Kingsoft Cloud Holdings Limited

Good morning, ladies and gentlemen, and thank you for standing by for Kingsoft Cloud's second quarter 2026 earnings conference call. All participants are currently in listen-only mode. Following management's prepared remarks, we will open the call for questions. Please note that today's call is being recorded. I will now turn the call over to Mr. Jackie Zou, Senior Director of Capital Markets at Kingsoft Cloud. Jackie, please go ahead.

Thank you, operator. Hello, everyone, and thank you for joining us today. Kingsoft Cloud's second quarter 2026 earnings release was issued earlier today and is available on our IR website and through PR Newswire. Joining us today are Mr. Zou Tao, Chairman and CEO, Ms. Li Yi, CFO, Mr. Liu Tao, Senior Vice President, Mr. Tian Kaiyan, Senior Vice President, Ms. Yu Jun, Vice President, Mr. Zhou Ruilong, Associate Vice President, and Mr. Clark Tian, Board Secretary and Associate Vice President. Mr. So will discuss our business performance and key developments, followed by Ms. Li with a review of our financial results. Management will then take your questions. Contemptive interpretation will be provided for convenience and for reference only. In the event of any discrepancy, mention statements in the original language will prevail. Before we begin, I would like to remind you that today's call contains forward-looking statements made under the safe harbor provisions of U.S. Private Securities' litigation reform text of . These statements involve risks and uncertainties and actual results may differ materially from those expressed or implied by the forward-looking statements. Additional information concerning factors that would cause actual results to differ materially is included in the company's filing with the U.S. SBC. The company undertakes no obligation to update any forward-looking statements except as required by applicable law. Unless otherwise stated, All financial figures discussed on today's call are denominated in Renminbi. With that, it is my pleasure to turn the call over to our Chairman and CEO, Mr. Zou. Mr. Zou, please go ahead.

Hello, everyone. Welcome to the second round of the Business Development Conference of J&J in 2026. I am Zou Tao, the CEO of J&J. In this quarter, we have seen AI cloud business model close to our eyes. Kaiyan's large-scale ecosystem of space prosperity brings a huge space of development to Chinese cloud manufacturers. Over the past few years, we have always believed in AI landing on the top of the sky and coming to us in the form of model-based service, AI-based service, and FDE integration. Facing this profound change in the industry, Jinan Cloud continues to monitor the development strategy of technical industry and high-capacity sustainable development, to promote the development of AI cloud services, MaaS business, and FDE business. They have achieved remarkable results. First of all, AI business continues to drive the company's revenue growth. This quarter, the total revenue reached 30.7 billion yuan. The single quarter's historical growth increased by 31 percent. Among them, AI Cloud Holdings' revenue reached 13.3 billion yuan, which increased by 82 percent. and Sun Yat-sen have increased their revenue by 56%. The revenue of MaaS business is growing rapidly. The revenue of MaaS in the second quarter has increased by 12%. Next, the level of profit has significantly increased. This quarter's net profit has increased by 15.4%. The net profit has increased by 2.4%. The first turnover of business profits has adjusted its operating profit to 4% and created a new high. This is a remarkable achievement in terms of capturing AI waves, increasing revenue, and implementing powder reduction effects. Third, the customer structure continues to optimize, and the business opportunities in and out of the ecosystem are accelerating. In the ecosystem, the income from Xiaomi and Jinshan Ecosystems is 8.1 billion yuan, which is 28% of the total increase. with a total revenue of 226 million yuan. The revenue of the top five clients outside the ecosystem has increased by 51% in comparison. AI cloud business has covered the Internet, AI lab, smart technology, autonomous driving, AI for Science, financial technology, games, video games, and other wide-ranging industries. The diversified client structure and business layout not only bring about a continuous increase in revenue,