Abstract: Tencent is expected to release the 2021 Q2 financial report on August 18. According to Bloomberg's agreed expectations, Tencent's Q2 revenue was 138.328 billion yuan, up 20.4% year on year; adjusted net profit was 32.826 billion yuan, up 8.9% year on year. Since 2021, Tencent has increased its investment in enterprise services and software, games and short videos with a high level of industrialization to fuel a new round of growth. Guoxin Securities believes that the slowdown in net profit growth under non-IFRS is within market expectations. During the investment period, we should focus on revenue growth and downplay the net profit growth rate under non-IFRS.
2021 Q1 review: Gaming revenue reached a record high, investment increased
The revenue of 2021Q1, Tencent Mobile Games and PC Games was 41.5 billion yuan and 11.9 billion yuan respectively, up 15% and 9% year-on-year, and the game sector accounted for 32.2% of the total revenue. Tencent's overall deferred revenue reached 98.6 billion yuan in Q1, with a month-on-month increase of 15.8 billion yuan, all of which reached record highs.
Q1 Tencent said it would increase its investment and use “part of this year's profit increase” to invest in three strategic areas, namely cloud computing, online games, and short videos focusing on SaaS products. Furthermore, Tencent announced the establishment of the “Sustainable Social Value Division” to promote social welfare, with an initial investment of 50 billion yuan. The capital comes from Tencent's investment income. Key investment areas include basic science, educational innovation, and rural revitalization.
2021 Q2 preview:...