Goldman Sachs Reduces Tencent Target Amid AI Investment Surge

Goldman Sachs has reduced its 12-month target for Tencent Holdings stock from HKD 670 to HKD 650, citing increased investment in artificial intelligence and recent equity financing. The adjustment, announced on September 17, 2026, represents a 2.99 percent decrease from the previous target. Despite the lowered target, Goldman Sachs maintained a Buy rating, highlighting Tencent's strategic focus on capital allocation and AI-driven growth.

Tencent's second-quarter 2026 financial results showed robust performance, with revenue reaching RMB 204.8 billion, up 11.00 percent year over year, and gross profit increasing 13.00 percent to RMB 118.4 billion. Operating profit also rose 12.00 percent to RMB 67.3 billion. The company's marketing-services revenue grew 22.00 percent to RMB 44.0 billion, while domestic games revenue increased 17.00 percent. However, operating capital expenditure surged 190.00 percent year over year to RMB 51.8 billion, reflecting Tencent's heavy investment in AI and other growth areas.

As of October 5, 2026, Tencent Holdings stock was trading at EUR 48.07 at Lang & Schwarz, up 1.50 percent from the prior close of EUR 47.36. On the Hong Kong Stock Exchange, the stock was priced at HKD 423.00, within a 52-week range of HKD 411.00 to HKD 682.50. The company's market capitalization stood at HKD 3.8 trillion. Investors will be watching closely for Tencent's third-quarter results, scheduled to be announced on November 18, 2026, to assess whether the AI investments are translating into higher revenue and profit growth.