Tencent's first-quarter net profit increased by 20%, with stable fundamentals but a weak stock price

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Caixin.com On May 13, after the Hong Kong stock market closed, Tencent Holdings (00700.HK) released its Q1 2026 financial report, achieving revenue of 196.46B yuan, a year-on-year increase of 9%; net profit attributable to shareholders was 58.09B yuan, a year-on-year increase of 21%; excluding the impact of investment income, non-International Financial Reporting Standards (IFRS) net profit was 67.9B yuan, an increase of 11% year-on-year.

In the past year, Tencent’s single-quarter revenue and profit growth remained stable, but in the first quarter, Tencent’s revenue growth significantly slowed down, dropping from around 15% in the previous four quarters to 9%. Revenue from value-added services, which accounts for 49% of Tencent’s total revenue, only increased by 4% year-on-year, far below the previous single-quarter growth rate of over 10%. This was due to the later Chinese New Year holiday this year, which caused domestic game revenue to be deferred until after the first quarter before it could be recognized.

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