On August 18th, 19th, and 22nd, the Hang Seng Index $Hang Seng Index (800000.HK)$rose or fell by -0.8%, 0.05%, and -0.42% respectively, while Tencent's changes were 3%, 0.77%, and -1.46%, with its market value returning near three trillion Hong Kong dollars. This indicates that after Tencent released its earnings report on the 17th, market sentiment overall trended toward stability.
The earnings report showed that in Q2 of 2022, Tencent $TENCENT (00700.HK)$generated revenue of 134 billion yuan, a year-on-year decrease of 3%, marking the first negative growth in its history; net profit (Non-IFRS) was 28.139 billion yuan, a year-on-year decrease of 17%, with the decline narrowing for two consecutive quarters.
In the first half of this year, Tencent generated revenue of 269.505 billion yuan, a year-on-year decrease of 1%, with net profit (Non-IFRS) of 53.7 billion yuan, a year-on-year decrease of 20%.
This quarter, Tencent's value-added service business revenue declined less than 0.5% year-on-year to 71.683 billion yuan, with gaming experiencing a year-on-year negative growth of 1% to 42.5 billion yuan, but social networks grew 1% year-on-year to 29.2 billion yuan.
Correspondingly, Alibaba's China commerce segment (calendar year) also dropped by 1%, marking its first contraction since going public.
In fact, amid macroeconomic growth pressures and the downturn in the internet industry, both companies' core businesses contracted somewhat in Q2. However, it is worth noting that neither company saw a drop exceeding 1%.
The impact of short-term adverse factors cannot change the interconnectedness of the two companies...