Tencent Shares Surge On First Quarter Results

Shares in internet giant Tencent surged as much as 7 percent in Hong Kong on Thursday after it announced profits jumped two thirds thanks to income from its online games and advertising businesses.

The company said its first-quarter net profit surged 61 percent to 23.3 billion yuan in the three months to March, outstripping forecasts.

Shares in the firm soared in early trading before ending up 3.74 percent at HK$411.00.

Its total revenues rose 48 percent to 73.5 billion yuan,with online game revenues up 26 percent, mainly driven by smartphone offerings, including the popular "Honour of Kings" and newly launched "MU Awakening".

The Shenzhen-based firm's strong results come after it invested in cloud computing, entertainment and physical retail, while also securing mainland distribution rights for some of the most popular games in the world.

"Its margins were better than people expected," Julia Pan, a Shanghai-based analyst at UOB Kay Hian, told Bloomberg News.

"Analysts were expecting a drag on margins because of increasing contribution from cloud and payments, but it looks like Tencent was pretty good at controlling costs." (AFP)