TENCENT announced its first quarter 2026 results, achieving revenue of approximately RMB 196.458 billion, representing a 9% year-on-year increase and a 1% sequential increase. Gross profit was RMB 111.265 billion, up 11% year-on-year and 3% sequentially. Net profit attributable to equity holders of the company was RMB 58.093 billion, an increase of 21% year-on-year but a slight decrease of 0.3% sequentially. Non-IFRS net profit attributable to equity holders was RMB 67.905 billion, rising 11% year-on-year and 5% sequentially. Basic earnings per share were RMB 6.431. The Value-Added Services business generated Q1 2026 revenue of RMB 96.1 billion, a 4% year-on-year increase. Domestic games revenue reached RMB 45.4 billion, up 6% year-on-year. However, this revenue growth lagged behind the growth rate of domestic games gross billings due to the later timing of the 2026 Lunar New Year holiday compared to 2025, which resulted in more revenue being deferred for recognition beyond the quarter. Domestic games gross billings grew by over ten percentage points year-on-year, driven by established evergreen titles such as "Honor of Kings" and "Peacekeeper Elite," as well as recent releases like "Delta Force" and "Valorant: Genesis." International games revenue was RMB 18.8 billion, increasing 13% year-on-year (14% on a constant currency basis), primarily fueled by revenue growth from "Clash Royale," "Wuthering Waves," and the PC version of "Valorant." Social Networks revenue declined 2% year-on-year to RMB 31.9 billion. This decrease was attributed to the later Lunar New Year holiday in 2026, which led to a reduction in recognized revenue from in-game item sales in domestic mobile games compared to Q1 2025. Online Advertising business revenue for Q1 2026 was RMB 38.2 billion, marking a 20% year-on-year increase and an acceleration from the 17% growth seen in Q4 2025. The company enhanced its AI-powered ad recommendation models and expanded closed-loop marketing capabilities within the WeChat ecosystem, driving improved ad performance and higher ad prices. Advertiser spending increased across most major industry verticals during the quarter, with particularly notable growth in internet services, e-commerce, and gaming. FinTech and Business Services revenue for Q1 2026 was RMB 59.9 billion, up 9% year-on-year. Growth in FinTech services revenue was mainly driven by commercial payment activities and wealth management services. Business Services revenue grew 20% year-on-year, benefiting from increased demand in both domestic and overseas markets, including demand for AI-related services, and a more favorable pricing environment, which propelled cloud services revenue growth. Revenue from merchant service fees also increased due to higher transaction volumes on Weixin Shops. As of March 31, 2026, the combined monthly active user accounts for Weixin and WeChat were 1.432 billion, a 2% year-on-year and 1% sequential increase. Mobile terminal monthly active user accounts for QQ were 516 million, down 3% year-on-year but up 2% sequentially. The number of paid value-added service subscriptions was 266 million, a slight decrease of 0.7%. The company stated that in 2026 it has achieved significant breakthroughs in new AI products while continuing to empower its core businesses with AI. The reorganized AI R&D team has revamped the AI infrastructure and developed the Hy3 preview model, which leads in performance among models of comparable parameter scale, offering both practicality and cost-effectiveness. Since April 28, it has consistently ranked at the top of the token consumption leaderboard on OpenRouter. The company's efficiency AI agent solutions have begun to show results, and it believes that WorkBuddy is currently the most widely used efficiency AI agent service in China. Simultaneously, the company's core businesses continue to grow in user engagement, revenue, and profitability. This growth not only provides ample cash flow to support AI investments but also establishes a rich foundation of application scenarios for the implementation of AI.