Tencent 2Q25: Ads Hold Strong, Cloud Accelerates on GPU Leasing, Gaming Faces High Base

Advertising

Solid Performance with Potential Upside

Advertising performance this quarter remains solid, with potential to exceed expectations. Revenue growth could still reach 20%, with client-side ad spending showing no material slowdown versus last quarter. Government subsidies and the food delivery price war had minimal impact. Initially, major players planned to reduce advertising budgets and shift spending toward subsidies, but in practice, new funding was injected, leading to only limited budget reductions (cross-checked with ByteDance trends). WeChat Channels continues to scale, and WeChat Search ads—posting ~8% CTR, above typical search benchmarks—contributed significant incremental revenue. Key user-side metrics for Channels should be monitored going forward. E-commerce GMV on Channels remains in growth mode, though service formats appear to be still evolving. AI-driven ad initiatives are progressing on schedule, delivering a 1–2% quarterly revenue uplift since the start of the year.

Gaming

Mid-Teens Growth Guidance, the actual performance is likely to be in line with, or slightly above, guidance, but any deviation is expected to be limited