According to the Zhitong Finance App, Tencent Holdings (00700) announced results for the first quarter of 2024. Revenue was 159.501 billion yuan, up 6% year on year and 3% month on month. Gross profit was 83.87 billion yuan, up 23% year on year and 8% month on month. Profit attributable to the company's equity holders was 41,889 billion yuan, up 62% year on year and 55% month on month. Non-IFRS equity holders should account for profit of $50.265 billion, up 54% year on year and 18% month on month. Basic earnings per share were $4.479.

Among them, revenue from the value-added services business fell 0.9% year-on-year to RMB 78.6 billion in the first quarter of 2024. Total game sales in the international market increased 34% year over year, due to the rebound in popularity of Supercell's games (in particular “Brawl in the Wild”) and the increase in the number of “PUBG MOBILE” users and sales. Due to Supercell's long game revenue deferral period, game revenue in the international market increased 3% year over year to RMB 13.6 billion (year over year stable at a fixed exchange rate). Total game turnover in the local market resumed year-on-year growth, reaching 3%. Game revenue in the local market fell 2% year over year to RMB 34.5 billion, due to revenue delays. As far as individual games are concerned, “Wang Zhe Rongyao” was affected by the high base during the Spring Festival last year, and revenue for “Peace Elite” declined year over year due to weak commercialization content in the second half of 2023. Much of this was offset by revenue contributions from the company's recently released games (including “Dreadnought” and “Ark of Destiny”) and strong growth in “Battle for the Golden Shovel.” Social networking revenue fell 2% to RMB 30.5 billion, reflecting an increase in service fee revenue for paid music and long video subscribers, video streaming services, and mini game platforms, while revenue from live music streaming and game streaming services declined.

Revenue from the online advertising business increased 26% year-on-year to RMB 26.5 billion in the first quarter of 2024. This was driven by the growth of WeChat video accounts, applets, public accounts and search, and was driven by increased user engagement and the company's constantly upgrading AI-driven advertising technology platforms. Ad spending increased in all major industries except the automotive industry, with significant increases in advertising spending in the gaming, internet services, and consumer goods industries.

Revenue from the fintech and corporate services business increased 7% year-on-year to RMB 52.3 billion in the first quarter of 2024. Revenue from fintech services grew at a single-digit percentage year over year, mainly due to a slowdown in offline consumer spending growth and a decrease in withdrawal revenue, while revenue from financial management services grew strongly. Enterprise service revenue achieved a year-on-year growth rate of more than ten points due to the increase in cloud service revenue and technical service fees for video account merchants.

According to the announcement, in the first quarter of 2024, the Group's team adjustments in several leading games in the local and international markets saw initial results, and total game turnover grew, laying the foundation for game revenue to resume growth in the next few quarters. The Group continues to cultivate high-quality revenue sources, including WeChat video accounts and search ads, mini game platform service fees, and video account merchant technical service fees, which have driven the increase in gross profit and operating profit to exceed revenue growth. Committed to returning surplus capital to shareholders, the Group is stepping up repurchase efforts, implementing share repurchases exceeding HK$100 billion in 2024 according to the plan, increasing dividends, and continuing to invest in AI technology, enhance platforms and produce high-value content.

Among them, the total usage time of video channel users increased by more than 80% over the same period last year. By expanding product categories and encouraging more content creators to participate in live streaming delivery, the Group has strengthened the live video channel delivery ecosystem.

The total usage time of applet users increased by more than 20% over the same period last year. Among them, the average number of daily uses of non-game applets achieved a double-digit percentage increase year over year, and mini game traffic increased 30% year over year.

Tencent Video released a number of popular homemade TV series and animation series, such as “Blossoming Flowers,” “Ice Hunting,” and “Perfect World Season 4,” which led to an 8% year-on-year increase in the number of paid Long Video members to 116 million.

TME has strengthened its collaboration with Tencent Video to release the original soundtrack for the hit series “With Fengxing”. The number of paid music members increased 20% year over year to 114 million.

The two flagship games in the local market, “Wang Zhe Rongyao” and “Peace Elite”, began to benefit from the new commercialization pace and improvements in game content design, and achieved year-on-year growth in sales in March 2024.

The volume of local market games such as “Battle of the Golden Shovel”, “CrossFire Mobile Game”, and “Dark Zone Breakthrough” reached record highs this season.

Supercell's game achieved an increase in the number of users and turnover; the number of daily active accounts in the international market was more than double that of the same period last year, and the turnover was more than four times that of the same period last year.

The Group upgraded its advertising technology platform to help advertisers place ads more effectively, and launched generative AI-driven ad material creative tools for all advertisers.

Benefiting from the sale of low-risk money market funds, the number of users and per capita investment scale of our financial management business have grown rapidly.

Tencent Cloud's audio and video solutions have attracted more local and international customers, especially in the media, entertainment and live streaming industries. For the sixth year in a row, International Data Corporation (IDC) has rated Tencent Cloud's audio and video solutions as a leader in the Chinese market.