Chinese Internet giant Tencent recently announced that the company’s total revenue reached 18.4 billion ($2.99 billion) in first quarter of 2014 ended March 31, an increase of 8% QOQ or an increase of 36% YOY.
Of the total amount, VAS revenues increased 21% QOQ to 14. 41 billion yuan, representing 78% of the total revenues for the reporting period.
The revenue from online games surged 23% QOQ to RMB10.39 billion yuan ($1.68bn) in Q1, mainly driven by increased revenues from smart phone games integrated with Mobile QQ and WeChat. The paying user base for Tencent’s mobile games more than doubled, and total revenues approximately tripled to over 1.8 billion yuan during the period. For PC client games, new titles such as Blade & Soul made significant revenue contribution.
According to the report, six of Tencent’s mobile games were ranked within the Top 10 Grossing Chart in China’s iOS App Store at some point during the quarter. In addition to home-grown smartphone games, Tencent also planned to add several international hit titles, such as Candy Crush Saga and Taming Monster.
The company’s revenue from social networks revenues increased 16% QOQ to 4.03 billion yuan. This mainly reflected an increase in platform revenues from smart phone games integrated with Mobile QQ and WeChat.
The monthly active users of WeChat increased 87% YOY to 396 million at the end of the first quarter of 2014. In Q1, the company focused on building an ecosystem for WeChat by integrating Dianping and other services under WeChat Payment, expanding the user base of WeChat Payment via subsidy programme, notably for booking taxi rides; and exploring mobile e-commerce with selected merchants via their Official Accounts.
However, the company’s revenue from online advertising and e-commerce transactions saw a 21% and a 24% QOQ decline during the period. Tencent claimed the decline mainly reflected the impacts of weaker seasonality and their transition of e-commerce strategy.