Tencent's game revenue declined for two consecutive quarters, and payment, cloud

Tencent not only sent high-profile money on the occasion of the double eleven that Ali has spent money, but now the high-speed growth business of the financial report just coincides with Alipay and Aliyun.

Tonight, Tencent released today unannounced third-quarter earnings. The report shows that Tencent's total revenue in the third quarter increased by 52% year-on-year, and the growth rate was the same as that of the previous quarter; the growth rate of net profit declined.

It is worth noting that the proportion of Tencent's game revenue has dropped for two consecutive quarters. In the third quarter, online game revenue accounted for only 45% of total revenue; while the proportion of emerging businesses such as payment and cloud computing continued to rise, exceeding 10% for the first time. Reached 12%.

Net profit growth rate decline
In terms of overall financial situation, Tencent's total revenue in the third quarter was RMB 40.388 billion (US$6,048 million), a year-on-year increase of 52%, and the growth rate was unchanged from the previous quarter. However, the profit growth rate declined. The profit for the period was RMB 10.776 billion (US$1.614 billion), a 42% increase over the same period last year; the net profit margin decreased to 27% from 29% in the same period last year.

Game revenue accounted for two consecutive quarters of decline

In terms of segment business, value-added services, including online games and social networks, are still the bulk of Tencent's revenue, accounting for about 80%. However, the game business, which has always been regarded as Tencent's cash cow, has seen its revenue share decline for two consecutive quarters. Today, it accounts for only about 45% of total revenue. This business once accounted for 60% of Tencent's revenue in 2015. The growth rate of social network revenue is gradually increasing, and the proportion has been stable at 23-24%.

Looking further, mobile games have become the main force of the game business. In the game business income of 18.1 billion yuan, mobile games were 9.9 billion yuan, an increase of 87%; end-end revenue increased by only 10%, and according to the financial report It shows that the average simultaneous online users of the end-games are still declining. Therefore, Tencent is shifting its focus from increasing the user's time in the game to expanding the user interaction.

The proportion of online advertising revenue is also relatively stable, accounting for about 17% of the group's revenue. Among them, the effect advertising revenue increased significantly, the growth rate reached 83%, mainly due to the contribution from WeChat friends circle, mobile news applications and WeChat public account advertising revenue. WeChat is also constantly exploring ways to monetize its circle of friends, including LBS local promotion ads and native promotion page ads for its recently launched circle of friends.

In addition, in the context of QQ monthly active users (8.77 billion, 2% increase over the same period last year), the number of monthly active accounts of WeChat and WeChat continued to grow, reaching 864 million, an increase of 30% over the same period last year. However, compared with QQ's monthly users, if WeChat fails to further internationalize, the date of its users' peak is obviously not far away. Therefore, the current focus of WeChat is no longer to increase the users of WeChat, but Find out how to get users to stay on WeChat and spend all their time in this app. Therefore, WeChat is testing "small programs", allowing users to perform low-frequency interactions without leaving the WeChat interface.

Other business income increased by 348%
The most eye-catching growth was in other businesses, including payments and cloud services, which grew by 348% year-on-year to RMB 4.964 billion. At this point, other businesses accounted for 12% of the Group's revenue, exceeding 10% for the first time.

Ali and Tencent had already been the two major payment giants in China. The former relied on e-commerce, and the latter relied on social interaction to launch multiple payment and relief wars. Alipay has recently made frequent moves to the sea. Tencent has also begun to deploy the payment market in Southeast Asia after Alipay.

At the same time, although the specific income of cloud services is not disclosed, even in the domestic public cloud market, a large Alibaba Cloud accounted for only 4% of Ali's total revenue, plus this market has just begun, sitting strong Tencent, the capital, has its own advantages in the vertical field of games, and has the meaning of laying out artificial intelligence. It is not difficult to catch up.

It seems that although Tencent has suffered setbacks in the e-commerce field, there is no big move in the film industry. However, in the star business of Ali and the two cloud-based businesses, Tencent may have to face several bloody battles.