Kingsoft Cloud Holdings Limited KC shares are trading lower after the company reported a third-quarter FY23 revenue of $222.754 million, missing the consensus of $244.77 million. Revenues fell 17.5% Y/Y.
Adjusted earnings per ADS was $(0.18), missing the analyst consensus of $(0.17) loss.
The decrease was mainly due to the proactive scale-down of services for content delivery network (CDN) customers and the phasing-out of loss-making clients.
Revenues from public cloud services decreased by 24.5%, and enterprise cloud services fell by 2.2%.
Gross profit was $26.9 million, representing a significant increase of 60.3%. Q3 gross margin was 12.1%, compared with 6.2% in the same period in 2022.
The significant improvements in gross profit and margin were mainly due to strategic adjustment of revenue mix, optimized enterprise cloud project selection, and efficient cost control measures.
Kingsoft held $358.0 million in cash and equivalents at quarter end.
Tao Zou, Chief Executive Officer of Kingsoft Cloud, commented, "We expect to deepen our strategic planning and engagement with Xiaomi and Kingsoft in their comprehensive AI cloud demand to capture market opportunities, maintain the healthy trajectory of continued profitability improvement, and generate value for our shareholders."
Price Action: KC shares traded lower by 12.16% at $4.84 on the last check Tuesday.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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