Tencent posts 11 per cent rise in quarterly revenue, buoyed by advertising and game sales as China’s economy rebounds

Total revenue for the Hong Kong-listed internet giant reached 150 billion yuan (US$21.4 billion) in the three months ended March 31, up from 135.5 billion yuan a year ago. That was better than the consensus estimates of 146.32 billion yuan, according to analysts polled by Bloomberg.

Profit rose 10 per cent to 25.8 billion yuan from 23.4 billion yuan a year ago, below analysts’ expectations of 28.93 billion yuan.

02:26

What makes Tencent such a tech goliath?

What makes Tencent such a tech goliath?

“During the first quarter of 2023, we achieved solid revenue growth, as our payment volumes benefited from and facilitated domestic consumption recovery, our game revenue improved, and our advertising revenue sustained rapid growth,” Pony Ma Huateng, founder and CEO of Tencent, said on Wednesday.

From January to March, international gaming revenue rose 25 per cent to 13.2 billion yuan, driven by new titles including Goddess of Victory: Nikke and Triple Match 3D, while domestic sales increased 6 per cent to 35.1 billion yuan, the company said.

With government measures that limit the gaming time of minors, players under age 18 contributed only 0.4 per cent of total time spent on domestic games, and 0.7 per cent of gross receipts, down by 96 per cent and 90 per cent respectively from the same period three years ago.

Revenue from online advertising rose 17 per cent year on year to 21 billion yuan during the quarter, driven by the addition of Video Accounts, Tencent’s fast-growing short video service within its super app WeChat, as a new advertising revenue stream, as well as growth in advertising in Mini Programs, and the recovery of mobile advertising, the company said.

Shares of the Shenzhen-based company fell 0.58 per cent on Wednesday ahead of the earnings announcement, closing at HK$342.8.