Kingsoft Announces 2023 First Quarter Results
HONG KONG, May 23, 2023 – (ACN Newswire via SEAPRWire.com) – Kingsoft Corporation Limited (“Kingsoft” or the “Company”; HKEx stock code: 03888), a leading Chinese software and Internet service company, has announced its unaudited quarterly results for the three months ended 31 March 2023 (“period under review”).
During the period under review, the revenue of Kingsoft increased 6% year-over-year to RMB1,970.3 million. Revenue from the office software and services, and online games and others represented 53% and 47%, respectively, of total revenue. Gross profit increased 8% year-over-year to RMB1,625.4 million.
Mr. Jun LEI, Chairman of Kingsoft, commented, “We had a good start in the first quarter of 2023. Kingsoft Office Group actively explores and promotes the practical application of artificial intelligence (“AI”) technology, invests in related R&D, and continues to empower the digital transformation of institutional and individual users. Online games business further enhances the value of original IPs and remains committed to the strategy of developing premium games.”
Mr. Tao ZOU, Chief Executive Officer of Kingsoft, added, “The Group’s businesses remained steady in this quarter, with total revenue reaching RMB1,970.3 million, increasing by 6% year-on-year. Revenue from office software and services business reached RMB1,051.7 million, up 21% year-on-year. Both domestic individual office subscription and institutional subscription businesses experienced robust growth during this quarter, demonstrating the significant effect of the subscription transformation.
In face of the technological transformation brought about by generative AI and large language models, Kingsoft Office Group focuses on the AI field, collaborates with companies engaged in the large language models and concentrates on core businesses to excel in the application layer. Centering on the needs of organizational users, we continue to leverage the advantages of the digital office platform, actively promote the digital transformation and upgrading for organizations of all sizes, and empower their digital construction. In April 2023, we launched WPS 365, a comprehensive package of office software suitable for a wide range of institutional users, which includes powerful office software and collaboration management capabilities aiming to improve their work efficiency. In order to achieve high-quality development of individual office subscription business, we consistently enhanced the user experience of our products in cross-platform scenarios like cloud and collaboration and reconstructed the membership system in April.
Online games business made progress in iterating core IPs. Based on the high-quality expansion pack launched in the fourth quarter of 2022, our flagship JX Online III achieved an increase in new users, expanding the user base. At the same time, the number of daily active users and revenue of JX Online III increased year-on-year in the first quarter of 2023. At the end of February 2023, a new expansion pack of JX World III mobile game released, together with effective marketing and promotions, stimulated the game’s vitality and improved user experience. At the end of March 2023, World of Sword Origin mobile game was initially launched in Vietnam. Upon its launch, it topped both the free and grossing charts in local iOS and Android stores. Our anime mobile games, Snowbreak: Containment Zone and The Other Shore, are scheduled for launch in the second half of 2023.”
Office Software and Services
For the first quarter of 2023, revenue from the office software and services business increased 21% year on-year to RMB1,051.7 million. The year-on-year increase was mainly due to the robust growth of domestic individual office subscription business, and rapid growth of domestic institutional subscription business of Kingsoft Office Group, partially offset by the decrease in domestic institutional licensing business. The solid growth of domestic individual office subscription business was primarily attributed to the continuous optimization of cloud and collaboration user experience. The fast growth of domestic institutional subscription business was mainly driven by the continuous upgrades of digital office solutions and service quality, as well as the ongoing process of promoting cloud integration and collaborative office in government and enterprises. The decrease in domestic institutional licensing business was mainly due to the relatively high base in the first quarter of 2022 and reduction in new purchase orders on localization solutions in the current quarter.
Online Games and Others
Revenue from the online games and others business for the first quarter of 2023 decreased 6% year-on-year to RMB918.7 million. The slight year-on-year decrease was primarily due to a natural decline in revenue from the mobile games such as JX World III and JX I: Gui Lai, which had a relatively high revenue base in the first quarter of 2022. The decrease was partially offset by the revenue growth from JX Online III, which was attributed to our continuous efforts in enhancing user engagement and in-game consumption through game content updates and operations optimization.
Mr. Jun LEI concluded, “We adhere to technology-driven business. Looking forward, Kingsoft Office Group will continue to cultivate in AI, fully leveraging new technologies to drive the reconstruction and pattern innovation of office products and services. Online games business will continuously adjust and optimize products and services in response to player needs, improve games’ reputation, introduce more unique gameplay and content, and further strengthen players’ recognition and confidence in our core IPs. We are committed to creating long-term value for our shareholders by enhancing our core competencies.”
About Kingsoft Corporation Limited
Kingsoft is a leading software and Internet services company based in China listed on the stock exchange of Hong Kong. It has three main subsidiaries including Kingsoft Office, Seasun and Kingsoft Shiyou. Following the implementation of its “mobile internet transformation” strategy, Kingsoft has completed the comprehensive transformation of its overall business and management models, and formed a strategic platform with office software and interactive entertainment as the pillars and cloud services and AI as the new directions. The Company has around 7,000 staff around the world and enjoys a large market share in China. For more information, please visit http://www.kingsoft.com.
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