Mobile Gaming Is A Boon For Tencent Revenues

Mobile gaming saved Asia’s highest-valued tech company, Tencent, from what analysts were predicting could have been a poor quarter. The company’s mobile games business is growing fast, according to TechCrunch reports, surpassing its former cash cow, PC gaming, last year.

Net profits for the quarter were reported at $3.7 billion USD on a revenue of $11.5 billion USD. That equates to 23.29 billion CNY in net profits and 73.53 billion CNY in revenue, and blew a Thomson Reuters revenue estimate of 71.04 billion CNY out of the water. That’s a 61 percent increase in year over year net profits, too, and a 48 percent growth in revenue in the same timeframe.

Mobile game revenue alone hit $3.4 billion USD last quarter, marking a 68 percent year-on-year increase, while PC gaming remained flat at approximately $2.2 billion USD. Tencent’s success is largely being driven by its hand in Player Unknown Battlegrounds (PUBG) and Fortnite, the two largest mobile games in the smartphone world, to which it secured distribution rights in China and beyond. The company said it is just beginning to monetize the battle royale-style games.

Tencent also holds distribution rights for Honour of Kings, which was the world’s highest-grossing mobile game last year — an empire built entirely on its Chinese users. There is potential for even further growth with this title, as the tech giant pushes the game to other markets worldwide. Another promising title is that of QQ Speed Mobile, a PC game that Tencent has now adapted for a mobile platform.

While mobile gaming made a good haul, it wasn’t Tencent’s only high-performing asset last quarter: The company’s WeChat messaging service recently surpassed 1 billion active user accounts. It has also beefed up its Mini Program feature for developers, adding the ability to create Mini Games within WeChat, and merged Mini Programs with WeChat Pay.