Facebook’s biggest challenge is to convince the public that further growth will not obliterate society. Tencent, with a HK$4.4tn ($560bn) market cap, faces no such difficulty in persuading investors that its growth can stick.
On Wednesday the group announced annual revenues of Rmb237bn ($37bn) — 56 per cent more than the prior year. This undershot market predictions, but profit margins gained slightly. Some had feared pressures from growth investments and China’s merciless online competition could increase.
While the group’s core gaming business suffered a weak quarter, investors should take heart from the fourth quarter’s advertising revenues, which were higher by half than a year ago, comprising almost a fifth of the total. In the past the group was criticised for not growing the segment aggressively enough.