Tencent's Q2 Revenues Up 80% Thanks To Online Games

Chinese web portal, IM firm and MMO operator Tencent reported RMB 2,878.4 million ($421.3 million) in total revenues for its second quarter ending June 30th, a 14.9 percent increase over the previous quarter and a 79.9 percent growth compared to the same period in 2008. Gross profit for the firm, largely powered by instant messaging-related revenues alongside virtual items and currency, came to $284.5 million, up 13.1% from the first quarter of 2009 and 69.5% from the second quarter of 2008. The company attributed part of this substantial increase to its online gaming revenues, which saw a 17 percent boost even over the previous quarter -- and an unspecified, much larger year on year increase -- to RMB 1,241 million ($183 million). Popular PC MMOs such as Dungeon & Fighter and Cross Fire, as well as "organic growth" for multiplayer online games client QQ Game, helped bolster Tencent's profits in this sector. The company, however, says decreased revenues for "more mature MMOs" such as QQ Fantasy, QQ SanGuo and QQ Huaxia offset that growth. It will also postpone the launch of two planned MMOs originally scheduled to release before the end of 2009 and the first of 2010. Tencent believes the postponed launches will affect its gaming revenue in the short-term but will benefit the operator's long-term strategies, according to a report from Redline China. It also expects to see even more success from online games in the coming months. "Looking ahead, we expect the third quarter to present stronger seasonality compared to the second quarter for our online games due to summer school holidays," Tencent's chairman and CEO Ma Huateng said in a statement published by The Wall Street Journal.