Tencent’s top-line continued to recover from a downturn caused by tighter government oversight of online games, with growth across its core business segments during Q3.
Ma Huateng, chairman and CEO, said its fintech and business services, and advertising segments increased at double-digit rates, demonstrating the strength of its new businesses and increased diversity.
Net profit decreased 12.6 per cent year-on-year to CNY20.4 billion ($2.88 billion) on rising costs for its new businesses and content. Total revenue increased 21 per cent to CNY97.2 billion.
Value-added services (VAS) revenue was 15 per cent higher at CNY50.6 billion due to strong growth in online games and social networks.
Smartphone games revenue jumped 25 per cent to CNY24.3 billion (total online game sales rose 11 per cent to CNY28.7 billion), driven by a robust performance of key domestic titles and increasing contributions from overseas games.
Social networks revenue grew 21 per cent to CNY22 billion, mainly a result of greater contributions from digital content services including video and music streaming.
Its fintech and business services segment increased 36 per cent to CNY26.8 billion, with commercial payment revenue rising on increases in daily active users and transactions per user, along with growth in cloud services.
Online advertising revenue was up 23 per cent to CNY18.4 billion, with social advertising 32 per cent higher at CNY14.7 billion. Media advertising dropped 28 per cent to CNY3.65 billion, primarily due to lower revenues from platforms including Tencent Video and unpredictability in scheduling major content releases.
Monthly active users (MAUs) on WeChat and Chinese version Weixin increased 6.3 per cent to 1.15 billion, while smart device MAU of instant messaging platform QQ fell 6.4 per cent to 698 million, attributed to an enhanced security protocol, and removing accounts engaged in spamming and bot activities.
Fee-based VAS subscriptions increased 11 per cent to 170.6 million, with Tencent Video subscribers up 22 per cent to 100.2 million and music subscribers 42 per cent higher at 35.4 million.