Tencent’s gross revenue for 2013 reached 60.4bn yuan ($9.9bn), up 38% year-on-year.
More importantly, its operating profit increased 24% year-on-year to 19.1bn yuan ($3.1bn).
Q1 2014 revenue
In Q1 2014 Tencent’s revenues showed their fastest growth in three years reaching 18.4bn yuan ($2.95bn), up from 13.5bn yuan ($2.17bn) in Q1 2013.
Non-GAAP operating profit increased 28% year-on-year to 6.47bn yuan ($1.04bn).
‘Value-added services’ such as video games and virtual goods accounted for 78% of Q1 revenues at 14.4bn yuan ($2.3bn).
Online games revenues grew 23% QoQ to 10.3bn ($1.65bn), thanks mainly to an increase in revenues from smartphone games integrated with WeChat and QQ.
Social network revenues increased 16% QoQ to 4bn yuan ($640m), which was again largely due to mobile games.
Online advertising revenues actually decreased 21% QoQ to 1.1bn ($180m) and represented only 6% of total revenues.
Ecommerce transactions accounted for 14% of total revenue at 2.5bn yuan ($400m). This also decreased 24% QoQ.
Instant messaging mobile apps
Tencent owns China’s two most popular mobile IM apps in QQ and WeChat.
In January 2014 QQ had 325m active users and WeChat had 295m, while the third most-popular app, Momo, had just 13m.
Active users of mobile IM apps in January 2014
Tencent launched WeChat in 2011 and racked up more than 100m followers in 15 months.
Alongside text, video and voice messaging, users in China can make mobile payments, browse ecommerce stores, play games, or book a taxi. It even offers access to an online investment fund.
In Q1 2014 WeChat’s global user numbers grew 11.5% from the previous quarter to 396m.
It earned $50m in revenue in Q4 2014, but Tencent has said that the focus is on growing its user base rather than monetization.
The messaging app also has more than 100m overseas users and as of March this year it had been downloaded more than 100m times from Google Play.
How WeChat’s number of active monthly users has grown over time (Statista)
JD.com and WeChat
In March 2014 Tencent purchased a 15% stake in JD.com, China’s second-largest ecommerce company, for $215m.
Tencent will acquire an additional 5% stake in JD.com after the company files for IPO.
This deal is important as Tencent plans to integrate JD.com with WeChat, enabling its 300m users to buy a wide range of products from within the app.
According to Business Insider, JD.com logged roughly $16bn in sales in 2013, more than 15% of which came via mobile apps.
QQ is an instant messaging software service which offers a variety of features, including online social games, music, shopping, microblogging, and voice chat.
In Q1 2014 QQ had 848m active user accounts, an increase of 3% year-on-year.
In April 2014 Tencent QQ’s peaking concurrent users (PCU refers to the total number of people using the resource within predefined period of time) reached 200m for the first time. 70% of these users were on mobile.
This was double the PCU of 100m in March 2010, and a leap of some 20m on March 2014 when the figure stood at 180m.
Mobile QQ’s number of monthly active users increased 52% year-on-year to 490m.
The most popular activity on QQ is sending messages, followed by browsing Qzone and playing games.
Created by Tencent in 2005, Qzone is a social network that allows users to write blogs, keep diaries, send photos and watch videos.
Profiles can be customised to the user’s taste, which of course involves the purchase of virtual goods.
Though registration is free, certain features can only be accessed if you pay a membership fee. The longer that users remain as paid members on Qzone, the more features they are able to access.
They are then locked in, as if paid membership expires all the acquired features also expire.
In Q1 Qzone had 644m monthly active users, an increase of 5% year-on-year. Monthly active mobile users reached 467m, representing a year-on-year increase of 44%.