Impressive Growth in Profit and Revenue for Tencent Holdings in Q1 2024
Impressive profit growth
Like other major Chinese tech companies, Tencent has shifted its strategy to prioritize profitability amidst economic challenges in China. In Q1, the company's revenue increased by 6% while gross margin expanded significantly by 8 percentage points. Non-GAAP gross profits surged by 23%, highlighting Tencent's emphasis on high-profit segments like online advertising.
Business Segment Strength
Aside from online advertising, Tencent's video and music subscriptions saw substantial growth rates in Q1, along with positive performance in cloud services. The company's commitment to enhancing user engagement through AI technology resulted in increased advertiser targeting capabilities on the WeChat platform.
Hidden Gaming Segment Strength
Despite a slight decline in gaming revenue, Tencent's gross receipts from gaming segments showed promising growth, with international gaming gross receipts up by 34%. Tencent's valuation remains attractive even after the stock surge, making it an appealing investment choice in the Chinese market.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.