Kingsoft Cloud (03896) delivered solid Q3 results, achieving its first quarterly operating profit and turning net profit positive. Daiwa has maintained its "Buy" rating on the stock while raising the target price from HK$10.5 to HK$11.
The brokerage expects Q4 revenue to reach RMB2.69 billion, with Q3 gross margin at 15.4%. Benefiting from deferred revenue recognition, Daiwa forecasts the company will achieve operating profitability by 2026.
Daiwa has raised its 2026-2027 revenue forecasts by 0.5-0.6% to reflect increasing contributions from AI-related revenue streams.
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