China's Kuaishou Technology (1024) reported a 32 percent year-on-year decline in net profit to 6.06 billion yuan (HK$7.05 billion) for the first half of 2026, partly dragged down by rising artificial intelligence investment.
Its adjusted net profit, which excludes share-based compensation expenses and net fair value changes on investments, also dropped 28.5 percent to 7.29 billion yuan.
Revenue inched up 2.4 percent to 69.25 billion yuan during the period.
For the second quarter alone, adjusted net profit slipped 30.3 percent to 3.91 billion yuan, higher than market estimates of 3.89 billion yuan.
Revenue rose 1.4 percent to 35.54 billion yuan for the quarter ended June, beating market expectations of 35.51 billion yuan, primarily driven by the growth of its online marketing services and Kling AI business.
However, its research and development expenses climbed 34.7 percent to 4.6 billion yuan, primarily due to the increased investment in AI, including related training expenditures.
The online marketing services business generated 20.6 billion yuan, up 4.4 percent, thanks to the increased online marketing spending.
Income from the Kling AI business surged more than 200 percent to over 850 million yuan, supported by breakthroughs in model capabilities, continuous product enhancements and deeper penetration across application scenarios.
Previously, Kling AI reportedly planned to go public in Hong Kong next year.
Revenue of the live streaming business went down 13.5 percent to 8.7 billion yuan, while that of other services increased by 18.5 percent to 6.2 billion yuan.
The short-video platform’s second-quarter average daily active users were flat at 412.3 million.
Looking ahead, the company said it will continue to deepen AI integration across these ecosystems by advancing the capabilities of its large models across multiple scenarios, helping merchants and marketing clients operate more efficiently.
Kuaishou will also continue to scale Kling AI’s model capabilities and expand its adoption across professional creative scenarios, unlocking additional commercialization opportunities, it added.
