On March 3, 2026, Kingsoft Cloud Holdings Limited officially announced that its subsidiary, Wuhan Kingsoft Cloud, has entered into a share transfer agreement with Xunlei and Xinghan Zhilian. According to the agreement, Xunlei will transfer its 20% equity stake in Shenzhen Wangxin Technology Co., Ltd. to Wuhan Kingsoft Cloud for 50 million RMB, while simultaneously transferring a 30% stake in Wangxin Technology to Xinghan Zhilian for 75 million RMB. Upon completion of this transaction, Kingsoft Cloud will indirectly hold a 20% stake in Wangxin Technology through its subsidiary. The target company will not be consolidated into Kingsoft Cloud's financial statements.
The announcement indicates this transaction constitutes a connected transaction. Xunlei is a controlled company in which Xiaomi Group, a major shareholder of Kingsoft Cloud, directly and indirectly holds approximately 10.29% of the shares, making it a connected person under Hong Kong listing rules. As the applicable percentage ratio of the transaction falls between 0.1% and 5%, it is only subject to reporting and announcement requirements according to relevant regulations, exempt from the circular and independent shareholder approval procedures.
Shenzhen Wangxin Technology Co., Ltd. is primarily engaged in content delivery network and acceleration services based on edge computing, possessing deep technical expertise in the field. Notably, the target company has recently achieved a critical financial turnaround.
According to financial data disclosed in the Kingsoft Cloud announcement, as of December 31, 2024, Wangxin Technology's unaudited net assets were negative 668 million RMB. However, by December 31, 2025, its net assets had turned positive to approximately 240 million RMB. More crucially, Wangxin Technology achieved a pre-tax profit of 12.4 million RMB and a post-tax profit of 9.9 million RMB in 2025, successfully returning to profitability. This significant improvement in financial performance provides important support for the valuation in this transaction.
Kingsoft Cloud provided a clear explanation of the strategic intent behind this acquisition. As the artificial intelligence industry evolves from the training phase to the inference phase, low-latency inference is expected to become a primary driver of computing power demand growth. The target company, as a leader in the edge computing sector, can process data locally by deploying distributed nodes at the network edge, meeting the demand for low latency and stable computing power required by AI applications, demonstrating considerable growth potential. Kingsoft Cloud stated that the Group has been prudently seeking investment targets with growth potential to optimize capital utilization and enrich its investment portfolio. Considering Wangxin Technology's future business growth potential, this acquisition represents an attractive strategic minority equity investment opportunity, expected to be a suitable way to share in the potential growth of the target company without significantly increasing the Group's operational risk.
It is noteworthy that Kingsoft Cloud is acquiring only a 20% stake in Wangxin Technology, meaning the target company will not be included in Kingsoft Cloud's consolidated financial statements. This indicates Kingsoft Cloud is adopting a posture of strategic minority investment rather than a full acquisition and consolidation. Concurrently, the transaction for Xinghan Zhilian to acquire a 30% stake is proceeding, and Xunlei will retain a partial shareholding in Wangxin Technology. This transaction structure allows Kingsoft Cloud to benefit from Wangxin Technology's growth potential in edge computing while avoiding the operational risks associated with full consolidation, demonstrating a prudent investment strategy.
Following the announcement, Kingsoft Cloud's stock price remained stable. Market analysts believe that as AI applications evolve from model training to large-scale inference deployment, the value of edge computing in reducing latency and saving bandwidth costs is being re-evaluated. As an early mover in edge computing CDN in China, Wangxin Technology possesses first-mover advantages in terms of distributed node resources and technical积累. Kingsoft Cloud's investment is expected to secure important edge node resources for its future AI computing power layout.
At a time when the structure of AI computing power demand is undergoing profound changes, this 50 million yuan strategic investment may mark the beginning of a new round of strategic moves by Kingsoft Cloud in the edge inference arena.