Tencent: China’s Internet Crackdown Pushes Tencent to Slowest Earnings Growth in Two Years

Chinese gaming and social media giant Tencent Holdings on Wednesday posted a 3% rise in third-quarter profit, its slowest growth in two years, impacted by increased regulation and a slowdown in advertising.

Net profit for the three months to September reached 39.5 billion yuan ($6.18 billion), the company said in a statement. That beat analysts’ expectations of a drop, according to data from Refinitiv.

Revenue soared 13% to 142.4 billion yuan, slightly below expectations, and it was the slowest quarterly growth since the company went public in 2004, data showed. Refinitiv.

China’s largest company by market value has been hit with new limits on how much time minors can spend playing video games. The government hasn’t approved any new games since August.

Beijing’s year-long crackdown on its once freewheeling internet industry has punished well-known companies for engaging in what were previously considered fair market practices, wiping billions of dollars from their market values.

“During the third quarter, the internet industry, including the domestic gaming industry, and some categories of advertisers adapted to new regulatory and macroeconomic developments,” said Pony Ma, chairman and CEO of Tencent. , in a press release.

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“We are proactively embracing the new regulatory environment which we believe should contribute to a more sustainable development path for the industry.”

Mobile game sales rose 9%, the owner of games such as “Honor of Kings” and “PUBG mobile” said in a statement.

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