First Shanghai Securities·2024-05-14 10:02Investment Rating - The report does not explicitly state an investment rating for the company [6]. Core Views - The report anticipates Tencent Holdings Limited's Q1 2024 revenue to be approximately 158.5 billion RMB, representing a year-on-year growth of 5.66% [6]. - The report highlights that the value-added services revenue is expected to decline by 1.84% year-on-year to 77.9 billion RMB, while advertising revenue is projected to increase by 18.76% to 24.9 billion RMB [6]. - Non-GAAP net profit is expected to rise by 31.59% year-on-year to around 42.8 billion RMB [6]. - The report notes a strong recovery in game revenue growth, with expectations for overseas game revenue to show single-digit growth year-on-year [6]. - The advertising business is expected to continue optimizing profit margins due to clear commercialization paths and technological support, with video account user engagement increasing [6]. - The cloud business will focus on cost reduction and efficiency while maintaining healthy market share growth [6]. Summary by Sections Financial Expectations - Q1 2024 revenue is projected at 158.5 billion RMB, a 5.66% increase year-on-year [6]. - Value-added services revenue is expected to decline by 1.84% to 77.9 billion RMB [6]. - Advertising revenue is forecasted to grow by 18.76% to 24.9 billion RMB [6]. - Non-GAAP net profit is anticipated to increase by 31.59% to approximately 42.8 billion RMB [6]. Game and Advertising Insights - Game revenue is expected to recover, with domestic game revenue anticipated to stabilize after a high comparative base from the previous year [6]. - Overseas game revenue is projected to show single-digit growth year-on-year [6]. - The advertising business is expected to benefit from improved user engagement and collaboration with Douyin, enhancing advertising effectiveness [6]. Cloud and Financial Services - The cloud business will prioritize cost reduction and efficiency while focusing on market share growth [6]. - Financial services are expected to see margin improvements driven by recovering macro demand and increased technology service fees from video accounts [6].