--- title: "Valuation of $20 Billion? Will Kuaishou Spin Off Kling AI" type: "News" locale: "en" url: "https://longbridge.com/en/news/285953524.md" description: "Requires substantial capital investment" datetime: "2026-05-11T13:36:00.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/285953524.md) - [en](https://longbridge.com/en/news/285953524.md) - [zh-HK](https://longbridge.com/zh-HK/news/285953524.md) --- # Valuation of $20 Billion? Will Kuaishou Spin Off Kling AI Author | Huang Yu Kuaishou may be seeking a more aggressive capital pathway for its most prominent AI asset. On May 11, market rumors emerged that Kuaishou plans to spin off and list its AI video generation platform, Kling AI, in 2027, aiming to seize capital opportunities amid the investment frenzy for AI-related stocks. Related reports indicate that Kuaishou has entered into discussions with potential investors regarding pre-IPO financing for Kling, valuing the company at $20 billion in this round. Kuaishou has not yet responded to these reports. Large video generation models are widely recognized as "cash guzzlers," facing immense computational power pressures. Spinning off Kling AI may be Kuaishou's most pragmatic financial defense during this phase of heavy capital consumption by large models. A typical case is that in March 2026, just two years after its launch, OpenAI announced that Sora, which had sparked a global race in AI video generation, would be retired. This implies that the video generation sector faces formidable challenges; even leading global AI players struggle to sustain such cash-burning projects. The commercial return on investment for AI products has become a critical focus, and Kling AI has been relatively quick in achieving commercial monetization. In 2025, Kling AI's total revenue reached RMB 1.04 billion, equivalent to approximately USD 150 million. As of January 2026, Kling AI's Annualized Run Rate (ARR) exceeded USD 300 million. Cheng Yixiao, founder and CEO of Kuaishou Technology, previously revealed that, based on current growth momentum and commercialization progress, the company remains highly confident that Kling AI will achieve year-on-year revenue growth of more than double in 2026. In 2026, as global capital scrutinizes the return on investment period for generative AI, the window for Kling AI to establish competitive barriers is narrowing. It is worth noting that the competitive landscape facing Kling AI is becoming unprecedentedly crowded. Currently, Kling AI is engaged in direct and fierce competition with similar products from giants such as ByteDance, Google, and Alibaba. Facing the dual challenges of commercialization and technological enhancement, Kuaishou undoubtedly needs to invest more capital. Kuaishou is continuously increasing its investment, with overall Capex expected to reach approximately RMB 26 billion in 2026. The additional RMB 11 billion in investment compared to 2025 will primarily be used to support computational power for the Kling large model and other foundational large models. As the user base continues to expand in the future, the computational pressure on Kling AI will also continue to rise. However, compared to those giants, if Kuaishou relies solely on the cash flow from its short-video business to support Kling, it will clearly face insufficient funding. Therefore, by bringing Kling to the forefront of the capital markets, Kuaishou not only transfers the high R&D costs but also locks in the highest valuation premium during the AI bubble period. For Kuaishou and Kling, this spin-off may be not just a capital hurdle, but also a crucial battle concerning the ultimate proposition of commercializing large AI models. ### Related Stocks - [01024.HK](https://longbridge.com/en/quote/01024.HK.md) - [OpenAI.NA](https://longbridge.com/en/quote/OpenAI.NA.md) - [BYTED.NA](https://longbridge.com/en/quote/BYTED.NA.md) - [GOOGL.US](https://longbridge.com/en/quote/GOOGL.US.md) - [GOOG.US](https://longbridge.com/en/quote/GOOG.US.md) - [BABA.US](https://longbridge.com/en/quote/BABA.US.md) - [09988.HK](https://longbridge.com/en/quote/09988.HK.md) - [81024.HK](https://longbridge.com/en/quote/81024.HK.md) - [89988.HK](https://longbridge.com/en/quote/89988.HK.md) - [HBBD.SG](https://longbridge.com/en/quote/HBBD.SG.md) ## Related News & Research - [Kuaishou Technology Class B (1024) Receives a Buy from First Shanghai Securities](https://longbridge.com/en/news/284105807.md) - [Xiamen Jihong Calls June EGM to Raise Guarantee Limits for Subsidiaries](https://longbridge.com/en/news/285962328.md) - [Wolford corrects annual financial report publication notice](https://longbridge.com/en/news/285962041.md) - [TikTok is letting UK users pay to remove ads](https://longbridge.com/en/news/285950391.md) - [06:50 ETTheLotter Exposes Latest Scam Affecting Online Lottery Players](https://longbridge.com/en/news/285533308.md)