Kingsoft Cloud (03896.HK) Becomes a Hot Stock in Hong Kong Due to DeepSeek AI Effect and Analysis of Kingsoft Corporation's 2024 Annual Report

This analysis is based on Hong Kong stock hot list information from the East Money App (Tushare dc_hot). As a leading cloud service provider in China, Kingsoft Cloud (03896.HK) saw its stock price surge over 800% in 2025 due to the DeepSeek AI model effect, becoming a focus in Hong Kong stocks [2]. Kingsoft Corporation (03888.HK)'s 2024 annual report shows total revenue increased 20.92% year-on-year to 10.318 billion yuan, and net profit doubled by 130.1% to 2.797 billion yuan, with AI empowerment and gaming business as core growth engines [0]. The Hong Kong stock market performed strongly in the first nine months of 2025, with the Hang Seng Index rising 33.88% cumulatively, and tech stocks, especially AI-related ones, performed prominently [3].

Due to the successful application of the DeepSeek AI model, Kingsoft Cloud’s stock price soared from a low to a high of HK$10.88, an increase of over 800% [2]. The company raised 2.802 billion yuan through placing new shares, 80% of which was used to support AI business expansion, including computing power infrastructure construction [0]. Market analysis suggests that the DeepSeek effect may replicate the AI stock boom brought by ChatGPT in 2023, becoming an important catalyst for computing power stocks [2].

Kingsoft Corporation’s total revenue in 2024 reached 10.318 billion yuan, a year-on-year increase of 20.92%; net profit was 2.797 billion yuan, a year-on-year increase of 130.1%, mainly benefiting from cost optimization and increased proportion of high-margin businesses [0]. Among business segments, office software and services revenue was 5.121 billion yuan (accounting for 49.6%, +12.4%), and entertainment software and other revenue was 5.197 billion yuan (accounting for 50.4%, +30.7%) [0]. AI empowerment was significant: WPS AI function integration improved user willingness to pay, increasing the proportion of subscription revenue; in the gaming business, new games such as “Jian Wang 3” and overseas market expansion drove growth [0].

The Hong Kong stock market performed strongly overall in the first nine months of 2025, with the Hang Seng Index rising 33.88% cumulatively, and tech stocks, especially AI-related ones, performed prominently [3]. The business synergy between Kingsoft Cloud and Kingsoft Corporation is obvious: Kingsoft Cloud provides AI computing power infrastructure to support the development of WPS AI and gaming AI tools by Kingsoft Corporation, forming an ecological closed loop [0].

1. AI Ecosystem Synergy Value
   : Kingsoft Cloud’s computing power infrastructure and Kingsoft Corporation’s AI applications (WPS AI, gaming AI) form deep synergy, enhancing overall competitiveness [0].
2. Industry Impact of DeepSeek Effect
   : The success of the DeepSeek model not only drove Kingsoft Cloud’s stock price up but may also lead to the recovery of the entire AI computing power sector, replicating the market enthusiasm during the ChatGPT period [2].
3. Sustainability of Profit Growth
   : Kingsoft Corporation’s net profit doubled, driven by the expansion of high-margin businesses empowered by AI and cost control, indicating the sustainability of its profit model [0].

• AI and Cloud Computing Market Growth
  : The generative AI market is expected to have a compound annual growth rate of about 40% from 2024 to 2029, bringing huge opportunities for Kingsoft Cloud’s computing power business and Kingsoft Corporation’s AI applications [0].
• Global Layout Potential
  : Kingsoft Corporation accelerates the overseas market penetration of office software (Southeast Asia and Europe), and the globalization strategy of the gaming business has achieved initial results, which is expected to open up new growth space [0].

• Intensified Market Competition
  : The office software field faces competition from international giants such as Microsoft, requiring strengthening of AI differentiated advantages; the success rate of new games in the gaming industry fluctuates greatly, requiring continuous R&D investment [0].
• Policy Regulatory Risks
  : Data security and AI compliance requirements are becoming stricter, requiring continuous optimization of risk control systems [0].
• Dependence on Related Transactions
  : Kingsoft Corporation’s continuous transactions with Xiaomi Group account for a certain proportion of revenue, requiring ensuring fair pricing [0].

Kingsoft Cloud became a hot stock in Hong Kong due to the DeepSeek AI effect, with a stock price increase of over 800%, and accelerated AI business expansion through financing; Kingsoft Corporation’s 2024 financial performance was strong, with AI empowerment and gaming business as core drivers. The business synergy between the two forms an AI ecological closed loop, benefiting from the high-speed growth of the AI market. However, attention should be paid to risks such as competition, policy, and related transactions.