Tencent posts first-ever quarterly drop in revenue, game revenue fell at home and abroad
Tencent posts first-ever quarterly drop in revenue, game revenue fell at home and abroad

Tencent posts first-ever quarterly drop in revenue, game revenue fell at home and abroad

 

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China’s Tencent Holdings logged its first ever quarterly sales fall on Wednesday, hurt by clampdown on game approvals and playing time as well as COVID-19 lockdowns and a weakening economy that squeezed ad sales.

The company said revenue declined 3% to 134 billion yuan ($19.78 billion) for the three months ended June 30 from 138.3 billion yuan a year earlier.

“During the second quarter, we actively exited non-core businesses, tightened our marketing spending, and trimmed operating expenses,” Ma Huateng, chairman and CEO of Tencent, said.

Net profit attributable to equity holders tumbled 56% to 18.6 billion yuan, below analysts estimate of 25 billion yuan.

Tencent’s game business revenue from China’s domestic market reached 31.8 billion yuan in the second quarter, falling 1% from a year earlier, while its game revenue from overseas markets totaled 10.7 billion yuan, also down 1% from a year ago, the company said.

Tencent’s revenue from social media business increased by 1% year over year in the second quarter to 29.2 billion yuan, with revenue from WeChat Video live-streaming services and digital content subscription growing, while revenue from music streaming and online game streaming business falling, it said.

Revenue growth from the company’s fintech and business services, slowed to 1% to 42.2 billion yuan ($6.22 billion) due to the impact of lockdowns on business activities.

WeChat, the dominant messengering app owned by Tencent, saw monthly active users reach 1.3 billion by the end of the second quarter, rising 3.8% from a year earlier and up 0.8% from the previous quarter.