Kuaishou Plans to Spin Off KuLing AI and Raise $2 Billion at a $20 Billion Valuation, with Tencent Participating in the Negotiations

BlockBeats News, May 11th, LatePost cited foreign media reports that Kuaishou plans to spin off its in-house large-scale video generation AI model business, "Koala AI," and is seeking to raise $20 billion at a valuation of around $200 billion. Tencent and other institutions are involved in the negotiation, and the transaction is pending.

LatePost's exclusive report stated that Koala's current Annual Recurring Revenue (ARR) has reached $5 billion, doubling from the pre-Chinese New Year level, far exceeding Kuaishou's previous expectations. In early 2025, Kuaishou had set a $60 million annual revenue target for Koala, but the actual revenue reached $150 million.

Kuaishou has established an independent incentive mechanism and a special stock option pool for Koala to cope with the fierce competition from tech giants such as ByteDance and Alibaba in the video generation field. Currently, Koala's core team has also become a key target for talent poaching in the AI video generation sector.

Currently, Koala has ranked first in the iOS Drawing and Design category in nearly 40 countries and regions, including Brazil, Russia, and Singapore, and has become one of the highest-grossing graphic design applications in South Korea and Russia.