Chinese tech stock Kingsoft Cloud (NASDAQ:KC) made quite a splash in Wednesday’s trading. Investors sent it up over 20%, thanks in large part to a terrific earnings report. Both results and guidance turned out to be a lot better than expected and gave investors hope going forward.
On the surface, the earnings report might not seem that great. Kingsoft Cloud posted a loss of $0.02 for earnings per share and posted $308.97 million in revenue. That by itself was a mixed bag; while it beat analyst projections of $299.9 million, it was down 19.9% against the same time last year.
However, its EPS of -$0.02 was much better than the expectation of -$0.29. Its Q1-2023 outlook was bright as well. Kingsoft Cloud plans to bring in between 1.85 billion yuan (roughly $268.62 million) and 2.05 billion yuan (roughly $297.66 million). Expectations fell about in the middle of that, with analysts looking for 1.99 billion yuan (roughly $288.95 million USD).
Kingsoft’s Public Cloud Service unit pulled in lots of revenue, 1.34 billion yuan by itself, to be exact. Another 785.9 million yuan came in from its Enterprise Cloud Services operations. It wasn’t all good news, though; gross billings were down 20.7%, reports noted, and the Public Cloud Service total was actually down 12.2% against this time last year.
A look at the last five days in trading on Kingsoft shows the difference that the earnings report really made. The four days leading up to it were erratic, slightly skewing downward. But the morning of March 29 hit, the earnings report followed, and Kingsoft shot up hard, reaching a new 52-week high in the process.
