Tencent crushes analysts’ expectations in third quarter
Chinese technology giant Tencent, the country’s king of mobile gaming and online messaging, blew analysts’ expectations out of the water this week when it reported its third quarter earnings. For the three-month period through September, the company reported a net profit of 18 billion yuan ($2.72 billion). This overshot expectations of 15.18 billion yuan significantly, and is a 69% increase against the same period in the previous year.
Tencent’s share price is up by 106% year to date
SOURCE: Yahoo Finance
Revenue also beat expectations, rising by 61% from the year-ago quarter, and coming in at 65 billion yuan. Analysts’ had forecast a figure of 60.78 billion yuan. Of this, revenue from PC games made up 14.6 billion yuan – a year on year rise of 27% - while smartphone games contributed 18.2 billion yuan – a rise of 84% from the third quarter of 2016.
Tencent also saw strong performance from its ubiquitous (in China) mobile messaging app, WeChat. The company said that monthly active users of the app rose to 980 million – up from 936 million in the second quarter of the year. Daily messages sent rose to 38 billion, a 25% increase from the same period in the previous year. The company’s revenue from online advertising grew by 48% from the year-ago quarter to 11 billion yuan. And its “other” businesses – a relatively small but important segment that includes payment and cloud services, doubled over the same timeframe.
Dominion holds Tencent in its Global Trends Ecommerce Fund.
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