① Today, Tencent released its 2024 Q1 earnings report. Among them, the online game business revenue was 48.1 billion yuan, the same as the previous year; ② Both the local market and the international market of Q1 Tencent games achieved year-on-year growth, with the international market growing as high as 34%, mainly driven by a recovery in Supercell's games; ③ agency sources said that the decline in revenue in the Q1 local market was within expectations, and DNF Mobile Games is expected to become an inflection point in Q2 growth.
Financial Services Association, May 14 (Reporter Cui Ming) After achieving a 14% growth rate last year, Tencent Gaming's international market achieved another “good start” in Q1 this year. Domestic market turnover has also resumed growth, and is expected to usher in an inflection point in revenue growth in Q2, driven by DNF mobile games. Agency sources predict that DNF mobile game revenue is expected to reach 5.8 billion yuan in the first year, which is equivalent to 4% of Tencent's game revenue in the local market last year.
Today, Tencent (00700.HK) announced its results for the first quarter of 2024. Among them, the revenue from the online game business was 48.1 billion yuan, which is basically the same as the previous year. According to financial reports, the Q1 Tencent gaming business achieved year-on-year growth in both the local market and the international market, and the performance in the international market was particularly impressive. Thanks to the strong performance of Supercell's games (in particular “Brawl in the Wild”) and the growth contribution of “PUBG MOBILE,” international market turnover increased 34% year over year. Game traffic also resumed growth in the local market, with a year-on-year increase of 3%.
By market, game revenue in the Q1 international market increased 3% year-on-year to 13.6 billion yuan. Mainly driven by the recovery of Supercell games mentioned above.
Game revenue in the local market was 34.5 billion yuan, down 2% year on year. Tencent attributed this to revenue delays. As far as individual games are concerned, “Wang Zhe Rongyao” and “Peace Elite” both declined year on year, “Battle of the Golden Shovel” revenue increased year on year, and the two mobile games “Fearless Pact” and “Ark of Destiny” also contributed some revenue.
According to Gamma Data's mobile game sales estimates for the first quarter of this year, Tencent Gaming's products occupied 6 seats in the top 10, involving game genres such as MOBA, shooting, and self-propelled chess. Among them, “Battle of the Golden Shovel” increased significantly over the same period last year. According to Sensor Tower data, the revenue of “Battle of the Golden Shovel” increased 96% year-on-year in the first quarter of this year, achieving double-digit growth for four consecutive quarters.
A CIFA reporter learned that the Q1 local market data was within the expectations of most institutions. Previously, many brokerage firms predicted that revenue from this business would drop by about 2%-3% year on year, mainly considering that “Wang Zhe Rongyao” etc. had a high base during the Spring Festival in the same period last year. Furthermore, due to the delay of this year's Spring Festival compared to last year, the time between flow and revenue confirmation was shortened, which affected the presentation of revenue indicators in Q1 to a certain extent.
Institutional sources believe that starting in the second quarter, the revenue from the old game stream will be combined with the launch of a major new game, which may reverse the decline in Tencent's local market. The new game “Dungeons and Warriors: Origins” (DNF mobile game), which is a key catalyst, is scheduled to launch on May 21. The agency expects the game's first-year revenue to reach 5.8 billion yuan, which is equivalent to 4% of Tencent's local market revenue last year.
It is worth mentioning that Q1 mini-game sales increased 30% year over year. Tencent also said that the total usage time of Q1 applet users increased by more than 20% over the same period last year. Among them, the average number of daily uses of non-game applets achieved a double-digit percentage increase over the same period last year.
According to other financial data, in the first quarter of 2024, Tencent achieved revenue of 159.5 billion yuan, an increase of 6% year on year; net profit (non-IFRS) was 50.265 billion yuan, an increase of 54% year on year. Among them, revenue from the fintech and corporate services business was 52.3 billion yuan, up 7% year on year; revenue from online advertising business was 26.5 billion yuan, up 26% year on year.