Tencent reports second-quarter profit, revenue rises amid strong performance of gaming units by Investing.com

Tencent Holdings (OTC: ) saw its earnings accelerate in the second quarter on the back of the successful summer release of Dungeon & Fighter Mobile, pulling China’s most valuable company out of a slump in its games division.

For the April-June period, revenue rose 8 percent to 161.1 billion yuan ($22.5 billion), slightly below estimates of 161.4 billion yuan. Net income rose to 47.6 billion yuan, beating expectations of 39.9 billion yuan.

Tencent shares in Hong Kong ended Wednesday down 1.27 percent.

With the Q2 report, the world’s largest game publisher ended two consecutive quarters of declining performance in its games segment, thanks to the May launch of Nexon Co.’s DnF Mobile in China.

Tencent’s widely used app WeChat also contributed to growth, boosting ad sales and generating transactions for virtual items and e-commerce through mini-programs and TikTok-style video streaming.

DnF Mobile topped China’s top-grossing game charts, with investors hoping Tencent will benefit from its long-term popularity, similar to the success of Honor of Kings.

The company reported that its China business generated revenue of 34.6 billion yuan in the second quarter, marking a 9 percent year-over-year increase, up from 3 percent growth in the first quarter. In addition to the successful launch of DnF Mobile, higher sales from Valorant also contributed, Tencent said.

“DnF Mobile, a recently released game, has re-energized millions of IP (intellectual property) fans and is retaining players well, positioning it to become our next major evergreen hit,” Tencent said in its earnings release.

International gaming revenue also saw a 9% year-on-year increase to 13.9 billion yuan.

Shares in Tencent, which operates WeChat, have risen more than 27 percent this year, in contrast to a 10 percent decline in the Hang Seng Tech index.