China’s Blockchain King Tencent Reports Strong Third-Quarter Earnings
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Tencent Holdings Limited’s (TCEHY) third-quarter reports are in. Their earnings beat the expectations of most publicized predictions. TCEHY holds more than 20 patents utilizing blockchain technology – an amount equal to blockchain patents held by Accenture, Bitmain, China’s State Grid Corporation, Google, Intel, Ping An Insurance, Sony, and Visa. The probability of blockchain technology being added to the daily operations of all of these corporate powerhouses is high enough to monitor their price activity with the fluctuations occurring within the cryptocurrency markets.
TCEHY adjusted 3rd quarter earnings per share (EPS) value was 2.06 Yuan a share vs 1.79 Yuan a share for the same period a year ago. Other factors that weighed in heavily on the increased EPS value were a 24% increase in revenue based on sales of 80.6 billion Yuan vs sales of 65.2 billion Yuan last year. Tencent was also able to report a 47% increase in advertising revenue to 16.2 billion Yuan.
Tencent Holdings Limited (TCEHY)
There was a strong probability TCEHY may have even surpassed these stronger-than-expected earnings reports. Earlier this year Tencent was about to market a highly anticipated digital game for Chinese youth. But the government came in and said to Tencent the game was too addictive for the minds of the young people of China and too harmful to their eyes as well. Tencent was not allowed to bring the game to market, causing TCEHY to lose a large portion of its market cap value earlier this year.
The gaming accounted for approximately 40% of Tencent’s revenue stream. Online games like ‘Honor of Kings,’ which TCEHY holds the license to sell in China, is one of the highest grossing games in the region. A massive multiplayer game, PlayerUnknown’s Battlegrounds, or ‘PUBG’ is awaiting approval from Chinese regulators so that it can be monetized by TCEHY. Sales of the game ‘Monster Hunter: World’ were also stopped. Tencent is supposedly working with regulators to find a way to bring their product to market with time restrictions for play. TCEHY remains confident an accord can be reached with regulators within a reasonable time frame.
TCEHY closed the week trading at US $37.63 a share, gaining $1.03 from the previous trading day. That value translates into a 2.81% increase from the closing price one day earlier.