Core Viewpoint - Tencent Holdings demonstrated strong performance in a generally declining stock market, with shares increasing over 3% following the release of its third-quarter results, contrasting with a 0.6% dip in the S&P 500 index [1] Financial Performance - Tencent reported third-quarter revenue growth of 8% year over year, reaching over 167 billion yuan ($23.1 billion) [2] - The company's IFRS net income surged by 47% to 53.2 billion yuan ($7.4 billion), exceeding analyst expectations [2][3] Revenue Drivers - The domestic gaming business contributed significantly to revenue growth, with a 14% increase, generating over 37 billion yuan ($5.1 billion). This growth was bolstered by the launch of the new game, Black Myth: Wukong [4] Investment Outlook - Despite the positive quarterly results, Tencent's substantial investments in artificial intelligence (AI) have not yet yielded significant revenue, indicating that investors may need to wait several quarters for these investments to impact earnings meaningfully [5] - Overall, the quarter was favorable for Tencent, especially in light of the sluggish domestic economy affecting other sectors, although the slow progress in AI development may raise concerns if it does not accelerate soon [6]

Investment Rating - The report maintains a "Recommend" rating for Tencent Holdings (0700 HK) [6] Core Views - Tencent's Q3 2024 revenue reached RMB 1672 billion, up 8% YoY, with gross profit of RMB 888 billion, up 16% YoY, and a gross margin of 53%, up 4 percentage points YoY [1] - Non-IFRS operating profit was RMB 613 billion, up 19% YoY, and Non-IFRS net profit was RMB 598 billion, up 33% YoY, with an adjusted net margin of 35 8%, up 7 percentage points YoY [1] - The report forecasts 2024 2025 2026 revenues of RMB 6586 7123 7702 billion, and Non-IFRS net profits of RMB 2230 2403 2583 billion, with adjusted P E ratios of 16X 14X 13X based on the closing price on November 14, 2024 [4] Value-Added Services - Value-added services revenue in Q3 2024 was RMB 827 billion, up 9% YoY [2] - Domestic games revenue was RMB 373 billion, up 14% YoY, with flagship games like "Honor of Kings" and "Peacekeeper Elite" showing steady growth [2] - International games revenue was RMB 145 billion, up 9% YoY, with "PUBG M" and "Brawl Stars" performing well, and "VALORANT" seeing over 30% YoY growth in key overseas markets [2] - Social networks revenue was RMB 309 billion, up 4% YoY, with music subscription revenue up 20% YoY and paid members reaching 119 million, up 16% YoY [2] Marketing Services - Marketing services revenue in Q3 2024 was RMB 300 billion, up 17% YoY, driven by strong demand for video accounts, mini-programs, and WeChat Search ads [3] - Video accounts marketing revenue grew over 60% YoY in Q3 2024, with long-term potential from increased ad load rates, AI-powered ad creation, and WeChat's internal ad ecosystem [3] - Mini-program transaction volume exceeded RMB 2 trillion in Q3 2024, up by double-digit percentages YoY [3] FinTech and Business Services - FinTech and business services revenue in Q3 2024 was RMB 531 billion, up 2% YoY [4] - FinTech revenue was flat YoY, with payment transaction volume up 10% YoY despite a decline in average transaction value [4] - Business services revenue and gross profit grew YoY, driven by increased cloud services revenue and higher e-commerce transaction volumes [4] - Tencent released an upgraded version of its foundational model, Tencent Hunyuan Turbo, in Q3 2024, which doubled training and inference efficiency while halving inference costs [4] Financial Projections - The report forecasts 2024 2025 2026 revenues of RMB 6586 7123 7702 billion, with growth rates of 8 1% 8 2% 8 1% respectively [5] - Adjusted net profits are projected to be RMB 222971 240262 258316 billion for 2024 2025 2026, with growth rates of 41% 8% 8% respectively [5] - EPS based on adjusted net profit is forecasted to be RMB 24 06 25 93 27 87 for 2024 2025 2026, with P E ratios of 16X 14X 13X [5] Balance Sheet and Cash Flow - Total assets are projected to grow from RMB 1756788 billion in 2024E to RMB 2128540 billion in 2026E, with cash and cash equivalents increasing from RMB 259882 billion to RMB 457531 billion over the same period [8] - Operating cash flow is forecasted to grow from RMB 232365 billion in 2024E to RMB 278297 billion in 2026E, driven by increased net profit and stable depreciation and amortization [9] - Net cash flow is expected to increase from RMB 87562 billion in 2024E to RMB 110957 billion in 2026E [9] Profitability and Valuation - Gross margin is projected to increase from 53 08% in 2024E to 54 74% in 2026E, with net margin remaining stable around 28 7% [10] - ROE is forecasted to decline slightly from 19 63% in 2024E to 17 12% in 2026E, while ROIC remains stable around 13% [10] - P B ratio is expected to decrease from 3 6X in 2024E to 2 7X in 2026E, reflecting improved valuation metrics [10]

Investment Rating - The investment rating for Tencent Holdings is maintained at "Buy" with a target price of HKD 505.43 [3][6]. Core Insights - Tencent's Q3 revenue grew by 8.1% year-on-year to RMB 167.2 billion, aligning with consensus expectations. The adjusted net profit increased by 33.2% year-on-year to RMB 59.8 billion, exceeding expectations by 11.4% due to improved investment income and tax rate [2][4]. - The company anticipates accelerated growth in gaming revenue for Q4, with the upcoming launch of the mobile game "DnF" during the Spring Festival in 2025 expected to act as a catalyst [2][4]. - Despite short-term macroeconomic factors potentially impacting Q4 advertising revenue, the growth of the video account feature is expected to help expand Tencent's market share [2][5]. Summary by Sections Financial Performance - Q3 value-added services revenue increased by 9.2% year-on-year to RMB 82.7 billion, surpassing market expectations. Online advertising revenue grew by 16.6% year-on-year, while fintech revenue saw a modest increase of 2.0% [4][5]. - The gross profit margin for value-added services, online advertising, and fintech improved by 1.9, 0.7, and 6.8 percentage points respectively [2][4]. Advertising Business - The advertising business is expected to face pressure in Q4 due to weak consumer spending, but the video account feature is anticipated to mitigate some of the negative impacts [5]. - Q3 advertising revenue grew by 16.6% year-on-year, exceeding consensus expectations, with a gross margin increase of 0.7 percentage points [5]. Profit Forecast and Valuation - Revenue forecasts for 2024-2026 have been adjusted downwards by 0.4%, 0.9%, and 0.9% respectively, primarily due to macroeconomic factors affecting advertising and payment revenue growth [6][22]. - Adjusted net profit estimates for 2024, 2025, and 2026 are revised to RMB 221.8 billion, RMB 250.8 billion, and RMB 285.9 billion, reflecting improvements in tax rates and strong performance in investment business [6][22]. Gaming Performance - Q3 gaming revenue continued to accelerate, with strong performances in both domestic and overseas markets. Upcoming game launches are expected to act as catalysts for future growth [4][14]. - The mobile game "Pokémon Unite" launched in November is anticipated to leverage Tencent's long-term operational capabilities in mobile gaming [17][18].

Tencent Holdings Q3 2024 Earnings Call Summary Company Overview - **Company**: Tencent Holdings - **Date**: November 13, 2024 Key Financial Metrics - **Total Revenue**: RMB 167 billion, an 8% year-on-year increase and a 4% quarter-on-quarter rise [2][3] - **Gross Profit**: RMB 89 billion, reflecting a 16% year-on-year growth [2][3] - **Operating Cash Flow**: RMB 14.7 billion, a year-on-year rise of 122% [7] - **Free Cash Flow**: RMB 58.5 billion, a year-on-year increase of around 40% [7] - **R&D Expenses**: RMB 17.9 billion, a 9% year-on-year increase [8] Segment Performance Digital Content and Gaming - **Digital Content**: Strong performance driven by new games with evergreen potential, contributing approximately 18% to total gross profit [3] - **Gaming Segment**: Robust year-on-year growth in mobile game receipts, particularly from "Honor of Kings" [5] - **International Launches**: Anticipation for "Delta Force" and a 30% year-on-year increase in gross receipts for "Valorant" due to console version launch [5] Fintech and Business Services - **Revenue Contribution**: Significant contributions from mini games platform services, offset by a decrease in subscription revenue [4] - **Video Subscription Revenue**: Increased by 4% year-on-year to RMB 37 billion, driven by popular titles [4] - **Transaction GMV**: Reached RMB one trillion, benefiting from improved solutions for food ordering and electric vehicle charging [4] Marketing Services - **Revenue Growth**: Approximately 60% increase attributed to higher demand for promotional activities across various platforms [6] Cash Flow and Expenses - **Non-Operating Tax**: RMB 2.4 billion, significantly increased due to CIT adjustments [7] - **Operating Expenses**: Continued investment in GPU services contributing to cash flow growth [7] R&D and Innovation - **Investment in R&D**: Continued focus on new game developments both domestically and internationally [8] - **AI Integration**: AI plays a crucial role in enhancing business services revenue, improving efficiency in content production [23] E-commerce Initiatives - **Vision Mini Stops**: Upgraded e-commerce offerings to enhance consumer shopping experiences, improving traffic allocation for merchants [11] - **Transaction Facilitation**: Mini programs facilitate numerous transactions, enhancing visibility and customer reach for merchants [11] Market Trends and Strategies - **Consumer Behavior**: Observed an uptick in transactions post-policy announcements, indicating a positive response to pro-growth domestic policies [19] - **Gaming Preferences**: Younger users in China show a strong preference for first-person action games, a trend expected to dominate across all age groups [25] - **Evergreen Titles Strategy**: Focus on maintaining and enhancing games with long lifecycles, leading to significant growth in titles like "Honor of Kings" [27] Future Outlook - **Earnings Growth**: Aiming for a normalized earnings growth rate while balancing top-line and earnings growth [22] - **Advertising Technology**: Anticipated advancements in advertising technology and increased advertising load as key drivers for growth in 2025 [28] - **Collaboration with Taobao**: Benefits include user convenience, increased exposure for payment services, and high conversion rates for partners [29][30] Challenges - **Collaborative Designs**: Ensuring compliance and protecting users from excessive spending incentives during collaborative designs with other platforms [31]

Summary of Conference Call Records Company Overview - The conference call discusses Tencent, a leading technology and entertainment company in China, focusing on its financial performance, gaming strategy, e-commerce initiatives, and market outlook. Key Financial Metrics - Total revenue for the quarter was **167 billion RMB**, an increase of **8% year-on-year** and **4% quarter-on-quarter** [1] - Gross profit reached **89 billion RMB**, up **16% year-on-year** [1] - Mobile Monthly Active Users (MAU) of QQ stood at **562 million** [1] - Subscription revenue increased by **4% year-on-year**, with video subscription revenue at **37 billion RMB** [2] - Operating capital expenditures (capex) were **14.7 billion RMB**, up **122% year-on-year** [3] - Free cash flow was **58.5 billion RMB**, reflecting a **14% year-on-year** increase [4] Gaming Industry Insights - Tencent's gaming segment saw significant growth, with **Valorant** gross receipts increasing over **30% year-on-year** due to the launch of a console version [2] - The company is focusing on developing "evergreen" games, which are titles that maintain long-term popularity and profitability [5][6] - The gaming strategy includes leveraging both in-house studios and external partnerships to enhance game development and operations [5][6] - The company noted that the gaming market is evolving, with a shift towards first-person action games among younger demographics [15][16] E-commerce Strategy - Tencent is enhancing its e-commerce strategy through WeChat mini-stores, aiming to provide better access to traffic and improve the shopping experience for merchants [6][7] - The mini-shop experience is integrated into the WeChat ecosystem, allowing merchants to reach new customers through social and media properties [6][7] - The company is optimistic about the long-term potential of its e-commerce ecosystem, drawing parallels to the success of mini-programs [7] Marketing Services and Advertising - The marketing services segment, previously known as online advertising, saw revenue growth of over **60%** [2] - The company is focusing on improving ad load and enhancing advertising technology to outpace industry growth [18] - There is a noted increase in commercial queries and click-through rates in Weixin search, particularly from industries like financial services and luxury goods [8][9] Macroeconomic Outlook - Tencent is cautiously optimistic about the macroeconomic environment, noting a potential recovery driven by government policies and structural factors [10][11] - The company observed an uptick in transaction values in October, indicating a positive trend following a period of decline [10] Strategic Focus Areas - Tencent is prioritizing investments in high-margin segments and innovative technologies, including AI, to enhance its service offerings [14] - The company is also exploring collaborations with other platforms to improve user experience and compliance in e-commerce [19][20] Conclusion - Tencent's management expressed confidence in the company's ability to navigate market challenges and capitalize on growth opportunities across gaming, e-commerce, and advertising sectors [20]

Investment Rating - The report maintains a "Buy" rating for Tencent Holdings (00700.HK) [2] Core Views - The company's business shows resilience with impressive growth in gaming and advertising sectors [2] - The WeChat ecosystem is thriving, with significant advancements in AI deployment and commercial capabilities [2] - The gaming segment continues to grow healthily, with both domestic and international revenues showing positive trends [2] - Advertising revenue, particularly from video accounts, is experiencing high growth rates [2] - Financial technology and enterprise services are stable, with potential for recovery in the future [2] Summary by Sections Performance Overview - In Q3 2024, Tencent reported revenue of 167.2 billion yuan, a year-on-year increase of 8%, and a NON-IFRS net profit of 59.8 billion yuan, up 33% year-on-year [2] Business Analysis - WeChat's mini-program transaction volume exceeded 2 trillion yuan, reflecting a growth of over 10% year-on-year [2] - The gaming revenue reached 51.8 billion yuan in Q3 2024, marking a 13% increase year-on-year, with domestic game revenue at 37.3 billion yuan, up 14% [2] - Advertising revenue was 30 billion yuan, growing 17% year-on-year, with video account ads increasing by over 60% [2] - Financial technology and enterprise services revenue reached 53.1 billion yuan, a 2% increase year-on-year [2] Financial Forecasts and Valuation - Projected NON-IFRS net profits for 2024, 2025, and 2026 are 222.5 billion yuan, 252.6 billion yuan, and 275.2 billion yuan respectively [2] - The current stock price corresponds to a PE ratio of 15.57 for 2024, 13.71 for 2025, and 12.58 for 2026 [2]

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Investment Rating - The report maintains a BUY rating for Tencent with a target price of HK$525.0, representing a 30% upside from the current price of HK$403.80 [3][7]. Core Insights - Tencent's total revenue for 3Q24 increased by 8% YoY to RMB167.2 billion, aligning with consensus estimates. Non-IFRS operating profit grew by 19% YoY to RMB61.3 billion, also in line with expectations. The company anticipates continued earnings growth in 4Q24, driven by accelerating game revenue and resilient marketing performance [1][2]. - Game revenue growth accelerated in the second half of 2024, with a 13% YoY increase to RMB51.8 billion in 3Q24. Domestic game revenue rose by 14% YoY, primarily due to strong performance from DnF Mobile, while international game revenue grew by 9% YoY [1][2]. - Marketing services revenue showed solid momentum, increasing by 17% YoY to RMB30.0 billion in 3Q24, driven by strong demand for Video Accounts, Mini Programs, and Weixin Search [1][2]. - The Fintech and Business Services (FBS) segment experienced a 2% YoY revenue growth to RMB53.1 billion in 3Q24, reflecting a deceleration due to soft consumption sentiment [1][2]. Financial Summary - For FY24E, Tencent's revenue is projected to reach RMB655.999 billion, with an adjusted net profit of RMB224.394 billion and an adjusted EPS of RMB23.17 [2][4][17]. - Gross margin is expected to improve from 48.1% in FY23A to 53.2% in FY24E, with operating margin increasing from 32.0% to 32.8% [2][4][17]. - The adjusted net profit forecast for FY25E is RMB241.929 billion, with an adjusted EPS of RMB24.98 [2][4][17]. Valuation Breakdown - The SOTP-derived target price of HK$525.0 includes valuations for various segments: HK$202.9 for online games, HK$30.4 for SNS, HK$102.6 for marketing services, HK$84.5 for fintech, HK$22.6 for cloud, and HK$68.8 for strategic investments [7][8][9][10][11]. - The valuation reflects Tencent's strong market position and growth potential across its diverse business segments [7][8][9][10][11]. Peer Comparison - Tencent's valuation metrics are competitive within the online games and advertising sectors, with an average PE of 18x for online games and 19x for marketing services compared to its peers [13][14]. - The report highlights Tencent's leadership in the digital payment market and its potential for growth in fintech, supported by a premium valuation compared to industry averages [10][14].

Financial Data and Key Metrics - Total revenue for Q3 2024 was RMB 167 billion, up 8% YoY and 4% QoQ [8] - Gross profit was RMB 89 billion, up 16% YoY and 3% QoQ [8] - Non-IFRS operating profit was RMB 61 billion, up 19% YoY and 5% QoQ [8] - Diluted EPS was RMB 6.34, up 36% YoY [40] - Free cash flow was RMB 58.5 billion, up 14% YoY [45] Business Line Data and Key Metrics - Value-Added Services (VAS) revenue was RMB 83 billion, up 9% YoY, with social networks contributing RMB 31 billion, up 4% YoY [14] - Domestic games revenue grew 14% YoY to RMB 37 billion, driven by titles like Honour of Kings and Peacekeeper Elite [15] - International games revenue increased 9% YoY to RMB 15 billion, with PUBG Mobile and Brawl Stars performing well [16] - Marketing Services revenue grew 17% YoY, with video accounts marketing services revenue increasing over 60% YoY [29][31] - FinTech and Business Services revenue was RMB 53 billion, up 2% YoY [33] Market Data and Key Metrics - Combined MAU of WeChat and QQ grew to 1.38 billion, with QQ mobile MAU resuming YoY growth to 562 million [9] - Mini Programs facilitated over RMB 2 trillion in GMV in Q3 2024, driven by use cases like food ordering and medical services [17] - International cloud revenue increased significantly YoY, leveraging competitive pricing and domain expertise in gaming and live streaming [36] Company Strategy and Industry Competition - The company upgraded its e-commerce strategy around Mini Shops to create a unified transaction experience within the Weixin ecosystem [7] - AI deployment across products and operations, including marketing services and cloud, is yielding tangible benefits [7] - The company continues to invest in AI technology, tools, and solutions to assist users and partners [7] - The strategy for games focuses on leveraging both in-house studios and external partnerships to create evergreen titles [53][54] Management Commentary on Operating Environment and Future Outlook - Management highlighted the robust performance of evergreen games and the potential of new titles like DnF Mobile and Delta Force [6][10] - The company is optimistic about the long-term potential of its e-commerce ecosystem, particularly with the upgrade to Mini Shops [59][60] - Management is constructive on the outlook for international games revenue growth, given the deferred revenue backlog and potential from new releases [70] Other Important Information - The company introduced Tencent Hunyuan Turbo, which doubles training and inference efficiency and halves inference costs compared to its predecessor [35] - GPU-powered services now represent a teens percentage of the company's infrastructure as a service revenue [34] - The company made its Hunyuan large model and 3D generation models available on an open-source basis [36] Q&A Session Summary Question: Implications of major hit games on the industry and Tencent's game strategy - The success of games like Black Myth Wukong and Whiteout Survival reflects a structural trend facilitated by China's large home market and engineering workforce [50][51] - Tencent's strategy focuses on leveraging both in-house studios and external partnerships to create evergreen titles [53][54] Question: Upgrade to Weixin Mini Shops and its potential - The upgrade aims to create a unified and trustworthy e-commerce platform within Weixin, improving the shopping experience for consumers and providing better transaction support for merchants [56][57] - The potential is significant, with Mini Programs already facilitating RMB 2 trillion in GMV, primarily in services [60] Question: Weixin Search and international games deferred revenue - Weixin Search saw commercial queries increase and click-through rates improve, with search revenue more than doubling YoY [32][66] - The elongation of deferred revenue periods for international games is primarily for flagship titles, with deferral periods typically six to nine months or longer [70] Question: Macroeconomic environment and positioning - Management is encouraged by recent pro-growth policies in China and is constructive on the long-term economic outlook [73][74] - The company focuses on compliance, product improvement, and cost efficiency to navigate the evolving regulatory and macroeconomic environment [75][76] Question: Near-term focus for Weixin e-commerce and collaboration with Taobao - The near-term focus is on improving the infrastructure and functionalities of Mini Shops, with growth expected to follow [83][84] - The collaboration with Taobao has seen good adoption of Weixin Pay, benefiting both companies [85] Question: Delta Force monetization and payment revenue decline - Delta Force is monetizing well, with the majority of revenue generated on PC, despite the majority of users being on mobile [90][91] - The decline in payment revenue is due to the elimination of lower-quality transactions and a focus on smaller ticket everyday items [92][93] Question: Earnings growth outlook and share buyback - The company does not have a specific target for earnings growth but aims to achieve operating leverage from revenue growth [95][96] - Share buybacks for 2024 are expected to exceed the RMB 100 billion target, with plans for 2025 to be shared at the year-end earnings announcement [97][98] Question: AI-related revenue and Hunyuan monetization - AI is driving significant benefits in content recommendation and ad targeting, with GPU-powered services contributing to infrastructure as a service revenue [101][102] - The company is testing Hunyuan across various products and services, with more use cases expected to scale in the coming quarters [105][106] Question: Game preferences and FinTech strategy - Younger users in China disproportionately favor first-person action games, with titles like VALORANT and Delta Force performing well [109][110] - The company is focusing on wealth management, particularly money market funds, and is cautious on lending due to macroeconomic conditions [114][116] Question: Game business adjustments and advertising outlook - Adjustments to game teams, such as Honour of Kings and Peacekeeper Elite, have been productive, with both games registering good growth [120][121] - The advertising business is expected to continue outperforming peers, driven by ad tech enhancements and increased ad load in video accounts [129][131] Question: Collaboration with Taobao and future partnerships - The collaboration with Taobao benefits users, Tencent, and Taobao, with significant work done to ensure a good user experience and compliance [134][135] - The company is open to future collaborations that make sense and are safe for users and content partners [138]

Financial Data and Key Metrics - Total revenue for Q3 2024 was RMB 1671.93 billion, an 8% YoY growth [3] - Return on investment was 4% for the quarter [3] - Gross margin increased from 49% to 53% YoY [15] - VAS (Value-Added Services) revenue grew 9% YoY to RMB 827 billion [15] - International games revenue increased 9% YoY to RMB 145 billion [15] - Domestic games revenue grew 14% YoY to RMB 373 billion [15] Business Line Performance - Game business achieved strong income growth, driven by long-term tree games and new game launches [3] - WeChat and WeChat reached 13.82 billion users, while QQ Mobile reached 5.62 billion users [4] - Music subscription revenue grew 20% YoY, with 119 million subscribers [6] - Long video subscription revenue increased 4% YoY, with total video subscriptions reaching 116 million [6] - Mini programs achieved GMV exceeding RMB 2 trillion [7] Market Performance - International games revenue growth lagged behind total revenue growth due to extended revenue deferral periods [15] - PUBG Mobile and Brawl Stars drove strong performance in international markets [7] - Domestic games like Peacekeeper Elite and Valorant set new revenue records [6] Strategy and Industry Competition - Company is upgrading its e-commerce strategy through the WeChat ecosystem [3] - Continued investment in AI technology, tools, and solutions to enhance user and partner experiences [3] - Focus on developing long-term tree games and identifying new games with potential [18] - Emphasis on standardizing and indexing the WeChat Shop platform to improve user experience [19] Management Commentary on Operating Environment and Future Outlook - Management remains optimistic about the long-term economic outlook despite current challenges [26] - Company is actively adapting to regulatory changes and focusing on compliance [27] - AI is seen as a key driver for future growth, particularly in content recommendation and advertising [37] - Company is cautious in its lending practices and selective in its loan approvals [44] Other Important Information - Company launched two new games, DNA mobile game and Delta Force, which show potential to become long-term games [4] - WeChat Shop is being integrated into the WeChat ecosystem, with a focus on improving logistics and customer service [19] - Company is leveraging its expertise in gaming and live streaming to strengthen its cloud services [4] Q&A Summary Question: Impact of macro environment on business strategy - Company remains optimistic about long-term economic growth and is focused on executing its current strategy [26][27] Question: Future of gaming industry and company's strategy - Company sees a structural trend in the success of Chinese games globally and is investing in new tools and technologies [17][18] Question: E-commerce strategy and WeChat Shop - Company aims to build a unified and trustworthy e-commerce experience through WeChat Shop, with a focus on standardization and indexing [19][20] Question: AI integration and revenue potential - AI is expected to significantly enhance content recommendation and advertising efficiency, with substantial revenue potential [37][38] Question: Payment and wealth management strategy - Company is cautious in its lending practices and is focusing on building a robust wealth management platform [43][44] Question: Advertising and video integration - Video integration is a key driver for advertising growth, with potential for further ad load rate increases [48][49] Question: Collaboration with Taobao - Collaboration with Taobao is seen as beneficial for users and both companies, with a focus on compliance and user experience [50][51]