4. Tencent Holdings Ltd.

Revenues 2020: RMB 482.100 billion (€ 61.220 billion)



Tencent became famous with the universal app WeChat, and is now the third most valuable company in Asia according to market capitalisation (after Saudi Aramco and Alibaba, as of 31.3.2020). In addition to the WeChat platform, without which, it is said, "it's almost impossible to get by in China", Tencent operates the world's largest video and online games company. Plus film, television, music and books: Tencent is one of the three Chinese tech giants ("BAT": Baidu, Alibaba, Tencent), many also speak of the "Chinese Disney".

General Information


Head Office:
Tencent Binhai Towers
No. 33 Haitian 2nd Road
Nanshan District
Shenzhen, 518054
Telephone: 0086 755 8601 3388
Website: www.tencent.com/en-us/investors.html

Branches of trade: Online Games, Social Media, E-Commerce
Legal type: Corporation (investment holding company)
Financial year: 01.01. - 31.12.
Founded: 1998

Basic Economic Data
Revenue (RMB m)482,064377,289312,694237,760151,938
Net income (RMB m)281,172119,901142,120116,92584,499
Share price (US$, year end) 56638340.6251.9224.22
Employees 85,85862,88554,30944,79638,775

Executives and Directors



  • Ma Huateng, Co-Founder, Executive Director, Chairman of the Board & Chief Executive Officer
  • Lau Chi Ping, Executive Director and President
  • Jacobus Petrus (Koos) Bekker, non-Executive Director
  • Charles St. Leger Searle, non-Executive Director
  • Li Dong Sheng, non-Executive Director
  • Iain Ferguson Bruce, non-Executive Director
  • Yang Siu Shun, non-Executive Director
  • Ke Yang, non-Executive Director

  • Xu Chenye, Co-Founder, Chief Information Officer
  • Ren Yuxin (Mark Ren), Chief Operating Officer
  • Zhang Xiaolong (Allen Zhang), Senior Executive Vice President, President of Weixin Group
  • James Mitchell, Chief Strategy Officer, Senior Executive Vice President
  • Tong Taosang (Dowson Tong), Senior Executive Vice President, President of Cloud and Smart Industries Group, Chairman of Tencent Music Entertainment Group
  • Lu Shan, Senior Executive Vice President, President of Technology and Engeneering Group
  • David Wallerstein, Chief Exploration Officer, Senior Executive Vice President
  • Ma Xiaoyi (Steven Ma), Senior Vice President
  • Lin Ching-Hua (Davis Lin), Senior Vice President
  • John Shek Hon Lo, Chief Financial Officer, Senior Vice President
  • Guo Kaitian (Leon Guo), Senior Vice President
  • Xi Dan, Senior Vice President
  • Yeung Kwok On (Arthur Yeong), Senior Management Adviser



Today Tencent and its celebrity founder, Ma Huateng (Pony Ma), are synonymous with China’s innovation and leadership in the internet sector. When the company was founded in Shenzhen in November 1998, however, its internet services were derivative and uninspiring in a crowded field of major operators of “internet service portals” launched between 1996 and 1998, including Sina, Sohu and Netease. These portals, prohibited by regulations from maintaining their own newsgathering operations, were not regarded as “media,” but seen largely as entertainment sites that aggregated content, including news from licensed traditional outlets. They managed, however, to find creative ways beyond news aggregation to provide additional content offerings in a bid to “attract eyeballs” and draw ever larger audiences to promise advertisers.

Tencent’s desktop-based instant messaging product, OICQ, launched in February 1999, was a virtual carbon copy of ICQ, a service created two years earlier by the Israeli company Mirabilis. A trademark infringement case brought by ICQ owner AOL later that year forced Tencent to rename its service “QQ.” But the QQ messaging service soon distinguished Tencent services from those of its competitors. The service was free to use, and its popularity grew quickly among young internet users, particularly university students.

In 2001, at a time when Tencent was still, according to one industry analyst, "unprofitable and not well known," South African publishing group Naspers acquired a 46.5 percent stake in the company for 32 million dollars through a subsidiary, MIH Holdings. The attraction was Tencent's growing user base and popular messaging service. “Tencent was identified reasonably early on due to the number of users they were starting to attract and the ‘stickiness’ of their instant messaging service," a Naspers executive later told the South China Morning Post. Naspers had a track record of unprofitable media investments in China and had considered exiting the market altogether. But the Tencent investment would pay off big time.

By the end of 2001, QQ had already reported more than 90 million registered users. By 2003, Tencent was the clear leader in instant messaging, followed by Netease, with Sina struggling to compete. Users of QQ were predominantly in the 15-29 age group, and online often referred to themselves as the “Q generation,” showing a high degree of self-identification with the service. It was this “stickiness” that attracted Naspers and other investors. The service’s mascot, a cuddly, egg-shaped Penguin, became iconic in China. By the time Bloomberg profiled Tencent in 2011, it could report that the company’s QQ messaging service has “twice as many users as the U.S. has people.”

On June 16, 2004, Tencent listed on the Hong Kong Stock Exchange, joining a wave of Chinese internet companies seeking public listings. Its instant messaging service still dominated discussion, Shanghai’s iResearch noting ahead of the listing that nearly three-quarters of Chinese respondents in its survey of messenger services reported using Tencent’s QQ, handily beating out competitors such as Microsoft's Messenger, Popo (Netease), and Yahoo! Messenger. But Tencent’s next area of expansion was already in the works. The company had launched a subsidiary, Tencent Games, in 2003, with plans to move strongly in this direction. In 2004, Tencent launched its first suite of online games, “QQ Tang,” which came free with downloads of QQ software and were monetized with for-purchase game accessories and fee-based subscriptions. Beyond these casual games, Tencent began licensing hardcore games, beginning with the massive multiplayer online game (MMOG) “Sephiroth” from South Korean developer Imazic. Tencent continued push into online gaming through 2007 and 2008, licensing games like Dungeon & Fighter from South Korea’s Neople, and capitalizing on its online community base of nearly 300 million active users. At the same time it began exploring development of its own games and acquisition of key developers. Tencent’s focus was on games as a service (GaaS) – also known as “live-service games” – offering video game content on a continued revenue model that allowed them to be monetized after their initial sale or free download with the purchase of new content.

In 2011, Tencent paid 400 million dollars for a 93 percent stake in Riot Games, creator of the hit game League of Legends, becoming its largest shareholder. By 2015, when Tencent would buy the remaining stake in the company, League of Legends was "exploding as an esport around the world." In 2012, Tencent invested 330 million dollars in Epic Games, the creator of hit games like Fortnite and Paragon. The marriage of Tencent and Epic Games marked an important turn for the industry as a whole, allowing a major developer to make the shift from console to live-service games on the basis of Tencent’s huge user community and reach in China. In 2018, Tencent was part of a group of investors in the French game developer Ubisoft that helped it fend off a hostile takeover from the French mass media conglomerate Vivendi. Tencent's share acquisition also marked the start of a strategic partnership with Tencent to publish Ubisoft games in the Chinese market.

Tencent’s bold moves in the online game industry have made it the world’s largest video game company today. The gaming business was the company's chief money maker in 2019, accounting for 18 billion in annual sales, about 40 percent of Tencent’s total revenue.

But the boom of online gaming has also come with challenges and controversies. Video game content has come under stronger government scrutiny in China in recent years, with regulators even introducing curbs on the licensing of new games. The pressure to censor games that are now global in reach to satisfy domestic political needs has prompted sharp criticism internationally. In November 2018, for example, Ubisoft announced that it would remove bloody scenes and references to sex and gambling to its popular Rainbow Six Siege game to prepare for the Chinese and other Asian markets. This drew a backlash from fans of the game across the world, who accused the company of bowing to Chinese censorship. Given the huge revenue potential of games, other Chinese companies, including traditional rivals like Netease and upstarts like ByteDance, have also increased competitive pressures on Tencent.

On 21 January 2011, Tencent launched a new messaging app called Weixin, in German "Mikrobriefe", which would revolutionise the communications landscape in China within a few years. At the time of launch, the free Weixin (initially for the iPhone) was compared to Canada's Kik and other services - but the wide range of features and platforms found under the app's umbrella would soon set Weixin apart from other global social media platforms like Facebook. In April 2012, shortly after the launch of the Android version, Weixin was renamed WeChat overseas and a number of features were added. By August 2012, the service had 100 million users. On the back of this immense user base, major international brands such as Nike began to flock to the platform. Soon there were more mobile than desktop users in China.

While analysts in 2012/2013 were still comparing WeChat to platforms like WhatsApp (which had been around since 2009), it became clear that WeChat was developing into its own user universe. What some called a "super app" or "super platform". "The phenomenal thing about the app," says Ben Lamb, a digital marketing specialist based in Shanghai, "is that you can use it for so many services, so you're constantly using it." Soon, nothing went without WeChat. By the end of 2012, the platform had more than 200 million users.

True, WeChat's importance as a commercial tool increased. But this success could not be seen in isolation from the growing political problems facing China's hugely popular social media platform Weibo (similar to Twitter, run by Sina Corporation, ranked 84th in the current IfM ranking). Weibo had become a social and political force only a year after its launch in 2009, an open platform through which many millions of Chinese could discuss current news and other issues. Journalists and intellectuals with millions of followers gained more influence than the major newspapers.

By 2012, it was clear to the Chinese leadership that even with automated and other controls, Weibo was becoming a problem for the Communist Party. Then in 2013 and 2014, the leadership moved aggressively to silence the "Big V's" in particular: Verified members, known Weibo users who could influence public opinion. After the state interventions, Weibo became boring for many. People switched to WeChat, which offered a more diverse user experience - with Moments timelines (similar to Facebook), so-called "public accounts" that acted like blogs, and private chat groups (similar to WhatsApp). If Weibo was like a giant banquet hall where everyone could be seen and heard, WeChat was less public.

At least initially, media controllers favoured the more compartmentalised nature of WeChat. Here, it was much harder for discussions about breaking news to attract mass attention. But the immense popularity of WeChat made "information control" necessary after all. Since 2013, the platform has been frequently criticised for censoring the activities of users outside China by blocking sensitive keywords.

With the implementation of payment services, WeChat became a real super-platform in 2013. Competitors like Alibaba have also had success with mobile e-commerce. But WeChat's ubiquity proved to be a clear advantage. WeChat had more than one billion monthly active users by the end of 2019, and WeChat Payments can be used to make purchases both online and in-store. Tencent's WeChat platform remains "sewn into the lives of the Chinese people", as the Financial Times noted. But like all great Chinese technology and media companies, its success comes at the cost of ever-increasing government vigilance - Tencent must continue to maintain close ties with the state. Which, viewed from the outside, can certainly be seen as problematic. Domestically, Chinese authorities have heavily censored WeChat and a number of Tencent's other products, particularly games. Since 2018, a number of popular games - including Honor of Kings, one of Tencent's most successful games - have been suspended or banned outright on the grounds that they encourage online gaming addiction among youth. Dealing with regulators is both a burden on business development and a prerequisite for being able to continue at all. The government's attitude is simple: "If we want to turn off the money spigot, we turn off the money spigot." The censorship of WeChat is unmistakable, even neutral references to the government that come from state media are removed. Which is reminiscent of the kind of censorship Sina's Weibo experienced in 2013-2014, and which contributed to the rise in popularity of WeChat.

Concerns about data espionage have always been a problem for Chinese tech companies like Tencent that are expanding internationally. In May 2019, after the Trump administration issued a trade blacklist order for Huawei and telecoms equipment maker ZTE, Tencent's CEO Pony Ma warned that this could create a "prolonged tech war" between the US and China. In light of these tensions, Ma also expressed concern that China, whose internet development is largely based on developing application-based products as opposed to high-end products, may not be prepared for such competition. The era of "borrowing", as Ma put it, is over for Chinese firms anyway, he said. "If we don't make efforts to develop our own infrastructure and core technology, the digital economy in China will be difficult to sustain."

Tencent's advertising business has recently been challenged on two fronts: by the overall slowdown in China's economy since 2018, and by fierce competition at home, both from emerging companies like ByteDance and traditional rivals like Baidu and Alibaba. In the cloud and fintech space, for example, Alibaba is currently the biggest domestic competitor.



As of February 2021, Ma Huateng (known as Pony Ma), co-founder of Tencent born in 1971, was China's richest man with US$ 73.4 billion, ahead of Alibaba founder Jack Ma (US$ 62.3 billion), according to Forbes. Huateng is a respected figure in the Chinese and global tech scene, and at the same time of particular importance for the Chinese Communist Party. Ma is a good example of the close relationship between the executives of top Chinese companies and the political leadership, and is also a delegate of the National People's Congress.

The question of who will succeed him remains open. In January 2020, he sold $260 million worth of Tencent shares "for personal financial reasons". The move, which coincided with Ma's resignation as chairman of fintech division Tenpay Micro Loan and followed his resignation from Tencent Credit in September 2019, sparked speculation that he may soon also withdraw from stakes in "non-core" businesses.

Lau Chi Ping (Martin Lau), born in 1973, is the current executive director and president of Tencent Holdings, the number two in the group with an estimated fortune of two billion euros. He previously worked at Goldman Sachs as Chief Strategy and Investment Officer, and joined Tencent in 2005. Born in Beijing, Lau grew up in Hong Kong and studied in the US. He led a series of major acquisitions by Tencent, including that of Finnish mobile device developer Supercell in 2016, for $10.2 billion.

Business Units


Communication and social media:
Weixin (founded in 2011, known as WeChat outside China) remains the heart of Tencent's social media business, with 1.2 billion monthly active users (MAU) reported for March 2020. In the comprehensive WeChat cosmos, users shop, pay, order their food and more. The app has even become the most popular means of exchanging personal and business contacts in face-to-face meetings. Tencent's QQ messaging platform for mobile phones (since February 1999) recorded 768 million MAU in March 2020. In 2005, Tencent launched Qzone, a networking/blogging service integrated with QQ, now one of the world's leading social networks with 808 MAU in the second quarter of 2019.

Digital Content:
Tencent Games, i.e. the online games business, remains the group's most important sales driver and relies on its huge social media user base. And as for e-sports, the electronic sporting competition with computer games: Tencent owns a large part of this rapidly growing global industry. The Tencent Esports division owns some of the most important games and organises eSports leagues and tournaments.

The Tencent Music Entertainment Group not only owns China's largest music apps (QQ Music, Kugou, Kuwo, WeSing) with a combined total of over 800 million MAU. Tencent Music's share in the world's largest music company Universal Music (part of Vivendi, 19th place in the current IfM ranking) is 20 per cent, plus nine per cent in Spotify (31st place in the current IfM ranking) and two per cent in Warner Music Group (third largest music company worldwide, part of Access Industries, 44th place in the current IfM ranking). Tencent Music has also signed distribution agreements with international players in recent years, including Warner, YG Entertainment and Sony.
Tencent Video was founded in 2011 and provides streaming and video-on-demand services for mobile phones. As of June 2019, Tencent Video had 96.9 million subscriptions. The international version of the service is called WeTV.
The group's own film production unit, founded in 2015, is called Tencent Pictures, owns six studios and produces, distributes and markets for cinema and TV. In China, soon to be the world's largest market for cinema films. Tencent Pictures was involved in the Chinese blockbuster "The Eight Hundred", the most successful production worldwide in 2020. "China challenges Hollywood", according to Der Spiegel of 5.2.2021.
Tencent Animation and Comics is the largest anime platform in China with 120 million MAU and 30,000 online anime comics. Since March 2019, it also has an international version in English and Indonesian, WeComics.
China Literature Limited operates the leading Chinese literature platform with, as of June 2020, 8.9 million authors and 13.4 million online literary works in 200 genres. Tencent share: around 57 per cent.
Tencent Sports ("China's leading internet sports media platform") owns internet broadcasting rights for headline global sporting events such as the World Cup, Olympics, French Open, Formula One, NBA, MLB, NHL, NFL.
Finally, Tencent hosts the popular news app Tencent News. Regularly, and unsurprisingly, this comes into conflict with censorship authorities, e.g. in January 2019, when the Chinese Cyberspace Administration accused the Tencent app of being "vulgar, negative and harmful", and "damaging the online world".

FinTech and Business Services:
Tencent has an expanding "fintech" business, which together with "business services" accounted for 27 per cent of revenue in 2019. Tencent has also been expanding its cloud computing business for corporate clients.

Commitment in Europe


In December 2019, Tencent announced plans to invest 10 billion dollars in Europe in 2020, about a third of this in Germany. One key focus of expansion for the company in Europe has been its cloud service, as traditional European manufacturers look to digitalize operations. Li Shiwei, the European chairman of the Tencent Cloud division, said Tencent had plans to create 2,000 to 3,000 jobs in Europe in the coming three years. In light of its ambitions for expansion of cloud services in Europe, Tencent has been actively exploring viable locations for related data centers. In late 2019, the company met with government officials in Serbia to plan for a possible cloud service data center in the country, which expects to join the European Union in 2025. On the cloud service front, however, Tencent may face some skepticism in Europe in light of general concerns in some member states over national security, technology theft and data privacy.

Tencent, which has rapidly expanded its mobile wallet service in recent years, has also identified Europe as the “next key market” for cross-border development for the WeChat Pay service. The expansion of WeChat Pay option in Europe comes on the back of rapid growth in Chinese tourist flows, and allows Chinese traveling in Europe to pay for goods and services in Chinese RMB using their mobile devices – potentially drawing key market share from Chinese card companies. “Together with our global partners, we hope to extend the convenient experience of WeChat Pay overseas,” said Tencent’s Dave Fan in May 2019, “so that global businesses can share the dividends of China's growing outbound travel market."

Tencent has made continued investments in Europe in a range of areas over the past few years, including video games, music and entertainment, and fintech. In January 2020, Tencent made a 138 million dollar bid to acquire the Norwegian game developer Funcom. The same month it made a 104 million dollar investment in Qonto – the largest funding round to date for a French fintech company. In an interesting twist for European investment markets, the South African media firm Naspers, which owns 31 percent of Tencent, created “Europe’s biggest consumer internet company” with the Euronext listing in September 2019 of its Prosus unit. By spinning off the Prosus unit, which includes the Tencent investment, Naspers said it hope to “draw in a more diverse crowd of shareholders than it currently has,” and establish Prosus as “a tech giant in its own right.”

Beyond its business presence in Europe, it is important to note that the WeChat platform remains indispensable terrain for European brands looking to access Chinese consumers.

Current Developments


In the United States, after months of investigations, some antitrust watchdogs are now calling for the big tech companies Google, Amazon, Facebook and Apple to be broken up (they are "overpowering platforms" with a gatekeeper position). Now Beijing is also "taking stricter action against the Chinese tech industry" (Handelsblatt, 20.01.2021), which for years profited not least from the fact that competitors from the USA were locked out by the "Great Firewall". Jack Ma, the richest Chinese and co-founder of Tencent competitor Alibaba, disappeared from the scene for three months after he criticised the government in a speech in Shanghai at the end of October. Why was he gone after that? Where did he stay? Unknown. Then, at the end of January 2021, he appeared somewhere in front of a mural and said, "During the past time, my colleagues and I have been learning and reflecting, and we have become more determined to devote ourselves to building the common good"

"China puts Alibaba, Tencent and Co. on a leash", headlines the Neue Zürcher Zeitung on 9 February 2021. The everyday lives of Chinese people are now completely dominated by tech platforms, such as Tencent's all-encompassing WeChat app; because the big Chinese tech corporations can look back on years of largely unchecked, unregulated growth. This is now to come to an end. Especially with regard to fintech services, regulators are publishing stricter rules, and violators are now being cracked down on more severely. As in the US, "the era of unbridled tech giants in China seems to be coming to an end." (Kai von Carnap, analyst at the Berlin-based China think tank Merics).