Kuaishou's fundamental resilience is prominent, and KeLing AI has become the second growth curve.
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On May 27th, Kuaishou (Stock Code: 1024.HK) released its financial report for the first quarter of 2026.
The financial report shows that Kuaishou achieved an operating income of 33.7 billion yuan in the first quarter of 2026, a year-on-year increase of 3.4%, in line with market expectations. In terms of profit, the operating profit in the same period was 3.6 billion yuan, a year-on-year decrease of 15.6%. The adjusted net profit in the same period was 3.4 billion yuan, with an adjusted net profit margin of 10%.
At the operational level, in the first quarter of 2026, Kuaishou showed remarkable user growth, especially in the number of average monthly active users, which had a strong growth momentum. Data shows that the average daily active users of Kuaishou within the quarter reached as high as 413 million, a year-on-year increase of 1.2%. The average monthly active users in the same period were 772 million, a year-on-year increase of 8%, hitting a new historical high.
So, how good is Kuaishou's financial report this quarter? How should Kuaishou be valued in the wave of AI?
Chart: Core data of Kuaishou's financial report for the first quarter of 2026; Source: Company announcement, 36Kr
Relay Growth of Core Businesses
Kuaishou achieved an income of 33.7 billion yuan in the first quarter of 2026, a year-on-year increase of 3.4%, and the growth rate slowed down to some extent compared with before. From the perspective of the income structure, the live-streaming income declined significantly year-on-year this quarter, which was the core factor dragging down the slowdown of the company's overall income growth. At the same time, Kuaishou's core businesses, including online marketing services and other services mainly based on e-commerce, had a year-on-year income growth of 10.7% during the reporting period, which offset the impact of the decline in live-streaming income to a certain extent.
Chart: Kuaishou's operating income and year-on-year growth rate in recent years; Source: Wind, 36Kr
The main reason for the decline in Kuaishou's live-streaming income is the impact of the downward trend of the industry's prosperity. In the past few years, the live-streaming industry, especially the general entertainment live-streaming, has achieved rapid growth in scale with the support of the traffic dividend, and the platform's live-streaming income has also increased synchronously. However, with the tightening of industry supervision, users' needs have gradually shifted from simple entertainment to diversified and high-quality content experiences, and the corresponding consumption concept has become more mature and rational. Coupled with factors such as excessive content supply and the peak of traffic, they have jointly driven the continuous reconstruction of the industry's business form and payment structure, and the live-streaming industry has bid farewell to the stage of barbaric growth.
It can be seen that as a national-level application, the short-term decline in Kuaishou's live-streaming income essentially reflects that the live-streaming industry is undergoing a round of active "dehydration". The approach of relying on low-quality and highly stimulating content to achieve short-term and highly volatile returns has been gradually eliminated by the market, and the focus has shifted to the construction of the platform ecosystem, the improvement of content quality, and the maintenance of long-term user experience.
For Kuaishou, the optimization and adjustment of the industry and its own business will surely suppress the growth of the income side in the short term, but the short-term pain will bring about the "slimming down" of the business structure and the overall improvement of the platform ecosystem's health level. This not only lays a solid foundation for the subsequent recovery of the growth momentum of Kuaishou's live-streaming business, but also, with the reshaping of the business growth logic, is likely to become one of the prerequisites for the re-stabilization of Kuaishou's long-term valuation framework.
Chart: Kuaishou's income structure in the first quarter of 2026; Source: Wind, 36Kr
From the perspective of the company as a whole, behind the slowdown of Kuaishou's income growth this quarter, the core businesses still maintained a strong growth momentum. With the ebb and flow, the company's income structure has changed to a certain extent. Reflected in the financial data, the income proportion of the core businesses increased by 5 percentage points year-on-year compared with the first quarter of last year. For the company as a whole, the above changes in the business structure are a direct manifestation of the relay growth of core businesses such as advertising and e-commerce.
The capital market's judgment on a company's valuation has always been divided into long-term and short-term. The short-term valuation logic pays more attention to the short-term marginal changes in performance. However, for large-scale comprehensive Internet platforms like Kuaishou, which integrate content, social, and e-commerce attributes, it is obviously unfair to measure its investment value only by the short-term valuation logic. The core elements supporting Kuaishou's long-term valuation system mainly include the following three points:
First, a stable user base. In recent years, Kuaishou's active users have always maintained a steady growth. The unexpected growth of Kuaishou's MAU this quarter once again confirms the platform's strong content attractiveness and user retention ability.
Second, advertising and e-commerce fill the structural gap after the decline in the proportion of live-streaming income. While the company's income maintained a steady growth, although the live-streaming income declined to a certain extent, advertising and e-commerce, as the core businesses, maintained a double-digit growth momentum as a whole.
Third, AI is gradually changing from an input item to an income item and an efficiency item. With the continuous evolution of the AI industry, the core point of the market's judgment on the investment value of AI business is gradually shifting from capital expenditure to performance realization. Against this background, the rapid growth of the income related to KeLing AI provides strong support for the company's valuation.
Generally speaking, although Kuaishou's financial report for the first quarter of 2026 has not achieved a "full reversal" for the time being, many data have released positive signals of structural improvement. On the one hand, the scale of the platform's active users continued the trend of steady growth, and core businesses such as advertising and e-commerce achieved a strong double-digit growth. On the other hand, the commercialization process of KeLing AI is accelerating, and AI applications are gradually penetrating into business scenarios such as advertising, e-commerce, and games, creating new business value and significantly improving operational efficiency. All the above signs indicate that Kuaishou's fundamentals are very resilient, the growth logic is continuously strengthened with the support of KeLing AI, and the long-term investment value is prominent.
KeLing AI: From Product Highlights to an Independently Identifiable AI Variable
In Kuaishou's overall layout of AI commercialization, KeLing AI has become a core business line that is highly iconic and easily recognizable by the capital market. The key lies in the fact that KeLing AI has completed a complete closed-loop from technology implementation, product iteration, scenario penetration to commercial realization. It has clear business boundaries and a mature product form, and has achieved considerable income. Thus, it has completely broken the industry's perception that Kuaishou's AI capabilities and value were difficult to be separately quantified before.
The financial report shows that the income generated by KeLing AI in the first quarter of 2026 has exceeded 650 million yuan, with a year-on-year growth rate of over 300%. In March 2026, the annualized revenue run rate (ARR) of KeLing AI was nearly 500 million US dollars, a four-fold increase compared with the same period last year. The explosive growth of the income related to KeLing AI currently indicates that its huge commercialization potential remains to be released. In terms of the product's ecological layout, KeLing AI adopts a dual-wheel drive development strategy, that is, it simultaneously focuses on the C-end mass consumer market and the B-end professional production scenario, thus covering the multi-dimensional needs from the lightweight creation of ordinary users to the professional production of industry customers.
In the C-end mass market, KeLing AI features a low-threshold, lightweight, and interesting AI creation experience. Relying on a large number of simple templates, it lowers the threshold of AI creation for ordinary users and integrates into the mass content ecosystem. Among them, a number of popular AI gameplay, represented by the "baseball live special effects", have become popular. With advantages such as strong fun, suitability for short-video dissemination, and low operation threshold, they have triggered a user creation boom, driving the double improvement of the platform's content output and dissemination popularity.
The above cases of popular products fully confirm that the C-end product logic of KeLing AI is highly in line with the mass content creation and consumption habits. Relying on product power, it stimulates users to participate in creation and sharing, promotes the fission and dissemination of content, and realizes the popularization of AI technology, continuously consolidating the user base and market recognition. Driven by the combination of content and AI technology application, the platform's content attractiveness and user retention ability have been significantly improved.
In the B-end professional market, relying on its model capabilities and product system, KeLing AI is continuously being implemented in high-value and professional commercial production scenarios. At the technical level, relying on the All-in-One design concept, it supports input and output in multiple native full-modalities such as text, image, audio, and video, integrating video understanding, generation, and editing into one, and creating an efficient and smooth AI workflow. In the popular historical drama "Taiping Nian", KeLing AI was deeply involved in the production of some virtual scenes and special effect shots. Its professional strength was fully verified by the delicate picture processing, smooth special effect presentation, and production effects in line with industry standards.
As KeLing AI's technical capabilities are continuously strengthened, its product system is becoming more and more perfect, and its commercialization process is steadily advancing, coupled with the continuous increase in the industry's attention to generative AI assets, the market has gradually realized that KeLing AI, as an independent AI asset, has huge potential value. Before this, the market's valuation of Kuaishou mainly focused on traditional businesses such as short videos, live streaming, and e-commerce, and the value of its self-developed AI technology capabilities and related businesses had not been separately priced for a long time. Kuaishou's current price-to-earnings ratio of less than 10 times hardly reflects the long-term value of KeLing AI at all.
Chart: Kuaishou's PE-TTM in recent years; Source: Wind, 36Kr
AI Efficiency Improvement: Beyond KeLing, Kuaishou Also Needs to Consider an Efficiency Account
From the perspective of the company as a whole, the value release of Kuaishou's AI capabilities is not limited to KeLing AI independently achieving considerable income. More importantly, Kuaishou's AI capabilities have been widely penetrated into core business scenarios such as marketing, e-commerce, and live streaming, becoming a core endogenous driving force for the company's income growth.
In terms of content consumption, AI technology has significantly reduced the production cost and creation threshold of comic dramas. In the marketing link, the two models of generative recommendation and intelligent bidding have significantly improved the efficiency of advertising matching and conversion, driving the growth of online marketing service income. In the e-commerce field, AI capabilities such as search, live-streaming shopping guide, and intelligent coupon issuance mainly play a role in improving users' shopping experience and merchants' operating efficiency. On the organizational side, tools such as My Flicker are moving from R & D efficiency improvement to more job scenarios.
Therefore, for large-scale comprehensive Internet platforms represented by Kuaishou, the judgment of its AI value usually does not use independent income as the single measurement standard. Especially when AI capabilities are embedded in existing businesses, while helping the income growth of businesses such as advertising, e-commerce, and content, they also further improve the company's overall organizational operation efficiency.
Generally speaking, the core highlight of Kuaishou's financial report is the structural changes formed by the user base, the commercialization of KeLing, and the AI efficiency improvement of the main business. Compared with short-term performance fluctuations, this underlying business development logic of "a stable user base + comprehensive AI empowerment of business growth" is Kuaishou's greatest confidence to cross the cycle and reshape the long-term valuation logic.