Chinese internet giant Tencent has seen profits rise 35% after release of new videogames, according to The Wall Street Journal.
Tencent is the owner of the social networking app WeChat. WeChat is China’s dominant social network with over one billion users. Tencent’s profits rose to $3.4 billion this quarter. However, a slowdown in China’s economy and competition from rivals has caused slowdowns in key areas like advertising.
“Advertising is dragging down the overall growth,” said Canaan Guo, a senior analyst at research firm Pacific Epoch. “WeChat advertising continues to decelerate quarter-on-quarter and year-on-year.”
The popularity of apps like Bytedance’s video-sharing app TikTok has made advertising on WeChat much less popular.
President of Tencent Martin Lau said, “Many users questioned the value of high-quality content given the popularity of user-generated short-video content, but [time spent on Tencent’s videos] continues to show healthy growth.”