Friday, March 22, 2019
Online Payments and Advertising Drive Tencent Forward
Tencent reported a 32% increase in revenues to 313 billion yuan for 2018 (45.6 billion US dollars). However, in the fourth quarter revenue growth slowed to 28%.
Revenues from its VAS business (online gaming and social networks) increased by 9% in the fourth quarter of 2018, as online games revenues were flat at 24.2 billion yuan. However, social networks revenues grew by 25% to 19.5 billion yuan, lifted by growth in revenues from digital content services, such as live broadcast services and video streaming subscriptions. Tencent said its total digital content subscriptions exceeded 100 million at the end of 2018, up 50% year-on-year.
Revenues from the online advertising business increased by 38% to 17 billion yuan for the fourth quarter. That rise was driven by a 44% rise in "social and others advertising" revenues to 11.8 billion yuan, thanks to Weixin Moments, Mini Programs and QQ KanDian. Tencent increased its advertising inventory by adding a second ad unit in Weixin Moments, and started to insert ad units into Mini Programs, which run within the WeChat/Weixin messaging service. The Mini Programs now cover more than 200 service sectors. Media advertising revenues grew by 26% to 5.2 billion yuan, fuelled by contributions from Tencent Video and Tencent News.
Revenues from other businesses, such as digital payments, cloud services and TV production, increased by 72% to 24.2 billion yuan for the fourth quarter. Tencent reported that its payment platforms supported more than one billion transactions a day in 2018, driven by rapid growth in commercial payments, which accounted for more than half the transactions. Source: Tencent statement
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