ratings suggests that the market has different expectations for the company’s future development, and it is necessary to carefully evaluate the balance between risks and opportunities [0,1,2,3,4].