To The Moon

Entering the second half of 2023, BAT's performance has accelerated overall due to the favorable policies and macro environment. In terms of revenue growth, Tencent has the fastest growth rate, thanks to the acceleration of the realization of WeChat video account and financial technology business; Alibaba has the second fastest growth rate, and the strong growth of global business has partially made up for the slowdown in domestic e-commerce growth; Baidu At the bottom, both online marketing and non-online marketing businesses are facing downward pressure on growth.$TENCENT(00700)$ $Alibaba(BABA)$ $Baidu(BIDU)$ 

Comparison of three companies

From the perspective of profitability, Tencent’s cost control and efficiency improvement are the most significant. On the one hand, Tencent achieves revenue growth while improving efficiency through the Hunyuan large model and WeChat ecosystem; on the other hand, it strictly controls cost investment. In contrast, Baidu's AI empowerment and efficiency improvement have played a certain role, but it still needs to be verified whether the commercialization effect meets expectations; Alibaba's own costs are difficult to reduce quickly, resulting in low profitability.

From the perspective of revenue scale alone, Alibaba’s revenue scale is 224.790 billion yuan, ranking first among BAT, Tencent’s revenue scale is 154.625 billion yuan, ranking second, Baidu’s revenue scale is only 34.447 billion yuan, the overall revenue The scale is far smaller than Alibaba and Tencent.

From the perspective of revenue growth, BAT's revenue growth has increased year-on-year after experiencing sluggish growth in the same period last year. Among them, Tencent’s third-quarter revenue increased by 10% year-on-year, Alibaba’s third-quarter revenue increased by 9% year-on-year, and Baidu’s third-quarter revenue increased by 6% year-on-year. Judging from the year-on-year revenue growth rate, Tencent>Alibaba>Baidu.

Tencent's cloud business occupies an increasingly important position in its revenue structure, especially PaaS and SaaS services. The year-over-year growth in its revenue and operating profit demonstrates the company's competitiveness and market acceptance in this field. In particular, the substantial growth in operating profit shows that Tencent's profitability in cloud computing services has been significantly improved. This may be due to Tencent's continuous innovation in products and services, as well as its ability to effectively control costs and improve efficiency. In addition, a high operating profit ratio may also mean that Tencent has higher pricing power and good customer stickiness in the cloud service market. Overall, Tencent's cloud business has shown strong growth momentum and has played a positive role in promoting the company's overall operating conditions.

Tencent Business Segment Highlights

Tencent's outstanding performance in revenue growth and profitability is mainly due to the bright spots of its business segments. WeChat video accounts have seized the opportunity to rise rapidly during the epidemic. The ad monetization capabilities of video accounts are rapidly improving and are expected to maintain high growth in the next few years. As WeChat is the mainstream traffic portal for mobile terminals, Souyisou’s advertising inventory is expected to continue to be released and is expected to become an important advertising monetization channel; in addition, Tencent announced that a number of new games are ready to be launched, and the game business segment is expected to accelerate again and become a new engine for revenue growth; new businesses such as live streaming e-commerce are also gaining momentum, and commission income will become a financial technology business new growth points.

Multiple pressures faced by Baidu

Compared with Tencent, Baidu's performance is slightly inferior. First, facing the pressure of slowing growth in search advertising, leading e-commerce platforms have compressed their marketing budgets, directly impacting Baidu’s core revenue sources; second, the growth rate of non-main businesses including AI business has slowed down, and commercial There are doubts about the transformation process; thirdly, the number of users and traffic growth of Baidu's core products have peaked, and how to open up new incremental space is another problem Baidu faces.

Alibaba’s multiple challenges

Among the three BATs, Alibaba’s performance was relatively weakest. The main challenge it faces is the loss of e-commerce business share. The rise of new e-commerce platforms has led to traffic diversion, and Alibaba e-commerce GMV has been directly affected. Second, the number of mobile e-commerce users is approaching saturation, and it has become extremely difficult to increase active users. Finally, the effect of Alibaba’s “1+6+N” business transformation strategy still needs to be verified, and whether it can find new profit growth points is still unknown.

Looking to the future, Tencent has the highest certainty of growth. The business space for video accounts, WeChat advertising, games and financial technology is vast and is expected to continue to grow rapidly; the commercialization of Baidu Wenxin series products has begun, but the overall effect of AI commercialization remains to be seen; the main problem facing Alibaba is the e-commerce business Share loss and user growth are weak, and there is uncertainty about improvement.

To sum up, among the three BAT giants, Tencent has the most outstanding comprehensive strength. With a complete business matrix, high profitability and strong growth momentum, it is a target worthy of long-term attention. Baidu and Alibaba are facing more business pressure and uncertainty, and need to further verify their transformation effects.$Semiconductor Bull 3X Shares(SOXL)$ $Nasdaq100 Bull 3X ETF(TQQQ)$ 

@TigerStars @Daily_Discussion @MillionaireTiger @MillionaireTiger