Games and AI drove Tencent’s 47% profit growth

The Chinese company Tencent reported an increase in net profit for the third quarter. The volume of profit received in the reporting period increased by 47% compared to the third quarter of last year and amounted to 53.23 billion yuan ($7.36 billion). This figure was significantly higher than analysts’ forecasts, which expected Tencent’s quarterly profit to be about 46.18 billion yuan.

Image source: Tencent

The company’s revenue for the quarter was 167.193 billion yuan, up 8% from the third quarter of last year. The gaming division continues to be the most profitable, with domestic revenue up 14% year-on-year to RMB 37.3 billion and global revenue up 11% year-on-year to RMB 14.5 billion.

Tencent’s online advertising segment posted year-on-year growth of 17% to RMB 29.99 billion in the third quarter. The company attributed this to “high levels of advertiser demand” for short videos, mini-applications and search functions on the company’s Weixin messenger in the Chinese market and WeChat outside the country. The average monthly number of messenger users increased by 3% compared to the third quarter of last year and amounted to 1.38 billion people.

Tencent also noted the benefits of using proprietary features based on artificial intelligence. “We are increasingly seeing tangible benefits from integrating AI into our products and processes, including marketing services and cloud technologies, and will continue to invest in AI-enabled technologies, tools and solutions that help users and partners,” Tencent said in a statement.