TENCENT(HK:00700) Ge Long Hui·2025-08-14 02:33Core Viewpoint - UBS reports that Tencent's Q2 performance significantly exceeded expectations, with a 15% year-on-year revenue growth, surpassing market expectations by 3% [1] - Adjusted operating profit increased by 18% year-on-year, exceeding expectations by 5%, primarily due to margin expansion [1] Group 1: Financial Performance - Online gaming and advertising businesses showed strong performance, providing visibility for revenue in the second half of the year [1] - Capital expenditure decreased by 30% quarter-on-quarter, attributed to short-term impacts from GPU import restrictions [1] Group 2: Future Outlook - UBS anticipates that the launches of "Delta Action" PC version, "Valorant" mobile game, and the 10th anniversary event of "Honor of Kings" will drive growth in the second half [1] - The firm maintains a positive outlook on AI monetization and capital expenditure strategies [1] Group 3: Investment Rating - UBS reaffirms Tencent as the industry preference, raising the target price from HKD 710 to HKD 720, while maintaining a "Buy" rating [1] - Earnings per share forecasts for 2025 to 2027 have been increased by 3% to 4% [1]