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cailianshe news, september 25 (editor: hu jiarong)today, tencent holdings (00700.hk) continued yesterday's upward trend, but the company broke through its previous high during the session. as of press time, it rose 2.29% to hk$411.6.

note: tencent holdings' performance since october 2022

specifically, tencent holdings has doubled between october 25, 2022 and september 24, 2024. it is worth noting that the company rose to hk$418 during today's trading, surpassing hk$416 on january 27, 2023, setting a new high in more than two years.

why did tencent holdings experience a periodic doubling in price?

first, the fundamentals have improved: tencent holdings' business adjustments have achieved positive results. specifically, in the game sector, which has attracted much attention, the growth of overseas games has basically offset the decline in domestic game and membership revenues. advertising and cloud businesses have contributed the main revenue growth and further grown into core pillars, accounting for more than half of the cumulative revenue.

taking the second quarter performance as an example, tencent holdings' total revenue was 161.1 billion yuan, an increase of 8% year-on-year. among them, the revenues of domestic games, overseas games, social networks, online advertising, financial technology and enterprise services were 34.6 billion, 13.9 billion, 30.3 billion, 29.9 billion and 50.4 billion yuan, respectively, an increase of 9%, 9%, 2%, 19% and 4% year-on-year.

from the profit side, gross profit was 85.9 billion yuan, up 21.3% year-on-year; gross profit margin was 53.3%, up 5.8% year-on-year. the improvement in gross profit margin was mainly due to the high-quality transformation of the revenue structure, with the proportion of high-gross-profit businesses such as video account advertising, mini-game platform service fees, wealth management, and video account sales technology service revenue increasing.

secondly, tencent's continued repurchase also provided support for the stock price increase. the company repurchased a total of hk$146.149 billion and a total of 430 million shares during the period.

note: cumulative number of repurchased shares

note: cumulative repurchase amount

the agency said that the trend of platform interconnection may give rise to new growth points

taobao recently announced that it plans to add wechat payment capabilities to improve consumers' shopping experience. on the same day, according to china business news, meituan waimai and meituan hotels officially entered the alipay mini program, and meituan group buying may be launched soon.

tf securities predicts that the potential impact of the interoperability of taobao and wechat payment on tencent may include: helping to increase wechat payment fee income; helping the taobao platform and its merchants to strengthen cooperation with tencent's advertising platform; and helping taobao merchants to operate private domains through wechat. continue to pay attention to the promotion rhythm of wechat payment marketing tools in taobao, as well as the cooperation strategies of both platforms for non-closed-loop transactions.