Citi forecasts that Tencent will announce its Q2 2026 results on August 12, expecting robust growth in its overall revenue. However, due to a cautious stance on the impact of AI expenditure and profitability, Citi's profit assumptions for Tencent are more conservative than market expectations. Citi believes that Tenc willent focus on advancing Agentic AI testing within WeChat, integrating Mini Programs with Hy3, iterating and upgrading the Hy model, and increasing capital expenditure in the second half of the year. Meanwhile, Tencent will continue to evaluate its investment portfolio, engaging in AI-related investments and rebalancing rotations in mature industries. Citi notes that potential share buybacks, AI investments, and leveraging AI to enhance growth in core businesses are Tencent's main priorities. Based on this, Citi has lowered Tencent's target price from HK$763 to HK$758, while maintaining a 'Buy' rating.