Business / Companies

Tencent Q3 profit misses estimates

(China Daily) Updated: 2012-11-15 10:57

Tencent Holdings, China's biggest online gaming and social networking company, posted a 32 percent rise in quarterly profit but fell short of forecasts as costs soared and registered users for its Internet services declined.

Tencent's third-quarter net profit rose to 3.2 billion yuan ($514 million) from a year earlier, missing an average estimate of 3.5 billion yuan in a Reuters poll of nine analysts. Net profit rose 4 percent from the previous quarter.

Revenue jumped 54 percent to 11.6 billion yuan, matching the average forecast from nine analysts for 11.6 billion yuan.

Tencent's has seen its new game "League of Legends" gain traction in the market to join stalwarts "Cross Fire" and "Dungeon & Fighter" as China's most-searched-for games.

But costs of sales in the third quarter soared 80 percent over the period a year ago due to costs related to Tencent's e-commerce and online video businesses.

Tencent, which is more than 30 percent owned by South African media group Naspers Ltd, has been on an aggressive drive to expand further into social networking and diversify into e-commerce, search and other businesses.

Bloomberg - Reuters

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