China’s largest social media and gaming firm Tencent reported a sharp increase in its Q1 profit, with broad-based revenue growth across its games, payments, digital content and social advertising businesses.
The Chinese internet giant is pushing to expand acceptance of its mobile payments app WeChat Pay among international merchants, while also seeking to secure the service’s position in its domestic market: the company in April said it aims for WeChat Pay to be accepted in every shop in China within two years.
Newly released figures from analytics company App Annie show WeChat Pay was one of China’s most-used finance apps through 2016.
In the opening three months of 2017, Tencent also benefitted from a diversification strategy. The company announced plans to open an AI research lab in Seattle during the period, and in March acquired a 5 per cent stake in US electric car manufacturer Tesla for $1.8 billion.
The strategies appear to be bearing fruit. In Q1, profit attributable to equity holders of Tencent jumped 58 per cent year-on-year to CNY14.5 billion ($2.1 billion). Total revenue grew 55 per cent to CNY49.6 billion ($7.18 billion), mainly driven by a 34 per cent increase in online game revenue (CNY22.8 billion) and a 47 per cent jump in online advertising (CNY6.9 billion).
Media advertising increased 20 per cent from a year ago to CNY2.51 billion in the recent period. Other revenue, mainly payment related and cloud services, surged 224 per cent to CNY7.6 billion.
Global monthly active users (MAUs) of WeChat rose 23 per cent year-on-year to 938 million in the opening quarter, while MAUs of instant messaging service QQ fell 2 per cent to 861 million. Mobile users accounted for 79 per cent of QQ’s MAUs.
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