【行业研究报告】腾讯控股-Higher consumer internet revenue contribution boosted margin

14Nov2024
CMBInternationalGlobalMarkets|EquityResearch|CompanyUpdate
Tencent(700HK)
Higherconsumerinternetrevenuecontribution
boostedmargin
Tencentannouncedinline3Q24results:totalrevenuewasupby8%YoYto
RMB167.2bn,inlinewithour/Bloombergconsensusestimateof
RMB166.8/167.9bn;non-IFRSoperatingprofitgrewby19%YoYtoRMB61.3bn,
inlinewithourestimateofRMB61.4bn.Lookingahead,weremainpositiveon
earningsgrowthin4Q24Edrivenbytheaccelerationingamesrevenuegrowth
andresilientmarketingbusinessperformance.Forthelongerterm,weexpect
improvedadmonetizationande-commerceinfrastructuredevelopmentwithin
theWeixinecosystemtobethekeyearningsgrowthdrivers.Weslightlyliftour
FY24-26Enon-IFRSoperatingincomeforecastby1-2%tofactorinthe
unleashingofoperatingleverage.WemaintainourSOTP-derivedTPat
HK$525.0andourBUYrating.
Gamerevenuegrowthacceleratedin2H24.Gamesrevenueincreased
by13%YoYtoRMB51.8bnin3Q24(inlinewithconsensus).Domestic
by13%YoYtoRMB51.8bnin3Q24(inlinewithconsensus).Domestic
gamesrevenuewasupby14%YoYtoRMB37.3bnin3Q24,mainlydriven
bytherobustperformanceofDnFMobile.FlagshiptitlesHonourofKings
andPeacekeeperElitebothrecordedpositiveYoYgrowthofgrossreceipts
in3Q24.Internationalgamesrevenuegrewby9%YoYtoRMB14.5bnin
3Q24,mainlythankstosolidgrowthofPUBGMobileandBrawlStars.
Internationalgamesgrossreceiptgrowthcontinuedtosubstantiallyoutpace
revenuegrowth,primarilyduetothelongerrevenuedeferralperiodsof
certaintitles.Underpinnedbythesolidgrowthingamesgrossreceiptsand
low-baseeffect,weexpectgamesrevenuegrowthwillfurtheraccelerateto
+17%YoYin4Q24E.
Marketingservicesrevenuemaintainedsolidmomentum.Marketing
servicesrevenueincreasedby17%YoYtoRMB30.0bnin3Q24(1%ahead
ofconsensus),fuelledbyrobustaddemandforVideoAccounts(VA),Mini
ProgramsandWeixinSearch.VAmarketingservicesrevenueincreasedby
over60%YoYin3Q24.WeixinSearchleveragedLLMtoimproverelevance
ofsearchresultsandcontinuedtogrowitscommercialqueriesandclick-
throughratesYoY,withWeixinSearchrevenuemorethandoubledYoYin
3Q24.MiniProgramGMVgrewbyahigh-teenspercentageYoYtoover
RMB2tnin3Q24,primarilyattributabletowidercoverageofusecases.
FBSbusinessnavigatesshort-termheadwinds.FintechandBusiness
Services(FBS)revenuegrewby2%YoYtoRMB53.1bnin3Q24
(2Q24/1Q24:+4/7%YoY),furtherdeceleratingduetosoftconsumption
sentiment.FintechrevenuewaslargelyflattishYoY,asthegrowthinwealth
managementrevenueswaslargelyoffsetbythedeclineinpayment
revenue.BusinessservicesrevenuemaintainedhealthygrowthYoY,
supportedbygrowthinbothcloudande-commercerevenue.
Expectsolidearningsgrowthahead.TencentGPMexpandedby3.6ppt
YoYto53.1%in3Q24,withVAS/marketing/FBSGPM+2.0/0.7/6.9pptYoY
respectively.WeexpectGPMexpansiontocontinuein4Q24E(albeitata
slowpace),drivenbysolidgrowthofhigh-marginbusinesses.Overall,we
forecastnon-IFRSoperatingprofittogrowby22%YoYin4Q24E.