Chinese multinational technology conglomerate Tencent reported a strong Q1 2025, exceeding analyst expectations on revenue, adjusted net income, and earnings per share. Revenue rose +13% year-over-year to RMB 180 billion (S$32.3 billion), fuelled by impressive growth across domestic and international gaming, value-added services (VAS), and marketing services. The company also repurchased 43 million shares, signaling strong confidence in its outlook.In contrast, Alibaba’s results fell short of expectations with a +7% growth in revenue (RMB 236.45 billion) for the March-ended quarter. Despite a 23% increase in adjusted earnings and 18% growth in cloud revenue—driven by strong AI demand—Alibaba’s stock dropped over -7% as investors reacted to the weaker-than-expected sales and ongoing competitive pressures in China’s tech sector.

Bigger Picture: the Future of China’s Tech Dominance

Tencent’s strong earnings highlight the resilience and adaptability of China’s leading tech firms, even amid regulatory scrutiny and global economic uncertainty. 

Meanwhile, Alibaba’s robust cloud growth—driven by accelerating AI adoption—suggests significant long-term upside, despite current sales softness and competitive pressures. 

For investors, this reinforces the case for targeted exposure to China’s evolving economy, especially in high-growth sectors like digital services, green energy, healthcare, and consumer technology.

Despite short-term volatility, both Tencent and Alibaba have delivered strong year-to-date performance — with Tencent up 23% and Alibaba up 46%.

Source: Google Finance, 16 May 2025 

Ride China’s Next Growth Wave

One way to get in on these opportunities is through Syfe’s China Growth portfolio, powered by KraneShares. This portfolio taps into China’s “new economy” (sectors like tech, healthcare, green energy, and consumer goods) positioned to lead the country’s next growth chapter. Backed by KraneShares’ deep expertise in China-focused ETFs, it offers a diversified and strategic way to align with China’s innovation-driven future.

Top 5 Sectors in China Growth Portfolio: 

• Consumer Discretionary: 25.7%
• Information Technology: 14.2%
• Financials: 11.8%
• Communication Services: 11.0%
• Healthcare: 9.9% 

Market Recap

US stocks edged higher, while bond yields fell on expectations of Fed rate cuts. Chinese equities showed resilience—Tencent surged after a strong Q1 beat, though Alibaba’s weaker results dragged the Hang Seng down 0.8%. In commodities, oil rebounded 1% while gold fell 3% for the week. 

Key Events for the Week

This week, investors will closely monitor the following key events:

• Mon: US leading index (MoM) (Apr), China PBoC loan prime rate
• Tue: –
• Wed: US 20-year bond auction
• Thur: US manufacturing PMI, jobless claims
• Fri: SG YoY CPI (Apr)