Tencent has announced its financial results for the year ended December 31, 2022. Let’s focus on the key points and results that the Chinese company achieved in the gaming business.
- According to the 2022 earnings release, Tencent’s annual revenue was 554.6 billion yuan ($79.6 billion), down 1% year-over-year. As pointed out by Reuters, this is the first-ever decline since the Chinese company went public in 2004.
- The company’s operating profit fell 13% year-over-year to 235.7 billion yuan ($33.8 billion). On a non-IFRS basis*, it fell 4% to 153.5 billion ($22 billion).
*Non-IFRS adjustments exclude share-based compensation, net gains or losses from investee companies, income tax effects, and some other metrics.
- Tencent’s net profit was 188.7 billion yuan ($27 billion), down 17% year-over-year.
- Domestic games revenue reached 123.9 billion yuan ($17.7 billion), down 4% year-over-year. And revenue from international games grew 3% to 46.8 billion yuan ($6.7 billion).
- Overall, Tencent’s gaming business accounted for 43% of its total revenue in 2022.
More takeaways from the report about Tencent’s gaming division
- Mobile games revenue, which Tencent attributes to its Social Networks business, reached 39.2 billion yuan ($5.6 billion) in Q4, down 2% year-over-year. PC games revenue grew 8% to 11.5 billion yuan ($1.65 billion) in the three-month period.
- Tencent cited Honor of Kings, Dungeon Fighter Online, and Undawn as the main drivers of its domestic games revenue.
- The growth in its international games revenue was due to strong performances of League of Legends, Valorant, PUBG Mobile, and Call of Duty: Mobile. The company also launched several succesful new releases like NIKKE and Darktide.
- As part of its business strategy, Tencent plans to focus on making new titles in high potential genres, building games based on popular IPs, and publishing leading global franchises.
- On top of that, the company will bring more top PC and console IPs to mobile and expand its in-house franchises.