Summary of Bilibili Inc. Conference Call Company Overview - **Company**: Bilibili Inc (Ticker: BILI.O) - **Industry**: China Internet and Other Services - **Market Cap**: US$11,642 million - **Current Stock Price**: US$25.31 (as of November 19, 2025) - **Price Target**: US$25.00, indicating a slight downside of 1% from the current price [4][4][4] Key Points User Engagement and Content Strategy - User engagement accelerated significantly in Q2 and Q3 of 2025 without additional sales and marketing expenses, attributed to a strategic shift towards long and high-quality video content since 2024 [1][1][1] - The percentage of time spent on long videos increased from 70% to 75%, while short video engagement decreased, highlighting the effectiveness of premium content as a key driver for user retention [1][1][1] - Bilibili aims to enhance creator productivity through various AI tools and a fan charging scheme to improve monetization [1][1][1] - AI technology is being utilized to identify and promote high-quality content more effectively [1][1][1] Advertising Revenue - The advertising business experienced a 10% increase in effective cost per mille (eCPM) in the first half of 2025, with high single-digit growth expected in the second half [2][2][2] - Current ad load is approximately 7%, with a target of reaching 10% in the future, compared to higher levels in peer companies [2][2][2] Financial Projections - Management projects achieving an operating profit margin (OPM) target of 15-20% within the next 2-3 years [2][2][2] - Revenue forecasts for the upcoming fiscal years are as follows: - 2025: Rmb 30,206 million - 2026: Rmb 33,053 million - 2027: Rmb 35,834 million [4][4][4] - Expected earnings per share (EPS) for 2025 is Rmb 5.26, with projections of Rmb 6.61 and Rmb 8.90 for 2026 and 2027, respectively [4][4][4] Valuation and Risks - The valuation methodology is based on discounted cash flow with a weighted average cost of capital (WACC) of 12% and a terminal growth rate of 3% [6][6][6] - Upside risks include stronger-than-expected advertising revenue growth and better user retention for key content [8][8][8] - Downside risks involve lower-than-expected monthly active user (MAU) growth and potential increases in sales and marketing expenses [8][8][8] Stock Rating - Current stock rating is Equal-weight, with an attractive industry view [4][4][4] - The stock has a 52-week range of US$32.50 to US$14.47, indicating volatility in its trading history [4][4][4] Additional Insights - The company is set to launch the NCard in late March 2026, focusing initially on daily active user (DAU) growth rather than immediate monetization [2][2][2] - The management's focus on AI tools and premium content suggests a strategic pivot towards enhancing user experience and engagement, which could lead to long-term growth [1][1][1] This summary encapsulates the key insights from the conference call, providing a comprehensive overview of Bilibili Inc.'s current position, strategies, and future outlook.

November 19, 2025 05:17 PM GMT Kuaishou Technology | Asia Pacific M Update 3Q25 in line but outlook is weaker than expected; stay EW Reaction to earnings Unchanged In-line Modest revision lower Impact to our thesis Financial results versus consensus Direction of next 12-month Source: Company data, Morgan Stanley Research 4Q revenue outlook and early color on 2026 are both slight shy of market expectations, though cost control can help profit. 3Q25 results came in line with our estimates: See 3Q25 results su ...

Summary of Tencent Holdings Ltd. Conference Call Company Overview - **Company**: Tencent Holdings Ltd. (0700.HK) - **Industry**: China Internet and Other Services - **Market Cap**: US$743.371 billion - **Current Stock Price**: HK$622.50 - **Price Target**: HK$735.00, representing an 18% upside potential [6][6][6] Key Points Discussed 1. Capital Expenditure (Capex) - Tencent is currently increasing procurement of domestic ASICs due to US GPU supply-chain constraints, leading to higher COGS/opex during the transition period [8] - The company anticipates a shift from leasing compute capacity back to capex from the second half of 2026 [8] 2. AI Applications - WeChat's user engagement is primarily based on human-to-human communication, which is less susceptible to disruption by AI [8] - The platform is under-monetized, indicating potential for revenue growth despite risks associated with AI [8] - Tencent is exploring multiple channels for AI applications, including WeChat and QQ Browser [8] 3. Hunyuan Foundation Model - Tencent has been actively recruiting top AI researchers globally to enhance the architecture of the Hunyuan foundation model [8] - The upcoming launch of Hunyuan 2.0 is expected to showcase significant improvements in capabilities, particularly in multimodal performance [8] 4. Financial Projections - **Revenue Growth**: Projected revenue growth from RMB 660.3 billion in FY 2024 to RMB 918.3 billion by FY 2027 [6] - **EPS Growth**: Expected EPS growth from RMB 20.63 in FY 2024 to RMB 31.68 by FY 2027 [6] - **EBITDA**: Anticipated increase from RMB 264.3 billion in FY 2024 to RMB 424.3 billion by FY 2027 [6] 5. Risks and Opportunities - **Opportunities**: Successful execution of new game launches, market share gains in social and short video ads, and resilience in social network competition [13] - **Risks**: Regulatory uncertainties in the gaming industry, intensified competition in social networks, and tightened regulations amid US-China tensions [13] 6. Analyst Ratings - The stock is rated as "Overweight" with an attractive industry view [6][6][6] - The company is highlighted as a top pick in the Asia Pacific region [1][1][1] Additional Insights - The company is focusing on AI applications as a growth area, with a strategic emphasis on enhancing user engagement through its platforms [8] - The management's confidence in the Hunyuan model's capabilities suggests a forward-looking approach to AI integration in their services [8] This summary encapsulates the critical insights from the conference call, highlighting Tencent's strategic direction, financial outlook, and the potential risks and opportunities in the evolving market landscape.

November 13, 2025 09:40 AM GMT Tencent Holdings Ltd. | Asia Pacific 3Q25: Revenue Beat; Shy on Capex Reaction to earnings Strengthens our thesis Modest upside Modest revision higher Impact to our thesis Financial results versus consensus Direction of next 12-month consensus EPS Source: Company data, Morgan Stanley Research Key Takeaways Exhibit 1: 3Q25 results review | (Rmb mn) | | | | 3Q25 | Mse | | 3Q25 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Income Statement | 3Q24 82,695 | 2Q25 | 3 ...

Summary of Earnings Preview for China Internet and Other Services Industry Overview - The report focuses on the China Internet and Other Services sector, particularly highlighting companies involved in gaming and entertainment, such as Damai Entertainment, 37 Interactive Entertainment, G-bits, Perfect World, IQIYI, JOYY, Huya, and Focus Media [2][10]. Key Company Insights Damai Entertainment (1060.HK) - Forecasted 27% YoY total revenue growth in 1HF26, driven by 90% growth in IP business and 13% growth in offline entertainment [3]. - Expected net profit growth of 45% YoY [3]. 37 Interactive Entertainment (002555.SZ) - Anticipated 14% YoY revenue growth and 30% YoY adjusted net profit growth, attributed to new game releases [4]. G-bits (603444.SS) - Forecast aligns with preliminary announcements, with a focus on deferred revenue and 2026 pipelines [4]. Perfect World (002624.SZ) - Expected 34% revenue growth with a shift from a net loss of Rmb189 in 3Q24 to a net profit of Rmb326 in 3Q25 [5]. IQIYI (IQ.O) - Total revenue expected to be largely flat QoQ (-7% YoY), with a forecasted non-GAAP operating loss of Rmb23 million [6]. - Membership revenue projected to increase by 3% QoQ [6]. JOYY (JOYY.O) - Total revenue expected to grow 6% QoQ (-4% YoY), with net income remaining flat [7]. - Focus on advertising revenue and expense control [7]. Huya (HUYA.N) - Anticipated total revenue rebound in 3Q25 with an 11% YoY increase and a narrowing net loss [7]. Focus Media (002027.SZ) - Forecasted revenue growth of 4% YoY, driven by stronger demand from internet advertisers [8]. - Expected net profit growth of 10% YoY [8]. Financial Metrics and Projections - **Damai Entertainment**: Total revenue projected at Rmb3,879 million for 1HF26, with a normalized net profit margin of 12.8% [14]. - **37IE**: Revenue expected at Rmb4,674 million for 3Q25, with a gross margin of 79% [15]. - **G-bits**: Revenue forecasted at Rmb1,631 million for 3Q25, with a gross margin of 92% [17]. - **Perfect World**: Revenue expected at Rmb1,766 million for 3Q25, with a gross margin of 65% [18]. - **IQIYI**: Total revenues projected at Rmb6,688 million for 3Q25, with a gross profit margin of 18% [20]. - **Huya**: Total revenues expected at USD 1,710 million for 3Q25, with a gross profit margin of 13% [21]. - **JOYY**: Total revenues projected at USD 537 million for 3Q25, with a gross margin of 36% [24]. Additional Insights - The report emphasizes the importance of management comments on revenue growth momentum and normalized margin levels across companies [3][4][5]. - The potential for upside surprises in revenue growth for several companies, particularly in the context of new game releases and advertising demand, is highlighted [12][13]. - The overall industry view remains attractive, with a focus on the evolving landscape and potential regulatory impacts [10]. This summary encapsulates the key points from the earnings preview, providing a comprehensive overview of the anticipated performance and strategic focus of the highlighted companies within the China Internet and Other Services sector.

Tencent Holdings Ltd. 3Q25 Earnings Call Summary Company Overview - **Company**: Tencent Holdings Ltd. - **Industry**: China Internet and Other Services - **Market Cap**: Approximately US$749.87 billion - **Stock Rating**: Overweight - **Price Target**: HK$700.00 Key Financial Metrics - **Revenue Growth**: Forecasted to grow by 13% YoY - **Non-IFRS Operating Profit Growth**: Expected to increase by 18% YoY - **Capital Expenditure (Capex)**: Estimated at Rmb320 billion for 2025-27 Revenue Breakdown - **Value-Added Services (VAS)**: Revenue increased by 13% YoY, with online games growing by 18% - Domestic games: +13% - International games: +30% - **Marketing Services**: Revenue growth of 20% YoY, driven by AI ad-tech upgrades - **FinTech and Business Services (FBS)**: Revenue growth of 10%, with FinTech growing by 6% and Business Services by 22% [2][3][4][9] Core Insights - **Gaming Performance**: Strong performance from evergreen games and new launches, with Delta Force achieving record grossing during its anniversary event [2] - **AI Adoption**: Early AI adoption in marketing services is yielding high ROI, with improved click-through rates and user engagement [3] - **Cloud Services**: Despite prioritizing internal AI applications, demand for cloud services is expected to drive revenue growth, albeit at a slower pace compared to competitors [4] Financial Projections - **2025-27 Non-IFRS Operating Profit**: Increased by 1-2% due to higher revenues from games and marketing [5][9] - **Earnings Per Share (EPS)**: Projected to rise from Rmb20.63 in 2024 to Rmb30.70 by 2027 [7][19] Valuation and Investment Thesis - **Valuation Methodology**: Price target based on a sum-of-the-parts approach, with a DCF value of HK$612/share for core businesses and HK$88/share for associate investments [16][20] - **Investment Drivers**: Globalization of gaming, higher social ad monetization, and strategic upgrades in consumer and industrial Internet [27] - **Risks**: Competition in social networks and gaming, regulatory challenges, and potential impacts from US-China tensions [36] Additional Insights - **Market Position**: Tencent is positioned as a leader in China's online consumer market, with most services ranking in the top three by user base [27] - **Share Buybacks**: Recent buybacks are expected to support share price stability [28] - **Long-term Growth Potential**: Continued expansion in the Industrial Internet and AI applications is anticipated to drive future growth [35] Conclusion Tencent Holdings Ltd. is expected to maintain solid growth across all business segments, driven by strong performance in gaming, marketing, and cloud services. The company's strategic focus on AI and capital management positions it well for future opportunities, despite facing competitive and regulatory challenges. The current price target reflects a favorable outlook for investors.

Baidu Inc. 3Q25 Earnings Call Summary Company Overview - **Company**: Baidu Inc. - **Industry**: China Internet and Other Services - **Market Cap**: US$42.16 billion - **Current Stock Price**: US$121.69 - **Price Target**: US$140.00 Key Financial Metrics - **Core Revenue**: Rmb24.6 billion, down 7.3% YoY [1] - **Operating Profit**: Rmb2.2 billion, down 66.7% YoY [1] - **Online Marketing Revenue**: Expected to decline by 20% YoY [2] - **AI Cloud Revenue**: Expected to grow by 20% YoY [3] - **Total Net Revenue**: Rmb31.04 billion, down 7.5% YoY [13] Core Insights - **Online Marketing Revenue Decline**: The decline in online marketing revenue is attributed to the ongoing AI transformation affecting search ads monetization. By July 2025, 64% of mobile search result pages contained AI-generated content, up from 50% in June [2] - **AI Cloud Growth**: AI cloud revenue growth has slowed to 20% from 27% in the previous quarter, primarily due to slower growth in personal cloud services [3] - **Management Focus**: The management is focused on unlocking value through AI services, balance sheet optimization, and potential spin-offs of undervalued assets [1][3] Financial Projections - **Revenue Estimates**: Core revenue estimates for 2025-2026 have been lowered by 2% [3] - **Sum-of-the-Parts Valuation**: The SOTP value is estimated at US$220, with contributions from various segments including marketing (US$40), cloud (US$80), robotaxi (US$30), and net cash + investments (US$70) [3] - **P/E Ratio**: Baidu is trading at a 2026 estimated P/E of 15x, compared to 18-19x for competitors Tencent and Alibaba [3] Upcoming Developments - **Disclosure of AI Revenue**: Expected in November 2025, detailing revenues from AI-native marketing services and AI SaaS [9] - **Shareholder Returns**: Enhanced shareholder returns, including potential buybacks and dividends, are anticipated during the 4Q25 earnings announcement [9] - **Spin-off Plans**: Future plans include the spin-off of undervalued assets such as chips and robotaxi services [9] Risks and Considerations - **Market Environment**: A weak macro environment and risks associated with AI disruption are significant factors affecting the recovery of search ads [24] - **AI Monetization**: The monetization of AI services is still in early stages and has not yet shown a meaningful financial impact [27] - **Competition**: Intensifying competition in search and online video may drive up traffic acquisition costs and necessitate more aggressive content investments [42] Conclusion Baidu Inc. is navigating a challenging environment with a focus on AI transformation and unlocking shareholder value. While there are growth opportunities in AI cloud services, the decline in online marketing revenue poses risks. The management's strategic initiatives and upcoming disclosures will be critical in shaping investor sentiment and financial performance moving forward.

Summary of NetEase, Inc. Conference Call Company Overview - **Company**: NetEase, Inc (NTES.O) - **Industry**: China Internet and Other Services - **Current Price Target**: Increased from US$151.00 to US$170.00, representing a 14% upside from the current stock price of US$149.59 as of October 7, 2025 [1][7][32] Key Titles and Growth Potential - **Key Titles in Pipeline**: - **Ananta**: An ACG urban-theme open-world RPG game - **Sea of Remnants (SOR)**: An ocean adventure RPG game - **Growth Strategy**: Focus on fewer but larger titles, with Ananta and SOR being the top two in the pipeline according to management expectations [2][3] Revenue Scenarios for New Titles - **Projected Grossing for Ananta**: - Low Case: Rmb5 billion - Middle Case: Rmb10 billion - High Case: Rmb15 billion - **Projected Grossing for Sea of Remnants**: - Low Case: Rmb3 billion - Middle Case: Rmb5 billion - High Case: Rmb8 billion - **Comparison with Peers**: - Genshin Impact: ~Rmb30 billion - FWJ: ~Rmb18-20 billion - Where Winds Meet: ~Rmb7 billion - **Base Case Expectation**: Both titles reaching the middle level could imply an additional Rmb15 billion in game revenue by 2027 compared to 2025 [3][11] Launch Timing and Market Impact - **Launch Timing**: One title expected before summer 2026 and the other in late 2026, with potential staggered launches for PC and mobile versions [4] - **Impact of Delays**: 1-2 quarters of delay could significantly affect 2026 growth but may not impact long-term value [4] Financial Projections and Adjustments - **Revenue Revisions**: - 2026-27 game revenue revised up by 3-7% due to new title contributions and FWJ PC performance - Non-GAAP profit forecasts increased by 1.5% and 6.4% for 2026 and 2027, respectively [5][30] - **Earnings Estimates**: - Adjusted EPS for 2026-27 increased by 1.5% and 6.4% [30] - Revenue for 2026 projected at Rmb122,269 million, up from Rmb115,477 million in 2025 [7][31] Valuation and Market Position - **Valuation Method**: Sum of the Parts (SOTP) valuation leading to a new price target of US$170, driven by earnings estimate revisions and an increased game P/E to 16x [32][34] - **Market Capitalization**: Approximately US$95.93 billion with 641 million shares outstanding [7] Additional Insights - **Peer Comparison**: NetEase's P/E ratio is 14.2 for 2025E, compared to Tencent's 22.8 and Bili Bili's 42.9, indicating a relatively attractive valuation [22] - **Revenue Growth**: Expected CAGR of 8% from 2025 to 2027 based on the base case scenario for new titles [11] This summary encapsulates the key points from the conference call, focusing on NetEase's strategic direction, financial projections, and market positioning.

Summary of Baidu and IQIYI Conference Call Company and Industry Overview - **Companies Involved**: Baidu Inc. (BIDU.O) and iQIYI Inc. (IQ.O) - **Industry**: Internet and Other Services in Asia Pacific Key Points and Arguments Baidu's Advertising Performance - Core advertising revenue is expected to decline by **23% YoY** in Q3, worsening from a **15% decline in Q2** [1][2] - AI-related search results have increased from **50% in June to 64% in July**, but monetization remains limited [2] - Estimated **16% of advertising revenue** in Q2 came from AI, with **13% from AI agents** and **3% from digital humans** [2] - Cautious outlook for advertising recovery, with expectations of a **15% decline in Q4** [2] Baidu's Cloud Business - Cloud revenue reached **Rmb 6.5 billion**, growing **27% YoY** in Q2 [3] - Enterprise cloud growth is outpacing personal cloud, with subscription revenue growing over **50% YoY** [3] - Expected cloud growth of **30% YoY** in Q3, with margins maintained in the teens [3] Robotaxi Developments - Apollo Go operates in **16 cities globally** and has formed partnerships with Uber and Lyft [4] - Focus on expanding global operations with over **1,000 fleets** and **2.2 million rides in Q2** [4] - Limited financial contribution expected in the near term [4] Margin Pressures - Margins are under pressure due to declining ad revenue and increased investments in AI and robotaxis [5] - Operating profit for Q2 is expected to be **Rmb 2.2 billion**, down **66% YoY**, with an operating margin of **9.0%**, a decrease of **16.1 percentage points** [5] iQIYI's Financial Outlook - Price target raised from **US$1.7 to US$2.1**, maintaining an equal weight rating [6] - Despite recent financial struggles, potential for revenue growth exists due to regulatory relief [6] - Risks include competition in the long video and short drama segments [6] Baidu's Price Target and Earnings Estimates - Price target maintained at **US$100**, with a cautious outlook on core ads and margin pressures [7] - Core earnings estimates for 2025 lowered by **12%** [7] - Current price target implies an **11x P/E** for 2026, compared to **19-20x** for Tencent and NTES [7] Financial Performance Highlights - Baidu's total revenue fell **4% YoY**, with core revenue declining **2% YoY** [17] - Core marketing revenue dropped **15%**, while non-marketing revenue rose **34% YoY** [17] - iQIYI's revenue fell **11%** to **Rmb 6.6 billion**, missing estimates [17] Valuation Insights - Baidu's valuation derived from a sum-of-the-parts approach, with a **12% discount rate** and **3% terminal growth rate** [25] - iQIYI's valuation reflects weaker earnings growth visibility compared to peers [27] Additional Important Information - Baidu returned **US$232 million** in Q2 under its **US$5 billion share repurchase program** [17] - iQIYI's operating profit declined **88% YoY**, missing consensus estimates [17] - Baidu's gross margin decreased to **43.9%**, down **7.8 percentage points** YoY [17] This summary encapsulates the critical insights from the conference call, highlighting the challenges and opportunities faced by Baidu and iQIYI in the current market landscape.

Summary of NetEase, Inc. 2Q25 Earnings Call Company Overview - **Company**: NetEase, Inc (NTES) - **Industry**: China Internet and Other Services - **Market Cap**: US$86,501 million - **Stock Rating**: Overweight - **Price Target**: US$151.00, representing a 12% upside from the close price of US$134.90 on August 13, 2025 Key Financial Highlights - **Revenue**: - 2Q25 revenue increased by 9% YoY to Rmb27.9 billion, with online game revenue rising by 15% YoY to Rmb22.1 billion, exceeding Morgan Stanley's estimate by 2% [1][3] - **Gross Profit**: - Gross profit rose by 13% YoY to Rmb18.1 billion, with a gross profit margin (GPM) improvement to 64.7%, driven by a shift towards PC games [2][3] - **Operating Profit**: - Adjusted operating profit increased by 24% YoY to Rmb10 billion, also 2% above estimates [2] - **Net Profit**: - Adjusted net profit grew by 22% YoY to Rmb9.5 billion, slightly above estimates but below heightened market expectations due to increased sales and marketing expenses [3][6] Segment Performance - **Online Games**: - Revenue from online games was Rmb22.1 billion, reflecting a 15% YoY growth [1] - **Youdao**: - Revenue increased by 9% YoY to Rmb1.4 billion [3] - **Music**: - Revenue decreased by 4% YoY to Rmb1.97 billion [3] - **Innovative Business and Others**: - Revenue fell by 17% YoY to Rmb2.36 billion [3] Expense and Margin Analysis - **Sales and Marketing Expenses**: - The sales and marketing expense ratio increased to 12.8%, aligning with management's long-term target [2] - **Operating Margin**: - Operating margin for 2Q25 was reported at 35.9%, a 4.2 percentage point increase YoY [3] Market Outlook - **Growth Expectations**: - The company anticipates continued growth in the gaming sector, supported by strong contract liabilities, which are expected to positively impact 3Q performance [1] - **Investment Opportunity**: - Analysts suggest that any potential dip in share price presents a good opportunity for accumulation, given the long-term guidance of 13-14% growth [6] Risks and Considerations - **Market Risks**: - The company faces risks related to slower growth and limited overseas exposure compared to US/EU publishers [9] - **Performance Risks**: - Potential risks include weaker-than-expected margins and the performance of existing or new game titles [9] Conclusion NetEase, Inc. demonstrated solid financial performance in 2Q25, with significant growth in revenue and profit, particularly in the online gaming segment. The company is well-positioned for future growth, although it faces certain market risks that investors should consider.