Ge Long Hui·2025-11-21 03:53Core Insights - The company reported a revenue of 193 billion RMB in Q3 2025, marking a 15% year-on-year increase and a 5% quarter-on-quarter increase, driven by the expansion of core ecosystem scenarios such as video accounts, mini-programs, and search [1] - Non-IFRS net profit attributable to shareholders reached 70.6 billion RMB, reflecting an 18% year-on-year growth and a 12% quarter-on-quarter growth, indicating improved operational efficiency and profit quality [1] - The AI's role in enhancing efficiency across various business lines is becoming increasingly significant, with a focus on precision targeting, search relevance, content generation, and game production [1] Business Segments Gaming - Value-added services revenue was 95.9 billion RMB, a 16% year-on-year increase, with domestic game revenue at 42.8 billion RMB, up 15% [1] - Key titles such as "Delta Force," "Honor of Kings," and "Peacekeeper Elite" showed strong performance, with "Delta Force" achieving a DAU of over 30 million and "Honor of Kings" reaching a record DAU of 139 million [1] - International game revenue surged by 43% to 20.8 billion RMB, driven by significant contributions from titles like Supercell's "Clash Royale" [1] Marketing Services - Marketing services revenue for Q3 was 35.8 billion RMB, reflecting a 21% year-on-year increase, with video accounts and mini-programs leading the growth [1] - The improvement in eCPM and automated ad placement efficiency driven by AI contributed to revenue growth, although traffic expansion remained a primary revenue driver [1] Financial Technology and Enterprise Services - Financial technology and enterprise services revenue reached 58.2 billion RMB, a 10% year-on-year increase, with strong performance in commercial payments and enterprise services [1] - The company maintained one of the lowest bad debt ratios in the industry for consumer credit, while its cloud business continued to grow, supported by advancements in AI capabilities [1] Investment Outlook - The target price for the company's stock has been raised to 790 HKD, indicating a potential upside of 26.7% from the previous closing price, with a "buy" rating maintained due to improved profit margins and AI-driven returns in high-margin sectors [2]