Chinas Tencent misses expectations despite fastest profit rise since late 2021
Summary
Tencent on Wednesday reported a weaker-than-expected surge in profit for the second quarter, as cost-cutting measures began to pay off and sales rose across the companys various businesses. Tencent is now starting to see the benefits of the cost-cutting drive it embarked on last year, when it exited non-core businesses and tightened marketing spending. The company, which owns Chinas biggest messaging app WeChat, is now observing a pick-up in its businesses, from gaming to cloud computing. Firstly, its core gaming business slowed dramatically relative to comparisons with 2021, when people relied more on indoors entertainment because of the spread of the pandemic. But the weaker-than-expected revenue growth continues to reflect the turbulence of the Chinese economy, which has failed to recover as briskly as many had anticipated after the pandemic.
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