Tencent posts slowest quarterly revenue growth since 2004

Tencent posted its slowest quarterly revenue growth since it was listed in 2004 as the tech giant was hit by a regulatory crackdown in Beijing and an economic downturn in the country.

Photo credit: Tencent

Revenue for the first quarter of 2022 stood at 135.5 billion yuan (US$20.1 billion), up marginally from 135.3 billion yuan (US$20.07 billion) in the same period the year prior.

The company’s operating profit for the quarter checked in at 37.2 billion yuan (US$5.5 billion), a 34% decrease from 56.3 billion yuan (US$8.4 billion) in Q1 2021, as per international financial reporting standards.

Gains in Tencent’s quarterly revenue were also offset by decreases in revenue from its gaming segment, music and gaming stream services, and lower advertiser demand.

Revenue from value-added services, the biggest earner for Tencent, remained largely stable, with the lack of growth attributed to the normalization of spending post-Covid. Domestic growth was also affected by the country’s minor protection policy that tackles gaming addiction.

The company’s advertising revenues also took a hit, dropping 18% for the quarter due to weaker demand, as well as regulatory changes that increased oversight of ads.

See also: Alibaba and Tencent’s footprints across SEA

Currency converted from Chinese yuan to US dollar: US$1 = 6.74 yuan.