Tencent Holdings Limited, the Chinese defacto tech-gov conglomerate, has just announced a blowout quarter, posting a 13% yoy revenue gain. For the first quarter, the company recorded revenues of 180.02 billion Chinese yuan (around $25 billion). As such, the company’s net profit jumped 14%, hitting 47.8 billion yuan. Their gaming division has done very well recently, propelling tremendous success. Marketing services have experienced a significant increase.
Tencent is the world’s largest gaming company by revenue. It runs WeChat, the world’s most popular social messaging app, with more than 1.4 billion monthly active users. The key drivers for the company’s financial success are the combination of social media and gaming. They use their massive install base to propel and amplify exciting new gaming innovations and experiences.
The domestic games segment had a strong quarter, with revenue growing 24% y-o-y to 42.9 billion yuan. Massive hits such as “Honor of Kings” and “Peacekeeper Elite” were the main drivers behind this spike. Other newer hits like “DnF Mobile” were just as critical. The fact that players are still consistently returning to these games on a daily basis further reinforces Tencent’s stronghold on the Chinese gaming market.
In addition, Tencent’s international gaming business revenue amounted to 16.6 billion yuan, a 23% YoY growth. This rapid expansion was mostly made possible through the runaway successes of global phenoms such as “Brawl Stars” and “PUBG Mobile.” The company’s success in winning international markets is a reflection of its strategy to expand the gaming industry and further diversify its gaming offerings.
Tencent’s online marketing services revenue jumped in the first quarter. It expanded by an astonishing 20% YoY, hitting 31.9 billion yuan! This reflects the company’s successful adaptation to changing market dynamics and its ability to effectively monetize its vast user base.
Tencent’s first quarter earnings results are a testament to the company’s deep resilience. It further underscores the company’s smart strategic positioning in technology and gaming sectors. The company has proven especially adept at building on emerging trends while putting up impressive growth and profits in both the domestic and international markets.