TENCENT(00700) 格隆汇·2025-05-20 01:42Core Viewpoint - Company reported strong Q1 2025 financial results with revenue of 180 billion yuan, reflecting a year-over-year growth of 13% and a quarter-over-quarter growth of 4% [1] Group 1: Operational Data - WeChat's monthly active users (MAU) reached 1.402 billion, showing a year-over-year increase of 3% and a quarter-over-quarter increase of 1% [1] - QQ's active accounts slightly declined year-over-year, while the number of registered accounts for paid value-added services reached 268 million, up 3% year-over-year and 2% quarter-over-quarter [1] Group 2: Overall Performance - The overall gross margin improved to 55.8%, an increase of 3.24 percentage points year-over-year and 3.25 percentage points quarter-over-quarter [1] - Non-IFRS operating profit grew by 18% year-over-year, while Non-IFRS net profit increased by 22% to 61.3 billion yuan [1] Group 3: Value-Added Services - Game revenue accelerated with a 24% year-over-year growth, with domestic and overseas markets growing by 24% and 22% respectively [2] - Tencent Video maintained its leading position in the domestic long video market, with paid membership increasing by 1% year-over-year to 117 million [2] - Online music subscription revenue grew by 17% driven by increases in paid membership and ARPPU [2] Group 4: Marketing Services - Marketing services revenue grew by 20% year-over-year, supported by strong demand for key advertising placements within the WeChat ecosystem [2] - Upgrades to the AI advertising system improved ad click-through and conversion rates [2] Group 5: Financial Technology and Enterprise Services - Revenue from financial technology and enterprise services grew by 5% year-over-year, with healthy growth in wealth management and consumer loan services [2] - Cloud business returned to double-digit growth due to increased demand for AI [2] Group 6: Capital Expenditure - Capital expenditure reached 27.5 billion yuan, a year-over-year increase of 91% [3] - AI and existing business operations continue to generate operational leverage [3] Group 7: Profit Forecast and Investment Rating - Revenue projections for 2025-2027 are set at 725.6 billion, 791.3 billion, and 863.1 billion yuan respectively, with Non-IFRS net profit estimates of 254.7 billion, 286.5 billion, and 321.8 billion yuan [4] - Target market capitalization for 2025 is set at 5.2 trillion yuan, corresponding to a target price of 617 HKD, maintaining a "buy" rating [4]