TENCENT(HK:00700) Ge Long Hui·2025-11-14 01:28Core Viewpoint - Citi maintains a positive outlook on Tencent, highlighting the company's strong execution in driving sustainable revenue and profit growth while actively positioning itself in the AI application space for both enterprise and consumer sectors [1] Group 1: Financial Performance - Tencent reported third-quarter revenue of 192.87 billion yuan, with a net profit increase of 19% year-on-year to 63.13 billion yuan [2] - The growth momentum in the third quarter is primarily attributed to high-margin businesses such as self-developed games, video accounts, and WeChat search [1][2] Group 2: Strategic Investments - Despite a 24% year-on-year decline in capital expenditure due to chip procurement shortages, Tencent's investments in upgrading foundational model architecture and developing agent-based AI within the WeChat ecosystem remain strong [1] - The company has strategically recruited AI talent to optimize productivity costs, which is expected to yield significant returns in the future [1] Group 3: Analyst Ratings - Citi has raised its target price for Tencent from 735 HKD to 751 HKD and reiterated a "Buy" rating, continuing to view the company as a preferred investment in the AI theme [1]