Home Coach outlet profit Tencent profits jump nearly 30% as China continues historic tech crackdown

Tencent profits jump nearly 30% as China continues historic tech crackdown

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The Chinese games and social media giant said on Wednesday that its revenue jumped 20% to 138.3 billion yuan ($ 21.3 billion) for the three months ended in June, compared to the same period l ‘last year, while profits reached 42.6 billion yuan ($ 6.6 billion).

Tencent (TCEHY) announced the results as the company and other Chinese tech companies are rocked by Beijing’s historic crackdown on the industry.

Martin Lau, president of Tencent, said Wednesday that “new regulations are expected to arrive” in the near future.

“Regulators are very focused on identifying and rectifying bad industry behavior as well as effective regulation,” he told analysts on a conference call. “They emphasize compliance, social responsibility, and fair and appropriate behavior.”

The internet giant has so far escaped the harshest scrutiny that peers like Ali Baba (BABA), which this spring was hit with a record fine of $ 2.8 billion after regulators concluded it had behaved like a monopoly.

But Tencent has always faced challenges. Last month, its market value plummeted after being ordered to abandon plans to acquire a streaming music player, China Music Corporation. Regulators have cited competition concerns, noting that the Shenzhen-based tech giant has long been a market leader.

Tencent also briefly suspended a new user registration for its popular messaging app WeChat in July to upgrade its security technology “in accordance with applicable laws and regulations” – a move amid another regulatory review.
And the company announced new limits on the time minors can spend playing the company’s online games earlier this month.

The statement came after an economic newspaper owned by Xinhua News Agency – China’s official media – published a lengthy analysis that used terms such as “opium” and “electronic drug” to describe the harmful effects. of play on children. The article mentioned Tencent’s popular “Honor of Kings” video game as one of the games young people are addicted to.

“I think the key issue at this point is still the time and amount of money minors spend on games,” said Lau, who added that Tencent was looking for ways to reduce the total time young people spend. . spending on games, rather than limits on specific games.

Tencent’s sale even continued earlier this week, when it and other tech giants lost more than $ 50 billion in market value collectively after the government proposed sweeping new rules to fight further. against the anti-competitive behavior of large Internet companies.

Lau reported on Wednesday that Tencent would seek to avoid trouble.

“There will be short-term uncertainties and many new regulations to come, but we are quite confident that we can comply,” he said.

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