Tencent Second-Quarter Results
Tencent Holdings is set to release its second-quarter results on Wednesday. Analysts predict an 80% surge in net profit to 33.44 billion Chinese yuan ($4.61 billion) for the period ending June 30. This compares to a net profit of CNY18.62 billion in the same quarter last year. Meanwhile, revenue is expected to have grown by 13% to CNY151.19 billion.
Key Factors to Watch
Gaming Business
Tencent's domestic games division saw a 6% increase in revenue in the first quarter, reaching CNY35.1 billion. This growth can be attributed, in part, to the success of popular titles like "Honour of Kings" and "CrossFire." The performance of Tencent's core gaming business will be closely scrutinized by investors this quarter.
Online Advertising
In the first quarter, Tencent's online advertising segment experienced a 33% rise in gross profit, amounting to CNY8.74 billion, with revenue reaching CNY20.96 billion, a 17% increase. As the economy continues its recovery from the impact of the Covid-19 pandemic, investors are eager to see the pace of growth in ad spending.
Fintech and Business Services
Tencent's fintech and business services segment witnessed a 24% boost in gross profit, totaling CNY16.80 billion in the first quarter. This was driven by a 14% rise in segment revenue, reaching CNY48.70 billion. The recovery in commercial payment activities and increased sales of specific cloud services contributed to this growth. Investors are keen to gauge the segment's growth trajectory.
These results will provide valuable insights into the performance of Tencent Holdings as key sectors within the company continue to thrive.
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