Tencent Crushes Q2 Expectations, Cloud Arm Growth Accelerates
Is Tencent becoming too big to fail?
Tencent (700:HK) reported its Q2 2020 financials on Wednesday, surpassing the expectations for the period.
Q2 saw a quarterly revenue of CNY 114.88 billion and Non-IFRS net income CNY 30.15 billion.
To break down the figures, the online gaming revenue jumped 12% to CNY 38..29 billion, while the social media and advertisement revenue rose 27% to CNY 15.26 billion. The financial technology segment expanded to CNY 29.86 billion.
Tencent Cloud saw increased demand from Internet companies and public cloud services as the pandemic lockdown was put into place. To pour CNY 500 billion into infrastructure development, it continued to use customized equipment to build self-owned hyper-scale data centers. It keeps attracting customers from finance and government, getting more presence in health care, education and exhibitions.
Gartner (IT:NYSE) recently published its global public cloud market report. Tencent Cloud ranked #5 in 2019 in Infrastructure as a Service, growing at the fastest pace among the top 5 cloud players.
Tencent is pushing the merger of Huya (HUYA:NYSE) and Douyu (DOYU:NASDAQ). The new company would have a market cap of over USD 10 billion with over 300 million Monthly Active Users.