Daily Brief TMT/Internet: Tencent, Sea , Taiwan Semiconductor (TSMC) – ADR, Tokyo Tsushin Inc, Heartcore Enterprises , Godaddy Inc Class A, Worldline SA, ON24 Inc, Cloudflare and more

• Microsoft’s China AI teams relocate due to US rules, focusing on Wi-Fi 7 development for improved connectivity and performance.
• Amazon’s stake in Alchip suggests potential synergy in AI tech and expanded market reach, while Kymco launches eco-friendly e-scooter.
• Tencent Cloud partners with BRI and Hi Cloud Indo for banking innovation, while Veolia opens first regeneration plant in China for sustainable water treatment. Tron Future secures funding for counter-drone tech.

• Sea Limited (SE US) booked a strong set of 1Q2024 results from a GMV, revenue and adjusted EBITDA perspective, with fears of greater competition from TikTok failing to materialise. 
• The company has been investing in growth across all segments, with e-commerce driving and digital financial services driving growth but digital entertainment also seeing a return to growth mode. 
• Sea Limited continues to focus on its core competitiveness in pricing, improving service quality, and lowering the cost to serve through SPX Express, with advertising becoming a more meaningful contributor.  

• Taiwan Tech and Nvidia Rally Ahead of Nvidia Earnings Next Week; Microsoft Build Conference Could Showcase Edge AI Copilot
• Hon Hai: Traditional Server Market Now Adding to AI Growth; Expects Market Share Gains in 2024E 
• Asustek: Margin Beat, Guides More Upside; Qualcomm for AI PCs; Why Asus Confident in AI PC Up-Cycle 

• Tokyo Communications Group’s core businesses currently include its Media business, where it plans and develops free game apps for smartphones and uses a portion of the app’s screen space to generate advertising revenue, and its Platform business, where it operates a consultation service based on a pay-as-you-go model.
• The company also functions as an investment company with the aim of achieving company-wide growth while diversifying risks by allocating the cash flow generated by these core businesses into various promising digital businesses.

• The company’s main business at the time of its founding consisted of developing and operating free game apps for smartphones.

• HeartCore Enterprises is an established software development and consulting company based in Tokyo, Japan and operates in five core offerings and solutions.
• These include 1) Content Management in which the core product is HeartCore CMS, 2) Digital Transformation which includes Controlio, myInvenio, Apromore and HeartCore Robo, 3) GO IPO, a consulting service that helps Japanese companies prepare for a U.S. Nasdaq public listing, 4) Sigmaways, that specializes in infrastructure modernization, and 5) other revenues.
• We believe the company is poised for strong growth due to its entry in the U.S. market and solid results from the Go IPO offering.

• GoDaddy’s first quarter results for 2024 demonstrate a strong start to the year and contribute to the positive reputation of the company.
• Notably, through their free cash flow, the company has achieved growth of 26% year-over-year, thanks to their profitable growth model that converts customer value to shareholder value.
• This has been largely driven by a surge in the applications and commerce sector, which has seen bookings growth of 22% and normalized EBITDA margin expansion of 400 basis points.

• Worldline (WLN FP) stock dropped over 60% after disappointing Q3 earnings and reduced guidance for 2023
• Company scrapped medium-term plan through 2024, facing challenges including costly French restructuring and uncertainty about merchant revenues
• Stock considered cheap at 6x multiple of EPS and EBIT in 2025, potential for shares to double or more in next 24-36 months with activist pressure and company hiring advisors. Worldline SA is second-largest merchant acquirer in Europe with focus on merchant, financial, and e-Transactional services.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• ON24 is a cloud-based SaaS platform for digital engagement through webinars and virtual events
• Company has a low valuation and has seen a significant decline since IPO but shows signs of turnaround
• ON24 Elite has generated approximately $171 million in revenue over the last twelve months, making it a high conviction long investment for the author

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Cloudflare Inc., in its Q1 2024 earnings, witnessed a strong start to the year, with the company’s revenues hitting a high of $378.6 million, marking a significant 30% increase on a year-over-year basis.
• The company notched up its large customer base to 2,878 signifying a 33% increment year over-year.
• It successfully added 122 new large customers, concurrently boosting the revenue contribution from this segment from 62% to 67%.