Kingsoft Office: How Qiu Bojun and Lei Jun Revived WPS Through Subscriptions and AI After Three Decades of Rivalry with Microsoft

Origin

In 1988, Qiu Bojun single-handedly wrote WPS 1.0 on a 386 computer in a rented room in Caiwuwei, Shenzhen. His motivation was the urgent need for Chinese word processing software at a time when almost no usable local products existed. Upon its release, WPS quickly captured the domestic word processing market, earning Qiu the title of 'China's No. 1 Programmer.' In 1992, Lei Jun joined Kingsoft to lead commercialization, setting the company on a thirty-year path of direct competition with Microsoft Office.

Milestones

Turning Points

• After the 1996 Pangu suite failure, the company admitted that direct confrontation was unfeasible and pivoted to a strategy of compatibility and free access to buy time for survival.
• The 2005 decision to make the personal version free was a high-stakes gamble that traded profit for a user pool, securing hundreds of millions of potential subscribers for the future.
• The 2011 spin-off and early bet on mobile allowed WPS to outperform the slower-moving Microsoft on smartphones.
• Listing on the STAR Market in 2019 established subscriptions as the core metric, shifting the company's valuation logic from licensed software to a SaaS-like model.
• Since 2023, the 'All in AI' strategy and the proactive cutting of advertising revenue were calculated moves to trade short-term pain for a structural upgrade in membership.

Failures & Pitfalls

• The 1996 Pangu suite saw dismal sales after millions in R&D investment, pushing the company to the brink of insolvency.
• The 1994 format compatibility agreement with Microsoft was internally viewed as a strategic misjudgment that accelerated Word's penetration of the Chinese market.
• The direct offensive against Microsoft Office in the PC era was a total failure, with market share dropping from dominant to marginal over more than a decade.
• The post-2023 decision to shut down third-party ad traffic caused short-term revenue pressure, and AI monetization speed initially fell below market expectations, leading to a significant stock price correction.

Core Data

• 2026 H1 Revenue：Nearly 5 billion RMB (based on public data, independent verification not performed)
• 2024 Full-Year Revenue：5.121 billion RMB (based on public data, independent verification not performed)
• 2026 H1 R&D Investment：Approx. 1.15 billion RMB (based on public data, independent verification not performed)
• Global Monthly Active Devices：Over 500 million (based on public data, independent verification not performed)
• 2019 STAR Market IPO Day Market Cap：Over 60 billion RMB (based on public data, independent verification not performed)
• Historical Peak Market Cap：Over 150 billion RMB (based on public data, independent verification not performed)

Competitors / Peers

Globally, the biggest rival remains Microsoft Office, which dominates the enterprise market through Windows bundling, Azure cloud, and Copilot. Google Workspace captures overseas and cloud-based market share with lightweight collaboration. Domestically, DingTalk Docs, Feishu, and Tencent Docs compete for young teams and SMEs with free collaborative documents, diverting users from WPS's personal subscriptions and government/enterprise renewals. Legacy domestic Office vendors like Evermore and中标 compete directly in the 'Xinchuang' (IT innovation) market. Kingsoft Office's differentiation lies in its 30+ years of document format compatibility, its solid base in government and enterprise under domestic substitution policies, and its channel barrier of over 500 million monthly active devices. However, it still needs to continuously catch up with direct competitors like ByteDance and Alibaba in terms of large model capabilities and ecosystem entry points.