--- title: "Citi: Downgrades Tencent Holdings target price to HKD 758, maintains a cautious stance on AI spending and profit drag in the next quarter" type: "News" locale: "en" url: "https://longbridge.com/en/news/292030233.md" description: "Citi released a research report stating that potential buybacks, AI investments, and enhancing core business growth through AI will continue to be major priorities for Tencent Holdings Limited. Citi has lowered its target price from HKD 763 to HKD 758 to reflect changes in portfolio value. Based on its status as an AI investment target, it maintains a \"Buy\" rating. Tencent will announce its Q2 2026 results on August 12. The bank believes that while it expects the gaming business to remain strong despite weaker seasonal factors, along with robust growth in advertising revenue, overall revenue growth will perform steadily. However, it holds a cautious attitude towards AI spending and profit drag, thus its profit assumptions are more conservative than market expectations. In the second half of 2026, the bank expects Tencent's focus to remain on Agentic AI testing within WeChat, integration of mini-programs with Hy3, the release of the next generation iteration/upgrade of the Hy model, and capital expenditures. Additionally, the bank believes Tencent will continue to evaluate its portfolio, conducting strategic rotations and rebalancing between AI-related investments and mature industries" datetime: "2026-07-08T07:44:03.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/292030233.md) - [en](https://longbridge.com/en/news/292030233.md) - [zh-HK](https://longbridge.com/zh-HK/news/292030233.md) --- # Citi: Downgrades Tencent Holdings target price to HKD 758, maintains a cautious stance on AI spending and profit drag in the next quarter According to the Zhitong Finance APP, Citigroup has released a research report stating that potential buybacks, AI investments, and strengthening core business growth through AI enhancements will continue to be major priorities for Tencent Holdings Limited (00700). Citigroup has lowered its target price from HKD 763 to HKD 758 to reflect changes in portfolio value. It maintains a "Buy" rating based on its status as an AI investment target. Tencent will announce its Q2 2026 results on August 12. The bank believes that although it expects the gaming business to remain strong due to weaker seasonal factors and steady growth in advertising revenue, overall revenue growth will perform robustly. However, it takes a cautious stance on AI spending and profit drag, thus its profit assumptions are more conservative than market expectations. In the second half of 2026, the bank expects Tencent's focus to remain on Agentic AI testing within WeChat, integration of mini-programs with Hy3, the release of next-generation iterations/upgrades of the Hy model, and capital expenditures. Additionally, the bank believes Tencent will continue to evaluate its portfolio, engaging in strategic rotations and rebalancing between AI-related investments and mature industries ### Related Stocks - [TCTZF.US](https://longbridge.com/en/quote/TCTZF.US.md) - [00700.HK](https://longbridge.com/en/quote/00700.HK.md) - [TCEHY.US](https://longbridge.com/en/quote/TCEHY.US.md) - [C.US](https://longbridge.com/en/quote/C.US.md) - [C-R.US](https://longbridge.com/en/quote/C-R.US.md) - [80700.HK](https://longbridge.com/en/quote/80700.HK.md) - [HTCD.SG](https://longbridge.com/en/quote/HTCD.SG.md) ## Related News & Research - [Tencent unit seeks up to $1.55 billion from Kuaishou share sale, term sheet shows](https://longbridge.com/en/news/291804827.md) - [Tencent Cuts Kuaishou Stake as Video Platform Presses Ahead With Share Buybacks](https://longbridge.com/en/news/291823198.md) - [WorkBuddy is exploding! WeChat AI is coming: Does Tencent AI have a "new ticket"?](https://longbridge.com/en/news/291743762.md) - [MeltFlex AI Interior Design Tool Passes 213,000 Users Worldwide](https://longbridge.com/en/news/292099142.md) - [This AI shortcut could destroy the industry's profits](https://longbridge.com/en/news/292041141.md)