In a rare display of corporate unity, China’s three internet titans—Baidu, Alibaba, and Tencent—have set aside their long-standing rivalries to back a single horse in the race for artificial intelligence supremacy. Keling, the video-generation AI spin-off from short-video giant Kuaishou, has successfully closed a massive $3 billion funding round. This deal values the nascent firm at $18 billion, marking a historic high for the sector and signaling a consolidated national effort to dominate the global AI video landscape.
The investment arrives at a pivotal moment for the industry. While Western enthusiasm for video generation hit a temporary snag with OpenAI’s surprising decision to sunset its Sora project in early 2026, Chinese competitors have accelerated their pace. Keling has transformed from an internal R&D project into a standalone powerhouse, reporting an annualized revenue run rate of over $300 million just as the global market seeks a new champion for high-fidelity generative video.
However, the $18 billion valuation masks a stark financial reality. Keling remains a 'contradiction on paper,' posting a net loss of 1.9 billion RMB against revenues of 1.1 billion RMB in 2025. With a negative net asset value, the company’s survival and valuation are predicated entirely on the 'growth-at-all-costs' logic that defined the previous decade of tech expansion. This time, however, the burn rate is driven by the astronomical costs of GPU clusters and the specialized talent required to maintain its 15-second high-consistency video outputs.
To secure this $3 billion 'ammunition' dump, Kuaishou has signed what local analysts call a 'military order' with its investors. The terms include a strict five-year deadline to reach an initial public offering (IPO) by late 2031. If the company fails to go public or meet regulatory milestones, it faces an 8% interest-bearing buyback clause. This high-stakes pact reflects the dwindling patience of global capital, demanding that AI projects transition from technical demos to profitable market leaders within a fixed window.