Renewal and Revision of Related Party Transaction Framework Agreement Revenue Visibility Enhanced Kingsoft Cloud (KC.US) Rises 9% Before the Market Open
1min read Kingsoft Cloud (KC.US) rose 9% before the market opened on Friday to US$6.30. On November 19, Kingsoft Cloud announced the renewal and amendment of the related transaction framework agreement with Kingsoft (which directly held about 37.40% of Kingsoft Cloud's shares at the announcement date) and Xiaomi (which directly and indirectly held a total of about 12.25% of the shares at the announcement date), covering the three-year period from 2025 to 2027, including cloud services provided by Kingsoft Cloud to the above related parties and financing services received from related parties, etc. The visibility of revenue from the Xiaomi and Kingsoft ecosystem continues to improve.
According to the announcement, the total upper limit of cloud service revenue from Kingsoft and Xiaomi from 2022 to 2024 is about Rmb808.9mn and 4077.5mn, with an average annual usage rate of 91.13% and 71.87% respectively in the period from 2022 to 2023. The total upper limit of cloud service revenue from Kingsoft and Xiaomi from 2025 to 2027 is about Rmb1841.6mn and 9483.2mn, up 128% and 133% year-on-year respectively, implying a hidden annualized compound growth rate of 29% and 32%.