0246 GMT - Kuaishou's investment case still rests on its core short-video advertising cash engine, Morningstar analyst Ivan Su says in a research note, even though its AI video tool Kling is monetizing faster than expected. While Kling's annualized run rate already exceeds Morningstar's expectation, its thin gross margin, likely around 5%, and unproven user retention make Morningstar unsure about its long-term shareholder value. Across Kuaishou's three core profit engines, advertising remains the strongest driver, he notes. "We share the market's view that near-term profitability is under pressure, but still see a path for earnings recovery driven by the core short-video business, its cash cow," Su says. Shares are 0.8% lower at HK$44.50.(sherry.qin@wsj.com)

(END) Dow Jones Newswires

May 28, 2026 22:46 ET (02:46 GMT)

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