Tencent has released its report for the fiscal year ending December 31, 2021. The tech giant still remains the largest game company by revenue, although domestic restrictions continue to slow down its growth.

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Key takeaways

  • Total revenue for 2021 was $87.8 billion, up 16% year-over-year. It is lower than analysts’ expectations of $88.8 billion.
  • Operating profit was around $25 billion, up 7% year-over-year.
  • Tencent’s gaming revenue was $32.94 billion, which is up 9.9% when compared to FY2020.
  • According to Niko Partners senior analyst Daniel Ahmad, the growth was driven by the company’s mobile games and its overseas titles like PUBG Mobile, Brawl Stars, Valorant, and Clash of Clans.
  • When looking at figures for the fourth quarter of 2021, Tencent reported a revenue of $22.62 billion (up 8% year-over-year). It is the slowest quarterly growth in the company’s history.

The slowdown might be due to Chinese authorities’ toughened regulation of the domestic games industry. As a result, around 14k studios closed in the country between July and December 2021. Tencent has also lost around $470 million in market value since the beginning of 2021.

Despite all the issues, the Chinese tech giant is still the number one company in the world by gaming revenue. In comparison, Sony, Microsoft, and Nintendo had much smaller revenue last year — $24.8 billion, $16.2 billion, and $15.3 billion respectively.