Tencent has outstripped expectations reporting a surge in first quarter profits and revenues driven by mobile gaming and digital content.
The company, which owns the social networking ecosystem WeChat, reported total revenues of RMB 49,552m ($7.182m) and net profit of RMB 14,548m ($2,109m) for Q1 2017.
The results revealed year-on-year increases of 55% and 57% respectively, marking the highest quarterly profit growth in two years for the company and exceeding market expectations.
The growth was driven by a 34% increase in gaming revenues of RMB 22,811m, buoyed by the success of smartphone games Honour of Kings and Dragon Nest Mobile.
Social networks revenues grew 56% to RMB 12,297m, driven by an increase in digital music and video services over the Chinese New Year period.
Online advertising revenues increased 47% year-on-year to RMB 6,888m.
Social advertising revenues (which include Tencent’s app store, browser and ad networks) grew by 67% to RMB 4,379m, and media advertising revenues (including Tencent Video and Tencent News) increased 20% year-on-year to RMB 2,509m.
WeChat’s global monthly active users reached 938 million in the first quarter, up 23% from 762 million in Q1 2016.
Tencent chairman and chief executive Ma Huateng said, “We delivered a strong set of operating and financial results for the first quarter of 2017. Financially, our smartphone games, payment related services, digital content subscriptions, PC games and social advertising businesses all contributed to our broad-based revenue growth.
“We will continue to invest in new technologies, quality content and innovative products to bring increasingly better experiences to our users.”
It follows an announcement earlier this week, that Tencent Music Entertainment Group have signed a licensing agreement with Universal Music Group to distribute music on its streaming platforms.