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CMSI Cuts TENCENT (00700.HK) TP to HKD632; 1Q Results In Line; Rating Overweight
2026-05-14 18:04:05
CMSI issued a report covering TENCENT (00700.HK)'s 1Q results, which were broadly in line. Revenue hiked 9% YoY, while non-IFRS net profit added 11% YoY, on the ride of margin improvement in its core businesses, partially offset by AI-related investments.

AI continued to juice accelerated growth in TENCENT's core businesses, the report noted. The WeChat Agent was expected to be launched in 3Q26, becoming a key differentiating competitive advantage for the company.

CMSI maintained its Overweight rating on TENCENT. Due to increased investment, it lowered its earnings forecasts for 2026-28 by 2-9%, but remained optimistic about its unique market position and growth opportunities driven by Agentic AI. The TP was cut to HKD632 from the previous HKD700.
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