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Technology Services

Tencent Holdings Ltd.

Company Background

Tencent Holdings is a Chinese Internet services giant based in Shenzhen, Guangdong Province. It is the biggest rival of Alibaba Group, the country's largest e-commerce company. Baidu, Alibaba and Tencent are commonly known collectively as BAT in China.

Tencent was established in 1998. With the hit of its social network service QQ, users of its smartphone chat app WeChat surged, reaching 549 million at the end of March 2015. WeChat is gaining popularity with young Chinese.

As its revenue mainly comes from PC and smartphone games as well as advertising, increasing QQ and WeChat users is likely to lead to higher earnings.

Ma Huateng, founder and CEO of Tencent, is a young entrepreneur from Shantou, the coastal eastern part of Guangdong Province, where many competent overseas Chinese have their roots. He is also a major shareholder of Tencent, owning some 10% of the company.

Business Summary

Tencent Holdings Ltd. is an investment holding company. It operates through the following segments: Value-Added Services, FinTech and Business Services, Online Advertising, and Others. The Value-Added Services segment involves online and mobile games, community value-added services, and applications across various Internet and mobile platforms. The FinTech and Business Services segment provides fintech and cloud services, which include commissions from payment, wealth management and other services. The Online Advertising segment represents display based and performance based advertisements. The Other segment consists of trademark licensing, software development services, software sales, and other services. The company was founded by Yi Dan Chen, Hua Teng Ma, Chen Ye Xu, Li Qing Zeng, and Zhi Dong Zhang on November 11, 1998 and is headquartered in Shenzhen, China.

Financial Highlights

Dec 2021 HKDUSD
Revenue675,060.34M86,848.64M
Gross Profit290,106.32M37,323.09M
Operating income139,205.48M17,909.22M
Income before tax318,785.52M41,012.76M
Net income270,957.93M34,859.59M
EBITDA208,620.81M26,839.72M
Diluted EPS27.943.59
Dividends Per Share1.600.20
Total Assets1,972.34B252,985.33M
Total liabilities899,921.04M115,429.25M
Total equity986,317.85M126,511.02M
Operating cash flow212,006.24M27,275.27M
Currency in HKDCurrency in USD

Historical Data

 Dec 2017Dec 2018Dec 2019Dec 2020Dec 2021
Revenue 274,157.94M 370,371.62M 427,814.21M 541,692.11M 675,060.34M
Gross Profit 134,824.68M 165,629.29M 188,022.62M 244,184.18M 290,106.32M
Operating income 76,359.72M 90,450.82M 105,103.85M 135,114.01M 139,205.48M
Income before tax 100,772.87M 110,129.33M 125,956.57M 198,163.32M 318,785.52M
Net income 82,457.24M 93,239.02M 105,805.74M 179,619.01M 270,957.93M
EBITDA 103,424.97M 130,736.46M 155,650.44M 191,895.36M 208,620.81M
Diluted EPS 8.64 9.74 11.01 18.56 27.94
Dividends Per Share 0.88 1 1.20 1.60 1.60
Total Assets 665,853.41M 825,072.33M 1,067.12B 1,580.96B 1,972.34B
Total liabilities 333,218.41M 418,869.14M 520,328.07M 658,483.24M 899,921.04M
Total equity 307,402.83M 368,916.93M 484,022.94M 834,671.75M 986,317.85M
Operating cash flow 128,774.43M 133,371.87M 169,455.88M 218,902.21M 212,006.24M
 Dec 2017Dec 2018Dec 2019Dec 2020Dec 2021
Revenue 35,180.85M 47,256.07M 54,601.58M 69,841.73M 86,848.64M
Gross Profit 17,301.14M 21,132.80M 23,997.17M 31,483.28M 37,323.09M
Operating income 9,798.73M 11,540.70M 13,414.31M 17,420.59M 17,909.22M
Income before tax 12,931.50M 14,051.50M 16,075.73M 25,549.69M 41,012.76M
Net income 10,581.18M 11,896.45M 13,503.90M 23,158.73M 34,859.59M
EBITDA 13,271.83M 16,680.79M 19,865.54M 24,741.55M 26,839.72M
Diluted EPS 1.10 1.24 1.40 2.39 3.59
Dividends Per Share 0.11 0.12 0.15 0.20 0.20
Total Assets 85,176.90M 105,381.97M 136,954.79M 203,893.85M 252,985.33M
Total liabilities 42,625.76M 53,499.86M 66,778.93M 84,923.39M 115,429.25M
Total equity 39,323.40M 47,119.74M 62,119.52M 107,646.10M 126,511.02M
Operating cash flow 16,524.76M 17,017.04M 21,627.51M 28,223.61M 27,275.27M

Valuation Measures

Dec 2021
PER16.06
ROA15.25%
ROE29.75%
Operating margin20.62%
Profit margin40.13%

Key executives

  • Executive Chairman & Chief Executive Officer: Hua Teng Ma
  • President & Executive Director: Chi Ping Lau
  • COO & President-Interactive Entertainment Group: Yu Xin Ren
  • Chief Financial Officer & Senior Vice President: Shek Hon Lo
  • Chief Information Officer: Chen Ye Xu

Shareholders

  • Prosus NV (28.8%)
  • MA HUA TENG PONY (8.3%)
  • The Vanguard Group, Inc. (1.9%)
  • BlackRock Fund Advisors (1.3%)
  • Baillie Gifford & Co. (0.9%)
  • Norges Bank Investment Management (0.8%)
  • E Fund Management Co., Ltd. (0.6%)
  • Fidelity Management & Research Co. LLC (0.5%)
  • Canada Pension Plan Investment Board (0.4%)
  • BlackRock Advisors (UK) Ltd. (0.3%)

Contact Details

  • Website:http://www.tencent.com
  • Address: Tencent Binhai Towers, No. 33 Haitian 2nd Road, Shenzhen, 518054, China
  • Phone: +86.755.8601.3388

Related Companies

  • Tencent International Service Europe BV
  • Tencent Ltd. (United Kingdom)
  • Inflexion Studios, Inc.
  • Slamfire, Inc.
  • Wake Up Interactive Ltd. /Japan/
  • FuSure Reinsurance Co., Ltd.
  • OPH E Ltd.
  • Proxima Beta Europe BV
  • Sixjoy Hong Kong Ltd.
  • TCH Ivory Ltd.
  • Isle Oasis Ltd.
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  • Tpp Follow On I Holding E Ltd.
  • Double Combo Holding Ltd.
  • Serene Century Ltd.
  • Tenup Entertainment Netherlands BV
  • Mount Yandang Investment Ltd.
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  • Beijing BIZCOM Technology Co., Ltd.
  • APKPure, Inc.
  • TJ Sports Culture Development (Shanghai) Co. Ltd.
  • Proximagamma Pvt Ltd.
  • Concerto HK2 Co., Ltd.
  • Tencent Cloud Europe BV
  • Kapok Tree Investment Ltd.
  • THL A25 Ltd.
  • THL A Ltd.
  • Shenzhen Tencent Commercial Management Co. Ltd.
  • Tencent Technology (Wuhan) Co., Ltd.
  • Nanjing Wang Dian Technology Co., Ltd.

Competitors

  • Microsoft Corporation
  • Netease Inc
  • Baidu, Inc. Class A
  • Electronic Arts Inc.
  • Alibaba Group Holding Ltd.
  • Gravity Co., Ltd. Sponsored ADR
  • iQIYI, Inc. Sponsored ADR Class A
  • Sohu.com Limited Sponsored ADR
  • Phoenix New Media Ltd. Sponsored ADR Class A
  • Qutoutiao, Inc. Sponsored ADR Class A
  • Netmarble Corp.
  • Fuchun Technology Co., Ltd. Class A
  • NetDragon Websoft Holdings Limited
  • Starbreeze AB
  • Xunlei Ltd. ADR
  • Zynga Inc. Class A
  • UCloud Technology Co., Ltd. Class A
  • G-Bits Network Technology (Xiamen) Co., Ltd. Class A
  • Meta Platforms Inc. Class A
  • Playtika Holding Corp.
  • PopReach Corporation
  • Roblox Corp. Class A
  • Spotify Technology SA
  • Prosus N.V. Class N
  • Twitter, Inc.
  • Snap, Inc. Class A
  • Super League Gaming, Inc.
  • Beijing Transtrue Technology Inc Class A
  • 36Kr Holdings Inc ADR Class A
  • BEC World Public Co., Ltd.
Last Updated on 20 May, 2022

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