TENCENT(HK:00700) Bei Jing Ri Bao Ke Hu Duan·2025-05-14 13:31Core Insights - Tencent reported Q1 2025 revenue of 1800.22 billion yuan, a 13% year-on-year increase, with net profit attributable to equity holders at 478.21 billion yuan, up 14% [1] - The company's gross profit reached 1004.93 billion yuan, reflecting a 20% increase, while operating profit (Non-IFRS) was 693 billion yuan, growing 18% [1] Revenue Breakdown - Value-added services revenue was 921 billion yuan, a 17% increase year-on-year [1] - Marketing services revenue reached 319 billion yuan, up 20% year-on-year [1] - Financial technology and enterprise services revenue was 549 billion yuan, growing 5% year-on-year [1] Gaming Performance - Domestic gaming revenue was 429 billion yuan, a 24% increase compared to the previous year, driven by popular titles such as "Honor of Kings" and "Peacekeeper Elite" [1] - The company noted record high revenues for "Honor of Kings" and "Crossfire Mobile" in Q1 [1] International Market and Social Network - International gaming revenue was 166 billion yuan, a 23% year-on-year increase, primarily from "Brawl Stars," "Clash Royale," and "PUBG MOBILE" [2] - Social network revenue grew 7% to 326 billion yuan, supported by mobile game virtual item sales and music subscription services [2] Profitability and Investment - The gross margin for value-added services improved from 57% to 60% year-on-year due to high-margin contributions from domestic gaming and mini-game platform services [2] - R&D expenditure reached 189.1 billion yuan, a 21% increase, while capital expenditure was 275 billion yuan, up 91% [2] AI and Workforce - AI capabilities have made significant contributions to Tencent's advertising and gaming sectors, with increased investments in AI opportunities [2] - As of March 31, 2025, Tencent employed 109,414 individuals, up from 104,787 the previous year [3]