China-based internet giant Tencent reported strong increases in both profit and revenue for the first quarter of 2018, with the growth driven by a surge in revenue from its popular smartphone games.
The company’s Q1 net profit jumped 61 per cent year-on-year to CNY23.3 billion ($3.7 billion), on total revenue of CNY73.5 billion, up 48 per cent. Smartphone games revenue grew 60 per cent year-on-year to CNY21.7 billion.
In an earnings statement, Tencent chairman and CEO Ma Huateng said: “In the first quarter, we launched the popular tactical tournament mobile games and enhanced the capabilities of widely-used services such as our Weixin Mini Programs, deepening engagement across our social, games and media platforms.”
“We drove adoption of our infrastructure services, seeing notable progress in areas such as mobile payment, cloud services, online financial services and smart retail.”
The company said Honour of Kings remained the leading smartphone game in China’s iOS top grossing chart in Q1, while QQ Speed Mobile was the second-highest earning title in the quarter.
Monthly active user (MAU) accounts on its instant messaging platform QQ fell 6.4 per cent year-on-year to 805.5 million at end-March, although smart device MAUs the service rose 2.4 per cent to 694.1 million. MAUs of message service WeChat, known as Weixin in China, increased 10.9 per cent to 1.04 billion.
Revenue from its online advertising business increased by 55 per cent year-on-year to CNY10.7 billion. Social and other advertising revenues grew 69 per cent to CNY7.39 billion, benefitting from an expanded advertiser base boosting advertising fill rates in Weixin Moments and higher cost-per-click for its mobile advertising network.