Good day, and thanks for standing by. Welcome to the Kingsoft Cloud second quarter 2021 earnings conference call. At this time, all participants are in listen-only mode. After the speakers' presentation, there will be a question-and-answer session. To ask a question during the session, you need to press star, then number one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. Now I would like to hand the conference over to the first speaker for today, Ms. Nicole Shan. Thank you. Please go ahead.
Thank you, Annie. Hello, everyone, and thank you for joining us today. Kingsoft Cloud's second quarter 2021 earnings release was distributed earlier today and is available on our IR website at ir.ksyun.com, as well as on global newswire services. On the host side from Kingsoft Cloud, we have our CEO, Mr. Yulin Wang, and CFO, Mr. Haijian Henry He. Mr. Wang will review our business operations and company highlights, followed by Mr. He, who will discuss the financials and guidance. They will be available to answer your questions during the Q&A session that follows. There will be consecutive interpretations. All interpretations are for your convenience and reference- purpose only. In case of any discrepancy, management statements in the original language will prevail.
Before we begin, I'd like to remind you that this conference call contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon management's current expectations and current market and operating conditions. They relate to events that involve known or unknown risks, uncertainties and other factors. All of which are difficult to predict and many of which are beyond the company's control, which may cause the company's actual results, performance, or achievements to differ materially from those in the forward-looking statements. Further information regarding these and other risks, uncertainties, or factors are included in the company's filings with the U.S. SEC.
The company does not undertake any obligation to update any forward-looking statement as a result of new information, future events, or otherwise, except as required under applicable law. Finally, please note that, unless otherwise stated, all financial figures mentioned during this conference call are denominated in RMB. It's now my pleasure to introduce our CEO, Mr. Yulin Wang. Please go ahead.
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Thank you, Nicole. Thank you all for joining our second quarter 2021 earnings call. In the second quarter, we generated RMB 2.17 billion in total revenues, which was a new quarter record for us. It was 41.6% increase year-over-year and also a significant acceleration from the 30.4% year-over-year increase in the first quarter. Our Public Cloud services revenues increaseed for the sixth consecutive quarter since our IPO and hit a record of RMB 1.55 billion, which is an increase of RMB 159 million over the first quarter. Our Enterprise Cloud services revenues reached RMB 622.1 million representing a 152.8% increase over the same period of 2020 and an acceleration from 131.3% year-over-year increase in the first quarter. Overall, we continue to effectively execute our premium customer strategy as the largest independent cloud service provider in China.
Our new position helps us attact, develop, and maintain long-lasting, stable, in-depth, and multi-dimensional relationships with an expanding group of premium customers. Now let me walk you through our performance across our major verticals. I'll start off with Public Cloud. Despite a challenging market environment, we delivered solid progress during the quarter. On customer front, our existing customer base remained stable with a solid year-over-year increase in their usage, while continued to make significant progress attracting a diverse group of new customers. Today, we are pleased to announce that Kingsoft Cloud had entered into a comprehensive partnership framework agreement with Volcano Engine under ByteDance in an effort to jointly provide services to enterprises digitalization and seize the huge market opportunities from China's cloud computing market. Kingsoft Cloud, leveraging our rich sales resources and capabilities, will help Volcano Engine sell its PaaS and SaaS products.
At the same time promote our IaaS products. We will also jointly work on business development as partners. In addition, we successfully supported a certain top social media company for its three key large-scale online events, including a gala and a live-streamed variety show that had a massive number of concurrent viewers. We started to provide Meituan with Public Cloud solutions, l everaging on our neutrality, leading product and technology, and the premium customer service experience. We're able to continuously engage the broadest premium customer base established, especially under the multi-cloud trend. We jointly hosted Intellectual Property Protection Forum with Kuaishou, a top internet client of ours, that brought together senior executives from over 70 leading internet companies, raising our profile among internet industries and interacting with our customers to advocate IP protection initiatives.
On product and technology front, we continue to enhance our PaaS capabilities to meet our customers' needs while also providing stable IaaS services to them. In support of these efforts, we completed the acquisition of two PaaS companies to optimize our services capabilities in real-time communication and edge computing. This allowed us to boost our Public Cloud revenue at the PaaS level through cross-selling. As a symbol of recognition for our technology, during the quarter, we were proud to have received a national-level award, which is the highest award of its kind in China, for our patented IaaS virtualization technology. In this quarter, many customer cases exemplify our leading technological prowess. We supported top customers events during the June 18th online shopping festival, ensuring smooth and stable performance during periods of peak traffic with zero failures throughout.
We worked with large-scale video customers to apply edge computing to live streaming scenarios, significantly improving network transmission speed and stability. We were the exclusive vendor for Autohome during the Shanghai International Auto Show, where we helped to deliver a stable and smooth experience with our 4K 360-degree virtual reality live streaming solutions. On gaming front, following the success of our recent partnership with miHoYo on the phenomenal game Genshin Impact, we entered into an agreement with Seasun Games for its blockbuster game, JX Online 3, which was launched at the end of July on multiple terminals, thanks to our cloud gaming technology. In terms of underlying infrastructure, our new data center in Tianjin was topped out on June 30th. The project includes two phases with a total of over 6,800 racks.
Among that, phase one includes over 3,400 racks, which is to be delivered in the fourth quarter and pre-sale expected within this year. Phase two to be delivered next year. Once in operation, the data center will enrich our computing resources in the Beijing neighborhood and support our Public Cloud revenue next year. In addition, according to the 2020 China Cloud Computing Market Annual Research Report just released by CCID Consulting, a direct affiliate of the Ministry of Industry and Information Technology of the PRC, we remain the third largest internet cloud service provider, with our market share rising to 7.1%. Going forward in Public Cloud space, the company will continue to strengthen our relationships and dig deeper into the needs of our existing customers, actively expand and diversify our customer base to maintain healthy and rapid business growth.
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In Enterprise Cloud space, market demand continued to be strong. We continue to cultivate the verticals selected to achieve accelerated growth. In the financial services sector, we have already been serving six out of the top 10 banks in China. Building on our track record of successful cooperation with existing major state-owned bank customers, we continue to provide expansion, upgrade and maintenance services while proactively engage with new customers and projects. For example, we have successfully engaged with a new large-scale commercial bank, Industrial Bank, to build their Big Data Cloud Platform. From there, we will continue to dig into its demands and provide stable and premium cloud services, contributing to bank to bank's digitalization process. As another example, we partnered with Shandong Property Rights Exchange Center to build a supply chain financing platform for Shandong Province. The experience gained from this project is transferable into other regions.
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In the healthcare sector, we won the bid exclusively to build the Healthcare Big Data Cloud Platform of Hubei Province, with a contract value of approximately RMB 80 million, and have started development on the platform. This is a national key project in healthcare space and will be a sector benchmark which helps to accelerate our business expansion. In addition, during the recent IHE China 2021 Annual Testing Conference, we passed all three IHE certifications for regional healthcare information platforms, which is a first for a cloud service provider. IHE is an abbreviation for Integrating Healthcare Enterprises. It was established in 1998 by Radiological Society of North America, also known as RSNA, and Healthcare Information and Management Systems Society, also known as HIMSS, and aims to improve the international standards for the connectivity and sharing of information among healthcare information systems.
It provides healthcare certifications and set information system standards worldwide. The certifications from IHEC demonstrate the recognition we command among prestigious networks in healthcare information space.
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In the public services sector, we further strengthened our regional presence, engaged with the middle platform digitalization in regions such as Beijing, Hubei, Jiangsu, Gansu, and other provinces. Besides leveraging our cutting-edge video cloud technologies, we successfully provided cloud delivery services to Migu China Mobile to broadcast the Euro 2020 and the Olympic Games.
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As part of our Enterprise Cloud business performance, the company in early August announced a major strategic move in our Enterprise Cloud services business. By integrating Camelot nationwide project execution capabilities and resources across major cities in China, including Beijing, Wuhan, Nanjing, Shanghai, among others. The company expects to further accelerate and enhance the implementation of Enterprise Cloud projects with lower costs and improved efficiency. By means of acquihire, Camelot's senior management team will join us and bring along in-depth industry knowhow and long-standing client relationships. This group of senior personnel has worked for Camelot for a long period of time, ranging from 15-29 years. Prior to Camelot, they worked at IBM, BearingPoint, and other global leading companies.
Leveraging Camelot's proprietary sector knowhow and solutions, strong project implementation, and maintenance capabilities, as well as a high-quality premium customer base that is highly complementary to our existing Enterprise Cloud business, we believe this will further cement our leadership in the Enterprise Cloud space.
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Overall, in the Enterprise Cloud segment, we maintain great relationships with our key customers and sequentially delivered a batch of flagship projects successfully. They laid a solid foundation for our further business expansion in terms of products and services, customer base, and market reputation.
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We fully appreciate stakeholders' concern on data security and privacy and would like to take this opportunity to share more color in this regard about our company. First, we focus on corporate customers rather than individual developers. Hence, we do not collect nor own massive personal identifiable information. Second, we only offer computing environments and the legal titles of the data in such environments belong to the customers and not us. Third, our Enterprise Cloud projects are privately deployed with physical separation. Fourth, we have set up the General Counsel and Compliance Office, led by a very experienced general counsel and appointed a certified data protection officer. We will continue to strengthen our internal management, implement stringent compliance and risk control standards, and maintain continuous effective and timely communications with all stakeholders, including the regulators.
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I will now pass the call over to our CFO, Henry, to go over our financials for the quarter. Thank you.
Thank you, Yulin. Before diving into the details, I would like to offer a few highlights for the past quarter. Our total revenue of RMB 2.17 billion in Q2 sets a new quarterly revenue record for our history, representing approximately 42% year-over-year growth, which was an acceleration from the 30% year-over-year in the first quarter of 2021. Revenues from Public Cloud services was RMB 1.55 billion. A quarter-over-quarter increase of RMB 158.9 million, representing the sixth consecutive quarter's revenue increase since our IPO, a s well as a decent step-up of incremental quarterly revenue. Revenues from Enterprise Cloud services was RMB 622.1 million, representing approximately 153% year-on-year growth, another significant acceleration compared to the 131% year-on-year in Q1 2021. Our strong and accelerated top-line growth in Q2 is underpinned by the following factors resulting from fundamental strategies and advantages.
First of all, under the strategy of serving premium customers, we have established robust and a multidimensional relationship with our premium customers. Revenues from our top three customers achieved healthy year-on-year growth. Revenue from our largest customer achieved quarter-on-quarter growth as well. The cross-selling initiatives of our PaaS level products has been successfully executed. In the meantime, while the total revenue from our top 10 customers has increased in dollar value on a year-over-year basis. The percentage of the revenue contribution to the company in total has gradually and slowly decreased quarter by quarter, which we believe is a very good sign and trend for de-risk the client concentrations. Second, under our strategy of being a neutral and a pure-play cloud service provider, we demonstrate strong customer acquisition capabilities under the multi-cloud deployment backdrop, driven by progressing vendor strategies being adopted by leading internet companies.
For example, we have started to provide Public Cloud services to Meituan, a successful leading internet client. Lastly, we have always adopt a disciplined approach to select the right verticals. For example, we have very small exposures in sectors such as online education. As a result, the recent headwinds have limited impact to our business. We expect these underlying strategy and advantages will continue to support our healthy growth in the future. In addition, as our CEO Yulin mentioned earlier, the agreement with Camelot in early August will benefit our future deployment in Enterprise Cloud services. In 2020, Camelot service served 213 premium customers and approximately 94% of total revenue were recurring with the backlog of RMB 3.8 billion as of July 31, 2021. Coupled with fast revenue growth and a robust profitability, we expect a positive impact to our overall financials.
In line with strong top-line growth, the cost of revenue grew 41.3% year-over-year to RMB 2.06 billion. IDC cost, the largest cost component representing approximately 61.1% of total cost of revenue, grew 28.3% year-over-year to RMB 1.26 billion. As a percentage of total revenue, IDC cost decreased from 63.8% in Q2 last year to 57.8% in this quarter. Depreciation and amortization costs were RMB 183.1 million, representing approximately 8.4% of total revenues, a lso a decrease from the same period of last year. Overall, we are achieving greater economy of scale and improved operational efficiency. As a result, adjusted gross profit grew 45% from RMB 83.8 million in the same period of last year to RMB 121.4 million this quarter. Our adjusted gross margin for this quarter increased from 5.5% in the same period last year to 5.6% this quarter, as we continue to scale up our business.
Total operating expenses were RMB 438.9 million, a 14.1% decrease from Q2 last year, mainly due to the one-time off-share-based compensation expenses and the listing expenses related to our IPO in Q2 last year, partially offset by increase in personnel expenses resulting from the suspended favorable social tax policies. Excluding share-based compensation, adjusted R&D expenses were RMB 213.6 million, representing an increase of 13.5% year-over-year. Adjusted selling and marketing expenses were RMB 86.6 million. As a percentage of total revenue, it decreased from 5.1% in Q2 last year to 4% this quarter. Adjusted G&A expenses were RMB 65.7 million. As a percentage of revenue, it decreased from 4.8% in Q1 last year to 3% this quarter, among the lowest in peers. Accordingly, our adjusted EBITDA was RMB -55.3 million. Adjusted EBITDA margin improved from - 2.7% in Q1 to - 2.5% this quarter.
Our net loss was RMB 220.6 million, with the net margin significantly improved from - 27.4% in Q2 last year to - 10.1% this quarter. The profitability improvement trajectory was mainly driven by enhanced operational efficiency, economy of scale, and partially offset by impact of suspension of favorable social tax policy. As of June 30, 2021, we had sufficient cash and cash equivalents of RMB 5.47 billion. During this quarter, our total capital expenditures was RMB 221.8 million. Looking ahead, we expect our total revenue to be between RMB 2.58 billion and RMB 2.7 billion for the third quarter of 2021, representing a year-over-year increase of 49%-56%.
Such re-acceleration of growth is expected to be built on a few pillars, including solid deepening and a multidimensional relationship with existing top premium customers, winning new premium customers, cross-selling of new products and services, and a strong demand momentum for our Enterprise Cloud services. As usual, this is based on our current preliminary views on the market and operational conditions, which are subject to change. In terms of the ESG efforts, we do not have super voting share class as opposed to dual class share structure of most U.S.-listed China ADR companies. Each share of Kingsoft Cloud represents the same voting rights. Our main shareholders are Hong Kong-listed companies. Our principal shareholder structure are fully transparent and straightforward. Also, we have established our ESG task force in April 2021 to continuously discuss and implement best practices with consultants, investors, and other stakeholders, improving transparency and our corporate governance.
Lastly, we are preparing company's first Investor Day, when we will invite our key business line executives, leaders from our customers, and renowned industry ecosystem partners to join us. We are targeting mid of October, but the time and format are subject to the change given the COVID situation. We are warmly welcoming investors and analysts to join either on-site or online. We are committed to improving our business transparency and bring sustainable value to our stakeholders. Thank you.
This concludes our prepared remarks. Thanks for your attention. We are now happy to take your questions. Please ask your question in Mandarin first and then in English, if possible. Operator, please go ahead. Thank you.
Yes, thank you. As a reminder, to ask a question, you need to press star and the number one on your telephone. To withdraw your question, please press the pound or hash key. Please stand by while we compile the Q&A roster. Once again, please press star one on your telephones. Our first question is from the line of Bryan Gong of Citigroup. Please go ahead.
Hi. Henry, Clark, Nicole. [Non-English content] I'll translate myself. Thanks management for taking my questions. I have two questions. First one is on the Public Cloud side, how should we see the segment growth in the second half, especially considering lots of regulatory headwinds toward internet? The second question is about the management give more details about our cooperation with Douyin. Does that mean Douyin's cloud product will integrate our IaaS products? How will this cooperation contribute to our revenue over long run? Thank you.
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Thank you for your question. In relation to your first question about how we think about the growth of Public Cloud business revenue in the second half of this year, there are a few points. First of all, we have already seen that the second quarter Public Cloud revenue has already increased around RMB 160 million quarter-over-quarter compared to the first quarter. This is not only the sixth consecutive growth of quarterly revenue growth for the Public Cloud segment, but also significantly the absolute dollar amount increase is also significantly higher than the past levels. Therefore, we are becoming more confident for the growth of the second half of our business this year. In particular, there are several reasons that we are more confident about it.
First is that we have managed to maintain a very stable relationship with top customers, including ByteDance, with the usage of volume becoming also very stable. This forms a very sustainable revenue foundation for our Public Cloud service segment. The second point is that under the heavy regulations, especially for the industries like online education. Because we have maintained a very disciplined approach to vertical focus, the impact to our business is actually non-material. The sector exposure for online education is in low- single digits. Thirdly, the current regulatory backdrop is actually beneficiary to us, because we can better leverage our neutrality positioning. Under the multi-cloud deployment, the general trend, we are able to penetrate further into the pan-internet customers and to make new revenues. The Meituan case just shows how we can further penetrate in this segment. Your second question about our cooperation with ByteDance.
First of all, I would like to make a clarification. The cooperation is not with TikTok but actually with ByteDance. Secondly, the way that we cooperate with them is that we will integrate our IaaS products and together with the PaaS and SaaS products from Volcano Engine, to altogether provide an integrated and one-stop shop solution for the potential customers. We'll also explore and do business development together with ByteDance, with Volcano Engine to do potential marketing to new customers. Certainly, I think it's hard to quantify the potential revenue as of now because we have just started this framework agreement. Even Volcano Engine has only started this for one or two months. We currently do not expect the revenue contribution from this corporation to have a material impact for the second half of this year. Thank you.
Thank you, operator. Next question, please.
Thank you. Thank you. Our next question is from the line of Xiaodan Zhang of CICC. Please go ahead.
[Non-English content] My first question is regarding our recent acquisition. Could you please update us on the consolidation progress of Camelot? Also, in the longer term, what type of targets will we look at for our acquisition in the future? My second question is regarding our guidance on EBITDA margin in the upcoming quarters. Thank you.
Thank you, Sophie, for the question. Happy to address two of the questions. The first question regarding our acquisition of Camelot. As we discussed in the prepared remarks, it is our business, especially the implementation capabilities, will be significantly improved and enhanced by this acquisition. It's a business and a strategy-driven deal. We're happy to see the full team with over 20 years of experienced management team will join us, and they will deliver their know-how in the space as well as their solid client relationship. Regarding the progress, as we announced the deal on the 2nd of August, right now we are doing all the necessary regulatory approvals, internal approvals before we close the deal.
We are hoping, if everything goes well, which is we believe it will go with that direction, will be closed by end of this year, sometime will be in Q4. As you know, the timing will depend on the approval process, and also the pacing of the closing for other mechanical process. We believe there will be no major bottleneck before we close the transaction. Once we close the transaction, the team and all the kind of process will be integrated into our business. The financials will be consolidated into Kingsoft Cloud, which we do think there will be a positive impact to the Kingsoft Cloud financials. Regarding the future investment, there are a few key themes that we will continue to explore and will enhance our capabilities from the following categories.
First of all, we were looking into the innovative technology ventures to really enhance our matrix of the product offerings and the services. That will be basically enhance and upgrade our cross-selling capabilities and extending our revenue opportunities with existing clients. As you can see, our previous investment in the PaaS level technology has a proven track record to really push up our Public Cloud revenue in this quarter in particular. I think we'll follow that philosophy and continue to look into good assets in the market. Second, I think Camelot is also a good example that will expand our capabilities in both Enterprise Cloud and also the ecosystem partnership with other companies that will help us to reach out to more Enterprise Cloud clients in that direction.
I think given the past few cases, we have proven ourselves, which we can identify the right assets, execute those process efficiently, and close that efficiently. A third question regarding the EBITDA margin. I think we are also happy to see that there is a sequential improvement on the EBITDA margin. There are a few important factors. First of all, we do adopt a very efficient process to manage our expenses. As you can see, while our company top line grows at around 40%+, our expenses in terms of the absolute dollar value has kept relatively stable. As our company continue to expand on the top line, I think that will naturally and mathematically convert it to a better margin bottom line going forward from the long-term perspective.
We want to point out, as you know, our business, especially from both Public and Enterprise Cloud, there are certain seasonality factors for different quarters. For the long term, we are confident our gross margin and EBITDA margin will be further improved in the long term. We'll look into the details, especially in the market factors for certain factors that may affect our EBITDA margin as well. Speaking to the margins for the following few quarters, we are still expect that our non-GAAP EBITDA margin will approaching breakeven by end of this year. We're hoping that trend will carry on and continue going forward. Especially consider about the few things you mentioned, I think that fundamental support to improving efficiency of expenses and cost will be carried as the organic factors that will be improving our bottom line as well. Thank you, Sophie.
Thank you.
Thank you. Next question is from the line of [Wendy Zhu] of UBS. Please go ahead.
[Non-English content] Wendy Zhan from UBS [Non-English content]. So I have two questions. The first question is about our acquisition of Camelot. How do we think about its impact of gross margin, given that this company can help us to improve our implementation efficiency. The second question is also about gross margin. So, China has launched the Critical Infrastructure Protection Law and Data Security Law. So how do we estimate the related cost to complying with these two policy?
OK. [Non-English content]
Thank you, Wendy. I would like to offer three perspectives regarding the cost impact of the acquisition. First of all, the company Camelot has over 16 delivery hubs around nation in China. Their local team has been very experienced and very close to the clients, especially in those sophisticated projects. Those local team will dramatically save, for example, the travel expenses and the local delivery cost. That will be reflecting to the cost of the delivery projects. Point number two, over 94% of the current revenue of Camelot are recurring, which means two things. First of all, they do have their proprietary products, and some of them are standardized. By adding into those components as a module within the Enterprise Cloud projects, that will be also improving our contribution margin.
Second, given the company is growing at a double-digit on a year-over-year basis, we do believe the incremental revenue will be also receiving a better economic scale even on a standalone basis. The third point, Camelot currently has about 213 premium customers, which follow the same definition of Kingsoft Cloud of 2020. We actually analyze the overlapping premium customer base of Camelot and Kingsoft Cloud. Majority of the 213 premium customers, especially the top quantile of those customers, have great overlap with Kingsoft Cloud at this moment, which means we can leverage and cross-sell or up-sell our current projects. We can enhance and deepening our multi-dimensional client relationships, including our top 10 clients, by leveraging the Camelot team as well. That will also reduce our sales cost for the recurring projects and for the sales cost also for the new engagement of the new projects.
By combining the three factors I just mentioned, the contribution and the benefits of Camelot acquisition will be coming to contribution margin, the percentage of recurring revenue, sales marketing cost, and the local travel expenses. Those will be also reflecting to both gross margin and EBITDA margin of Kingsoft Cloud. Thank you.
A llow me to translate what Mr. Yulin Wang answered in relation to the regulation of data security. Like we've always talked about, we believe that cloud computing is a very important constituent of information technology sector. Therefore, the regulation on information security and data security is very important. We do believe that an orderly regulation is beneficial for the long-term and healthy development of an industry. Even though that short-term regulation might impact some of the players or the industry, and people would need to adapt to that, we still believe that in the mid to long term, it's going to be beneficial for the growth of the company.
Like we said in the prepared remarks, some of the points show that both our business model, and our methods, and approach towards data security and privacy show that we are very well-prepared in this regard. Number one, we really focus on corporate clients rather than serving a lot of individual developers. Therefore, the personal data information security does not relate to us to that great extent. Secondly, what we provide is computing environment and the data that are stored or processed in that environment belong to the customers and not us. Thirdly, the majority of our Enterprise Cloud businesses of this project are deployed privately. Therefore, there is physical separation, which enhances data security.
Lastly, we really advocate the full life cycle of data security and protection mechanism with all the internal control methods, including the data security and privacy committee and the general counsel office, et cetera. We do think that in light of this, we're pretty well-prepared in facing the regulatory developments. Since you asked about the expenditure in this regard, we do believe that we will continue to build our capability in security, including human resources and spending financial resources on this, but we do not expect this will cause any material financial impact for our financial results. Also, I would like to mention that in light of these regulations, some of the clients may choose to adopt for private cloud or hybrid cloud, which we can provide as well. This could also benefit for our customer acquisition efforts. Thank you.
Thank you. Our next question is from the line of Thomas Chong of Jefferies. Please go ahead.
[Non-English content] Hi, management. Thanks for taking my question. Congratulations on the strong results. I have two questions. My first question is regarding the acquisition of Camelot. Could you please share some details about the current net margin of Camelot, and will the financial results of Camelot be consolidated by KCG in the first quarter next year? My second question is could you please provide some color about the revenue contribution from premium public cloud customers? How should we think about competitive landscape of Public Cloud and Enterprise Cloud? How do you think about the trending ARPU? Thank you.
Thank you. I'm happy to take on the first two questions. Regarding the acquisition of Camelot, I think all the necessary information has been disclosed in our previous announcement in the 6-K form. Happy to share some additional color on this call. First of all, given Camelot's revenue, most of that are recurring. They do have their proprietary products. I think at this moment, their gross margin or at the internal contribution margin, at least on the double-digit territory. Point number two, regarding the timing of our consolidation. We are hoping, as we mentioned, there's no major roadblocks for receiving the necessary regulatory approvals and internal approvals. We are hoping the deal will be closed sometime in Q4 this year.
I think the latest time of the financial consolidation will be Q1. Hopefully, we hope that timing can be moved and pushed a little bit ahead, if everything goes well. We're happy to share the updates once the things are confirmed. Regarding the revenue contribution of the public cloud clients, as we mentioned in the prepared remarks, in a while, we are happy to see our top three clients are contributing on the year-over-year basis, have a higher dollar revenue contribution. Our largest customer has also sequentially on the quarter-over-quarter also seeing revenue increase. Given our total revenue are increasing as improving at a faster pace, mathematically, our top 10 clients are contributing a lower percentage of total revenue of Kingsoft Cloud quarter-over-quarter, but on a gradually pacing. I think that will de-risk our client concentration from that perspective.
Speaking to your question, I think right now, we have to say that there is no major client has been contributing a majority revenue of Kingsoft Cloud over 30%, and we do feel like the revenue contribution as a percentage perspective are healthy, and moving to the right direction. Also, as you see from the total company revenue mix, our Enterprise Cloud, this year, it will be likely around 30% of the total revenue if we do follow that on track. Our total company's revenue mix will be also moving to a healthy combination. That actually the few things regarding the enterprise. Regarding the total revenue going forward. I think we are going to see the major breakthroughs of the previous backlog a s we discussed early, will be gradually book into the revenue as we are seeing the continuing implementation and also the delivery of those projects.
Some of the announcements and public information regarding some of the great bits of our enterprise projects has been currently implemented on track, and also the Camelot acquisition will be helping going forward to accelerate those implementation schedule. Thank you.
Thank you.
Thank you. Our next question is from the line of Joel Ying of Nomura. Please go ahead.
[Non-English content] After we acquire Camelot, which is focusing Enterprise Cloud. As of now, Enterprise Cloud outgrow Public Cloud and already attribute 29% of total revenue for 2021. What's our guidance of the revenue mix going forward into 2022 and into long term? Thank you.
Thank you, Joel. Happy to share some additional color as well. As you can see, the three major fundamental driver of the revenue growth. Number one is our Public Cloud, majorly from our new accounts, as well as the solid base of existing accounts. Number two is our organic growth of Enterprise Cloud revenue. Number three is the gradual conversion of the backlog of RMB 3 billion from Camelot going forward. I want to mention that all three streams are actually all growing, obviously, at a different pacing, but they are actually all growing. Depends on the timing of closing the Camelot transaction, w e're going to have a final views regarding how the three different speeds can convert into a final mix, but I think that will be the natural results.
I think our focus from management team perspective is to make sure that our Public Cloud, organic Enterprise Cloud, and additional opportunities from Camelot can all grow. I think right now, frankly speaking, it's going to be a bit early to give a final view regarding the guidance of the mix because the timing of the closing has not been fixed yet. Hopefully, given that even the Camelot today's revenue is also growing at also a double-digit in that perspective. Hopefully, after the consolidation as late as Q1 next year, it will significantly add into the business opportunity to Kingsoft Cloud. I think for next year, the percentage of Enterprise Cloud will be growing as well. However, our Public Cloud revenue in dollar value we believe will be also seeing a good growth for next year as well. Thank you.
Thank you very much.
Thank you. That's the end of our question and answer session. I'd like to hand the conference back to the management. Please continue.
Thank you, operator. Thank you once again for joining us today. If you have any further questions, please feel free to contact. Look forward to speaking with you again next quarter. Thank you.
Thank you. This concludes today's conference call. Thank you for participating. You may now all disconnect.