Kuaishou's Q1 revenue of 33.72 billion yuan, Keling AI's revenue grew by over 300% year-on-year

Kuaishou Technology released its financial report for the first quarter of 2026 on May 27. Total revenue was 33.72 billion yuan, slightly higher than the Bloomberg consensus expectation of 33.41 billion yuan; adjusted net profit was 3.37 billion yuan, above the expected 3.03 billion yuan, but a year-on-year decrease of 26.3%.

In terms of revenue structure, online marketing service revenue was 19.64 billion yuan, live broadcast revenue was 8.49 billion yuan, and other service revenue was 5.58 billion yuan; adjusted EBITDA was 6.23 billion yuan, above the expected 5.63 billion yuan.

Kuaishou App's daily active users (DAU) reached 412.7 million, and monthly active users (MAU) reached 771.7 million, with a year-on-year increase of 8.4% in monthly activity. The peak daily activity during the Spring Festival set a historical record, with the user base continuing to expand.

AI Becomes the Largest Growth Engine

In the first quarter, KuaiLing AI revenue exceeded 650 million yuan, growing by over 300% year-on-year. In March 2026, its annualized revenue run rate (ARR) approached 500 million USD. The company has clearly positioned it as the "second growth curve" and has achieved large-scale commercial deployment in professional fields such as film and television, advertising, and e-commerce.

KuaiLing AI 3.0 series models have supported full-modal input and output, successfully participating in the visual effects and scene generation for the domestic historical drama "Taiping Year" and the Hollywood series "Great Heng Dynasty". On the product side, the "Team Plan" supports real-time collaborative creation by multiple people, and the "Baseball Live" special effects have helped it top the App Store in 42 countries and regions.

Core Business Solid, but Pressure on Profit Margins

Kuaishou's core business revenue (including online marketing and e-commerce-related other services) increased by 10.7% year-on-year, still the main support for revenue growth. However, overall profitability faces pressure:

• Total revenue increased by 3.4% year-on-year to 33.72 billion yuan

• Operating profit decreased by 15.6% year-on-year to 3.6 billion yuan

• Net profit decreased by 27.0% year-on-year to 2.9 billion yuan

Gross margin fell from 54.6% to 51.2%, slightly lower than the forecasted 51.5%, with the decline mainly due to rising costs of bandwidth, server hosting, and depreciation.

R&D expenditure was 3.62 billion yuan, below the expected 3.67 billion yuan, but increased by 9.8% year-on-year, with the company stating this was mainly due to increased investment in AI. Sales and marketing expenses were 10.33 billion yuan, a slight year-on-year increase of 4.4%, basically in line with expectations.

E-commerce Search and Live Broadcast Boosted by AI

The quarter did not disclose GMV for e-commerce separately, but several core indicators have improved significantly. The number of merchants using promotions for sales growth increased by 38.0% year-on-year, and marketing spending by brand merchants increased by 42.0% year-on-year.

In the search scenario, the new generative search framework OneSearch V2 was fully launched, driving an increase of about 3.0% in e-commerce search GMV; in the