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<Research>CLSA Expects TENCENT (00700.HK) 1Q26 Revenue, Adj. EBIT to Grow 11% and 10%; AI Investment May Weigh on Margins
Recommend 42 Positive 46 Negative 24 |
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CLSA issued a research report expecting TENCENT (00700.HK) to keep delivering solid revenue growth, although AI investment may weigh on margins in 2026. The broker estimated that TENCENT's total revenue for 1Q26 will climb 11% YoY to RMB200 billion, while adjusted EBIT will rise 10% YoY to RMB76 billion. Leveraging its enormous WeChat ecosystem, TENCENT is well positioned to monetize AI applications, with earnings likely to be more resilient than peers, the broker opined. The Hunyuan 3.0 preview version was open-sourced in April, with inference efficiency improving by 40% compared with Hunyuan 2.0, while input and output costs declined by more than 50%. New models and agent-based applications are expected to support a re-rating of TENCENT's share price. CLSA maintained its High-Conviction Outperform rating on TENCENT with a TP of HKD740. AASTOCKS Financial News |
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