Tencent in regulatory limbo as earnings decline

Chinese Internet Titan Tencent Falters After Chinese Gov. Bans Game

Chinese Internet Titan Tencent Falters After Chinese Gov. Bans Game

On Thursday, Tencent reported a profit of $2.59 billion or 17.87 billion yuan for the quarter ending in June, a 2% dip from the previous quarter, and their first decline in profit in nearly 13 years. "The miss, however, was driven purely by regulatory delays to game approvals, meaning the long-term story for Tencent may well remain intact".

Tencent shares are down around 27 percent since January, but trading yesterday wiped out around $15 billion from the company's market value.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move.

Tencent's profit in April-June fell 2 percent year-on-year to 17.87 billion yuan ($2.59 billion), while revenue grew 30 percent, the slowest in three years, to 73.68 billion yuan, with sequential declines in both mobile and PC games.

Tencent has survived from previous run-ins with Beijing, and its WeChat messaging app remains a vital service for Chinese phone users.

While there is a "green" process that enables the company to test monetization of games, that won't apply to PUBG because of its sheer scale, Lau said.

Shares of chipmaker Samsung Electronics Co fell almost 2 percent, SK Hynix dropped 3.4 percent, while Japan's Capcom, which developed Tencent's blockbuster game Monster Hunter:World, fell 3 percent. Although gaming revenue made up 40 percent of the revenue, it is also the business line that is causing the financial woes.

Turkey doubles tariffs on some US imports; lira rallies
The country's Finance Minister will seek to reassure around 1,000 worldwide investors in a teleconference scheduled for Thursday. Since January, the Turkish lira has lost more than 34% of its value against the dollar, pushing up the price of everyday items.

The government is "the visible hand" behind the country's internet market, where success or failure - especially for media and entertainment companies - is contingent upon its approval, according to the China Internet Report co-authored by the Post, its online tech news site Abacus and San Francisco-based venture capital firm 500 Startups.

China's biggest social networking and gaming company said it's seeking to reinvigorate mobile game revenue growth, via deepening engagement with existing titles and potential global monetization opportunities.

Tencent yesterday reported less-than-expected profit and revenue in the second quarter as the pace of growth in online gaming income slowed.

"It's quite a big mess", said Serkan Toto, CEO of Tokyo-based game industry consultancy Kantan Games. Chinese authorities have been said to be undergoing bureaucratic changes, and the already-shaky status of games consumers in the country is now becoming more precarious.

Tencent blamed its profit decline also on fewer investment gains.

After soaring into the ranks of the world's biggest companies, Tencent has lost more than $US150 billion ($207 billion) of market value as the company struggles to monetise new games.

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