CLSA Lifts Kingsoft Cloud Target to $20.4 as AI Drives 24% Revenue Growth

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·Mar 26 2026, 06:22

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Key Takeaways

Credit Lyonnais Securities Asia (CLSA) has raised its price target for Kingsoft Cloud, citing strong performance and a robust outlook fueled by the artificial intelligence sector. The upgrade reflects growing confidence in the company's ability to capitalize on accelerating AI demand from key clients and the broader market.

CLSA increased its price target on Kingsoft Cloud (KC.US) to $20.4 from $17.7, maintaining an "Outperform" rating.
The revision follows strong Q4 results where total revenue grew 24% year-over-year, driven by a 35% increase in public cloud services.
The firm forecasts Kingsoft's revenue growth will accelerate to 30% annually by 2026, propelled by sustained AI demand from customers like Xiaomi.

CLSA Boosts Kingsoft Target to $20.4 After 24% Q4 Revenue Gain

Analyst confidence in Kingsoft Cloud (KC.US) is strengthening, with CLSA raising its price target to $20.4 from a previous $17.7 while reiterating an "Outperform" rating. The upgrade was prompted by the company's fourth-quarter results, which surpassed expectations. Total revenue for the period expanded by 24% year-over-year, led by a notable 35% growth in its public cloud services division. This performance underscores the company's successful monetization of the intense demand for artificial intelligence infrastructure.

AI Demand Forecast to Drive 30% Annual Growth by 2026

CLSA's optimistic outlook is anchored in the sustained demand for AI capabilities. The investment firm projects Kingsoft Cloud's revenue growth will accelerate from 23% in 2025 to 30% in 2026. This trajectory is expected to be fueled by major clients, including electronics giant Xiaomi, alongside a growing base of non-ecosystem customers seeking AI solutions. In response to this momentum, CLSA has increased its revenue forecasts for Kingsoft Cloud by 8% for the current year and 9% for the next, extending its valuation basis into the fiscal year 2027.

Cloud Sector Booms on AI Infrastructure Spending

The growth at Kingsoft Cloud reflects a powerful, sector-wide trend where cloud providers are primary beneficiaries of the AI boom. Major technology companies are investing heavily in data center capacity to power AI workloads. This market dynamic is validated by the performance of industry giants like Alphabet, which recently reported a 48% year-over-year increase in its cloud computing revenue, largely driven by AI infrastructure and services. The high demand for specialized cloud services positions companies like Kingsoft to capture significant value as the AI market continues its rapid expansion.