March 18: Chinese Internet giant Tencent, operator of the country’s most popular messaging app WeChat, a reported a 22 percent jump in fourth quarter net profit but fell short of expectations.
The firm is engaged in a three-way fight over mobile payment services in China with domestic rivalAlibaba and US tech behemoth Apple.
Net profit for the fourth quarter reached CNY 7.16 billion (roughly Rs. 7,339 crores), Tencent said in a statement. The market had expected a higher CNY 7.44 billion, according to an average of analysts’ estimates compiled by Bloomberg News.
Monthly active users for WeChat known as Weixin in Chinese reached 697 million at the end of 2015, up 39 percent year-on-year, the statement said. Tencent also operates an older instant messaging service called QQ.
“Our QQ and Weixin social platforms continued to improve and innovate, reinforcing their positions as China’s most-used mobile applications,” Tencent chairman and chief executive Pony Ma said in the statement.
“We created new social advertising formats and technology to help advertisers reach consumers online,” he said.
Besides advertising, Tencent uses its social media platforms to offer mobile games, digital music, video and other services to users, and the statement said the company was looking to “enrich” its mobile payment services this year.
Tencent is second in China’s mobile and online payments market with a 17 percent share but lags far behind e-commerce giant Alibaba, which commands nearly three-quarters, according to Beijing-based BigData Research.
US technology giant Apple last month launched its mobile payment service Apple Pay in China, in a challenge to the established firms.
Fourth quarter revenue surged 45 percent year-on-year to CNY 30.44 billion, Tencent said.
For all of 2015, revenue rose 30 percent on the year to CNY 102.86 billion, yielding a net profit of 28.81 billion, a 21 percent rise, it said.
Shares of Tencent closed up 0.93 percent in Hong Kong, where it is listed, on Thursday.