Tencent is a company I am very interested in. Its scale, products, and its outsize importance in Chinese people daily lives are amazing. My last article on Tencent was in Sept 2018. I looked at its 4Q results announced last night. Basically I was trying to find out three things. Did its gaming division sustain growth? To what extent its advertising business slowdown? Is the Fintech and Cloud Division growing well after huge resources poured in? Let’s find out.

Overall

Revenue up 25%, gross profit up 31%, non IFRS operating profit up 35%. Operating margin 28.7%, up 2.3%. Compare this to 3Q 2019 which total revenue up 21%, gross profit up 19%, non IFRS operating profit up 27%, with operating margin of 29%. I would say at first glance, Tencent showed great results. Year-on-year growth improved from previous quarter.

Gaming Division

Gaming is a key revenue generator for Tencent. Traditionally, it has been the group’s cash cow. Despite recent years’ efforts in diversifying into other division, it still makes up 30% of FY2019 total revenue....