Tencent’s blockbuster game and solid advertising have boosted an 89% increase in quarterly earnings on Chinese games and social media, helping it break its forecast on Thursday.
Tencent, the world’s largest gaming company with revenue, has benefited from a surge in video game payouts with its flagship Kings of Honor game, which reports a record 100 million daily active users in the first 10 months of 2020.
Tencent said on Thursday it had posted a profit of 38.5 billion yuan ($ 5.8 billion) in the three months to September. That was 30.81 billion yuan above the analyst’s average estimate, according to Refinitiv. Revenues increased by 29% to 125.4 billion yuan.
Celebrating their 22nd birthday on Wednesday, Tencent said it had returned to advertising following the outbreak of the COVID-19 epidemic, with rapid growth in areas such as education, Internet services and e-commerce.
Its shares closed 4.72% against a 0.22% drop in the Hang Seng Index, which returned to a 7% drop on Wednesday when investors threw shares in Chinese tech companies after the announcement of the draft antitrust rules.
They wiped out hundreds of billions of dollars in value from some tech giants, including Alibaba.
Speaking on Thursday, Tencent chairman Martin Lau said in the post-election results that the draft antitrust regulations were not new or unique to China, adding that the new regulations reflected a new reality as technology companies grew.
He added that Beijing was still supporting the industry and that Tencent would work with regulators to ensure compliance.
“For games that are actually more of a personal product than a platform, I think they’re less focused,” Lowe said.
China has also published draft rules to promote online microcredit control, and a section of Tencent is involved through WeBank, which disrupted Ant Group’s blockbuster IPO.
Law said that there will not be many changes in Tencent fintech strategy as the proposed micro-lending rules և its operation comply with the regulations.
Tencent said revenue from its other cloud business services, a potential driver of future growth, grew more slowly as a result of the epidemic. Delays in areas such as project deployment և signing new contracts.