Tencent Holdings Ltd. has reported a 65 percent rise in quarterly profits. The Chinese company reported that the rise in profit was a result of the increasing demand for its video games by users in China and international markets.
The gaming and social media company is the world’s largest gaming company by revenue volume. The company’s profit for the fiscal first quarter was 47.77 billion Yuan ($7.42 billion) and has surpassed the expectation of analysts from Refinitiv. The analysts from Refinitiv expected the company’s profit to run into 35.45 billion Yuan.
Against the market expectations of 134.39 billion Yuan, the company’s revenue rose 25 percent to 135.3 billion Yuan. The company revealed that revenue from online games rose by 17 percent.
Tencent Holding Ltd. unveiled more than 60 new titles at its annual video gaming conference last week. The company has plans of launching a Pokemon game in partnership with Nintendo, and a mobile version of its League of Legends game. “We are stepping up our investments in game development, and in particular focusing on large-scale and high-production-value games that can appeal to users globally”, the company which gets 32 percent of its revenue from video games said.
In a report by Reuters last month, Chinese regulators are demanding anti-trust fines that could exceed 10 billion Yuan from the company, and have also asked the company to sell off some of its music assets as well as give up exclusive rights. Tencent Holdings Ltd. has still not said anything concerning this.
The company’s music wing has however revealed that it is facing increased supervision from Chinese regulators.
The gaming company expects that profits will continue to rise as the demand for its video games continues to rise amidst the pandemic.