By Pei Li
HONG KONG (Reuters) – China’s Tencent said Wednesday that it did think that a US resolution banning transactions in its foreign messages to WeChat app invoices would apply to its domestic Weixin platform, which could restrict the consequences of the resolution.
Tencent is the newest Chinese generation caught in the crosshairs of a Chinese-American cyber war that intensified after President Trump said last week that the United States would ban WeChat-related transactions in the country.
CfO John Lo said Tencent’s initial reading that the U.S. executive order was targeting WeChat in the U.S. And he didn’t think his other business would be affected.
The United States accounts for less than 2% of Tencent’s total revenue, said James Mitchell, chief strategy officer, and less than 1% of total advertising revenue.
“If you take a look at the decrees possibly of 2019 and then, obviously, the executive order a few days ago, make it very clear that they control the jurisdiction of the U.S. And so we don’t see that any have an effect on the advertising of corporations on our platform in China,” he said.
Online gaming revenue, which accounts for a third of total sales, increased by 40% this quarter, mainly due to smartphone games, adding Peacekeeper Elite and Honor of Kings, while the coronavirus hindered other entertainment options.
However, the company has postponed the successful release of the game “Dungeon and Fighter Mobile”, scheduled for August 12, featuring innovations in the game’s addiction prevention system. It didn’t involve a new release date.
Social media, fintech and business services, as social advertising revenue has increased by almost 30%.
However, media advertising revenue fell by 25% in a “difficult macroeconomic environment” and delays in content production and production.
According to the knowledge of Refinitiv, the world’s largest gaming company in terms of revenue, it posted a profit of 33.1 billion yuan ($4.8 billion) during the 3 months through June, ahead of an average analyst estimate of 27.56 billion yuan.
Revenues increased 29% to 114.880 million yuan, compared to market expectations of 112.760 million yuan.
(Information through Pei Li; additional information through Brenda Goh; edited through Louise Heavens and Jan Harvey and Kirsten Donovan)