Tencent Holdings, the operator of the country's largest online chat platform, has warned shareholders to prepare for weaker fourth-quarter results despite a strong performance in the third quarter.
'In the event of an economic downturn, our online advertising business will inevitably be affected,' said Ma Huateng, the chairman and chief executive of the Shenzhen-based firm.
'On the other hand, our value-added services are relatively more resilient as they comprise small-ticket consumption items for the consumers.'
The company reported a 91.4 per cent surge in third-quarter sales to 2.02 billion yuan (HK$2.29 billion) from a year earlier, beating analysts' estimates of 1.7 billion yuan. Profit was up 72.9 per cent to 737.1 million yuan, or 40 fen per share, beating estimates of 37 fen.
'The company outperformed in its online games. Dungeon and Fighter recorded 700,000 peak current users. Newly launched QQ Dancer and Cross Fire also did very well,' said an analyst.
Games-related sales increased 50 per cent from the previous quarter to 679.9 million yuan, accounting for 33.6 per cent of total revenue. But net profit margins shrank to 36 per cent from 40 per cent a year earlier.
