Tencent Profits Soar 60% Thanks to Mobile Games Boost.
Asia’s largest Internet company, Tencent Holding, has recently posted their first-quarter profit that analyst have estimated on soaring revenue from online games and advertising through its messaging services WeChat and QQ.
Net income has risen over 60 percent to 6.46 billion yuan ($1.04 billion) in the three months ended March from 4 billion yuan a year earlier, helping by one-time gains, the Shenzhen-based company said during a statement recently. This compares with the 4.86 billion yuan average of nine analysts estimates , which were compiled by Bloomberg.
Tencent had included games and advertising services onto its messaging applications which include WeChat, known as Weixin in China, as it competes against Alibaba Group Holding, and Baidu. The company is relying on its applications and games such as Blade & Soul and Candy Crush Saga to win a larger part of China’s 618 million Internet users as they migrate towards content found on mobile devices.
“The results were strong as income from mobile games on QQ and WeChat grew faster than we expected,” said You Na, an analyst at ICBC International Research Ltd. in Hong Kong. “People initially were only upbeat about WeChat and worried that QQ’s growth would slow down, but the latest mobile active users show that QQ remains strong.”
Shares of Tencent has soared up to 1.3 percent to close at HK$514 in Hong Kong trading. The company’s shares have gained 3.9 percent within this year, compared with a 3.1 percent drop in th city’s benchmark Hang Seng Index.
Revenue had went up by 36 percent from the previous year to 18.4 billion yuan. Online game revenue increased to 10.4 billion yuan, and online advertising revenue rose 38 percent from a year earlier to 1.17 billion yuan.
Mobile gaming revenue had tripled from its previous quarter of 1.8 billion yuan, according to the information found on the filing.
Tencent ha launched over 18 games into Google’s Android operating system and 16 games into Apple’s iOS, these include GunZ Dash, Piyushi Mubayi, an analyst at Goldman Sachs based in Hong Kong, had reported back in May 9th.
The company’s open platform has shared over 5 billion yuan in revenue with developers, Dowson Tong, president of social network group for Tencent, stated during a conference held in Beijing on May 10th.