Kingsoft Cloud Announces Unaudited Third Quarter 2020 Financial Results
BEIJING, China, Nov. 18, 2020 (GLOBE NEWSWIRE) -- Kingsoft Cloud Holdings Limited (“Kingsoft Cloud” or the “Company”) (NASDAQ: KC), a leading independent cloud service provider in China, today announced its unaudited financial results for the third quarter ended September 30, 2020.
Third quarter 2020 Financial Highlights
- Total revenues were RMB1,728.8 million (US$1254.6 million) in the third quarter of 2020, representing an increase of 72.6% year-over-year.
- Gross profit was RMB112.9 million (US$16.6 million) or 6.5% gross margin in the third quarter of 2020, compared with RMB18.7 million or 1.9% gross margin in the third quarter of 2019.
- Non-GAAP gross profit2, was RMB114.8 million (US$16.9 million) or 6.6% Non-GAAP gross margin in the third quarter of 2020, compared with RMB20.6 million or 2.1% Non-GAAP gross margin in the third quarter of 2019.
- Net loss was RMB105.3 million (US$15.5 million) or -6.1% net loss margin in the third quarter of 2020, compared with net loss of RMB350.6 million or net loss margin of -35.0% in the third quarter of 2019. The profitability and margin have been improving on both year-over- year and sequential basis.
- Non-GAAP EBITDA3, was RMB-26.3 million (US$-3.9 million) or -1.5% Non-GAAP EBITDA margin in the third quarter of 2020, compared with RMB-102.0 million or -10.2% Non-GAAP EBITDA margin in the third quarter of 2019.
Mr. Yulin Wang, Chief Executive Officer of Kingsoft Cloud, commented, “We delivered another solid quarter of operational and financial results for the third quarter of 2020. Our total revenues increase by 72.6% year-over-year to RMB1,728.8 million. While we experienced strong demand from many existing clients, we also saw the resumption of a number of enterprise cloud projects that had been delayed due to COVID-19. In light of the ongoing digital transformation trends and the increasingly rapid roll out of enterprise cloud projects across the country, we will continue to invest in technology and expand our reach into select industries so that we can take advantage of the numerous growth opportunities around cloud computing that lie ahead.”
_____________
| 1 | This announcement contains translations of certain Renminbi (RMB) amounts into U.S. dollars (US$) at a specified rate solely for the convenience of the reader. Unless otherwise noted, the translation of RMB into US$ has been made at RMB6.7896 to US$1.00, the noon buying rate in effect on September 30, 2020 as certified for customs purposes by the Federal Reserve Bank of New York. | |
| 2 | Non-GAAP gross profit is defined as gross profit excluding share-based compensation allocated in the cost of revenues, and we define Non-GAAP gross margin as Non-GAAP gross profit as a percentage of revenues. See “Reconciliation of GAAP and Non-GAAP results” set forth at the end of this press release. | |
| 3 | Non-GAAP EBITDA is defined as Non-GAAP net loss excluding interest income, interest expense, income tax expense and depreciation and amortization, and Non-GAAP net loss is defined as net loss excluding share-based compensation, foreign exchange (gain) loss, changes in fair value of financial instruments and other (income) expense, net. Non-GAAP EBITDA margin is defined as Non-GAAP EBITDA as a percentage of revenues. See “Reconciliation of GAAP and Non-GAAP results” set forth at the end of this press release. |
Mr. Henry He, Chief Financial Officer of Kingsoft Cloud added that “We are pleased to observe accelerated year-over-year revenue growth and improving bottom line performance. Our total revenues during the quarter came in at the mid-to-top end of the previous guidance, at RMB 1,728.8 million. It represents accelerated year-over-year growth of 72.6%, which makes us one of the fastest growing major players in the industry. Enterprise cloud services revenues reached RMB409.1 million, representing an increase of 257.3% year-over-year and 66.2% sequentially. It contributed 23.7% of total revenues this quarter, compared with 11.4% in the same period last year. Our adjusted EBITDA margin increased to -1.5% this quarter from -10.2% in the same period last year, representing an improvement of 8.7 percentage points. It has now steadily improved for nine consecutive quarters.”
Third quarter 2020 Financial Results
Total Revenues reached RMB1,728.8 million (US$254.6 million), representing an increase of 72.6% from RMB1,001.8 million in the same period of 2019. The increases were primarily due to the growth in both public cloud services and enterprise cloud services for our premium customers.
- Revenues from public cloud services were RMB1,309.7 million (US$192.9 million), representing an increase of 48.1% from RMB884.5 million in the same period of 2019.
- Revenues from enterprise cloud services were RMB409.1 million (US$60.2 million), representing an increase of 257.3% from RMB114.5 million in the same period of 2019.
- Other revenues were RMB10.0 million (US$1.5 million).
Cost of revenues was RMB1,615.9 million (US$238.0 million), representing an increase of 64.4% from RMB983.0 million in the same period of 2019, primarily attributable to the rapid growth of our business. IDC costs increased by 51.2% to RMB1,060.1 million (US$156.1 million) from 701.3 million in the same period of 2019. The increase in IDC costs was in line with the Company’s expanding business and was partially offset by improved efficiency and utilization of bandwidth. IDC costs as a percentage of total revenues decreased from 70.0% during the same period of last year to 61.3% in the third quarter of 2020. Depreciation and amortization costs remained stable at RMB156.5 million (US$23.0 million), compared with RMB153.6 million in the same period of 2019. We review the useful lives of equipment on an ongoing basis, and effective July 1, 2020 we changed our estimate of the useful life for our certain electronic equipment from three to four years. The longer useful life is due to increasing purchase of high-end equipment, continuous improvements in our software and enhancements in our capability of operation.
Gross profit was RMB112.9 million (US$16.6 million), compared to RMB18.7 million in the same period in 2019. Gross margin was 6.5%, representing an increase of 4.6 percentage points from 1.9% in the same period in 2019.
Non-GAAP gross profit was RMB114.8 million (US$16.9 million), compared to RMB20.6 million in the same period in 2019. Non-GAAP gross margin was 6.6%, representing an increase of 4.5 percentage points from 2.1% in the same period in 2019. The increase was primarily due to our continued leverage on economies of scale and the costs savings.
Selling and marketing expenses were RMB96.8 million (US$14.3 million), representing an increase of 10.9% from RMB87.3 million in the same period in 2019, mainly due to the increase in share-based compensation expenses, as well as the salaries and welfare of selling and marketing personnel.
General and administrative expenses were RMB91.3 million (US$13.5 million), an increase of 64.5% from RMB55.5 million in the same period in 2019, mainly due to the increase in expenses for legal, accounting and other administrative and compliance affairs, as well as the share-based compensation expenses.
Research and development expenses were RMB167.6 million (US$24.7 million), an increase of 7.5% from RMB155.9 million in the same period in 2019, primarily due to the increase in share-based compensation expenses.
Operating loss was RMB242.8 million (US$35.8 million), compared with RMB279.9 million in the same quarter of 2019.
Net loss was RMB105.3 million (US$15.5 million), compared with RMB350.6 million in the same quarter of 2019.
Non-GAAP net loss was RMB169.1 million (US$24.9 million), compared with RMB241.9 million in the same quarter of 2019. The Non-GAAP net loss margin increased to -9.8% from -24.2% in the same quarter of 2019. The profitability and margin have been improving on both year-over-year and sequential basis.
Non-GAAP EBITDA was RMB-26.3 million (US$-3.9 million), compared with RMB-102.0 million in the same quarter of 2019. Non-GAAP EBITDA margin was -1.5%, compared to -10.2% in the same quarter of 2019. The steady increase of Non-GAAP EBITDA margin was due to the revenue growth and operating leverage.
Basic and diluted net loss per share was RMB0.03 (US$0.00), compared with RMB0.39 in the same quarter of 2019.
Cash and cash equivalents and short-term investments were RMB6,796.9 million (US$1,001.1 million) as of September 30, 2020, compared to RMB2,248.7 million as of December 31, 2019. The increase was primarily driven by the net proceeds received from IPO in May and follow up offering in September, as well as the improving profitability.
Outstanding ordinary shares were 3,270,266,493 as of September 30, 2020, equivalent to about 218,017,766 ADSs.
Business Outlook
For the fourth quarter of 2020, the Company expects total revenues to be between RMB1.88 billion and RMB1.95 billion. This forecast reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change.
Conference Call Information
The Company will hold a conference call on Wednesday, November 18, 2020 at 7:00 am, U.S. Eastern Time (8:00 pm, Beijing/Hong Kong Time on the same day) to discuss the financial results.
Participants can register for the conference call by navigating to http://apac.directeventreg.com/registration/event/5847057. Once preregistration has been completed, participants will receive dial-in numbers, direct event passcode, and a unique registrant ID.
To join the conference, simply dial the number in the calendar invite you receive after preregistering, enter the passcode followed by your registrant ID, and you will join the conference instantly.
A telephone replay of the call will be available after the conclusion of the conference call through 10:00 a.m. U.S. Eastern Time, November 26, 2020. The dial-in details for the replay are as follows:
International: +61-2-8199-0299
U.S. Toll Free: +1-855-452-5696
Mainland China Toll Free: 800-870-0206
Hong Kong Toll Free: 800-963-117
Conference ID: 5847057
A live and archived webcast of the conference call will also be available at the Company’s investor relations website at http://ir.ksyun.com/.
Use of Non-GAAP Financial Measures
The unaudited condensed consolidated financial information is prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In evaluating our business, we consider and use certain non-GAAP measures, Non-GAAP gross (loss) profit, Non-GAAP gross margin, Non-GAAP EBITDA and Non-GAAP EDITDA margin, as supplemental measures to review and assess our operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define Non-GAAP gross (loss) profit as gross (loss) profit excluding share- based compensation allocated in the cost of revenues, and we define Non-GAAP gross margin as Non-GAAP gross (loss) profit as a percentage of revenues. We define Non-GAAP net loss as net loss excluding share-based compensation, foreign exchange (gain) loss, changes in fair value of financial instruments and other (income) expense, net. We define Non-GAAP EBITDA as Non-GAAP net loss excluding interest income, interest expense, income tax expense and depreciation and amortization, and we define Non-GAAP EBITDA margin as Non-GAAP EBITDA as a percentage of revenues. We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. We also believe that the use of these non-GAAP measures facilitates investors’ assessment of our operating performance. These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. These non-GAAP
financial measures have limitations as analytical tools. One of the key limitations of using these non-GAAP financial measures is that they do not reflect all items of income and expense that affect our operations. Further, these non-GAAP measures may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited.
We compensate for these limitations by reconciling these non-GAAP financial measures to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.
Exchange Rate Information
This press release contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from RMB to U.S. dollars, in this press release, were made at a rate of RMB6.7896 to US$1.00, the noon buying rate in effect on September 30, 2020 as certified for customs purposes by the Federal Reserve Bank of New York.
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Among other things, the Business Outlook and quotations from management in this announcement, as well as Kingsoft Cloud’s strategic and operational plans, contain forward-looking statements. Kingsoft Cloud may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (“SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to fourth parties. Statements that are not historical facts, including but not limited to statements about Kingsoft Cloud’s beliefs and expectations, are forward-looking statements. Forward- looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Kingsoft Cloud’s goals and strategies; Kingsoft Cloud’s future business development, results of operations and financial condition; relevant government policies and regulations relating to Kingsoft Cloud’s business and industry; the expected growth of the cloud service market in China; the expectation regarding the rate at which to gain customers, especially Premium Customers; Kingsoft Cloud’s ability to monetize the customer base; fluctuations in general economic and business conditions in China; the impact of the COVID-19 to Kingsoft Cloud’s business operations and the economy in China and elsewhere generally; China’s political or social conditions and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Kingsoft Cloud’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Kingsoft Cloud does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
About Kingsoft Cloud Holdings Limited
Kingsoft Cloud Holdings Limited (NASDAQ: KC) is a leading independent cloud service provider in China. Kingsoft Cloud has built a comprehensive and reliable cloud platform consisting of extensive cloud infrastructure, cutting-edge cloud products and well-architected industry-specific solutions across public cloud, enterprise cloud and AIoT cloud services.
For more information, please visit: http://ir.ksyun.com.
For investor and media inquiries, please contact:
Kingsoft Cloud Holdings Limited
Nicole Shan
Tel: +86 (10) 6292-7777 Ext. 6300
Email: ksc-ir@kingsoft.com
Christensen
Ms. Linda Bergkamp
Phone: +1-480-614-3004
E-mail: lbergkamp@christensenir.com
| KINGSOFT CLOUD HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (All amounts in thousands) | ||||||
| Dec 31, 2019 | Sep 30, 2020 | Sep 30, 2020 | ||||
| RMB | RMB | US$ | ||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | 2,023,263 | 3,866,503 | 569,474 | |||
| Accounts receivable, net | 1,347,481 | 2,027,606 | 298,634 | |||
| Short-term investments | 225,425 | 2,930,435 | 431,606 | |||
| Prepayments and other assets | 421,938 | 553,324 | 81,496 | |||
| Amounts due from related parties | 131,632 | 127,070 | 18,715 | |||
| Total current assets | 4,149,739 | 9,504,938 | 1,399,925 | |||
| Non-current assets: | ||||||
| Property and equipment, net | 1,720,974 | 1,935,358 | 285,047 | |||
| Intangible assets, net | 7,428 | 19,696 | 2,901 | |||
| Prepayments and other assets | 36,468 | 59,495 | 8,763 | |||
| Equity investments | 114,876 | 117,081 | 17,244 | |||
| Amounts due from related parties | 2,336 | 5,758 | 848 | |||
| Operating lease right-of-use assets | - | 276,452 | 40,717 | |||
| Total non-current assets | 1,882,082 | 2,413,840 | 355,520 | |||
| Total assets | 6,031,821 | 11,918,778 | 1,755,445 | |||
| LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS’ DEFICIT | ||||||
| Current liabilities | ||||||
| Accounts payable | 1,254,589 | 1,992,053 | 293,398 | |||
| Accrued expenses and other current liabilities | 949,213 | 717,739 | 105,712 | |||
| Short-term bank loans | - | 278,488 | 41,017 | |||
| Long-term bank loan, current portion | 100,000 | 124,351 | 18,315 | |||
| Income tax payable | 11,930 | 20,156 | 2,969 | |||
| Amounts due to related parties | 104,259 | 120,154 | 17,697 | |||
| Current operating lease liabilities | - | 66,287 | 9,763 | |||
| Total current liabilities | 2,419,991 | 3,319,228 | 488,871 | |||
| Non-current liabilities | ||||||
| Long-term bank loan | 74,351 | - | - | |||
| Deferred tax liabilities | 206 | 74 | 11 | |||
| Other liabilities | - | 41,799 | 6,156 | |||
| Non-current operating lease liabilities | - | 209,189 | 30,810 | |||
| Total non-current liabilities | 74,557 | 251,062 | 36,977 | |||
| Total liabilities | 2,494,548 | 3,570,290 | 525,848 | |||
| Mezzanine equity: | ||||||
| Series B convertible preferred shares | 337,268 | - | - | |||
| Series C redeemable convertible preferred shares | 1,043,147 | - | - | |||
| Series D redeemable convertible preferred shares | 5,965,273 | - | - | |||
| Series D+ redeemable convertible preferred shares | 388,844 | - | - | |||
| Total mezzanine equity | 7,734,532 | - | - | |||
| Shareholders’ (deficit) equity: | ||||||
| Series A convertible preferred shares | 123,186 | - | - | |||
| Ordinary shares | 5,558 | 22,343 | 3,291 | |||
| Additional paid-in capital | 91,746 | 13,826,068 | 2,036,357 | |||
| Accumulated deficit | (4,902,097 | ) | (5,759,144 | ) | (848,230 | ) |
| Accumulated other comprehensive income | 484,348 | 259,214 | 38,178 | |||
| Total Kingsoft Cloud Holdings Limited shareholders’ (deficit) equity | (4,197,259 | ) | 8,348,481 | 1,229,596 | ||
| Noncontrolling interests | - | 7 | 1 | |||
| Total (deficit) equity | (4,197,259 | ) | 8,348,488 | 1,229,597 | ||
| Total liabilities, mezzanine equity and shareholders’ (deficit) equity | 6,031,821 | 11,918,778 | 1,755,445 | |||
| KINGSOFT CLOUD HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (All amounts in thousands, except for share and per share data) | |||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||
| Sep 30, 2019 | Mar 31, 2020 | Jun 30, 2020 | Sep 30, 2020 | Sep 30, 2020 | Sep 30, 2019 | Sep 30, 2020 | Sep 30, 2020 | ||||||||||
| RMB | RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Revenues: | |||||||||||||||||
| Public cloud services | 884,518 | 1,208,514 | 1,287,139 | 1,309,693 | 192,897 | 2,513,701 | 3,805,346 | 560,467 | |||||||||
| Enterprise cloud services | 114,450 | 181,587 | 246,081 | 409,101 | 60,254 | 265,881 | 836,769 | 123,243 | |||||||||
| Others | 2,822 | 862 | 1,535 | 10,049 | 1,480 | 3,131 | 12,446 | 1,833 | |||||||||
| Total revenues | 1,001,790 | 1,390,963 | 1,534,755 | 1,728,843 | 254,631 | 2,782,713 | 4,654,561 | 685,543 | |||||||||
| Cost of revenues | (983,046 | ) | (1,320,192 | ) | (1,454,011 | ) | (1,615,945 | ) | (238,003 | ) | (2,829,327 | ) | (4,390,148 | ) | (646,599 | ) | |
| Gross profit (loss) | 18,744 | 70,771 | 80,744 | 112,898 | 16,628 | (46,614 | ) | 264,413 | 38,944 | ||||||||
| Operating expenses: | |||||||||||||||||
| Selling and marketing expenses | (87,309 | ) | (87,968 | ) | (109,775 | ) | (96,802 | ) | (14,257 | ) | (219,140 | ) | (294,545 | ) | (43,382 | ) | |
| General and administrative expenses | (55,491 | ) | (75,977 | ) | (170,421 | ) | (91,338 | ) | (13,453 | ) | (151,403 | ) | (337,736 | ) | (49,743 | ) | |
| Research and development expenses | (155,853 | ) | (195,650 | ) | (230,828 | ) | (167,590 | ) | (24,683 | ) | (423,685 | ) | (594,068 | ) | (87,497 | ) | |
| Total operating expenses | (298,653 | ) | (359,595 | ) | (511,024 | ) | (355,730 | ) | (52,393 | ) | (794,228 | ) | (1,226,349 | ) | (180,622 | ) | |
| Operating loss | (279,909 | ) | (288,824 | ) | (430,280 | ) | (242,832 | ) | (35,765 | ) | (840,842 | ) | (961,936 | ) | (141,678 | ) | |
| Interest income | 17,291 | 10,095 | 20,937 | 24,414 | 3,596 | 66,976 | 55,446 | 8,166 | |||||||||
| Interest expense | - | (1,884 | ) | (1,791 | ) | (3,940 | ) | (580 | ) | (4,925 | ) | (7,615 | ) | (1,122 | ) | ||
| Foreign exchange (loss) gain | (81,882 | ) | (40,144 | ) | (2,883 | ) | 117,714 | 17,337 | (95,714 | ) | 74,687 | 11,000 | |||||
| Changes in fair value of financial instruments | - | 198 | - | 2,825 | 416 | - | 3,023 | 445 | |||||||||
| Other (expense) income, net | (3,781 | ) | (5,259 | ) | (4,342 | ) | 515 | 76 | 9,807 | (9,086 | ) | (1,338 | ) | ||||
| Loss before income taxes | (348,281 | ) | (325,818 | ) | (418,359 | ) | (101,304 | ) | (14,920 | ) | (864,698 | ) | (845,481 | ) | (124,527 | ) | |
| Income tax expense | (2,311 | ) | (5,829 | ) | (1,697 | ) | (4,033 | ) | (594 | ) | (6,993 | ) | (11,559 | ) | (1,702 | ) | |
| Net loss | (350,592 | ) | (331,647 | ) | (420,056 | ) | (105,337 | ) | (15,514 | ) | (871,691 | ) | (857,040 | ) | (126,229 | ) | |
| Less: net (loss) income attributable to noncontrolling interests | - | (306 | ) | 117 | 196 | 29 | - | 7 | 1 | ||||||||
| Net loss attributable to Kingsoft Cloud Holdings Limited | (350,592 | ) | (331,341 | ) | (420,173 | ) | (105,533 | ) | (15,543 | ) | (871,691 | ) | (857,047 | ) | (126,230 | ) | |
| Accretion to redemption value of redeemable convertible preferred shares | - | (19,768 | ) | - | - | - | - | (19,768 | ) | (2,912 | ) | ||||||
| Net loss attributable to ordinary shareholders | (350,592 | ) | (351,109 | ) | (420,173 | ) | (105,533 | ) | (15,543 | ) | (871,691 | ) | (876,815 | ) | (129,142 | ) | |
| Net loss per share: | |||||||||||||||||
| Basic and diluted | (0.39 | ) | (0.39 | ) | (0.19 | ) | (0.03 | ) | (0.00 | ) | (0.98 | ) | (0.42 | ) | (0.06 | ) | |
| Shares used in the net loss per share computation: | |||||||||||||||||
| Basic and diluted | 894,711,200 | 898,305,836 | 2,218,943,950 | 3,153,524,558 | 3,153,524,558 | 886,714,057 | 2,098,997,211 | 2,098,997,211 | |||||||||
| Other comprehensive income (loss), net of tax of nil: | |||||||||||||||||
| Foreign currency translation adjustments | 126,033 | 51,349 | 683 | (277,166 | ) | (40,822 | ) | 140,665 | (225,134 | ) | (33,159 | ) | |||||
| Comprehensive loss | (224,559 | ) | (280,298 | ) | (419,373 | ) | (382,503 | ) | (56,336 | ) | (731,026 | ) | (1,082,174 | ) | (159,388 | ) | |
| Less: Comprehensive (loss) income attributable to noncontrolling interests | - | (306 | ) | 117 | 196 | 29 | - | 7 | 1 | ||||||||
| Comprehensive loss attributable to Kingsoft Cloud Holdings Limited shareholders | (224,559 | ) | (279,992 | ) | (419,490 | ) | (382,699 | ) | (56,365 | ) | (731,026 | ) | (1,082,181 | ) | (159,389 | ) | |
| Accretion to redemption value of redeemable convertible preferred shares | - | (19,768 | ) | - | - | - | - | (19,768 | ) | (2,912 | ) | ||||||
| Comprehensive loss attributable to ordinary shareholders | (224,559 | ) | (299,760 | ) | (419,490 | ) | (382,699 | ) | (56,365 | ) | (731,026 | ) | (1,101,949 | ) | (162,301 | ) | |
| KINGSOFT CLOUD HOLDINGS LIMITED RECONCILIATION OF GAAP AND NON-GAAP RESULTS (All amounts in thousands, except for percentage) | ||||||||||
| Three Months Ended | ||||||||||
| Sep 30, 2019 | Mar 31, 2020 | Jun 30, 2020 | Sep 30, 2020 | Sep 30, 2020 | ||||||
| RMB | RMB | RMB | RMB | US$ | ||||||
| Gross profit | 18,744 | 70,771 | 80,744 | 112,898 | 16,628 | |||||
| Adjustments: | ||||||||||
| – Share-based compensation expenses | 1,817 | 3,426 | 3,009 | 1,858 | 274 | |||||
| Adjusted gross profit | 20,561 | 74,197 | 83,753 | 114,756 | 16,902 | |||||
| Three Months Ended | ||||||||
| Sep 30, 2019 | Mar 31, 2020 | Jun 30, 2020 | Sep 30, 2020 | |||||
| Gross margin | 1.9% | 5.1% | 5.3% | 6.5% | ||||
| Adjusted gross margin | 2.1% | 5.3% | 5.5% | 6.6% | ||||
| Three Months Ended | |||||||||||
| Sep 30, 2019 | Mar 31, 2020 | Jun 30, 2020 | Sep 30, 2020 | Sep 30, 2020 | |||||||
| RMB | RMB | RMB | RMB | US$ | |||||||
| Net Loss | (350,592 | ) | (331,647 | ) | (420,056 | ) | (105,337 | ) | (15,514 | ) | |
| Adjustments: | |||||||||||
| – Share-based compensation expenses | 22,981 | 43,084 | 175,148 | 57,339 | 8,445 | ||||||
| – Foreign exchange loss (gain) | 81,882 | 40,144 | 2,883 | (117,714 | ) | (17,337 | ) | ||||
| – Changes in fair value of financial instruments | - | (198 | ) | - | (2,825 | ) | (416 | ) | |||
| – Other expense (income), net | 3,781 | 5,259 | 4,342 | (515 | ) | (76 | ) | ||||
| Adjusted net loss | (241,948 | ) | (243,358 | ) | (237,683 | ) | (169,052 | ) | (24,898 | ) | |
| Adjustments: | |||||||||||
| – Interest income | (17,291 | ) | (10,095 | ) | (20,937 | ) | (24,414 | ) | (3,596 | ) | |
| – Interest expense | - | 1,884 | 1,791 | 3,940 | 580 | ||||||
| – Income tax expense | 2,311 | 5,829 | 1,697 | 4,033 | 594 | ||||||
| – Depreciation and amortization | 154,919 | 206,362 | 219,227 | 159,199 | 23,447 | ||||||
| Adjusted EBITDA | (102,009 | ) | (39,378 | ) | (35,905 | ) | (26,294 | ) | (3,873 | ) | |
| Three Months Ended | ||||||||
| Sep 30, 2019 | Mar 31, 2020 | Jun 30, 2020 | Sep 30, 2020 | |||||
| Net loss margin | -35.0% | -23.8% | -27.4% | -6.1% | ||||
| Adjusted net loss margin | -24.2% | -17.5% | -15.5% | -9.8% | ||||
| Adjusted EBITDA Margin | -10.2% | -2.8% | -2.3% | -1.5% | ||||
| KINGSOFT CLOUD HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (All amounts in thousands) | |||||||
| Three Months Ended | |||||||
| Sep 30, 2019 | Sep 30, 2020 | Sep 30, 2020 | |||||
| RMB | RMB | US$ | |||||
| Net cash used in operating activities | (127,444 | ) | (103,510 | ) | (15,245 | ) | |
| Net cash generated from (used in) investing activities | 148,980 | (1,037,103 | ) | (152,749 | ) | ||
| Net cash generated from financing activities | 437 | 1,770,098 | 260,707 | ||||
| Effect of exchange rate changes on cash and cash equivalents | (26,325 | ) | (73,469 | ) | (10,821 | ) | |
| Net increase in cash and cash equivalents | 21,973 | 629,485 | 92,713 | ||||
| Cash and cash equivalents at beginning of period | 1,745,868 | 3,310,487 | 487,582 | ||||
| Cash and cash equivalents at end of period | 1,741,516 | 3,866,503 | 569,474 | ||||