Kuaishou Technology said artificial intelligence is what will drive users to its video platform after posting its slowest quarterly sales growth since its 2021 listing.

Kuaishou shares dropped 5% in morning trading.

AI is the “core engine that will drive our platform to create more value” for its commercial ecosystem while achieving traffic growth, the Tencent-backed internet company said in an exchange filing, touting its new video-generation tool.

Kling AI, as the tool is named, is expected to achieve “significant revenue growth” this year, Chairman Cheng Yixiao said on an earnings call. That’s after generating more than 100 million yuan ($13.8 million) in cumulative revenue through February since its launch late last year.

“Of course, we will dramatically adjust the scale of AI investments based on business progress,” Cheng said. “For example, if Kling AI’s monetization keeps accelerating, we might increase investment in inference computing power.”

Newer models and AI-generated content have increased both time spent and user engagement, making the platform more lucrative for marketing spending. Average daily spending targeting such content exceeded 30 million yuan in the last three months of 2024.

“Kuaishou remains well-positioned to push further into profit in 2025, though economic headwinds, rising R&D investment and intense e-commerce remain risks to margins,” said Bloomberg Intelligence analysts Robert Lea and Jasmine Lyu. AI investments are currently expected to impact adjusted net margin by about 1% to 2% this year, according to Cheng.

Fourth-quarter revenue rose 8.7% to 35.4 billion yuan, meeting the 35.7 billion yuan estimated by analysts.