Tencent profits jump nearly 30% as China continues historic tech crackdown
The Chinese gaming and social media giant said Wednesday that revenue jumped 20% to 138.3 billion yuan ($21.3 billion) for the three months ended June, compared to the same period last year, while profit rose to 42.6 billion yuan ($6.6 billion).
Martin Lau, Tencent’s president, said Wednesday that “new regulations should be coming” in the near future.
“The regulators are very focused on identifying and rectifying industry misbehavior and also efficient regulations,” he told analysts during a conference call. “They emphasize compliance, social responsibility as well as fair and proper behavior.”
But Tencent has still faced challenges. Last month, its market value plummeted after it was ordered to scrap its plan to acquire a music streaming player, China Music Corporation. Regulators cited competition concerns, noting that the Shenzhen-based tech giant has long been a market leader.
That statement came after a business newspaper owned by Xinhua News Agency — China’s official news outlet — published a lengthy analysis that used terms such as “opium” and “electronic drug” to describe the harmful effects of gaming on children. The article mentioned Tencent’s popular video game “Honor of Kings” as one of the games to which young people are addicted.
“I think that the key issue at this point in time is still the amount of time and the amount of money that the minors spend on games,” said Lau, who added that Tencent was looking at ways to curb the total time young people are spending on gaming, rather than limits on specific games.
Lau signaled on Wednesday that Tencent would seek to stay clear of trouble.
“There will be short-term uncertainties and there are a lot of new regulations that will be coming, but we are pretty confident that we can be compliant,” he said.