Kingdee International Software Group Company Limited (stock code: 00268.HK) released its audited 2025 annual results. Key figures are as follows:

• Revenue grew 12.0% YoY to RMB7.01 billion. Cloud services contributed RMB5.78 billion, up 13.2% and accounting for 82.5% of total revenue.

• Net profit attributable to shareholders reached RMB92.91 million, reversing a RMB142.07 million loss in 2024. On a non-IFRS basis, adjusted profit was RMB231.98 million versus a RMB10.15 million adjusted loss last year.

• Gross margin improved 2.0 ppts to 67.1%, reflecting scale effects in cloud subscriptions and AI-driven efficiency.

• Operating cash inflow rose 17.6% to RMB1.10 billion. Cash and bank deposits (including pledged and time deposits) stood at RMB3.80 billion; the Group reported no outstanding bank borrowings at year-end.

• Basic EPS turned positive at RMB2.64 cents (2024: –RMB4.01 cents). No final dividend was proposed.

Segment performance

Subscription & Software revenue increased 16.8% YoY to RMB4.23 billion, generating segment gross profit of RMB4.08 billion. Implementation, Consulting, Maintenance & Others revenue grew 5.4% to RMB2.78 billion, with segment gross profit of RMB623.57 million.

Operational metrics

– Cloud subscription revenue climbed 20.9% to RMB3.56 billion; ARR reached RMB4.09 billion, up 19.2%. – Contract liabilities expanded 17.8% to RMB4.39 billion, underpinning future revenue visibility. – Net dollar retention hit a three-year high: 110% for large-enterprise Cloud Cosmic/Constellation, 97% for Galaxy (growth enterprises), 94% for Stellar and 88% for Jingdou (SME lines).

Spending trends

Selling & marketing expenses rose 8.9% to RMB2.73 billion, but their ratio to revenue fell to 38.9% (2024: 40.0%). R&D expenses posted at RMB1.49 billion, 21.3% of revenue (2024: 24.2%). Administrative expenses increased 20.1% to RMB647.06 million, or 9.2% of revenue.

Balance sheet highlights

Total assets reached RMB14.59 billion. Net assets amounted to RMB8.21 billion, while the current ratio improved to 1.03. Financial assets at FVPL grew to RMB2.12 billion, chiefly short-term wealth-management products and unlisted equity investments.

Strategic progress

The Group advanced its “AI First, Subscription First, Globalisation” roadmap, rebranding “Kingdee Cloud” to “Kingdee AI” and launching the AI-native portal “Xiao K” plus 20 AI agents. AI-related contract value totalled RMB356 million. Overseas expansion added 463 new clients across Southeast Asia and the Middle East.

Outlook

Management expects continued scaling of cloud subscriptions and deeper AI integration to drive operating leverage, targeting further margin expansion and international growth over the next five years.