Kingsoft Corporation (03888.HK) Hot Stock Analysis: Divergent Performance Between WPS AI Growth and Gaming Business Under Pressure

Kingsoft Corporation (03888.HK) has recently become a focus in the Hong Kong stock market, mainly due to its significant business divergence: the WPS Office Software business has achieved rapid growth through deep integration of AI technology, while the gaming business faces ongoing challenges [0,5]. In Q3 2025, WPS business revenue increased by 26% YoY to RMB 1.521 billion, accounting for 63% of total revenue [5], with global monthly active devices reaching 669 million units, up 9% YoY [7]. AI-driven improvement in paid conversion efficiency is a core highlight of the WPS business [0].

Looking at the gaming business, the core new game “Xiexianji” did not meet operational expectations [9], leading to pressure on related revenue; Q2 total revenue decreased by 26% YoY [9]. At the stock level, the share fluctuated sharply in 2025, with the highest closing price at HK$46.69 and the lowest at HK$18.53 [0], and there was a single-day drop of 10.03% [7].

1. AI Technology Empowers Office Software
   : The AI integration of WPS not only improves user experience but also significantly drives the growth of paid users and monetization efficiency, becoming an important pillar for the company to resist the decline in gaming business [5,7].
2. Analyst Rating Divergence
   : CICC maintains the “Outperform Industry” rating but lowers the target price to HK$39 [8], reflecting the market’s cautiously optimistic attitude towards the company’s future growth; divergences may exacerbate short-term stock price fluctuations [0].
3. Share Repurchases Convey Confidence
   : The company has repurchased shares multiple times in 2025 (e.g., spent HK$39.996 million to repurchase 1.426 million shares on November 20 [0]), conveying management’s confidence during the period of stock price volatility.

• The gaming business continues to be under pressure; if new games underperform expectations, it may further drag down overall performance [9];
• Intensified market competition: WPS faces dual pressure from international office software giants and local manufacturers [0];
• Analyst rating divergences may lead to increased short-term stock price volatility [8].

• In-depth application of AI technology in WPS is expected to continue driving the growth of paid users and ARPU improvement [5,7];
• The localization substitution trend in the office software market brings long-term growth space for WPS [0];
• The share repurchase plan may provide short-term support for the stock price [0].

Kingsoft Corporation (03888.HK) has obvious business divergence; WPS Office Software is the current core growth engine, while the gaming business still needs time to improve. Investors need to pay attention to key factors such as the implementation effect of AI technology, the progress of gaming business transformation, and changes in analyst ratings to fully evaluate the company’s long-term value.