NINGDE, China -- Tencent Holdings scored solid first-quarter earnings growth in the January-March quarter as its popular WeChat messaging app hit the milestone of 1 billion users.
Net profit for the quarter soared 61% on the year to 23.2 billion yuan ($3.64 billion), with sales rising 48% to 73.5 billion yuan, the company said Wednesday. The profit and sales both mark second straight quarterly records. The net profit margin came to 32%.
Tencent's signature messaging app WeChat gained more users thanks to free games that can be played there. WeChat's monthly user count increased 11% over the past year to 1.04 billion at the end of March, reaching the 1 billion mark just over seven years since the app's inception.
Tencent's mainstay game segment booked a 34% increase in revenue to 46.8 billion yuan. The Arena of Valor mobile game continued to fare well, and enhanced paid content like videos and music also boosted sales.
With the rapid rise of smartphone payments, the business segment comprising that service and cloud computing operations saw sales more than double to 15.9 billion yuan.
Advertising income has also increased, again thanks largely to WeChat. The segment's sales jumped 55% to 10.6 billion yuan.
Tencent's market capitalization hit 3.77 trillion Hong Kong dollars ($480 billion) at market close Wednesday.