Tencent Holdings (00700) Reports Q2 Results: Adjusted Net Profit Attributable to Shareholders Up 9% to RMB 68.415 Billion
Tencent Holdings (00700) has released its second-quarter results for the 2026 fiscal year. The group achieved revenue of approximately RMB 204.785 billion, representing an 11% year-on-year increase and a 4% sequential rise. Gross profit reached RMB 118.433 billion, growing 13% year-on-year and 6% quarter-on-quarter. Profit attributable to equity holders of the company stood at RMB 56.022 billion, reflecting a 0.7% year-on-year increase but a 4% decline from the previous quarter. Under Non-IFRS measures, profit attributable to equity holders was RMB 68.415 billion, up 9% year-on-year and 0.8% quarter-on-quarter. Basic earnings per share were RMB 6.207. For the first half of 2026, the group's revenue totaled approximately RMB 401.243 billion, a 10% year-on-year increase. Gross profit was RMB 229.698 billion, up 12% from the prior year. Profit attributable to equity holders of the company reached RMB 114.115 billion, a 10% year-on-year gain, while Non-IFRS profit attributable to equity holders was RMB 136.32 billion, also up 10% year-on-year. Basic earnings per share for the period were RMB 12.639. In July 2026, the company released the formal version of Hy3, which showed significant performance improvements over the Hy3 preview version and surpassed most models of similar size. Based on token consumption data from OpenRouter, Hy3 has consistently ranked among the top three globally since its launch. WorkBuddy has achieved rapid user growth and strong user retention, with users demonstrating a high willingness to pay for subscriptions and token purchases. WorkBuddy's leading market position is attributed to its robust harness engineering capabilities, a wide range of model choices, and an industry-leading skill library.
Market Outlook
Overnight in the US stock market, the Dow Jones Industrial Average fell 21.58 points to close at 53,770.27, a decrease of 0.04%. The S&P 500 index rose 20.3 points to close at 7,748.5, up 0.26%. The Nasdaq Composite Index gained 143.04 points to close at 26,588.49, an increase of 0.54%. Major tech stocks showed mixed performance, with SpaceX rising 9.65% and Nvidia gaining 3.03%. AI concept stocks experienced significant gains. In the memory chip sector, SK Hynix rose 9.01%, Seagate Technology was up 7.03%, SanDisk gained 5.76%, Micron Technology increased 4.92%, and Western Digital added 3.69%. Among semiconductor equipment stocks, Applied Materials rose 4.29%, Lam Research gained 4.72%, and KLA Corp increased 3.88%. In the new AI cloud services segment, Nebius Group surged 34.14%, CoreWeave jumped 19.28%, and Super Micro Computer climbed 19.02%. For optical communication and photonics companies, Lumentum Holdings rose 13.63%, Coherent gained 8.24%, Credo Technology added 8.26%, and Corning increased 5.18%. Most popular Chinese concept stocks declined, with the Nasdaq Golden Dragon China Index falling 2.38%. The Hang Seng Index ADR was lower, calculated to close at 25,368.93 points, representing a drop of 71.24 points or 0.28% from the Hong Kong close. WTI crude oil futures for the nearest month fell $0.62 to settle at $82.58 per barrel, a decline of 0.75%. COMEX gold futures for the nearest month rose $27.90, or 0.63%, to close at $4,469.0 per ounce.
Key Developments on the Horizon
Anchorpoint, backed by Standard Chartered, has launched a Hong Kong dollar stablecoin. According to an email statement, the licensed stablecoin issuer Anchorpoint Financial, led by Standard Chartered, announced the launch of a Hong Kong dollar stablecoin. The HKDAP stablecoin is being introduced to institutional distributors and professional investors through a testing phase. Duan Yongping's stake in Pop Mart (09992) has increased from 5.55% to 7.70%. According to Hong Kong Stock Exchange filings, H&H International Investment, LLC, managed by Duan Yongping, raised its stake in Pop Mart's H-shares from 5.55% to 7.70% on August 6. Deeptek Technology (01384) plans to raise approximately HK$500 million through a share placement at HK$35 per share to intensify R&D in enterprise AI agents and token productivity platforms. The company announced that on August 13, 2026, before the start of trading, it entered into a placement agreement with a placing agent to place 14.286 million new H-shares to at least six independent placees at a price of HK$35.00 per share. Assuming all shares are placed, the net proceeds are estimated to be about HK$487.5 million. Dmall Inc (02586) released its interim results, posting a net profit attributable to shareholders of RMB 109 million, a year-on-year increase of 60.85%. The increase in revenue was primarily attributed to the continued expansion of the group's AI-powered retail core solutions business. Leveraging years of retail digitalization experience, the company is systematically advancing the deployment of AI agents in retail scenarios, officially initiating a strategic upgrade from a "retail digital solution provider" to a "retail AI agent service provider." CK Infrastructure Holdings (01038) reported its interim results, with net profit attributable to shareholders surging 388.78% to HK$21.252 billion. For the six months ended June 30, 2026, the group achieved a net profit of HK$21.252 billion, up 389% year-on-year. This significant increase was mainly driven by substantial gains from the sale of UK Power Networks (UKPN) and UK Rails, fully demonstrating the company's value creation capabilities and reflecting the deep value embedded in the group's quality asset portfolio. Bloks Group (00325) released its 2026 interim results, showing a net profit of RMB 387 million, a year-on-year increase of 30.5%. Basic earnings per share were RMB 1.56, with an interim dividend of HK$0.3247 per share. Revenue from new product categories, including play-set vehicles launched in November 2025, generated RMB 185.5 million, accounting for 10.4% of total revenue and representing the incremental revenue for the reporting period. Power Assets Holdings (00006) published its interim results, with net profit attributable to shareholders increasing by 383.37% to HK$14.704 billion. Earnings per share were HK$6.9, and an interim dividend of HK$0.78 per share was declared. The results were primarily driven by the group's sale of its interests in UK Power Networks (UKPN) and UK Rails. The group capitalized on favorable market conditions to realize these projects at attractive valuations, generating substantial accounting and cash gains to fund future investments. Yue Yuen Industrial (00551) reported interim results, with net profit attributable to shareholders falling 57.9% to US$71.998 million. An interim dividend of HK$0.4 per share was declared. Due to macroeconomic uncertainties, tariff policies, and inflation risks, end customers adopted a conservative approach to inventory restocking, leading brand clients to be more cautious in their orders. This resulted in increased order volatility and pressure on the group's manufacturing business revenue. Nexteer Automotive (01316) released its 2026 interim results, with profit attributable to equity holders rising 35.17% to US$85.806 million. Revenue was US$2.329 billion, a year-on-year increase of 3.86%. Earnings per share were US$0.034.
Stock Spotlight: Guangdong-Hong Kong-Macao Intelligent Computing (01396)
The rise of domestic large language models is directly driving a surge in demand for domestic computing power. DeepSeek plans to raise the overall pricing of its DeepSeek API services soon. A research report from GF Securities suggests that unlike previous adjustments targeting peak-hour pricing, this move points to a comprehensive pricing increase for API services, mainly driven by rising demand from AI application growth and tight supply of computing power. This price hike reflects a shift in the price war dynamics within the large model industry, with companies increasingly focusing on cost control and sustainable profitability. On the computing power side, the emergence of domestic large models directly fuels demand for domestic computing power, making domestic AI chips and computing power leasing beneficiaries. Notably, Guangdong-Hong Kong-Macao Intelligent Computing recently announced that its subsidiary, Shenzhen Hongrui, signed two financial leasing agreements with Puyin Financial Leasing, with a total financing amount of approximately RMB 1.185 billion. The latest agreement is for about RMB 790 million, with a lease term of up to 62 months. In the first half of the year, the company signed new contracts worth RMB 15 billion, with cumulative orders exceeding RMB 30 billion. It has delivered over RMB 2 billion, with another RMB 2 billion in equipment already purchased and pending delivery. With a robust order backlog and accelerating delivery, the company is well-positioned in a global environment of tight AI computing supply and surging demand, as the ability to quickly convert orders into operational computing assets is key to gaining a competitive advantage.
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