Tencent Reports Strong Q1 Revenue Growth, AI Investments Pay Off

Tencent's Q1 revenue grew 13% YoY to $24.98 bln, beating expectations, as its core gaming business remained strong and AI investments started to pay off. The company's capital expenditure surged 300% in Q4 and plans to accelerate spending further, with capex likely accounting for a low-teen percentage of revenue this year. Net profit rose 14% to $47.82 bln. Tencent's gaming business maintained momentum, with domestic revenue up 24% and international revenue up 23%. AI-powered ad targeting and creation helped lift marketing services revenue by 20%.

Title: Tencent Reports Strong Q1 2025 Performance, Driven by Gaming and AI

Tencent Holdings Limited reported robust financial results for the first quarter of 2025, showcasing significant growth across its core gaming business and AI investments. The company's revenue grew 13% year-over-year (YoY) to $24.98 billion, surpassing analysts' expectations. The gaming division, which includes popular titles such as "Honor of Kings" and "Peacekeeper Elite," contributed substantially to this growth, with domestic revenue increasing 24% and international revenue rising 23% [1].

Tencent's net profit also rose 14% to $47.82 billion, although it fell short of expectations. The company's capital expenditures (capex) surged 300% in the fourth quarter and are expected to continue accelerating, likely accounting for a low-teen percentage of revenue this year. This significant investment in AI is aimed at enhancing the company's performance advertising and creating evergreen games [1].

The company's marketing services revenue grew 20% YoY, driven by robust advertiser demand for its video, search, and Mini Program products within WeChat. This growth underscores the platform's growing importance as a digital hub for Chinese consumers [1].

Despite the strong performance, Tencent's net profit missed analyst expectations. However, the company remains optimistic about the long-term benefits of its AI investments and the operational leverage from its high-quality revenue streams. The company's AI spending surged in the first quarter, totaling $27.5 billion, up 91% from the same period last year [1].

Fathom Holdings Inc. also reported strong revenue growth for the first quarter of 2025, with total revenue increasing 32.1% YoY to $93.1 million. Brokerage revenue climbed nearly 36% to $88.9 million, driven by increased transaction volume and agent count. The company successfully reduced expenses by approximately $750,000 per quarter, contributing to a more efficient and scalable business model. Fathom Holdings Inc. expects to achieve adjusted EBITDA profitability in the second quarter of 2025 [2].

Airship AI Holdings Inc. is expected to report a loss of 2 cents per share for the period ending March 31, 2025, according to analyst estimates. The company is expected to report revenue of $4.3 million, with Wall Street's median 12-month price target set at $8.50 [3].

References
[1] https://www.cnbc.com/2025/05/14/tencent-q1-2025-earnings-report.html
[2] https://finance.yahoo.com/news/fathom-holdings-inc-fthm-q1-071819043.html
[3] https://www.tradingview.com/news/reuters.com,2025:newsml_L8N3RH2MJ:0-airship-ai-holdings-inc-expected-to-post-a-loss-of-2-cents-a-share-earnings-preview/