China tech giant Tencent's net profit jumps during pandemic

HONG KONG - Chinese internet giant Tencent reported Wednesday a sharp rise in first-quarter net profit after a surge in demand for its online games as the coronavirus pandemic forces people to stay home.

The Shenzhen-based company, one of the largest listed on the Hong Kong stock exchange, said net profit rose 29 percent from a year earlier to 28 billion yuan ($3.95 billion).

"During this difficult period, we seek to provide online services that keep people connected, informed, productive, and entertained," chief executive Ma Huateng said in a statement. 

"So far, our businesses have proved resilient and cashflow-generative."

While many companies are being hammered by the economic fallout of the pandemic, tech firms have seen strong demand for their products.

Tencent is one of the world's largest gaming companies and the industry has benefited enormously from the billions of people around the world forced into lockdowns or restricted by social distancing rules. 

Online game revenue grew by 31 percent on year to 37.2 billion yuan, Tencent said.

The company owns hugely popular titles such as "Honour of Kings", "PUBG Mobile" and "Clash of Clans".

"Peacekeeper Elite", a less violent version of "PUBG Mobile" that was released last year to comply with authoritarian China's censors, was also a major success.

Revenues from online advertising and tech products for the finance industry also held up despite the virus, increasing 32 percent and 22 percent respectively in the first quarter, though they continue to face stiff competition from Alibaba.

Tencent's shares closed down 0.32 percent on Wednesday before the results were released. 

But the company has gained more than $42 billion in market value since COVID-19 broke out, Bloomberg News reported, defying a global market rout and a record Chinese economic contraction.

Agence France-Presse

Clash of Clans, other games may generate USD7B by 2019

Southeast Asia's mobile gaming revenues are expected to grow six-fold to over USD 7 billion in the next five years thanks to smartphones and high-speed Internet access, an industry report said Tuesday.

Revenues only crossed the $1.0 billion mark in 2014 but are expected to rise at a compounded annual growth rate of 48 percent until 2019, making Southeast Asia the fastest-growing region for the industry, business consultancy Frost & Sullivan said.

The growth is being "driven by the rapid increase of broadband users, usage of smart devices and social media," it said in a press statement.

Southeast Asia's more prosperous economies such as Singapore and Malaysia largely account for the bulk of current mobile gaming revenues, but other countries are quickly expanding, the statement added.

"This is changing quickly, however, as markets like Thailand are now over 50 percent smartphone markets and Indonesia and Vietnam are also rising rapidly," the statement said.

"By 2019, we believe that smartphone usage will become mainstream in the region."

However, one major impediment to the industry's growth in Southeast Asia is the difficulty in making payments online.

"As a region, credit card penetration is extremely low," it said, noting that the credit card penetration rate is less than 10 percent in all countries surveyed excluding Singapore and Malaysia.

"This makes purchasing virtual goods extremely difficult for most gamers in the region," it said.

"Clash of the Clans", made by Finland-based company Supercell, is the favourite mobile game in Southeast Asia, mirroring the global trend, the consultancy said.

But Chinese and Korean games are also popular, the report said.

source: www.abs-cbnnews.com