构建更具全球竞争力的开放创新生态，提升源头创新供给能力，推动科技创新与产业创新互促双 强……"十四五"期间，广东坚持抢先一步、谋深一层，加快建设科技创新强省。 广东科创成绩单 ·"深圳—香港—广州"创新集群创新指数跃居全球第一 ·全省研发经费投入突破5100亿元，继续领跑全国 ·培育形成9个万亿级的产业集群，人工智能核心产业规模超2200亿元、约占全国1/3，数字经济规模居 全国首位 ·高价值发明专利拥有量以及高新技术企业数量均稳居全国第一 11月9日晚，熊熊燃烧的第十五届全国运动会圣火把广东奥林匹克中心的天空映照得一片辉煌。而点燃 这次全运圣火的"源火"，采自南海1522米深处，并通过引燃可燃冰的方式获取。这次深海取火、 燃"冰"成炬，既集中体现了我国深海科技实力，也是广东科技创新的生动写照。 突破可燃冰开采核心技术、研发我国首台国产商业场发射透视电镜、建成江门中微子实验大科学装 置……"十四五"规划以来，广东前沿成果绽放，创新活力涌动。广东加快建设粤港澳大湾区国际科技创 新中心，粤港澳三地创新要素加速流动。全省区域创新综合能力连续9年居全国第一，"深圳—香港—广 州"科技集群跃居全球创新指数第一位。全省研 ...

Group 1: AI and Semiconductor Industry Outlook - The market is discussing the AI bubble, with optimism for the hardware and semiconductor sectors, expecting an upcycle starting in 2024 and lasting until 2027, driven by AI demand [1] - Major tech companies like Google and Meta are rapidly increasing their AI application token output, with projected capital expenditure growth rates of approximately 30-35% next year and 65-70% this year [1] - Chip and component shortages are expected to persist, with no dramatic improvements anticipated next year, and the Asian supply chain's response remains relatively cautious [1] Group 2: Internet Platforms and AI Applications - Tencent and ByteDance are seeing the gradual adoption of AI applications, but their usage remains limited compared to major apps like WeChat and Douyin, with uncertainty about the emergence of killer AI applications [2] - The development of ideal AI agents requires long-term memory and structured storage of consumer behavior, which is currently challenging due to the need for platform cooperation and technical scalability [2] - The industry is still focused on developing single-purpose or industry-specific AI agents rather than integrating them into a universal agent [2]

Core Viewpoint - 招银国际 has raised the target price for Tencent Holdings (00700) by 7.8%, from HKD 705 to HKD 760, while maintaining a "Buy" rating [1] Financial Performance - Tencent's total revenue for Q3 2025 increased by 15% year-on-year to RMB 192.9 billion, exceeding institutional expectations by 2% and 招银国际's expectations by 4% [1] - The strong growth in gaming revenue, which rose by 23% year-on-year, significantly contributed to the overall revenue increase [1] - Non-IFRS operating profit also grew by 18% year-on-year to RMB 72.6 billion, aligning closely with consensus expectations and 招银国际's forecasts [1] Capital Expenditure and AI Development - Due to supply chain constraints, Tencent has lowered its capital expenditure guidance for 2025 but remains committed to accelerating AI applications in advertising, gaming, e-commerce, and WeChat smart agents [1] - 招银国际 is optimistic about Tencent's long-term development opportunities in the AI sector, supported by diverse application scenarios and a large user base [1] Revenue Forecast Adjustments - Considering the better-than-expected growth in gaming revenue, 招银国际 has revised its total revenue forecasts for 2025-2027 upwards by 3%-5% [1] - The valuation window has been rolled forward to 2026 [1]

Core Viewpoint - 招银国际 has raised the target price for Tencent Holdings (00700) by 7.8%, from HKD 705 to HKD 760, while maintaining a "Buy" rating [1] Financial Performance - Tencent's total revenue for Q3 2025 increased by 15% year-on-year to RMB 192.9 billion, exceeding institutional expectations by 2% and 招银国际's expectations by 4% [1] - The strong growth in gaming revenue contributed to this performance, with a year-on-year increase of 23% [1] - Non-IFRS operating profit rose by 18% year-on-year to RMB 72.6 billion, aligning closely with consensus expectations and 招银国际's forecasts [1] Capital Expenditure and AI Development - Due to supply chain constraints, the company has lowered its capital expenditure guidance for 2025 but remains committed to accelerating AI applications in advertising, gaming, e-commerce, and WeChat smart agents [1] - 招银国际 is optimistic about Tencent's long-term development opportunities in the AI sector, supported by diverse application scenarios and a large user base [1] Revenue Forecast Adjustments - Based on better-than-expected growth in gaming revenue, 招银国际 has increased its total revenue forecasts for 2025-2027 by 3%-5% [1] - The valuation window has been rolled forward to 2026 [1]

Group 1 - Major tech companies are engaging in a competitive AI product battle, with Alibaba, Google, and Tencent making significant moves in the AI space [3][4][31] - Alibaba is planning to revamp its Tongyi app, rebranding it as "Qwen" and integrating AI capabilities to enhance its e-commerce platform [6][7][8] - Google has introduced new AI shopping features aimed at enhancing the online shopping experience, allowing users to search, compare, and check out products using AI [16][18][21] Group 2 - Tencent is focusing on integrating AI into its WeChat platform, with plans to develop an AI agent that can assist users in various tasks within the app [22][30] - Tencent's Q3 financial report highlighted a 15% year-on-year revenue growth, with AI becoming a central theme in its strategic narrative [23][24] - The competition among these companies is centered around creating an "end-to-end closed loop" in user service, redefining the value chain in the internet landscape [33]

Investment Rating - The report maintains an "Accumulate" rating for Tencent Holdings [2][55]. Core Insights - The report highlights solid revenue and profit growth, driven by AI integration in advertising technology and the expansion of WeChat's AI capabilities [3][4]. - Tencent's revenue for Q3 FY25 reached 192.9 billion RMB, a year-on-year increase of 15.4%, with adjusted net profit rising by 18.0% to 70.6 billion RMB [8][46]. - The report adjusts revenue forecasts for FY25-27 to 752.9 billion, 841.8 billion, and 925.3 billion RMB respectively, reflecting a growth rate of 14.0%, 11.8%, and 9.9% [8][46]. Financial Summary - **Revenue Growth**: - FY25 Q3 revenue: 192.9 billion RMB (+15.4% YoY) - FY25 estimated revenue: 752.9 billion RMB (+14.0% YoY) [5][17]. - **Profitability**: - Adjusted net profit for FY25 Q3: 70.6 billion RMB (+18.0% YoY) - Adjusted net profit margin: 36.6% (+0.8 percentage points YoY) [5][17]. - **R&D Investment**: - R&D expenditure for FY25 Q3: 22.8 billion RMB (+27.6% YoY), representing 11.8% of revenue [14][24]. - **Capital Expenditure**: - Capital expenditure for FY25 Q3: 13.0 billion RMB (-24.0% YoY) [8][46]. Segment Performance - **Value-Added Services**: - Revenue: 95.9 billion RMB (+15.9% YoY), with domestic and overseas game revenues growing by 14.7% and 43.4% respectively [8][27]. - **Marketing Services**: - Revenue: 36.2 billion RMB (+20.8% YoY), benefiting from increased user engagement and AI-driven advertising targeting [8][29]. - **Financial Technology and Enterprise Services**: - Revenue: 58.2 billion RMB (+9.6% YoY), driven by growth in cloud services and WeChat store transactions [8][35]. Earnings Forecast and Investment Recommendations - The report projects adjusted net profits for FY25-27 to be 261.9 billion, 301.8 billion, and 338.3 billion RMB respectively, with growth rates of 17.6%, 15.2%, and 12.1% [8][46]. - A target price of 785 HKD is set for FY25, based on a 25x PE ratio [8][47].

Investment Rating - The report maintains a "Buy" rating for Tencent with a target price of HKD 792.53, up from the previous HKD 759.47 [6][35]. Core Insights - Tencent's 3Q performance exceeded expectations with a revenue growth of 15.4%, driven by increases in value-added services, advertising, and fintech revenues, which grew by 16%, 21%, and 10% respectively [1][2]. - The adjusted net profit for 3Q increased by 18%, surpassing expectations by 7%, primarily due to higher earnings from associated companies [1][6]. - The report highlights the potential of Tencent's gaming segment, particularly with the upcoming release of "Delta Action" expected to generate over RMB 18 billion in revenue in 2026 [1][20]. Revenue and Profitability - 3Q revenue reached RMB 192.9 billion, with a year-over-year growth of 15.4%, exceeding the consensus estimate of RMB 188.9 billion [14]. - Gross profit for 3Q was RMB 108.8 billion, reflecting a gross margin of 56.4%, an improvement from the previous year [14]. - The adjusted operating profit margin for 3Q was 37.6%, indicating strong operational efficiency [14]. Gaming Segment Performance - The gaming revenue for 3Q grew by 15% domestically and 43% internationally, driven by titles such as "Honor of Kings" and "Delta Action" [2][20]. - The report anticipates that Tencent's gaming pipeline will peak in 2026, with significant titles set to launch, including "Rock Kingdom: World" and "Honor of Kings World" [2][28]. Advertising and AI Integration - Advertising revenue increased by 21% in 3Q, with AI-driven enhancements contributing to eCPM improvements [3][33]. - The introduction of the AIM+ system is expected to attract more small and medium advertisers, enhancing overall advertising performance [3][33]. Financial Technology Growth - The fintech segment reported a revenue growth of 10% in 3Q, with a gross margin of 50.2% [4][14]. - The WeChat mini-store's GMV is experiencing rapid growth, supported by a low overlap of public and private domain users, indicating potential for further user acquisition [4][12]. Future Outlook - Revenue forecasts for Tencent have been adjusted upward for 2025-2027, with expected revenues of RMB 755.3 billion, RMB 852.3 billion, and RMB 954 billion respectively [35][36]. - The adjusted net profit estimates for the same period are RMB 2,655 billion, RMB 3,012 billion, and RMB 3,443 billion, reflecting a strong growth trajectory driven by AI and gaming [35][36].

Group 1 - The Hong Kong stock market experienced a decline on November 14, influenced by a drop in U.S. tech stocks and cooling interest rate cut expectations, with the Hang Seng Tech Index falling over 2% in the afternoon session [1] - Major tech stocks in Hong Kong faced widespread declines, while the innovative drug concept sector saw gains, and the lithium battery sector was among the biggest losers [1] - JD Group reported a third-quarter revenue of 299.1 billion RMB, a year-on-year increase of 14.9%, with new business revenue growing by 214% and service revenue up by 30.8%, reaching a historical high of 24.4% of total revenue [1] Group 2 - Tencent Holdings announced its third-quarter results on November 13, achieving a revenue of 192.87 billion RMB, a year-on-year increase of 15% and a quarter-on-quarter increase of 5% [2] - The net profit for Tencent in the third quarter was 63.13 billion RMB, reflecting a year-on-year growth of 19% and a quarter-on-quarter growth of 13%, averaging a net profit of 700 million RMB per day [2] - Tencent's R&D expenditure reached a record high of 22.82 billion RMB in the third quarter, with cumulative R&D spending of 61.98 billion RMB for the nine months ending September 30, 2025 [2]

Investment Rating - The report maintains a "Buy" rating for the company, with a target price of HK$ 760, indicating a potential upside from the current price of HK$ 656.00 [1][9][12] Core Insights - The company reported a strong Q3 performance with revenues of RMB 192.9 billion, a year-on-year increase of 15% and a quarter-on-quarter increase of 5%. Operating profit reached RMB 63.6 billion, up 19% year-on-year, and Non-IFRS net profit was RMB 72.6 billion, reflecting an 18% increase year-on-year [9][11] - The gaming segment showed robust growth, particularly in overseas markets, with a 43% increase in revenue. Domestic gaming revenue grew by 15%, supported by popular titles [11] - The advertising business outperformed industry averages, with a 21% increase in marketing services revenue, driven by AI enhancements [11] - The financial technology and enterprise services segment also saw a 10% increase in revenue, benefiting from growth in commercial payment activities and cloud services [11] - The company's gross margin remained high at 56%, with a 3 percentage point year-on-year increase, while capital expenditures decreased significantly [11] Summary by Sections Company Overview - The company operates in the media industry, with a market capitalization of approximately RMB 378.76 billion and a total share count of 9,144.77 million [2][3] Recent Ratings - The company has consistently received "Buy" ratings in recent reports, with the latest rating issued on August 14, 2025 [3][9] Financial Performance - Projected net profits for 2025-2027 are RMB 225.3 billion, RMB 256.4 billion, and RMB 290.5 billion, respectively, with year-on-year growth rates of 16.1%, 13.8%, and 13.3% [10][11] Product Mix - The company's revenue composition includes 31.3% from financial technology and enterprise services, 30.1% from online gaming, 18.8% from social networking, and 18.5% from online advertising [4]

Summary of Tencent Holdings (0700.HK) 3Q25 Conference Call Company Overview - **Company**: Tencent Holdings (0700.HK) - **Market Cap**: HK$6.4 trillion / $818.5 billion - **Target Price**: HK$770.00 - **Current Price**: HK$656.00 - **Upside Potential**: 17.4% [1][2] Key Financial Highlights - **3Q25 Revenue Growth**: +15% YoY, the fastest growth in four years, accelerating from 2Q25 [1] - **Adjusted Operating Profit Growth**: +18% YoY [1] - **Revenue Estimates for 2025-27**: Increased by 0-1% due to improved growth durability across games, marketing services, and fintech/business services [2] - **Net Profit Estimates**: Adjusted by -1% to 0% for 2025-27, reflecting higher expenses from AI-related initiatives [2] Core Business Insights AI-Driven Growth - **AI Impact**: AI continues to empower growth across all business segments, although capex investments for 2025E are lower than expected [3] - **AI Capex**: Revised down to Rmb80 billion for 2025E and Rmb100 billion for 2026E [3] - **AI Applications**: Enhanced functionalities in WeChat, including the "@Yuanbao" feature for content summarization [20] Gaming Sector - **Game Revenue Growth**: Sustained above 20% YoY growth for three consecutive quarters, with expectations of 18% and 11% growth for 4Q25E and FY26E respectively [21] - **Key Titles**: "Honour of Kings" and "Delta Force" showing strong performance, with DAU reaching 139 million for "Honour of Kings" [21] - **WeChat Mini-Games**: Surpassed 1 billion users, with significant growth in gross receipts [21][23] Marketing Services - **Marketing Revenue Growth**: Estimated at 18% for 4Q25E and FY26E, driven by increased user engagement and AI-driven adtech [24] - **Ad Load and eCPM**: Increased ad load and higher effective cost per mille (eCPM) contributing to revenue growth [24] Fintech and Business Services - **Revenue Growth**: Expected at 12% and 10% for 4Q25E and FY26E, driven by consumer loan services and commercial payment volume [25] - **Cloud Services**: Slower growth anticipated due to supply chain constraints on GPU sourcing [25] Investment Outlook - **Operating Profit Margins**: Expected to expand by 121bps and 119bps for FY25E and FY26E, respectively, despite higher operational expenses [26] - **AI as a Growth Driver**: Continued investment in AI expected to narrow the gap between revenue and profit growth [26] - **Overall Positioning**: Tencent is viewed as one of the best-positioned companies in the China internet sector to benefit from AI applications [1][2] Risks - **Industry Competition**: Increased competition in performance-based advertising [29] - **Game Launch Delays**: Potential delays in game launches and approvals [29] - **Fintech and Cloud Growth**: Slower-than-expected growth in these sectors [29] Conclusion - Tencent Holdings demonstrates strong financial performance with significant growth across its gaming, marketing, and fintech sectors, driven by AI applications. The company is well-positioned for future growth, although it faces risks from competition and operational challenges.