Tencent Third-Quarter Net Profit Rises 69% to CNY18.01 Billion, Beating Estimates -- Update
November 15 2017 - 5:31AM
Dow Jones News
By Chester Yung
HONG KONG--Chinese internet giant Tencent Holdings Ltd. said
third-quarter net profit rose nearly 70% from a year earlier,
driven by advertising revenue gains and strong growth at its
mobile-gaming and digital-content divisions.
Tencent's shares have been on a tear this year, doubling its
market capitalization to almost $475 billion. It has raised its
international profile with a number of recent acquisitions as well,
including buying Epic Games Inc. and a majority stake in
electric-vehicle maker Tesla Inc. And last week, Tencent bought a
12% stake in Los Angeles-based social media company Snap Inc.
The company, which is based in the southern tech boomtown of
Shenzhen, said its earnings for the quarter rose to more than 18
billion yuan ($2.7 billion) from about 10.6 billion yuan a year
earlier. Analysts polled by S&P Global Market Intelligence
expected a profit of 15.7 billion yuan. Tencent also beat revenue
expectations.
The bulk of Tencent's revenue comes from online gaming. For the
quarter, mobile-game revenue rose 48% from a year earlier to 26.8
billion yuan. The company had at least four of the 10
highest-grossing games in Apple Inc.'s app store during the
quarter, according to App Annie and Citi Research.
Last week, Tencent's online publishing unit, China Literature
Ltd., surged 86% in its Hong Kong trading debut after raising about
$1.1 billion in an initial public offering. And on Thursday, Yixin
Group Ltd., China's largest online auto retailing platform, will go
public; Tencent owns 24% of that company. Demand was high during
Yixin's bookbuilding period.
Founded in 1998, Tencent is one of three major internet firms in
China, along with e-commerce titan Alibaba Group Holding Ltd. and
search company Baidu Inc. Tencent is the largest videogame
publisher in the world by revenue, but it is best known in China
for its WeChat and QQ messaging and mobile-payment apps, which are
installed on nearly every PC and smartphone.
The combined monthly active users for Tencent's Weixin and
WeChat app reached 980 million at the end of September, up 16% from
a year earlier, the company said in a statement.
Tencent shares ended 1.3% lower Wednesday in Hong Kong at 383
Hong Kong dollars.
Alyssa Abkowitz contributed to this article.
Write to Chester Yung at chester.yung@wsj.com
(END) Dow Jones Newswires
November 15, 2017 05:16 ET (10:16 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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