Earnings

A Turnaround with First Operating …

Web Desk November 27, 2025

0 32 2 minutes read

This article first appeared on GuruFocus.

Release Date: November 26, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Cheetah Mobile Inc (NYSE:CMCM) achieved its first quarterly operating profit in six years, marking a significant turnaround.
Q3 2025 revenue rose by 50% year over year, driven by strong performance in both the internet business and AI and other segments.
The AI and other segments grew by 151% year over year and now account for 50% of total revenues.
The company’s AI robotic business contributed 15% of total revenue, with a 100% year-over-year growth.
Gross profit increased by 64% year over year, with gross margin improving to 75% from 68% in the previous year.

Despite the positive financial results, the company is still in the early stages of its AI tools development, indicating potential risks and uncertainties.
The AI and other segments, while growing, still reported an adjusted operating loss of RMB 15 million.
The company faces competitive pressures in the AI and robotics markets, which could impact future profitability.
Cheetah Mobile Inc (NYSE:CMCM) needs to maintain discipline in cash flow management and capital allocation to sustain growth.
There is a reliance on third-party and open-source models to enhance product offerings, which may pose integration and dependency risks.

Q: Can you elaborate on the factors driving the strong growth in your AI and other segments? A: (CEO) The growth in our AI and other segments, which increased by 151% year over year, is primarily driven by our AI robots and AI tools. Our voice-enabled wheel robots in China have seen strong demand, with revenue doubling year over year for the second consecutive quarter. Additionally, our AI tools are gaining traction as we integrate AI features into existing products and develop new tools, which has reduced development time and costs significantly.

Q: What are the key trends supporting the growth of your robotic arm business? A: (CEO) Three key trends are driving the growth of our robotic arm business: the increasing popularity of collaborative robotic arms in manufacturing due to their size, ease of installation, and affordability; new use cases in commercial spaces like coffee shops and smart retail; and the role of robotic arms in embodied AI, which is crucial as global demand for physical AI grows.