Chinese tech giant Tencent Holdings (OTCPK: TCEHY, OTCPK: TCTZF, HK: 00700) announced growing revenues for the second quarter of the fiscal year, ending on June 30, 2019.
The company’s revenues totaled $12.7 billion USD, representing a 21% increase year-on-year. Net income for the period was about $3.4 billion, a massive 33% increase from the same period last year.
Tencent online game revenues
These gains were primarily driven by PC and mobile online games, which grew 8% to $3.9 billion. The company was able to launch ten mobile games in the second quarter, after the Chinese government’s freeze on new game approvals was lifted. Comparatively, Tencent was only able to launch one mobile game in China during Q2 last year.
Mobile games, which includes income from social platforms, contributed the most to the company’s revenue, bringing in $3.2 billion, up 26% over last year.
Noteworthy existing titles include Honour of Kings, PUBG MOBILE, and Red Alert OL. Meanwhile, new games such as Perfect World Mobile offset revenue declines from PC client games.
Three games were launched in July: KartRider Rush, Game of Thrones: Winter is Coming, and Dragon Raja, which all ranked among the top ten highest-grossing iOS games in China. However, revenues for these games won’t be included in Tencent’s earnings until the Q3 report.
Revenue from PC games fell 11% year-on-year to $1.7 billion despite the fast growth of esports in China and the promotion of League of Legends skins.
Tencent’s social networks revenue grew by 23% to $2.9 billion. The company credits the increase to higher revenues from its digital content, including live broadcasts and video streaming subscriptions. Monthly active users for Weixin and WeChat totaled 1.13 billion during the second quarter.
Tencent invests in multiple gaming fronts
Video subscriptions totaled 96.9 million, a 30% increase year-on-year, which is largely attributed to joint membership promotions. The company reported that over 490 million internet users in China watched at least one streaming NBA game during the last season. Tencent recently renewed its partnership with the NBA and expanded it to include NBA 2K League esports broadcasts for the first time.
Additionally, the tech giant announced a partnership with Super League Gaming to create amateur esports competitions around PUBG Mobile. Super League Gaming focuses on local video game competitions hosted in movie theaters during daytime hours. It will now work with Tencent to build and grow PUBG Mobile across the US through amateur leagues, competitions, livestream broadcasts, and video-on-demand content
Tencent has a great deal going on to improve its performance for the rest of the year. Other highlights include a recent deal with Nintendo to distribute the Nintendo Switch console in China, modifying it to include WeChat Pay.