Kuaishou's Kling AI Nears $3 Billion Funding Round, Tencent Among Investors

Kuaishou’s AI video subsidiary Kling is close to closing a $3 billion funding round that values the company at $18 billion, according to sources cited by the South China Morning Post.

Tencent has joined the round as an investor. Kuaishou first signaled its plan to spin off Kling AI in April, initially targeting a $20 billion valuation before settling at $18 billion.

The company disclosed in a Hong Kong Stock Exchange filing on May 12 that it was evaluating restructuring options for Kling AI and could bring in outside investors through the process.

A source close to the deal said Kuaishou expects to launch Kling AI’s Hong Kong IPO within 12 months. Proceeds will go toward expanding computing capacity and building data centers. The company also plans to use the capital to hire and retain talent.

Kling AI’s finances show rapid growth. Its annualized revenue run rate reached $500 million in March — five times where it stood a year earlier. In the first quarter, revenue hit 650 million RMB (about $90 million), up 300% from Q1 2025.

About three-quarters of that revenue comes from outside China. Kling’s global user base has passed 100 million.

The company competes with ByteDance’s Seedance and U.S.-based Runway in the global video creation market, a sector estimated at $140 billion with 10% annual projected growth over the next three years.

In February, Kling released its 3.0 model series, which the company says gives creators stronger narrative control and better consistency in AI-generated video.