- US trade chief defends tariff hikes when paired with investment
- EU court blocks French ban on vegetable 'steak' labelling
- Meta AI turns pictures into videos with sound
- US dockworkers return to ports after three-day strike
- DR Congo to begin mpox vaccination campaign Saturday in east
- Meta must limit data use for targeted ads: EU court
- Oil extends gains, jobs report lifts Wall Street
- US hiring soars past expectations in sign of resilient market
- As EU targets Chinese cars, European rivals sputter
- Top EU court finds against FIFA in key transfer market ruling
- Oil extends gains, Hong Kong stocks resume rally
- 'A man provides': Ukrainian miners send families away as Russia advances
- EU states greenlight extra tariffs on EVs from China
- Hong Kong stocks resume rally, oil dips after Middle East-fuelled surge
- Crude stable after Israel-Iran surge, Hong Kong stocks resume gains
- Hera spacecraft to probe asteroid deflected by defence test
- US dockworkers to head back to work after tentative deal
- After Helene's destruction, North Carolina starts to rebuild
- Dockers end three-day strike at Montreal port
- What next for OpenAI after $157 billion bonanza?
- Israel-Hamas war causes 86-percent dive in Gaza GDP: IMF
- Milan's Morata moves house after Inter-fan town mayor 'violates' privacy
- 'Devastating' storm hits Augusta National but Masters will go on
- Relief in Brazil, Asia over delay to EU deforestation rules
- Oil prices jump, stocks fall on Middle East tensions
- Biden says 'discussing' possible Israeli strikes on Iran oil facilities
- Oil prices rise, stocks fall on Middle East tensions
- Oil rallies, stocks mostly retreat on Middle East tensions
- Phasing out teen smoking could save 1.2 mn lives: study
- 'Welcome relief': Asia producers hail EU deforestation law delay
- Japan PM slated to announce plans for 'happiness index'
- Turkish inflation falls less than expected in September at 49.4%
- Easing inflation lifts profit at UK supermarket Tesco
- Skiing calls on UN climate science to combat melting future
- China wine industry looks to breed climate resilience
- Tokyo rallies on weak yen, Hong Kong drops after surge
- Dutch airline KLM unveils 'firm' cost-cutting measures
- Carpe diem: the Costa Rican women turning fish into fashion
- Senegal looks to aquaculture as fish stocks dwindle
- Will AI one day win a Nobel Prize?
- Climate change, economics muddy West's drive to curb Chinese EVs
- Argentina's Milei vetoes university budget after huge protests
- TotalEnergies plans to grow oil and gas production until 2030
- 2024 Nobels offer glimmer of hope as global crises mount
- Tokyo rallies on weak yen, Hong Kong reverses after surge
- Tunisia readies for vote as incumbent Saied eyes victory
- High childcare costs in US weigh on women's employment
- US voters seek help with crushing childcare costs
- Taiwan shuts down for second day as Typhoon Krathon to land
- Supercharged storms: how climate change amplifies cyclones
Chinese tech giant Tencent revenue falls for first time since going public
Chinese tech giant Tencent on Wednesday posted its first drop in quarterly revenue since going public, as the company grapples with China's economic downturn, pandemic disruptions and ongoing scrutiny from regulators.
Revenue in the second quarter fell three percent to 134 billion yuan ($19.8 billion) compared to the year before, while profits plunged by 56 percent to 18.6 billion yuan, an earnings statement said.
Tencent also cut around 5,500 jobs down to 110,715 employees by the end of June, the first quarterly decline in workforce since 2014.
"We actively exited non-core businesses, tightened our marketing spending, and trimmed operating expenses, enabling us to sequentially increase our non-IFRS earnings, despite difficult revenue conditions," the company said in the statement.
Around half of Tencent's revenues came from fintech and business services as well as online advertising, which would position the company for growth when China's economy expands, the company added.
China has spent months cracking down on the video game industry to fight addiction among children, cutting into profits of giants like Tencent and its rival NetEase.
Beijing started approving new video games again in April after a hiatus, but no Tencent games were on the list, meaning it must rely on older titles like "Honor of Kings" for revenue.
Tencent said China's domestic gaming market was facing "transitional challenges", while the international market was in a "post-pandemic digestion period" as people resumed spending on other entertainment avenues.
Online advertising revenue fell a record 18 percent in the second quarter year-on-year, which reflected "notable weakness in the Internet services, education and finance sectors", the firm added.
"Tencent has tightened its belt as the Chinese tech industry embraces a downturn," Analyst Willer Chen at Forsyth Barr Asia told Bloomberg News.
"The company's performance now largely depends on its progress on cost control and operation optimisation."
- Tech sector reeling -
Tencent is among the biggest names in China's tech industry that is still reeling from Beijing's regulatory crackdown, which began in late 2020 to target anti-competitive practices and put an end to a decade of freewheeling growth.
The regulatory actions have wiped more than $1 trillion off the combined market value of the country's tech giants in 2021, according to Bloomberg News estimates -- though Tencent has retained the crown as China's most valuable company.
The latest economic slump has further damaged bottom lines for the sector's biggest firms, with Alibaba Group earlier this month reporting flat quarterly revenue growth for the first time.
Shares in Tencent rose less than 0.1 percent in Hong Kong before the Wednesday results announcement.
The announcement came a day after news broke that Tencent plans to sell all or much of its $24 billion stake in Chinese food delivery giant Meituan.
The Hong Kong-listed shares of Meituan fell more than 10 percent on Tuesday following the news, while Tencent dipped slightly before recovering.
Tencent went public in Hong Kong in 2004 and enjoyed double-digit growth for much of China's decades-long internet boom, dominating the market with instant messaging app WeChat and its roster of games.
Earnings data on the company's performance before its listing on the stock exchange is not publicly available.
X.Cheung--CPN