TENCENT ANNOUNCES 2026 SECOND QUARTER RESULTS

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Substantial Progress towards Building a New, AI-empowered Tencent at Intelligence, Application and Infrastructure Levels

HONG KONG, Aug. 12, 2026 /PRNewswire/ — Tencent Holdings Limited (HKEX: 00700 (HKD Counter) and 80700 (RMB Counter), “Tencent” or “the Company”), a world-leading Internet and technology company in China, today announced the unaudited consolidated results for the quarter ended 30 June 2026 (“2Q2026”).

Mr. Ma Huateng, Chairman and CEO of Tencent, said, “As we entered into the third quarter of the year, we are making substantial progress towards building a new, AI-empowered Tencent in terms of intelligence, applications, and infrastructure. At the intelligence level, Hy3’s production version provides users a widely used model with strong cost-performance metrics, and serves as a stepping-stone toward the Hy family of models attaining state-of-the-art capabilities in the future. At the application level, our WorkBuddy AI office productivity service and CodeBuddy AI coding tool are achieving breakout user growth and are the clear leaders in their fields in China today[1]. At the infrastructure level, we substantially stepped up our procurement of compute, which will enable us to convert usage of our applications and models into revenue going forward. At the same time, we continue to enhance our existing services, with sustained marketing services revenue growth, several successful recently released games, and rapidly increasing video views on Weixin Video Accounts.”

2Q2026 Financial Highlights

Revenues: +11% YoY, gross profit: +13% YoY, non-IFRS operating profit: +9% YoY

Total revenues were RMB204.8 billion, up 11% over the second quarter of 2025 (“YoY”).
Gross profit was RMB118.4 billion, up 13% YoY.
On a non-IFRS basis, which is intended to reflect core earnings by excluding certain one-time and/or non-cash items:

Operating profit was RMB75.6 billion, up 9% YoY. Operating margin decreased to 37% from 38% last year.
Operating profit excluding New AI Products[2] was RMB86.1 billion, increased by 19% YoY. Operating margin excluding new AI products contributions increased to 42% from 39% last year.
Net profit was RMB 70.6 billion, up 9% YoY.
Net profit attributable to equity holders of the Company was RMB68.4 billion, up 9% YoY.
Basic earnings per share were RMB7.581. Diluted earnings per share were RMB7.433.

On an IFRS basis:

Operating profit was RMB67.3 billion, up 12% YoY. Operating margin was stable at 33%.
Net profit was RMB58.0 billion, up 3% YoY.
Net profit attributable to equity holders of the Company was RMB56.0 billion, up 0.7% YoY.
Basic earnings per share were RMB6.207. Diluted earnings per share were RMB6.104.

Capital expenditure was RMB52.8 billion, up 176% YoY.
Total cash was RMB511.2 billion, up 9% YoY. Net cash position totalled RMB58.2 billion, down 22% YoY.
We recorded negative free cash flow of RMB13.8 billion for 2Q2026, as net cash generated from operating activities of RMB52.7 billion was more than offset by capital expenditure payments of RMB59.3 billion, media content payments of RMB5.0 billion and lease liability payments of RMB2.2 billion. Included in our operating cash flow were large AI-related prepayments to provide infrastructure to support our Hy model enhancements, WorkBuddy and CodeBuddy inference needs, Weixin AI initiatives, and development of AI capabilities across our products and services, as well as to meet growing external demand for our cloud services. Excluding the prepayments for compute procurement, our free cash flow would have been RMB37.6 billion.
The fair value of our shareholdings[3] inlisted investee companies (excluding subsidiaries) totalled RMB487.2 billion as at 30 June 2026, compared with RMB547.1 billion as at 31 March 2026. The carrying book value of our shareholdings inunlisted investee companies (excluding subsidiaries) was RMB387.9 billion as at 30 June 2026, compared with RMB365.1 billion as at 31 March 2026.
During 2Q2026, the Company repurchased approximately 37.4 million shares on the Hong Kong Stock Exchange for an aggregate consideration of approximately HKD16.9 billion.

2Q2026 Management Discussion and Analysis

Revenues from VAS increased by 8% year-on-year to RMB98.4 billion for 2Q2026. Domestic Games revenues were RMB47.3 billion, up 17% year-on-year, driven by growth from most of our major games, with notable contributions from Delta Force, VALORANT PC and MOBILE, and Roco Kingdom: World. International Games revenues were RMB18.6 billion, down 0.8% year-on-year due to foreign currency movements, or up 4% year-on-year in constant currency terms, as higher revenues from Wuthering Waves and VALORANT PC were offset by lower revenues from certain Supercell games. Social Networks revenues increased by 0.8% year-on-year to RMB32.5 billion.

Revenues from Marketing Services were RMB43.6 billion for 2Q2026, up 22% year-on-year, supported by enhancements to our AI-driven ad recommendation model (which determines the ad shown to each user for each impression), upgrades to our automated campaign management solution AIM+ (which helps advertisers purchase performant impressions), and integration of closed-loop marketing capabilities within the Weixin ecosystem (which facilitates Weixin-integrated services, such as Mini Games and Mini Shops, to advertise more effectively on Tencent-managed ad properties). Most major industry categories increased marketing spending on our platforms during the quarter.

Revenues from FinTech and Business Services rose by 9% year-on-year to RMB60.3 billion for 2Q2026. FinTech Services revenue growth was mainly due to higher revenues from commercial payment, wealth management and consumer loan services. Business Services revenue growth was primarily driven by increased revenues from our cloud services, underpinned by greater demand for AI-related services, ongoing international expansion, and a more favourable pricing environment.

Operating Metrics

Business Review and Outlook 

We released the full Hy3 production version in July 2026, which delivered a substantial step-up in performance versus the Hy3 preview version, and significantly outperforms most similar-sized models. Since its launch, Hy3 has consistently ranked among the top 3 models globally in terms of token consumption on OpenRouter[5].
WorkBuddy is achieving rapid user growth and healthy user retention rates, with high user willingness to pay for tokens via subscriptions and top-ups. WorkBuddy’s market leadership is underpinned by its robust harness engineering, wide range of model availability, and industry-leading Skills library.
In recent weeks, we have begun a small-scale prototype test for Xiaowei, the agentic AI inside Weixin. Xiaowei is powered by a customised model, WeLM, built for user privacy, Weixin-specific use cases and inference efficiency.
Video Accounts‘ total time spent grew more than 20% year-on-year in 2Q2026, benefitting from enriched content for younger users, upgraded interactive features and a new multi-variable content ranking system.
Our domestic evergreen games[6], Delta Force and VALORANT PC, achieved lifetime highs in average DAU in 2Q2026. Our new game, Roco Kingdom: World, ranked first by average DAU[7] and by gross receipts[8] among all new mobile titles released in China year-to-date.
Miniclip attained breakout success in international markets as Arrows – Puzzle Escape became the most downloaded mobile game globally in 2Q2026[9], generating robust in-app advertising revenues.
We upgraded our automated campaign management solution, AIM+, with AI-powered end-to-end execution capabilities for mini shop and mini drama advertisers.

For other detailed disclosure, please refer to our website https://www.tencent.com/en-us/investors.html, or follow us via Weixin Official Account (Weixin ID: TencentGlobal).

About Tencent

Tencent uses technology to enrich the lives of Internet users.

Our communication and social services, Weixin and QQ, connect users with each other and with digital content and services, both online and offline, making their lives more convenient. Our targeted marketing services helps advertisers reach out to hundreds of millions of consumers in China. Our FinTech and business services support partners’ business growth and assist their digital upgrade.

Tencent invests heavily in talent and technological innovation, actively promoting the development of the Internet industry. Tencent was founded in Shenzhen, China, in 1998. Tencent has been listed on the Main Board of the Stock Exchange of Hong Kong since 2004.

Investor contact: IR@tencent.com
Media contact: GC@tencent.com

Non-IFRS Financial Measures

To supplement the consolidated results of the Group (“the Company and its subsidiaries”) prepared in accordance with IFRS, certain additional non-IFRS financial measures (in terms of operating profit, operating margin, profit for the period, profit attributable to equity holders of the Company, basic EPS and diluted EPS) have been presented in this press release. These unaudited non-IFRS financial measures should be considered in addition to, not as a substitute for, measures of the Group’s financial performance prepared in accordance with IFRS. In addition, these non-IFRS financial measures may be defined differently from similar terms used by other companies.

The Company’s management believes that the non-IFRS financial measures provide investors with useful supplementary information to assess the performance of the Group’s core operations by excluding certain non-cash items and certain impact of investment-related transactions. In addition, non-IFRS adjustments include relevant non-IFRS adjustments for the Group’s major associates based on available published financials of the relevant major associates, or estimates made by the Company’s management based on available information, certain expectations, assumptions and premises.

Forward-Looking Statements

This press release contains forward-looking statements relating to the business outlook, estimates of financial performance, forecast business plans and growth strategies of the Group. These forward-looking statements are based on information currently available to the Group and are stated herein on the basis of the outlook at the time of this press release. They are based on certain expectations, assumptions and premises, some of which are subjective or beyond our control. These forward-looking statements may prove to be incorrect and may not be realised in the future. Underlying these forward-looking statements are a lot of risks and uncertainties. In light of the risks and uncertainties, the inclusion of forward-looking statements in this press release should not be regarded as representations by the Board or the Company that the plans and objectives will be achieved, and investors should not place undue reliance on such statements. The Board and the Company assume no obligation to correct or update the forward-looking statements contained in this announcement.