Chinese internet giant Tencent (HKG:2988) has announced its financials for Q1 2014, the three months ending 31 March 2014.
Total revenues were $2.99 billion, up 36 percent year-on-year.
Profit was $1.1 billion, up 60 percent.
Online PC games accounted for 56 percent of Tencent's revenue, or $1.7 billion.
Mobile games that are integrated with its Mobile QQ and Weixin/WeChat social platform are the fastest growing part of the company, however.
Sales were over $290 million, more than double compared to the past quarter.
We love chat
There are now 490 million registered users on Mobile QQ, up 52 percent year-on-year, while Weixin/WeChat has 396 million users, up 5 percent.
As a category, Tencent said social network revenues, which includes such smartphone games, were up 16 percent quarter-on-quarter to $654 million.
"Our smart phone games business achieved clear market leadership, allowing us to achieve 29 percent year-on-year growth in our non-GAAP net income while funding significant investments in various strategic initiatives," said CEO Ha Huateng.
The company ended the period with cash of $5.6 billion.
Accelerated growth
The news comes after an aggressive expansion of Tencent's mobile strategy, with a 28 percent stake in Korean publisher CJ Games, costing $500 million and considerably extending its global reach.
In March's joint press release concerning the venture, CJ Games CEO Young-Sik Kwon spoke of Tencent's "high appreciation for CJ Games' game development capability", with Tencent president Martin Lau highlighting his company's desire to "accelerate its next phase of growth through this strategic investment."
We've proved that a good mobile platform that provides a lot of user interaction will have a lot of monetisation potential.Martin Lau
Young-Sik spoke of his intention "to take advantage of Tencent's platforms which is used by hundreds of millions of users" - a theme picked up on by analyst Li Yujie in comments made to Bloomberg. "Tencent has a great advantage in promoting and distributing its mobile games because it has platforms like WeChat that have a huge user base," he said.
Speaking to Bloomberg, Lau highlighted the company's strength: "We've proved that a good mobile platform that provides a lot of user interaction, that captures a lot of usage, will have a lot of monetisation potential," he said.
[source: Bloomberg, Tencent (PDF)]
