Tencent Holdings Ltd. - ADR

Strong Financial Performance: Tencent reported a total revenue of RMB 193 billion for Q3 2025, marking a 15% year-on-year growth. Gross profit rose by 22% to RMB 109 billion, while non-IFRS net profit attributable to equity holders also increased by 18%, totaling RMB 71 billion. This solid performance underscores the resilience of the company amid market challenges.

Gaming Segment Growth: The international gaming business exhibited significant growth, increasing by 43% year-on-year, buoyed by the consolidation of recently acquired studios and the release of the game "Dying Light: The Beast." Tencent is likely to continue investing in high-quality overseas game studios and bringing Chinese games to the global market, although growth may decelerate to typical trend rates in the coming quarters.

Investment in AI: Tencent is enhancing its Hunyuan foundation model to support various business areas, aiming for industry-leading capabilities, particularly in AI. This strategic investment is believed to enhance ad targeting and customer engagement, with a positive outlook for the potential growth of AI applications within Weixin and other platforms.