Core Insights - Kingsoft Cloud Holdings Limited reported total revenue of RMB 2.35 billion for Q2 2025, reflecting a year-over-year growth of 24% [3][17]. - The company is experiencing accelerated revenue growth driven by AI-related business and contributions from major ecosystem customers, particularly Xiaomi [8][18]. - Management anticipates stronger revenue growth in the second half of 2025 compared to the first half [9][55]. Financial Performance - Public cloud revenue reached RMB 1.63 billion in Q2 2025, up 32% year-over-year, primarily due to intelligent computing cloud and basic cloud growth [4][20]. - Enterprise cloud revenue was RMB 724 million for Q2 2025, representing a 10% year-over-year increase [4][22]. - AI gross billings climbed over 120% year-over-year to RMB 728.7 million, now constituting 45% of public cloud revenue [4][17]. Ecosystem Contributions - Revenue from the Xiaomi and Kingsoft ecosystem reached RMB 629 million in Q2 2025, marking a 70% year-over-year growth and accounting for 27% of total revenue [5][18]. - In the first half of 2025, revenue from this ecosystem reached RMB 1.13 billion, contributing to 40% of the total annual cap of related product transactions [19]. Cost and Margin Analysis - Adjusted gross profit increased by 8.4% year-over-year in Q2 2025, driven by scale expansion and AI business contributions [5][32]. - Adjusted operating loss was RMB 166 million for Q2 2025, reflecting improved share-based compensation adjustments offset by increased prepayments to providers [5][35]. - The adjusted gross margin was negatively impacted by higher service costs and price pressure from scaling [5][33]. Strategic Developments - The company is shifting its procurement model from pure self-procured assets to mixed models, including profit sharing and an "agent model" for targeted client projects [6][9]. - Management confirmed ongoing investments in intelligent computing and full-stack AI capabilities, with a focus on verticals such as public services, finance, and healthcare [7][27]. - The company is addressing anticipated supply chain risks from geopolitical events, with current chip sourcing diversified but future domestic chip supply flagged as a potential constraint [10][60]. Market Outlook - Management expects the second half of 2025 to outperform the first half in terms of enterprise cloud delivery and revenue [10][55]. - The demand for AI implementation across various industries is anticipated to continue growing, with Kingsoft Cloud positioned to leverage its capabilities in this evolving market [28][60].