In "The Big Banks," Citigroup expects Tencent's third-quarter performance to be stable, maintaining a "highly confident buy" rating

AASTOCKS
2025.11.13 02:56

Citi expects that Tencent (00700.HK) will have a solid performance in the third quarter, with total revenue and adjusted EBITDA expected to grow by 14% and 21% year-on-year, reaching RMB 190 billion and RMB 74.1 billion, respectively. The firm anticipates that Tencent's online gaming revenue may grow by 18% year-on-year, with potential surprises due to strong performances from titles such as "Honor of Kings," "Delta Force," and "Clash Royale." Online advertising revenue is expected to increase by 20% year-on-year, driven by upgrades in advertising technology and conversion growth. Enterprise services should also maintain an annual growth rate of over 20%.

Citi expects Tencent's momentum to continue into the fourth quarter, with ongoing resilience in online gaming, advertising, and cloud services. Tencent is the biggest beneficiary of AI applications. The firm recently raised its adjusted net profit forecasts for Tencent for the fiscal years 2025 and 2026 by 0.8%. It maintains a "High Conviction Buy" rating

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