vested
Tencent powers to 64b yuan profitby Tereza Cai
Tencent (0700) beat earnings expectations thanks to an
increase in advertisement revenues and a whopping one-time gain, buying it time to find an answer for its plateauing core gaming business.
The social media titan's
net profit for the first nine months increased 27 percent year-on-year to 64.49 billion yuan (HK$72.6 billion).
Net profit for the third quarter maintained the high annual growth of 30 percent to reach 23.33 billion yuan, beating the market expectations, mainly because of a windfall 8.8 billion yuan from investments, including the debut of
Meituan Dianping (3690).Revenues for the nine months climbed 33 percent year-on-year to 227.8 billion yuan.
Revenues for the third quarter rose 24 percent to 80.6 billion yuan, up 9 percent on a quarterly basis, at its slowest pace in three years as a Chinese clampdown on gaming licenses continued to hammer its bread-and-butter division.
The government has effectively frozen new game approvals, which means Tencent's been unable to make money off global hits Fortnite and PlayerUnknown's Battlegrounds.
While China is trying to combat gaming addiction and is reshuffling regulators, uncertainty persists with Tencent counting on its WeChat social network, advertising and belt-tightening to tide it over the drought.
For the third quarter, revenue from value-added services accounted for 55 percent of total revenue, representing 44.05 billion yuan down from 65 percent a year ago, and online advertising proportion increased 3 percentage points to 20 percent, amounting 16.25 billion yuan.
Revenue from other business spiked by 69 percent year-on-year to 20.3 billion yuan, mainly driven by the payment-related and cloud services.
Social network revenue was 18.2 billion yuan, up 19 percent year on year.
Total online game revenue was 25.8 billion yuan, down 4 percent year-on-year, 4 percentage points below Jefferies Hong Kong's estimate, among which PC game revenue was 12.4 billion yuan, down 15 percent year-on-year.
Total mobile game revenue was 19.5 billion yuan, up 7 percent year on year, 5 percentage points above Jefferies Hong Kong's estimate, mainly driven by new titles released in the third quarter including Free Fantasy Online Mobile, MT4 and Saint Seiya.
Total
advertising revenue grew 47 percent year-on-year to 16.2 billion yuan, within which social advertising revenue was up 61 percent to 11.2 billion yuan, 13 percent above estimate, and media advertising revenue up 23 percent to 5.1 billion yuan, 6 percent below estimate.
The company plans to shift from the consumer internet to industrial internet, to help diverse industries embrace high-tech by using technologies such as cloud and artificial intelligence.
Source: The Standard
http://www.thestandard.com.hk/section-n ... r=20181115
It's all about "how much you made when you were right" & "how little you lost when you were wrong"