Things are looking good for Tencent Holdings, who has quietly overtaken Sony and Microsoft at the top of the gaming market. Tencent has made several, nearly 180 smaller-scale investments, a sharp contrast to the splashy moves that the other two tech companies have grabbed headlines with. According to research firm Newzoo, Tencent led the industry in game-related revenue last year at $32.2 billion, way more than Sony’s $18.2 billion or Apple’s $15.3.
Tencent’s large lead can mostly be attributed to the company’s wide-ranging portfolio, which includes companies all over the world. A surprising 40% of Tencent’s investment deals in the first half of 2022 were outside China, a major increase from the 18% share for all of 2021.
Tencent’s vast portfolio includes Riot Games (League of Legends), Supercell, Epic Games (Fortnite), and Krafton (PUBG), just to name a few.
Unfortunately for Tencent, they are faced with many challenges at home in China where gaming restrictions and regulations have hampered their GDP. Since the government began re-issuing gaming licenses to domestic companies in April, Tencent has yet to get the green light for any titles, a very noticeable omission.
But thanks to its savvy international investments, the company has continued to thrive. Other Chinese big-tech companies like Alibaba Group Holding have struggled mightily in the wake of regulatory crackdowns, and might look to take a page out of Tencent’s book if they want to rediscover that past glory.
(All information was provided by Nikkei Asia)
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