Profit of 100 billion yuan: relies games, advertising and micro-letters, you afraid of it
If the restraint is home to Tencent company, no one would argue.
The latest 2019 reported a 2019 full-year revenue of 377.289 billion yuan, the market is expected to 376.445 billion yuan, a year earlier to 312.694 billion yuan, up by 21%. Net profit of 93.31 billion yuan, the market is expected to 94.315 billion yuan, a year earlier to 78.719 billion yuan, up by 19%.
User data, competitive products QQ micro letter dated live up to the user 1.16 billion, an increase of 6.1%. Cash cow game business in the "glory of the King" and "Peace elite" driven by continued growth, 2019Q4 an increase of 25%.
Source: announcements, news research department this interface slightly more than expected earnings, the annual report is the first full post-split Tencent new business. From 2019Q1 start, Tencent updated revenue categories, headaches in previous years, "other income" in order to split the financial and business services and other technology. As a result, the proportion of "other income" fell from 25% to about 2%.
Split income revealed two reasons, one is the "other" income is too large, is not conducive to investor communication, on the other hand, Tencent also think time is ripe, it's time to pull out of this business and meet people.
Financial technology and corporate services also deliver the goods, and revenues maintained a strong momentum of growth at 39%, gross margin increased from 25% in 2018 to 27% in 2019.
But Tencent's traditional business has shown little signs of fatigue. In particular, the growth rate of online advertising sector is only 18 percent, a slight slowdown. Among both objective reasons, but also for their own micro-channel Tencent realized restraint. But as a market value of over 3.1 trillion giant, the financial technology and corporate services separately disclosed, sufficient to show its ambitions.
Crisis other than restraint
Despite holding the micro-channel QQ this cosmic flow inlet, the company's advertising business is still short board, which risks and opportunities.
Annual Report of view, its advertising revenue in 2019 was 68.38 billion yuan, including two social media as well as part of the business. Among them, social advertising is mainly micro-channel circle of friends, applets, and advertising revenue QQ Aspect, which is part of every quarter has maintained an over 30% growth; media advertising revenue fell 15% year on year, continuing the downward trend earlier.
Tencent advertising business ARPU 59 million, significantly lower than the peer, Facebook (FB.O) advertising ARPU was 198 yuan, Baidu advertising ARPU 71 million.
Source: Network interface Tencent News Research weak advertising business, Tencent internal problems both institutions, but also within the Framework restraint micro letter.
Tencent past strategy has been to develop new traffic between the existing and fully developed flow swing, 2017, the rise of the short video Tencent attracted to open up a new traffic on this road, which invested heavily in the micro view, the strategy failed when the micro view Tencent only to find good existing cash flow cost much higher.
After going around in circles, Tencent micro letter finally want to be effective, and in addition to the micro-channel payment, that is, three-piece micro-channel advertising, including the circle of friends, and a small number of public advertising procedures.
However, Tencent is clear that there are many problems in practice, this is not just a "restraint" will be able to explain.
First, execution of strategy in Taiwan Tencent.
Tencent 2018 proposed the strategy in Taiwan. Take micro-channel circle of friends ads, Tencent be without violation of user privacy, to the user in order to push advertising portrait, it is bound to need a table in the integrated treatment of all kinds of information "non-private", and only open up the interior wall of the establishment more connection points, in order to obtain more comprehensive information. However, some time ago from the micro-channel block QQ small program, in which the internal wall is far from Tencent get through.
Even by interpretation Tencent micro-channel domestic and foreign alike, it is difficult to say in the past. According to the Coase theorem, the meaning of existence of the organization is to make internal transaction costs less than an external transaction costs, Tencent doing now is not the equivalent of inside and outside, respectively, the efficiency of the organization can not be realized.
The second, late Tencent micro-channel video resolution.
Micro-channel hopes to find the point of the video signal of the user between private and public domains domain, but some late start.
In recent months, there has been a very clear trend, and that is the public copy number of the video.
The "food systems wearing boss", "semi Buddha immortal" and other such public head number, account has been opened at the station B, the public number of articles video, video length is generally 10 to 20 minutes. In fact, the difficulty of making this type of video is not, it is to copy the public with a certain number of video clips.
In the video version, see the graphic version of the attractive natural micro-channel public number dropped dramatically.
Micro-channel video opening number, it is difficult to prevent the outflow of long content, because micro-channel in the fancy long video, out of chat is very convenient to have a greater need for adjustments to the micro-channel interface and interaction.
Short content should now be the main direction of micro-channel video numbers, but ecology is not yet fully established, the current CCTV and other official media contributed main content. To steal it, and vibrato of video traffic, Zhang Xiaolong also need to support a greater number of video traffic.
Third, the crisis of confidence Micro One "Delete Library" event.
February 23, SaaS providers Micro One employee suffered a "delete database", a large area of server failure, one million businesses affected.
Tencent micro League both investment company, its SaaS business also "parasite" on the micro-channel can be said that Tencent's "little brother." Micro One early for the applet rattling in all sectors of the floor, and now this effect will be the same bite. Micro-channel with its "SaaS technology alliance" is facing a crisis of confidence, and that is how to ensure the safety of small micro-channel program.
At the same time, rival Alipay announced a comprehensive upgrade to digital life open platform, through an open platform strategy to help businesses achieve 40 million under the line digital upgrade.
This competition for private business domain traffic entrance war continues, micro-channel may be necessary to take on more responsibility in terms of security, improving existing infrastructure, so as to win back the trust of businessmen.
One investor told the news interface, he Tencent most important investment is its greater potential profit border.
Boundaries are potentially profitable enterprises without weakening competitive advantage, can achieve maximum profitability. Can be simply divided into three cases, one can not raise prices but to raise prices, and second, there is traffic and customers but not fully realized, three is a lot of investment in R & D investment in fixed assets or down the short-term profits.
Tencent is clearly the second. Liquidity micro-channel advertising, decided Tencent advertising can reach the heights, which is currently Tencent weak point, it is also a potential flashpoint.
Financial technology ambitions
Tencent micro-channel B-side for restraint, for ambitious financial technology.
Specifically, the financial technology refers to the micro-channel pay-related businesses by 2019 to achieve revenues of 84.35 billion yuan, business services refers to the Saas, IaaS and PaaS, cloud-based public service business, 2019 revenues of 17 billion yuan.
Fee is still the main source of income to pay the micro-channel, micro-channel charge a turnover of 0.6% to 1%, thus derived from financial operations also include the total size of 800 billion yuan financing through, the total size of the particles and other loans 300 billion yuan.
Behind the rapid growth of financial technology business, there is a set of data worthy of our attention. According to Tencent released "Economic Impact Report on the Code", as of 2019, over 50 million individual businesses and businesses active in the micro-channel payment platform, accounting for 79.4% of the total number of individual industrial and commercial households.
This means that the micro-channel future payments under the merchant's online penetration enhance aspects, may have little space.
In the past, relying on micro-channel payment convenience to micro-letter, we occupy the leading position in micro-payments, but with the penetration of micro-payment increase, which will be part of the dividend or suffered. Micro-channel pay future Alipay front Yingkang on large payments, according to Analysys data, micro-channel payment transactions in the payment of the total market share in third-party mobile currently nearly 40%, still lags behind Alipay.
Source: Analysys Tencent to enter the field of large-value payment Ali is also heavily armed, such as in the field of new retail Ali commercial operating systems, medical and health fields Ali (00241.HK) and so on.
Tencent in these areas to be able to do much, depend on the strength of its industrial transformation of the Internet.
Currently, Tencent total of six business groups, in which the newly formed cloud and wisdom Industry Business Group (CSIG) assumed the main task of the industrial transformation of the Internet, which is the main source of revenue of the financial sector technology, deep vertical industry sectors including retail wisdom , health care, education, travel, manufacturing, and other smart city.
Tencent also continue to overweight in this area. According to Tencent official micro news, Tencent is currently being recruited community of more than 5,000 jobs in 2020 than in 2019, the year the number of jobs to enhance more than 25%, which increased demand for the fight against SARS many jobs Tencent services products, including medical Tencent, Tencent meetings, corporate micro-channel, micro-channel search with a search applet, Tencent wisdom, education, government and other Tencent wisdom.
Earnings report also specifically pointed out the contribution of Tencent Tencent and meeting the health of the epidemic. Tencent meeting within two months since the launch of the end of December 2019, the number of days over 10 million active accounts. Medical, health has become more than 300 million Tencent micro-channel users to access data in real-time epidemic, an important channel for online inquiry and AI self-diagnosis and other services.
With in-depth industry Tencent layout of the Internet, can be expected, Tencent investment in R & D efforts will be further enhanced.
In the global head of Internet companies, Tencent both R & D investment minimum absolute value of 304 billion yuan, is put in the minimum proportion of only 8%. 2019 fiscal year, Amazon (AMZN.O) the absolute value of the highest R & D spending, or about 250.7 billion yuan, Facebook (FB.O) R & D expenses accounted for the highest proportion of revenue, was 19.2%.
Source: Web, announcements, news interface research from a historical perspective, from 2007 to 2015, Tencent R & D investment accounted for the proportion of revenue remained at between 8.5% to 10%, from the beginning of 2016, the first decline in this ratio to 8% the following 2017 and 2018 for two consecutive years remained at historically low level of 7.3% until 2019, Tencent R & D investment ratio was Guaitou trend has emerged.
Tencent R & D is undoubtedly efficient, spend less money to maintain growth. This and Tencent related to the game as the main industry, 2019, game three percent of its revenue, about half of the gross profit contribution, so the content Tencent developed a large part of the game naturally, this and other Internet companies are very different. By the end of 2015 on the line "glory of the King" is Tencent found a "money machine" that can Tencent down in subsequent years the proportion of R & D investment.
Source: Annual Report, Tencent Internet industry in-depth research news interface is bound to increase the degree of overlap with Ali business R & D intensity is also expected to emulate Ali. From past cases to see Ali, its R & D investment accounted for the proportion of revenue between 9% and 14.5% fluctuations, significantly higher than the overall Tencent. The next few years, Tencent's R & D investment accounted for the proportion of revenue may be restored again to its historically high level, that is, more than 9%.
As a market value of over 3.1 trillion super giant, Tencent still able to maintain double-digit profit growth, some really terrible. Games and has two leading products of micro-channel Tencent, looking in the short term will inevitably focus on financial technology. All this has only just begun
