Tencent releases financial report: more than 20 million video paying users and nearly 2.5 million daily paying readers

Tencent's video service ranks first in China in terms of mobile Video consumption, and its number of paying users has exceeded 20 million, a year-on-year increase of more than tripled.

On March 22, 2017, Tencent announced its unaudited fourth quarter comprehensive results and audited full-year comprehensive results as of December 31, 2016. The financial report shows that for the full year of 2016, Tencent's total revenue was RMB 151.938 billion (US$21.903 billion), an increase of 48% over the same period last year. The number of Tencent's video paying users has exceeded 20 million, a year-on-year increase of more than tripled. Previously, iQiyi announced that its membership number exceeded 20 million in June 2016. In December 2016, Youku Tudou announced that its membership number exceeded 30 million. In addition, Tencent's financial report shows that the combined monthly active accounts of Combined MAU of Weixin and WeChat in 2016 has reached 825 million, which is about 2.6 times the monthly active users of Weibo in 2016.

The financial report shows that revenue from Tencent's value-added services business in the fourth quarter of 2016 was RMB 29.191 billion, a year-on-year increase of 27%. Among them, online game revenue was RMB 18.469 billion, a year-on-year increase of 16%, and mobile game revenue was approximately 10.7 billion yuan, a year-on-year increase of 51%, accounting for approximately 58% of the total revenue of the game business. Tencent said the growth was mainly driven by contributions from Tencent's main player-versus-game and role-playing game types of smart mobile games. In addition, in terms of Social networks, which mainly reflect the growth in sales revenue from digital content services (including expanded digital music business) and virtual props, Tencent's revenue was RMB 10.722 billion, a year-on-year increase of 51%.

In terms of end games, SuperData data data shows that in 2016,"League of Legends" ranked first among all PC client games in the world in terms of revenue, and "Crossing the Fire" and "Dungeons and Warriors" also performed well.

In terms of mobile games, 2016 "Glory of the King" performed extremely well. The financial report shows that at the end of 2016,"Glory of the King" had more than 50 million daily active users, and it has ranked first in Apple's revenue list many times. In addition, data shows that the peak daily active users of "Glory of the King" during the Spring Festival holiday exceeded 80 million, which may be reflected in the first quarter of 2017 financial report. Liu Chiping also mentioned this point when answering questions from analysts."Glory of the King" became increasingly popular among users in January and February.

Tencent also mentioned in its 2017 outlook and strategy that it wants to expand the popularity of major smart mobile games while adding category-oriented PC games.

In the field of social and communication platforms, Tencent said that from Q1 to Q4 of 2016, the combined monthly active accounts of Combined MAU of Weixin and WeChat were 762 million, 806 million, 846 million, and 889 million respectively. In the fourth quarter of 2016, the number of Combined MAU of Weixin and WeChat exceeded the number of QQ monthly active accounts of 868 million. The financial report showed that revenue from Tencent's online advertising business in the fourth quarter increased by 45% year-on-year to 8.288 billion yuan, of which performance advertising revenue increased by 77% to 5.168 billion yuan, mainly due to the growth in contributions from WeChat Friends Circle, Tencent's mobile news applications and WeChat public account advertising revenue.

Tencent's video service ranks first in China in terms of mobile Video consumption, and its number of paying users has exceeded 20 million, a year-on-year increase of more than tripled. During the year, Tencent achieved initial success in the field of homemade content with the popularity of the film and television dramas "Ghost Blows Out the Lantern" and "If Snail Has Love". Previously, iQiyi announced in June 2016 that its membership number exceeded 20 million. In December, Youku Tudou announced that its membership number exceeded 30 million.

As for whether the video industry will continue to maintain losses, Liu Chiping said that in the medium term, he believes that losses will expand because the growth rate of content costs in the market exceeds the growth rate of revenue. Over time, as we continue to produce high-quality original content and continue to improve the level of commercialization, our ability to generate revenue will get better and better. However, this can only happen in a few years, not in recent years.

In terms of digital music, in 2016, the daily active accounts of national K songs exceeded 35 million, a year-on-year increase of more than doubled. The development of virtual gifts for national K songs also contributed to Tencent's revenue growth.

In terms of online literature, Tencent has strengthened its cooperation with leading authors and helped long-tail authors expand their fan base by intelligently recommending more content to readers. Benefiting from the reduction in piracy, the number of daily paying readers is close to approximately 2.5 million, more than doubling year-on-year.

Ma Huateng, Chairman and CEO of Tencent, said: "In 2016, Tencent consolidated its industry leading position, enriched the ecosystem and improved competitiveness through a series of strategic measures. We have released several successful self-developed and licensed games and strengthened our role as a leader in global gaming companies. It has increased the popularity of media platforms, and the number of paying users of digital content has also increased rapidly. We have also greatly increased the market share and average daily transaction number of mobile payment services, and achieved rapid growth in commercial payment transactions. Looking to the future, we will further implement the 'connect' strategy to provide users with high-quality experiences and create business opportunities for partners in the ecosystem. We will also continue to invest heavily in leading technologies such as security, cloud, big data and artificial intelligence to welcome the next round of growth."

Editor: Nancy