Tencent Focuses on Regulatory Compliance as Gaming Earnings and Funds Rise – Replace
By Stephanie Yang
TAIPEI – Tencent Holdings Ltd. CEO Pony Ma underscored his dedication to working with regulators amid elevated authorities scrutiny of highly effective Chinese language tech corporations, as robust progress in cell video games and funds propelled the social media and leisure big in its highest-grossing yr but. .
Ma’s put up on Wednesday, made at a quarterly earnings briefing, comes as Beijing steps up its antitrust efforts towards China’s tech sector, the place corporations have collected big quantities of consumer knowledge.
Tencent was amongst a number of corporations this month condemned by antitrust regulators for failing to correctly report on previous acquisitions. In the meantime, the State Council’s antitrust committee has been accumulating details about Tencent’s on-line fee service WeChat Pay – alongside rival Ant Group Co.’s Alipay – since final yr resulting from its dominance within the funds market in China, in response to officers acquainted with the investigation. .
“We’re working carefully with authorities and regulators on our compliance,” Ma stated by means of the interpretation, when requested about China’s antitrust laws.
This month, Ma met with Chinese language antitrust regulators from the State Administration for Market Regulation after asking to see them, individuals acquainted with the matter stated.
In a convention name Wednesday, Tencent Chairman Martin Lau stated the assembly was voluntary and an integral a part of doing enterprise. “We have now had discussions on a variety of matters and the principle objective is definitely to create a wholesome surroundings for innovation to occur in China,” Lau stated.
The State Administration for Market Regulation and the State Council’s Antitrust Committee didn’t reply to requests for remark. Reuters beforehand reported on Mr. Ma’s assembly.
Investor considerations have grown since Chinese language authorities tightened laws to curb the nation’s burgeoning web business. Antitrust regulators are probing e-commerce big Alibaba Group Holding Ltd., whereas Tencent has additionally been fined for not correctly reporting previous acquisitions.
But Tencent, like many different tech giants, took benefit of a yr through which the coronavirus pandemic led home-confined customers to show to on-line services and products.
The income of the world’s largest online game firm reached 482.06 billion yuan, or $ 73.88 billion, in 2020, a rise of 28% from the earlier yr. Web revenue for the yr was 159.85 billion yuan, a rise of 71%.
Web revenue for the quarter ending in December almost tripled to a document 59.30 billion yuan, following progress within the valuations of corporations through which it has invested. Income elevated 26% to 133.67 billion yuan. Each have exceeded analysts’ expectations.
Tencent’s cell gaming enterprise flourished throughout the pandemic, with on-line gaming income rising 29% year-over-year within the fourth quarter. The corporate declared its “Honor of Kings” the best grossing cell sport on the planet for the second yr in a row.
Fintech and enterprise providers revenues grew 29% within the final quarter, the corporate stated, on the again of progress in business funds and wealth administration providers. In its monetary report, Tencent stated its precedence for its fintech enterprise was threat administration quite than scale, and it stated it will work carefully with regulators.
Tencent’s presence within the e-commerce business has additionally grown. The corporate stated final quarter’s advert income grew 22% year-over-year partially resulting from elevated demand for e-commerce platforms and shopper items.
The annual transaction quantity generated by WeChat’s mini-programs, which work as apps within the messaging app, greater than doubled in 2020 in comparison with the earlier yr.
–Keith Zhai and Yifan Wang contributed to this text.
Write to Stephanie Yang at [email protected]
(END) Dow Jones Information Wire
March 24, 2021 at 3:35 p.m. ET (7:35 p.m. GMT)
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