Latest news with #Dungeon&FighterMobile
Yahoo
15-05-2025
- Business
- Yahoo
Tencent Just Dropped $25B Worth of Proof It's Not Playing Around
Tencent (TCEHY) is making noise again. The Chinese tech titan just delivered its strongest quarter in over three years, with Q1 revenue jumping 13% to 180.02 billion yuan ($25 billion). Not bad for a company navigating tariff tensions, a shaky consumer market, and AI disruption. Net income rose 14% to 47.8 billion yuanmissing estimates slightly, but for a reason that might excite long-term investors: aggressive AI spending. Management isn't shying away from pouring cash into R&D, and so far, markets are on boardTencent shares are already up 25% in 2025. Here's where it gets interesting. Tencent isn't just chasing AI headlinesit's stacking chips (literally). President Martin Lau confirmed the company has enough high-end GPUs to keep training its models for a few more generations. Thanks to a surge in demand from its cloud clients and the success of China's homegrown DeepSeek AI, Tencent is now embedding AI everywherefrom WeChat and mini-games to ad targeting and virtual assistants. And while executives admit the profit margin might take a short-term hit, they're betting that full-stack integration across products will pay off down the line. But Tencent isn't just betting on the futureit's securing IP to own it. Last year's hits like Dungeon & Fighter Mobile helped steady its gaming business, and 2025's pipeline includes Honor of Kings: World and Path of Exile 2. But the real headline? Tencent's $1.25 billion deal for a 25% stake in a new Ubisoft entity, giving it a direct line into franchises like Assassin's Creed. It's a classic Tencent move: think long-term, go global, and let the compounding do the work. This article first appeared on GuruFocus.
Straits Times
15-05-2025
- Business
- Straits Times
Tencent sales grow fastest since 2021 in solid start to rocky year
encent is among the biggest beneficiaries of a Chinese tech renaissance triggered by DeepSeek. PHOTO: REUTERS Hong Kong – Tencent Holdings' revenue grew at its fastest pace in more than three years, affirming investors' expectations that China's gaming and social media leader will weather a potential global downturn in 2025. The WeChat operator reported a faster-than-anticipated 13 per cent rise in sales to 180.02 billion yuan (S$32.4 billion) in the March quarter. Net income rose 14 per cent to 47.8 billion yuan, missing estimates in part because of rising spending on AI research and initiatives. The numbers may lend confidence to investors who regard China's most valuable company as resistant to much of the economic turmoil surrounding the Trump administration's tariffs campaign. Its shares have gained more than 20 per cent in 2025. Yet Tencent runs a giant cloud, advertising and fintech services business vulnerable to economic shocks and a slowdown in domestic consumption. Tencent is among the biggest beneficiaries of a Chinese tech renaissance triggered by DeepSeek, whose January release of the R1 model upended the idea of US AI dominance and rekindled interest in homegrown technology. Tencent rushed to buy up AI chips around the end of 2024 to serve growing demand from cloud clients. Its apps, including WeChat and the ChatGPT-style Yuanbao, have gained users since integrating with DeepSeek's offering. To counter a plateauing home market, the world's biggest games publisher has also focused on grooming what it calls evergreen franchises – established titles that players will stick with through multiple versions and updates. 2024's breakout hits, Dungeon & Fighter Mobile and Delta Force, helped Tencent stem a contraction in its marquee business. But it remains to be seen whether players will stick around. Still, investors are betting it will successfully experiment with newer initiatives such as mini-games and the Hunyuan foundation model. Executives including billionaire founder Pony Ma have outlined plans to rely on both third-party and self-made models to win the AI race, mirroring a playbook that seeded Tencent's gaming leadership two decades ago. Many observers have drawn parallels between AI and the rise of smartphone apps – a tidal shift that will create new winners and threaten the old guard. Tencent's longtime foe Alibaba Group has only gotten more aggressive, pledging to spend billions to build data centers and investing in many of China's up-and-coming AI platforms. For now, WeChat remains Tencent's most reliable asset as it takes on bigger monetisation roles in area from advertising to mini-games and TikTok-style shopping. Though broader consumer sentiment remains shaky, Tencent has sought to introduce even more features to its all-in-one platform – including a gifting function that's received a mixed reception from both merchants and buyers. Tencent also remains the undisputed leader in mobile games. It earned roughly four times as much as the second closest publisher in 2024, according to Appfigures. It's unclear whether Tencent can replicate the success of last year. Its pipeline for 2025 includes highly anticipated titles like Honor of Kings: World and the Chinese rollouts of Path of Exile 2 and Goddess of Victory: Nikke. But few are considered sure-fire hits like DnF Mobile, which owed its success to loyal players trying out a fresh version of their PC favorite. In a deal announced in March, Tencent said it will invest about US$1 billion (S$1.3 billion) to acquire a 25 per cent stake in a new entity holding Ubisoft Entertainment's most celebrated intellectual properties. That could give the Chinese company a bigger say in shaping the future of global franchises like Assassin's Creed, which Tencent is adapting for mobile. BLOOMBERG Join ST's Telegram channel and get the latest breaking news delivered to you.
Economic Times
14-05-2025
- Business
- Economic Times
Tencent Q1 revenue rises 13% on AI, gaming boost
Tencent Holdings, China's biggest technology company by market capitalisation, posted a 13% rise in first-quarter revenue on Wednesday, boosted by growth in gaming and AI-enhanced advertising. Tencent, also the world's largest video game company and operator of the WeChat messaging platform, reported revenue of 180 billion yuan ($24.97 billion) for the quarter ended March 31. The results exceeded the 174.6 billion yuan average estimate from analysts polled by LSEG. Net profit for the quarter was 47.8 billion yuan, compared with analyst expectations of 52.2 billion yuan, LSEG data showed. The revenue growth was led by robust performance in the gaming segment, as the company benefited from regulatory easing in China's gaming sector following stringent restrictions in previous years. For the quarter, domestic gaming revenue rose by 24% to 42.9 billion yuan, and international gaming revenue climbed 23% to 16.6 billion yuan. Titles that drove the growth included "Dungeon & Fighter Mobile", launched in May 2024, and shooting game "Delta Force," which debuted in September. Tencent has increased its AI investments, and in March said it would allocate a low double-digit percentage of 2025 revenue to capital expenditure, primarily for AI development. This follows the company's 39 billion yuan AI-focused spending in the fourth quarter of 2024. The company has developed its own proprietary large language model Hunyuan, and in March made public a version called T1. It has also been among the most open of its peers to adopting third-party technology. Tencent became the first major Chinese tech company to integrate technology from DeepSeek, a Chinese AI startup that gained prominence early this year with its release of AI models that rival Western counterparts at lower development costs. The DeepSeek integration has been rolled out across Tencent's core products, including WeChat—the company's flagship messaging and payment platform with over 1 billion active users—and Yuanbao, Tencent's AI assistant. Revenues from marketing services for the quarter were 17.7 billion, up 22% year-on-year, partly because of robust AI-driven adtech upgrades whose benefits include more targeted advertising. The company's FinTech and Business Services segment, which includes consumer loans, wealth management and cloud services, posted revenue of 27.6 billion yuan, a 16% increase. ($1 = 7.2086 Chinese yuan renminbi)
Yahoo
14-05-2025
- Business
- Yahoo
Tencent Posts Solid Results as AI Investments Start to Pay Off
Tencent Holdings' revenue growth accelerated in the first quarter as its core gaming business remained strong and ramped-up spending on artificial intelligence began to pay off. The company, China's largest by market capitalization, said Wednesday that AI capabilities have started to contribute tangibly to its advertisement and game businesses. The Unraveling of the King of Davos Can UnitedHealth's New Boss Succeed Where Other 'Boomerang' CEOs Failed? ESPN's New Streaming Service Will Cost $29.99 a Month Microsoft Slashing Thousands of Workers, Including Management Jobs 'MAGA Accounts': What to Know About the $1,000 Child Savings Pitch in the Tax Bill Tencent's first-quarter revenue climbed 13% from a year earlier to 180.02 billion yuan, equivalent to $24.98 billion, topping analysts' expectations. That marked a pickup from the single-digit growth seen in previous quarters. The Chinese technology giant has been investing more and more in AI to compete against rivals and enhance its offerings in gaming, social media, digital payments and cloud services. Tencent's capital expenditure surged more than 300% in the fourth quarter as it snapped up graphics processing units–and it plans to accelerate spending further. Company president Martin Lau said after the 2024 results that its capex will likely account for a low-teen percentage of revenue this year. First-quarter capital spending almost doubled from a year ago to 27.48 billion yuan but was down from the 36.58 billion yuan recorded in the final quarter of 2024. Analysts say that Tencent's increased spending and use of multiple AI models, both third-party and its own, will drive monetization and could lead to the creation of a powerful AI ecosystem. Its net profit rose 14% to 47.82 billion yuan during the quarter, missing the 52.12 billion yuan estimated by analysts in a FactSet poll. Tencent's bread-and-butter gaming business maintained strong momentum, with the domestic division delivering a 24% sales gain, boosted by a low base and legacy titles 'Honor of Kings' and 'Peacekeeper Elite,' as well as last year's breakout hit 'Dungeon & Fighter Mobile.' Revenue from the international gaming business increased 23%. AI-powered ad targeting and creation helped lift Tencent's marketing services revenue by 20% in the first three months of the year despite challenging macro conditions. Citi analysts viewed the results as 'a stronger-than-expected print,' supported by continued levers of sustainable growth of high-margin revenue streams and signs of AI-enhancing benefit. Continuous AI advertising tech upgrades could make Tencent's ad revenue growth more durable than that of global peers, Morgan Stanley analysts said in a recent note. That is largely due to the valuable user data it can use from the mini-programs and payment services embedded in its popular do-everything app, Weixin. Weixin and its overseas version, WeChat, had a combined 1.40 billion monthly active users as of the end of March. Tencent said operating leverage from existing high-quality revenue streams can help absorb the costs of investing more in new opportunities, such as its Yuanbao chatbot application and AI features on Weixin. The company's use of AI and solid earnings performances have helped make it one of the hottest Chinese tech stocks of 2025. Data from Wind showed that Tencent was one of the top three most purchased stocks via the Hong Kong Southbound Connect program over the past three months. Concerns about U.S. tariffs have taken some of the wind out of the broader rally in Chinese tech shares, tempering enthusiasm about the emergence of homegrown AI startups like DeepSeek. Tencent's business is relatively resilient to tariff risks as it makes most of its revenue in China. The stock is still up 25% so far this year, but tightened U.S. controls on advanced chips could disrupt AI ramp-up efforts. The U.S. government said last month that Nvidia will now need a license to export its H20 processors to China and several other countries. Chinese AI players, including Tencent, use the chips to power their AI efforts. Still, analysts think Tencent's strong H20 chip inventory will likely leave it less exposed to the latest U.S. restrictions. There is also a growing number of domestic substitutes for the chip. Coming earnings from Tencent's peers Alibaba and Baidu will offer a broader picture of how the Chinese tech industry is holding up amid the pressure. Write to Sherry Qin at Apple to Support Brain-Implant Control of Its Devices Trump's China Deal Makes Sense. How He Got Here Doesn't. United Adds Caviar Service and Luxe Jammies in Race for Superpremium Travelers Mild April Inflation Captures Early Stages of Tariff Effects Trump's Drug-Price Crackdown, Like His Trade War, Could Be More Bark Than Bite Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Times
14-05-2025
- Business
- Business Times
Tencent quarterly revenue up 13% on AI, gaming boost
[BEIJING] Tencent Holdings, China's biggest technology company by market capitalisation, posted a 13 per cent rise in first-quarter revenue on Wednesday (May 14), boosted by growth in gaming and AI-enhanced advertising. Tencent, also the world's largest video game company and operator of the WeChat messaging platform, reported revenue of 180 billion yuan (S$32.4 billion) for the quarter ended Mar 31. The results exceeded the 174.6 billion yuan average estimate from analysts polled by LSEG. Net profit for the quarter was 47.8 billion yuan, compared with analyst expectations of 52.2 billion yuan, LSEG data showed. The revenue growth was led by robust performance in the gaming segment, as the company benefited from regulatory easing in China's gaming sector following stringent restrictions in previous years. For the quarter, domestic gaming revenue rose by 24 per cent to 42.9 billion yuan, and international gaming revenue climbed 23 per cent to 16.6 billion yuan. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Titles that drove the growth included Dungeon & Fighter Mobile, launched in May 2024, and shooting game Delta Force, which debuted in September. Tencent has increased its AI investments, and in March said it would allocate a low double-digit percentage of 2025 revenue to capital expenditure, primarily for AI development. This follows the company's 39 billion yuan AI-focused spending in the fourth quarter of 2024. The company has developed its own proprietary large language model Hunyuan, and in March made public a version called T1. It has also been among the most open of its peers to adopting third-party technology. Tencent became the first major Chinese tech company to integrate technology from DeepSeek, a Chinese AI startup that gained prominence early this year with its release of AI models that rival Western counterparts at lower development costs. The DeepSeek integration has been rolled out across Tencent's core products, including WeChat – the company's flagship messaging and payment platform with over one billion active users – and Yuanbao, Tencent's own AI assistant. Revenues from marketing services for the quarter were 17.7 billion, up 22 per cent year on year, partly because of robust AI-driven adtech upgrades whose benefits include more targeted advertising. The company's FinTech and Business Services segment, which includes consumer loans, wealth management and cloud services, posted revenue of 27.6 billion yuan, a 16 per cent increase. REUTERS
