Tencent Q3 revenue climbs 10% as games sales recover
Chinese tech giant Tencent Holdings saw a 10% surge in its third quarter revenue, hitting 154.6 billion yuan (Rs. 1.78 lakh crore). This growth was driven by a recovery in the gaming sector from the regulatory clampdown on China's technology industry. In 2022, Tencent faced its first yearly revenue decline due to an eight-month halt on new gaming licenses and tighter restrictions on gaming time for minors. However, 2023 marked a turnaround as regulators resumed issuing game licenses.
Net profit and analyst estimates
The company's net profit for the third quarter dipped by 9% to 36.1 billion yuan (Rs. 41,450 crore), outperforming the average analyst prediction of 34.6 billion yuan. Operating profit surpassed expectations, reaching 48.48 billion yuan (Rs. 55,676 crore), compared to the projected 43.4 billion yuan. Adjusted net income also exceeded forecasts, with 44.92 billion yuan (Rs. 52,973 crore) against an anticipated 39.98 billion yuan.
Revenue breakdown by business segments
Revenue from the value-added services business slightly missed expectations, coming in at 75.7 billion yuan (Rs. 86,915 crore) as opposed to the estimated 77.9 billion yuan. Conversely, fintech & business services revenue exceeded expectations, with 52 billion yuan (Rs. 61,333 crore) against a predicted 50.71 billion yuan. Net other gains were below estimates, with 2.64 billion yuan (Rs. 3,031 crore) compared to the anticipated 3.3 billion yuan.
Gaming industry's record revenue in August
In August, the gaming industry generated a combined revenue of 29.2 billion yuan (Rs. 34,422 crore), the highest level in at least 20 months, according to CNG, a government-supported industry data firm. This demonstrates a robust recovery for the gaming sector following last year's regulatory crackdown and license suspension.
