Anika Begay
Tencent showcased its technology at the 2023 World Artificial Intelligence Conference in Shanghai on July 8, 2023.
Nude photos | Nude photos | Getty Images
Ten hundredth beat second-quarter revenue and profit estimates, helped by accelerating growth in its core gaming division.
Here’s how Tencent performed in the June quarter versus LSEG consensus estimates:
- Income: 161.12 billion Chinese yuan ($22.5 billion) versus the expected 160.77 billion yuan.
- Profit attributable to the company’s equity holders: 47.63 billion Chinese yuan versus the expected 39.95 billion yuan.
Revenue increased 8% from the previous year, while profits grew 82%.
After suffering its first annual revenue decline in 2022, Tencent has sought to reaccelerate growth in its core gaming business.
Investors have rewarded the company so far, with shares up about 28% this year as of Tuesday. That’s partly due to excitement around a new game called Dungeon & Fighter Mobile (DnF Mobile), made by South Korean company Nexon and distributed in China by Tencent.
DnF Mobile has dominated the top-grossing game charts in China, and investors are hoping Tencent can reap the benefits of its popularity for years to come, as it did with Honor of Kings.
Tencent said its China gaming business generated revenue of 34.6 billion yuan in the second quarter, up 9% year-on-year. That was faster than the 3% growth it saw in the first quarter of the year. Tencent attributed the performance to rising sales of Valorant and the “successful launch” of DnF Mobile.
“DnF Mobile, a newly launched game, has re-engaged millions of fans of the IP and is retaining players well, positioning itself to become our next major evergreen hit,” Tencent said in its earnings release.
International game revenue also increased 9 percent year-on-year to 13.9 billion yuan.
