Citigroup Reaffirms Buy Rating on HUYA After Q2 Revenue Growth
- Citigroup reportedly maintained its Buy rating on HUYA and increased its price target to $4.60 from $4.40.
- HUYA’s Q2 2026 total net revenue increased 11.0% year over year to RMB1.74 billion, supported by rapid growth in game-related services, advertising and other revenue.
- Operating performance improved, although non-GAAP net income declined from the prior-year quarter and the traditional live-streaming business remained under pressure.
On August 12, 2026, Citigroup reportedly reaffirmed its Buy rating on HUYA Inc. (NYSE: HUYA), a provider of game-related entertainment and services. The firm raised its price target to $4.60 from $4.40, according to the analyst-rating report cited in the original article.
Based on a share price of $2.36, the new target represented potential upside of approximately 94.9%. However, an analyst price target is an estimate rather than a prediction and does not guarantee that the stock will reach that level.
The rating action followed HUYA’s second-quarter 2026 results, released on August 11. Total net revenue increased 11.0% to RMB1.74 billion, or approximately $256.3 million, from RMB1.57 billion in Q2 2025.
Game-related services, advertising and other revenue increased 54.1% to RMB637.9 million, representing 36.7% of total revenue, up from 26.4% in the prior-year quarter. Growth was driven by higher in-game item sales and advertising revenue, together with revenue from the commercialization of the mobile game Goose Goose Duck.
HUYA’s live-streaming revenue, however, decreased 4.5% to RMB1.10 billion from RMB1.15 billion a year earlier. The decline shows that the company’s traditional live-streaming operation continues to face industry pressure even as newer revenue streams expand.
Gross profit increased 20.1% to RMB255.0 million, while gross margin improved to 14.7% from 13.5%. HUYA’s GAAP operating loss narrowed to RMB7.0 million from RMB23.7 million. On a non-GAAP basis, the company generated operating income of RMB16.2 million, compared with RMB0.4 million a year earlier.
HUYA reported GAAP net income attributable to the company of RMB1.6 million, compared with a net loss of RMB5.5 million in Q2 2025. However, non-GAAP net income declined to RMB36.4 million from RMB47.5 million, partly reflecting a 56.6% decrease in interest income.
The results therefore show stronger revenue diversification, higher gross profit and improved operating efficiency, but not an unambiguously strong earnings quarter. HUYA’s expanding game-related business must continue offsetting weaker live-streaming revenue and declining interest income for the company to achieve more substantial and sustainable profitability.
Forward valuation multiples should also be treated cautiously. HUYA’s expected earnings remain dependent on analyst forecasts, and comparisons with an unspecified “industry average” may be misleading because gaming, livestreaming and digital-advertising companies have substantially different business models and growth profiles.