Kingsoft Cloud (03896.HK) will raise prices on AI computing power products and services by 15% to 50% and file storage products by 30% to 50%, effective July 12. The price hike, driven by surging global AI demand and rising hardware costs, will not affect existing orders during the current billing cycle. Shares rose 3.75% to HKD5.81 on the announcement.
Kingsoft Cloud will raise prices on AI computing products by as much as 50% and file storage by 50%, the latest sign of pricing power in a cloud sector strained by surging AI demand and rising hardware costs.
"Surging global demand for AI computing power and rising hardware costs" drove the price adjustments, the Beijing-based cloud provider said in a statement. The new rates take effect July 12.
AI computing power-related products and services will increase by 15% to 50%, while file storage products and services will rise by 30% to 50%. Existing orders will not be affected during the current billing cycle, with the new prices applying at the start of the next billing period.
The price hike shows Kingsoft Cloud, which competes with Alibaba Cloud and Tencent Cloud in China's crowded cloud market, sees room to pass on higher costs to customers. Shares rose 3.75% to HKD5.81 on the announcement, with turnover of HKD280 million on 48 million shares traded.
Goldman Sachs named the cloud and data center subsector its most favored for the second half of 2026, recommending Kingsoft Cloud alongside Alibaba Group Holding Ltd., GDS Holdings Ltd. and VNET Group Inc. The investment bank's call reflects a broader view that AI infrastructure providers are well-positioned to benefit from the AI buildout.
The price increases come as cloud providers globally grapple with higher costs for Nvidia's graphics processing units and other AI hardware. Kingsoft Cloud's move mirrors similar pricing actions by larger US hyperscalers that have raised prices on AI cloud services to offset rising capital expenditure. Short selling data showed HKD34.41 million in Kingsoft Cloud shares shorted on June 12, representing 6.665% of turnover.
For investors, the key question is whether the price hikes will expand margins or drive customers to competitors. Kingsoft Cloud trades at a discount to larger peers, and the pricing action could provide a near-term boost to revenue growth if demand holds. The company's ability to sustain the increases will depend on whether customers accept higher costs or shift workloads to Alibaba Cloud and Tencent Cloud, which have not announced similar broad price hikes.
This article is for informational purposes only and does not constitute investment advice.
