Here's how: Chinese tech titan adds $34bn to its market value

Here's how: Chinese tech titan adds $34bn to its market value

Tencent did appear to beat forecasts for net profit.

Before the release of the first-quarter report, there had been concerns in the market about a potential slowdown in Tencent's online game income growth.

A major contributor to the bottomline was investments by Tencent, which brought in 7.6 billion yuan in gains.

Its latest results soothed fears that outsized spending would hammer profitability. It's also secured Chinese distribution rights to some of the world's hottest games, from PlayerUnknown's Battlegrounds to Fortnite, adapting them to draw in smartphone users.

The social media and gaming firm had posted on Wednesday better-than-expected net profit and gross profit margin for the first quarter, driven by the strong performance of its mobile gaming business and gains in its sprawling investment operations.

Tencent's ADRs surged 6.8 percent in US trading after earnings were released.

Still, shares of the company are still over 12 percent lower from the record high hit in January. Not only can this add to the moat and diversity of Tencent's operations, emerging rivals can also be turned into members of the group at an early stage. Analysts tracked by Thomson Reuters have a mean price target of 513.41 Hong Kong dollars, representing a more than 23 percent rise from Thursday's trading price. But adjusted earnings-per-share, which strips out one-time items, came to 1.92 yuan, missing the 1.94 yuan average estimate.

More news: Everton Announces Departure of Sam Allardyce

Hong Kong - Tencent Holdings is silencing the sceptics.

Tencent has historically done well in the games space with the PC its cash cow, but previous year its smartphone games business overtook that of PC based on revenue. The company announced that had seen growth in the double digits related to the number of daily active users for that game.

Honour of Kings continues to be a core source of earnings.

But overall costs surged 51 percent.

Tencent's gaming business has historically done well, with the PC games segment being the company's cash cow for a long time.

"We will continue to invest in improving our own products as well as enabling services for our partners", founder and Chief Executive Officer Ma Huateng said in a statement. The combined MAU of Weixin and WeChat amounted to 1.040 billion, up 10.9 percent year-on-year and from 989 million sequentially.

Revenue from PC games was flat compared to previous year, but analysts believe the comparison was tough with the 2017 first quarter, and overall its games business was strong. Gaming revenue was up 26%.