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Tencent Reports Revenue Decline In Q3 Backed By Domestic Slowdown, Regulatory Crackdown

Benzinga · 11/16/2022 05:50
  • Tencent Holding Ltd (OTC:TCEHY) reported a revenue drop for the second straight quarter as China's economic slowdown and regulatory crackdown hit its ad and gaming businesses.
  • Revenue fell 2% to 140.1 billion yuan ($19.8 billion), below the consensus of 141.4 billion yuan, Bloomberg reports.
  • Net income came in at 39.9 billion yuan, above the 25.2 billion yuan estimate.
  • Also Read: Tencent Clocks First Quarterly Revenue Decline As China's Tech Crackdown, Macro Slowdown Weighs
  • Tencent pledged to give away the majority of its shares in meal delivery giant Meituan (OTC:MPNGF) (OTC:MPNGY) as it continues to whittle away at its extensive holdings across China's internet industry.
  • Tencent, which had announced plans to pare its stake in e-commerce giant JD.com, Inc (NASDAQ:JD), will give out more than 958 million Class B stock in Meituan as a special dividend to existing shareholders.
  • Tighter marketing budgets worldwide and growing competition from TikTok-owner ByteDance Ltd. are cutting digital advertising profits. In cloud computing, revenue fell this year as it worked to cut loss-making contracts.
  • Tencent co-developed a new mobile game with Capcom Co. for the Japanese studio's popular Monster Hunter franchise.
  • Tencent has failed to win a gaming license since China lifted its suspension.
  • Tencent has begun a new round of job cuts targeted at its video streaming, gaming, and cloud businesses.
  • The layoffs affected three out of Tencent's six business divisions, namely, platform and content (PCG), which comprises its video and news platforms, its gaming-focused interactive entertainment department (IEG), and cloud and smart industries group (CSIG).
  • Price Actions: TCEHY shares closed higher by 10.78% at $37 on Tuesday.