(Yicai Global) Aug. 17 -- Owing to increase of revenue from online games, WeChat payment and network advertising, the total revenues of China's internet giant Tencent Holdings Ltd. [HKG:0700] in the second quarter jumped 59 percent, and net profit grew 68 percent, beating expectations. The total revenues of Tencent in the first half year surged 57 percent and net profits grew 43 percent year-on-year. It is the company's best-ever quarterly results.
Tencent Holdings yesterday released the unaudited comprehensive performance report on the second quarter and the first half year as of June 30, 2017.
Financial statements show in the first half year of 2017 the total revenues of Tencent reached CNY106.15 billion (USD 15.61 billion), 57 percent up from last year; based on general accounting standards, the profit for the period reached CNY30.85 billion (USD 4.53 billion), an increase of 43 percent compared with the previous year.
Previously, some 11 brokers predicted Tencent Holdings' first half year revenue to be between CNY100.32 billion to CNY106.05 billion, increasing 48.2 to 56.7 percent annually. The actual results are slightly better than the market expectation.
In the second quarter, the total revenues reached CNY56.6 billion (USD8.4 billion), increasing 59 percent year-on-year; net profits reached CNY18.2 billion (USD2.7 billion), up 68 percent over the last year.
The major revenue sources of Tencent were the social media, online games and advertising. The revenues from the three businesses accounted for 87 percent of the total, in which online games generated the most part. In the second quarter, the income from online games amounted to 42 percent of the total income, followed by social media and advertising.
Income from games drew attention of the industry. Tencent's income from online games in the second quarter of the year increased 39 percent to CNY2.38 billion (USD356 million), mainly from mobile games such as 'Arena of Valor' and PC games such as 'League of Legends' and 'Dungeon Fighter.'
The advertising revenue from WeChat Moments, WeChat official account and other mobile apps increased 61 percent year-on-year to CNY6.07 billion; income from social network increased 51 percent to CNY12.94 billion (USD1.9 billion); income of traditional network advertising is 55 percent up, increasing to CNY10.14 billion (USD1.49 billion); media advertising income from Tencent Video and Tencent News increased 48 percent to CNY4.07 billion (USD600 billion). Income from other businesses boosted 177 percent year-on-year to CNY9.65 billion (USD1.42 billion) mainly due to increased revenue from WeChat payment service and cloud service.
The stock price of Tencent rose 1.38 percent to HKD323.2 (USD41.30) yesterday.