The Zhitong Finance App learned that First Shanghai released a research report saying that Tencent Holdings (00700) will release the 2024 Q3 financial report on November 13. According to Visible Alpha's forecast, Q3 revenue will reach 167 billion yuan, an increase of 8% over the previous year. Among them, revenue from value-added services, advertising, cloud, and finance is expected to be 82.3 billion yuan, 29.6 billion yuan, and 53.5 billion yuan, respectively. Game revenue is expected to continue to rise, thanks to the performance of new products and blockbusters. The advertising business is driven by video accounts, etc., and revenue will increase year over year. The cloud business will pursue high-quality growth, and Financial Cloud focuses on the needs of the large model market. The connection between WeChat Pay and Taobao and Tmall will increase technical service fees.

First, Shanghai's main views are as follows:

Consistent financial expectations for the third quarter of 2024

According to Visible Alpha's consistent expectations, third-quarter revenue was 167 billion yuan, up 8% year over year. By revenue breakdown, value-added services are expected to be RMB 82.3 billion for the third quarter, up 8.71% year over year. The advertising forecast for the third quarter increased 15.18% year over year to 29.6 billion yuan. Advertising revenue is expected to continue to grow year over year, and video accounts are still the main driving force for advertising growth. It is expected that customer unit prices and load rates will still have room to rise. Cloud and Finance are expected to record 53.5 billion yuan in the third quarter, an increase of 2.75% year over year. On the profit side, non-GAAP net profit for the third quarter is expected to rise 19.55% year-on-year, to around RMB 53.7 billion.

Evergreen Gaming's strategy is growing steadily. AI enables advertising efficiency to improve, and video accounts, mini-games, and search ad traffic growth helps commercialization revenue

During the performance meeting, management should make a new outlook on this year's hot new games and future game commercialization development. Thanks to the recovery of large-scale games and the excellent performance of mobile games, the company's game revenue is expected to continue to rise in the next few quarters. Domestically, the monetization of the summer Peace Elite program has been accelerated since the end of July. Wang Zhe Rongyao DAU has maintained 0.1 billion users, and the mobile game DNF stabilized the top 4 game bestsellers in the third quarter. Overseas games continue to contribute revenue, and Wang Zhe's overseas edition performed brilliantly. In July, it was among the top three in Sensor Tower's overseas mobile game download list. It is expected that overseas games will maintain steady growth throughout the year. In terms of new travel products, the number of registrants for the first week of the launch of Operation Delta, which went live at the end of September, has exceeded 25 million.

Revenue from the advertising business will rise year-on-year, supported by the rapid development of video channels and operational optimization.

Thanks to the increase in video account loading rates, the upgrading of WeChat's small store ecosystem, the continuous growth of WeChat search advertising traffic, and summer game sales, it has all brought strong support to the advertising business. Coupled with AI technology empowering Tencent's 3.0 advertising side, it is expected that the high gross margin trend of the advertising business will continue.

The cloud business will continue to pursue operational efficiency while reducing costs, and focus on high-quality growth.

The financial cloud side mainly focuses on the rise in demand for cloud computing brought about by the large model market environment, as well as the commercialization process of projects such as small programs. WeChat Pay and Taobao Tmall began interconnection at the end of September, and it is expected that technical service fees for Q4 and 25 will increase significantly. It is expected that the company's overall revenue will improve this year; cost reduction and efficiency will continue, sales and management expenses are lower than expected, and we look forward to the disclosure of impressive data on the video account. At the same time, I expect management to give more clear guidance during the conference call.