SHENZHEN / LONDON (IT BOLTWISE) – Tencent surprised with impressive third-quarter revenue growth, driven by the renaissance of its gaming business and the use of artificial intelligence in advertising. Despite regulatory challenges and geopolitical tensions, the company is showing remarkable resilience and exceeding analyst expectations. However, the question remains whether this growth is sustainable or whether it is a one-off blip.
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Tencent exceeded analysts’ expectations in the third quarter with revenue growth of 15 percent to 192.9 billion yuan. Particularly notable is the increase in net profit to 63.1 billion yuan, exceeding the most optimistic forecasts. This development is primarily due to the revival of the gaming business and the increased use of artificial intelligence in advertising.
The gaming segment, once the heart of Tencent, is experiencing a renaissance. Games like Honor of Kings and Peacekeeper Elite record double-digit growth rates and high user loyalty. This recovery comes at a time when the industry was seen as fragile following regulatory interventions in China. But demand for high-quality mobile games remains stable, even in a challenging global consumer environment.
In parallel, Tencent has optimized its advertising strategy by using AI-powered models. These models analyze user behavior more precisely and enable targeted advertising with higher conversion rates. This has resulted in a 21 percent increase in advertising revenue. The trend towards performance-oriented advertising in China plays into Tencent’s hands.
Despite the regulatory uncertainties in China, Tencent is showing resilience. The company’s broad positioning in the areas of gaming, advertising, cloud and fintech ensures stability. While growth in the cloud and enterprise business is more moderate, operational profitability is improving, particularly in AI applications for corporate customers.
The stock market reacted positively to the quarterly figures, but the question remains whether Tencent can maintain this growth. The future depends on the gaming pipeline, AI investments and the stability of the regulatory environment. Analysts and investors are eager to see whether Tencent can maintain its momentum in the coming quarters.
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