0700.HK - Tencent Holdings Limited

HKSE - HKSE Delayed Price. Currency in HKD
+7.200 (+2.23%)
At close: 4:08PM HKT
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Previous Close323.000
Bid330.000 x 0
Ask330.200 x 0
Day's Range325.200 - 330.200
52 Week Range260.000 - 400.400
Avg. Volume15,199,236
Market Cap3.154T
Beta (3Y Monthly)1.28
PE Ratio (TTM)34.79
EPS (TTM)9.491
Earnings DateNov 13, 2019
Forward Dividend & Yield1.00 (0.31%)
Ex-Dividend Date2019-05-17
1y Target Est388.16
  • Tencent Falls $90 Billion Behind Alibaba After NBA China Row

    Tencent Falls $90 Billion Behind Alibaba After NBA China Row

    (Bloomberg) -- Just a year ago, Tencent Holdings Ltd. locked up one of the most coveted media franchises in the country when it paid $1.5 billion for five years of exclusive streaming rights to National Basketball Association games. A single tweet changed all that.Now, the Chinese social media giant may have to suspend airing those matchups -- which drew half a billion viewers last year -- after Houston Rockets General Manager Daryl Morey triggered a media blackout in China by tweeting support for Hong Kong’s pro-democracy protests. That sums up a disappointing 2019 for a company that looked like it was back on track after a horrendous 2018.At stake now for Tencent are billions of dollars in ad and subscription revenue, along with its strategy of becoming a go-to online destination for entertainment beyond gaming. Tencent was supposed to hit the comeback trail this year after a nine-month freeze on game approvals gutted its most profitable business in 2018. But a sharp Chinese economic slowdown, competition from up-and-comer ByteDance Inc. for internet traffic and advertising, and now tricky political considerations is snarling that recovery. That’s a key reason its stock has vastly under-performed arch rival Alibaba Group Holding Ltd. this year, creating a gap of more than $90 billion in their market valuation.“One of China’s biggest companies, who does everything right politically, stands to lose billions due to the political issues outside of its control,” Mark Tanner, founder and managing director of Shanghai-based consultancy China Skinny. “We’ve seen how the company has toed the line with the gaming rules recently and I expect they will be even more careful with this one.”Read more: Tencent-Against-Alibaba Bet Could Have Made 29% This YearPolitical issues aside, Tencent’s 2019 has not gone as well as investors anticipated. The company is projected to report barely any growth in net income when it announces September-quarter results Wednesday, because revenue growth is barely keeping up with the pace of spending on ever-costlier content and servers for its cloud and media services.Read more: Tencent Gets ‘Wakeup Call’ From China’s Assertions of PatriotismBut things are improving in its core gaming business, which still yields the majority of Tencent’s revenue. Widely ridiculed at the outset because of built-in party propaganda slogans -- the military advised on the project -- and family friendly gore-free rubric, 2019’s Peacekeeper Elite evolved into a breakout hit approaching the scale of longstanding cash cow Honour of Kings. Tencent’s shares climbed 2.2% Tuesday after Sensor Tower data showed the company’s gaming revenue gained 13% during the week of Oct. 28, led by Peacekeeper Elite.Yet uncertainty shrouds the division as well. Earlier this month, state media reported that the nation’s publications regulator will cap online game playing time at 1.5 hours per day for children, a big demographic for Tencent’s mobile games.What Bloomberg Intelligence Says“Tencent may deliver accelerating growth for its mobile games business, but its online advertising segment could stay tepid. 3Q mobile games’ sales growth could be the strongest in six quarters, based on Sensor Tower estimates. This is likely to be driven by the resilience of Honour of Kings, explosive growth of Peacekeeper Elite, and the low comparison base from 3Q18 stemming from China’s freeze on game approvals in March 2018.”\- Vey-Sern Ling, analystClick here for the research.The WeChat operator has lost $86 billion of market value since its April peak, and in October tested a key support level -- which would have precipitated a sharp and longer-term downtrend. At the time, trading floors were abuzz with talk about generally souring sentiment from investors in China, as well as concern that Tencent’s decision to resume live-streaming NBA games may backfire.Longer term, the worry is that Tencent may be losing its golden touch.ByteDance came out of nowhere in 2017 to humiliate the social media titan, betting presciently on the short-video craze that birthed its Douyin and TikTok apps and forcing Tencent to mimic its much smaller rival. ByteDance is now flooding the market with ad inventory, depressing prices for incumbents such as Tencent and Baidu Inc.That’s important because Tencent looks at advertising as a potential growth catalyst, given its lower ad load relative to its rivals -- and ByteDance has shown that the Chinese company can’t predict every trend or potential rival.The NBA brouhaha “places further pressure on Tencent’s advertising revenue. More broadly, Tencent’s advertising business faces structural declines in video advertising revenue and increased competition from ByteDance,” said Michael Norris, research and strategy manager at Shanghai-based consultancy AgencyChina.Read more: TikTok Owner ByteDance Aims to Build Global Reach Before IPO(Updates with weekly gaming and shares in the seventh paragraph)To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.netTo contact the editors responsible for this story: Peter Elstrom at pelstrom@bloomberg.net, Edwin Chan, Colum MurphyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Tencent Should Be Split Up

    Tencent Should Be Split Up

    (Bloomberg Opinion) -- China’s most ubiquitous company is hiding one of its most valuable assets. That needs to change.Tencent Holdings Ltd., best known for the WeChat messenger that almost everyone in the country uses, has a growing fintech business. But it’s getting overshadowed by the games and social media divisions. By spinning it off into a new company, with a move to a separate listing, management could unlock as much as $230 billion in value. That would make the entity China’s fourth-largest listed company and the world’s sixth-biggest financial services firm.Such a move could help Tencent retake some of the limelight that it’s about to share with Alibaba Group Holding Ltd. once that company lists in Hong Kong. Alibaba’s fintech unit, Ant Financial Services Group, already functions as a separate business with the e-commerce giant holding a 33% stake. At Tencent, fintech and business services accounted for 26% of revenue last quarter. The Shenzhen-based company is due to report third-quarter earnings late Wednesday.I estimate that revenue from Tencent’s fintech business grew in excess of 70% last year.(1)  The vast majority of that was payments. Yet Tencent also offers other products such as wealth management and has a 30% stake in WeBank, China’s first online-only bank, which was founded five years ago. Data on its fintech profits are hard to ascertain, yet information disclosed by Alibaba shows that Ant Financial was unprofitable last year, so Tencent could be in a similar boat. That’s not necessarily a bad thing. The two rivals are startups in the classic sense, using fast revenue growth driven by marketing and incentives to gain ground fast. A major reason why both have lost money in recent years is due to low take rates, the commissions received from processing payments, because they’ve offered discounts to consumers and merchants. A turnaround could be near, Sanford C Bernstein senior analyst David Dai wrote in a recent series on China’s fintech sector. He estimates that a maturing market will ease cut-throat competition and allow both companies to take a greater share of the money that sloshes through their payments platforms.As a result, Tencent’s payment business (TenPay) alone could be worth $137 billion, compared to $127 billion for Ant’s AliPay, the Bernstein team figures. HSBC Holdings Plc uses two methodologies(2) to come up with an estimated value of around $128 billion. Throw in the other products, and Bernstein calculates a base-case valuation for Tencent’s fintech unit of $160 billion, going as high as $230 billion. This indicates that 40% to 58% of Tencent’s current market cap is locked up in this hitherto hidden division. Bernstein has a base case of $210 billion for Ant, reaching as high as $320 billion.Payments spinoffs have proven to be lucrative in the past. EBay Inc. proved it with PayPal Holdings Inc. in 2015, with the latter posting a 177% normalized return since then, outpacing the 145% rise in the S&P Data Processing sub-index which includes Visa Inc. and Mastercard Inc. PayPal also trounced both eBay (35%) and the S&P 500 (49%). Square Inc., another payments provider, has been one of the hottest stocks of the past decade, returning more than 590% since its initial public offering in 2015.A more recent example comes from India, where Walmart Inc. is reported to be spinning off payments business PhonePe from local e-commerce company Flipkart Group, which it acquired last year. That transaction could turn a $20.8 billion startup into two unicorns with a combined value of more than $30 billion. Tencent doesn’t need to rush to list this fintech unit. Appetite for mega IPOs is likely to be satiated by Alibaba’s Hong Kong listing and that of Saudi Aramco over the next few months. And there’s a long runway of big startups ready for their moment in the sun. By merely making it a separate entity, management can signal intent and allow investors to start re-rating Tencent’s stock accordingly.An offering may not even be necessary, since Tencent is already sitting on more cash than it needs. Instead, the company could distribute shares in Tencent Fintech to existing shareholders, and then directly list the stock. That’s similar to the approach advocated by activist investor Dan Loeb for a Sony Corp. split.Tencent is sitting on a bright light in this fintech unit. Time to let it shine.(Updates to include reference to third-quarter earnings schedule in third paragraph.)(1) The "others" category includes fintech, cloud, film & TV. Tencent noted that fintech is the major component and gave a figure for cloudbut not content.(2) HSBC Approach 1: valuation per user. Approach 2: Using Tencent operating margins applied to its payments business, then comparing to peers.To contact the author of this story: Tim Culpan at tculpan1@bloomberg.netTo contact the editor responsible for this story: Patrick McDowell at pmcdowell10@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Tim Culpan is a Bloomberg Opinion columnist covering technology. He previously covered technology for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Alibaba Seals $38 Billion Singles’ Day Sales Record

    Alibaba Seals $38 Billion Singles’ Day Sales Record

    (Bloomberg) -- Alibaba Group Holding Ltd. logged more than 268 billion yuan ($38.3 billion) of purchases during its Singles’ Day bonanza, exceeding last year’s record haul after a 24-hour shopping marathon.An estimated half-billion shoppers from China to Russia and Argentina swarmed the e-commerce giant’s sites to scoop up everything from Apple Inc. and Xiaomi Corp. gadgets to Ugandan mangoes. The company again hosted a televised entertainment revue in Shanghai to run alongside the bargain-hunting, this time enlisting Taylor Swift and Asian pop icon G.E.M. to pump up sales.The world’s largest shopping event has become an annual ritual for Asia’s largest company, part showcase of commercialism and part publicity blitz. Also referred to as “Double 11” because it falls on Nov. 11, it’s closely watched by investors keen to gauge how willing Chinese consumers are to spend as economic growth threatens to slip below 6%.Tensions between Washington and Beijing continue to fuel uncertainty and roil global commerce. Among China’s largest corporations, Alibaba is expected to better ride out the storm, thanks to booming online consumption in the world’s No. 2 economy. On Sunday, Alvin Liu, a Tmall general manager, said Alibaba doesn’t expect any impact on its cross-border import business from an ongoing trade spat.“Alibaba will probably be the one that will be able to circumvent and come out from the trade war in better shape” versus Baidu Inc. and Tencent Holdings Ltd., Richard Wong, head of ICT for the Asia Pacific at Frost & Sullivan, told Bloomberg Television. “The current sentiment and confidence in terms of spending is still relatively high.”While Alibaba and its rivals routinely trumpet record sums in the event’s aftermath, it’s unclear how much Nov. 11 sales actually will contribute to the bottom line given the enormous discounting involved. A good result however could bolster Alibaba’s effort to raise as much as $15 billion in a landmark Hong Kong share sale this month, according to people familiar with the matter.Singles’ Day emerged as a uniquely Chinese antidote to the sentimentality surrounding Valentine’s Day. Emerging on college campuses across the country, it takes its name from the way the date is written numerically as 11/11, which resembles “bare branches,” a local expression for the unattached.It’s now become an excuse for people to splurge. Last year, sales at Alibaba climbed 27% to 213.5 billion yuan, equivalent to $30.7 billion at the time. This time, purchases grew 26% from the year earlier. More merchandise is sold online over the 24-hour period than during the five-day U.S. holiday buying spree that begins on Thanksgiving and ends on Cyber Monday.Alibaba’s U.S. traded shares were down 1.9% Monday to $183.70 at 11:25 a.m. in New York.Alibaba saw 100 million new users join the shopping festival this year, according to Jiang Fan, president of the company’s e-commerce marketplaces Taobao and Tmall.“This is the power of expanding into less developed regions,” he said. “We hope this event can help more factories and farmers.”Read more: Alibaba Said to Seek Up to $15 Billion in Hong Kong ListingIt’s Time for Alibaba to Slay Jack Ma’s Monster: Tim CulpanBut the company faced stiff competition this year from smaller platforms including JD.com Inc. and Pinduoduo Inc. -- the aggressively expanding upstart that’s encroaching on the market leaders’ turf. They vied for the wallets of Chinese shoppers particularly in relatively untapped rural areas. All employ heavy discounting and hard-sell tactics in the run-up to and during the 24 hours in a bid to best the previous year’s record.“Overall, we think this year will likely see a more competitive Double 11 period,” Ella Ji, an analyst at China Renaissance Holdings Ltd., said in a report. “We anticipate each platform will spend more on subsidies.”Daniel Zhang, who took over as Alibaba chairman from billionaire Jack Ma in September, pioneered the show in its present form in 2015. The Singles’ Day impresario passes the baton this year to Fan, a potential successor to Zhang himself.“Over the years, we’ve seen consumers become more diverse and younger. Each generation of consumers needs their own peers to serve them,” Zhang said in a post on Alibaba’s blog. “I think this young team is the future.”The 2019 edition came with slight twists to the formula. Alibaba, stung by criticism it harmed the environment by shipping an estimated 1 billion packages in a single day -- has enjoined its logistics arm Cainiao to set up recycling centers at 75,000 locations. It says it will also work with courier companies to pick up used boxes and wrapping.An expansion into Southeast Asia and less-developed areas in China plus newer services -- such as transactions on food delivery site Ele.me, grocery store chain Hema and travel service Fliggy -- bolstered the total. The company also brought in livestreamers including Kim Kardashian to appeal to younger buyers.Other aspects remained the same. Singles’ Day has always been an opportunity for Alibaba to test the limits of its cloud computing, delivery and payments systems. Leaving little to chance, Alibaba sent teams across the nation ahead of Nov. 11 to help myriad outlets prepare for the festival. Some 200,000 brands had been expected to participate in 2019‘s edition of the festival.“Singles’ Day is becoming popular outside of China, especially in the ASEAN region,” said Patrick Winter, Ernst & Young Asia Pacific managing partner. “You’re also seeing how it’s growing in smaller cities in China.”(Updates with new user number in tenth paragraph.)To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.netTo contact the editors responsible for this story: Peter Elstrom at pelstrom@bloomberg.net, Molly Schuetz, Edwin ChanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Stocks To Buy: Is It Time To Buy Or Sell These Large-Cap Stocks?
    Investor's Business Daily

    Stocks To Buy: Is It Time To Buy Or Sell These Large-Cap Stocks?

    Looking for stocks to buy? Get analysis of large-cap stocks like Amazon, Alibaba and Dow Jones stocks GE and Microsoft to see if it's time to buy — or sell.

  • Bloomberg

    Tencent Wants to Make Games for the U.S. With Nintendo, DJ Says

    (Bloomberg) -- Tencent Holdings Ltd is looking to make more of its partnership with Nintendo Co. to create video games for the U.S. market, Dow Jones reported.The Chinese company is looking to expand outside its home country, where it dominates the market with a range of smartphone games, with plans that include collaborating more with Kyoto-based Nintendo, unidentified Tencent officials told Dow Jones.Tencent is hoping to create more console games with Nintendo characters and “learn the essence of making console games from Nintendo engineers,” the officials were cited as saying. Nintendo declined to comment to Dow Jones.In April, shares in Nintendo and Tencent jumped after Chinese authorities gave Tencent approval to distribute a test version of Super Mario Bros. U Deluxe in China.Bloomberg has also previously reported that Tencent and Pokemon Co. have agreed to jointly make games.To contact the reporter on this story: Daniel Zuidijk in London at dzuidijk@bloomberg.netTo contact the editors responsible for this story: Katerina Petroff at kpetroff@bloomberg.net, James Amott, Marion DakersFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Bloomberg

    Tencent Buys 10% of Policybazaar, Enters India Insurance Market

    (Bloomberg) -- Tencent Holdings Ltd. has acquired a minority stake in Policybazaar.com valuing the Indian online insurance aggregator at $1.5 billion, according to a person familiar with the deal, as it tries to get a foothold in the country’s burgeoning insurance sector.The Chinese technology giant bought 10% of Policybazaar, half of Tiger Global Management LLC’s stake in the company, the person said, asking not be identified as the matter was not public. The $150 million deal was signed earlier this week, the person added.Tencent, known for its dominant WeChat messenger app, has been an aggressive investor in Indian startups. It’s thrown its might behind prominent technology companies including ride-hailing service Ola, education platform Byju’s and food delivery platform Swiggy. The Shenzhen-headquartered company has been a recent entrant to the booming fintech sector, investing in digital banking services startup NiYo Solutions earlier this year.Policybazaar declined to comment and Tencent did not immediately respond to calls and an email seeking comment. Tiger Global also did not reply to emails seeking a response.Policybazaar, operated by ETech Aces Marketing and Consulting Pvt., is among startups seeking to disrupt the dominance of state-owned or bank-promoted insurers in a sector with tight regulatory controls. It allows users to compare and buy life, health or auto insurance policies directly on its website, without any intermediaries.India’s insurance market has massive potential as the country of 1.3 billion is mostly un-insured or under-insured. Insurance penetration was estimated to surpass 4% in 2017 and projected to quadruple over the next 10 years from $60 billion, according to the government’s Brand Equity Foundation.Indian conglomerates including Tata Group and Aditya Birla Group are prominent players in the insurance market and technology giants including Amazon.com Inc. have backed insurance startups.To contact the reporter on this story: Saritha Rai in Bangalore at srai33@bloomberg.netTo contact the editors responsible for this story: Edwin Chan at echan273@bloomberg.net, Unni Krishnan, Tuhin KarFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • IQ Stock Is Heating up Just as the Trade War Appears to Be Cooling

    IQ Stock Is Heating up Just as the Trade War Appears to Be Cooling

    If the trade war with China is about to end with a whimper, Iqiyi (NASDAQ:IQ) looks cheap. IQ stock rose 6% on Nov. 6.Source: NYC Russ / Shutterstock.com The Chinese video streaming company was helped both by a quarterly report that was less bad than feared and word that China is ready to bury the trade hatchet with the U.S.Iqiyi is a partial spin-off of Baidu (NASDAQ:BIDU), the Chinese search engine company. It lost $4.34 per share on revenue of $1 billion during the September quarter but had 30% more subscribers than a year ago. The company also signed a deal to deliver its content in Malaysia, which has a large Chinese-speaking population.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAs a result, the stock rose 6.53% in pre-market trade to open November 7 at $18.60, a market cap of nearly $12.4 billion. Baidu shares also rose, by 4%. Is IQ Stock Cheap?Reporting on the quarter varied depending on what reporters were looking at. Variety, an entertainment magazine, emphasized the deepening losses. Financial reporters at Marketwatch emphasized that the losses were less than expected. * 7 Stocks to Sell Before They Roll Over In fact, the losses were just about in line with the company's 30% subscriber growth rate.Shares of all Chinese stocks have been depressed during the trade war. IQiyi (pronounced ee-KWI-kwee) stock is little changed from where it was when the year started.But the company has changed. It now has about 105 million paying subscribers, almost entirely in China. This compares favorably with Netflix' (NASDAQ:NFLX) 97.6 million subscribers outside the U.S.IQiyi, however, is much cheaper, just $2-3 per month, and its programming is supported by advertising. Netflix, which takes no advertising, is only in China thanks to a 2017 partnership with IQiyi.While IQ has been growing its subscriber base, advertising revenue was down 14% year-over-year in the latest quarterly report. The company blamed this on the local economy and intense competition. IQ's total subscriber count runs neck-and-neck with that of Tencent Holdings (OTCMKTS:TCEHY) and Alibaba Group Holding (NASDAQ:BABA).In comparison to U.S. tech companies, however, IQ is dirt cheap. Its market cap is about three times its revenue, the subscriber count continues to rise, and long-term debt is low. If trade peace is more than just a rumor, IQ stock should take off. IQ ProspectsIQ is interesting because of its differences with Netflix, not its similarities.IQiyi seeks to completely monetize both its talent and its programming. Netflix merely signs production and delivery agreements with producers. IQ develops and owns its own shows, it advertises against them, and it sponsors concerts to develop talent.More important, IQiyi is primarily a mobile service. It's designed to deliver short bursts of fun to Chinese students and workers during their commutes and work breaks. Netflix, by contrast, is built around TVs and long-form evening programming.The hope of IQ bulls is that the end of the trade war will spark the economy, especially the consumer side. That would deliver more advertising revenue, which is the part of the equation that's lagging. The Bottom Line on IQ StockI counseled patience on buying IQ last spring, and such patience has been rewarded. Shares have fallen 25% since March.I have also emphasized its differences with Netflix, but there are similarities. IQiyi has high initial costs for programming detective shows, romantic comedies and costume dramas. These are covered by convertible notes instead of pure debt. This means the upside in IQ stock is limited. Big gains will move people to turn bonds into stock.Still, if you believe in China, in the Chinese market, and in Chinese ingenuity, IQ stock may be one of the best ways to play that faith. It's a long-term speculative play for young investors who want to diversify outside the U.S.Dana Blankenhorn is a financial and technology journalist. He is the author of the environmental story, Bridget O'Flynn and the Bear, available at the Amazon Kindle store. Write him at danablankenhorn@gmail.com or follow him on Twitter at @danablankenhorn. As of this writing he owned shares in BABA. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Sell Before They Roll Over * 5 Beaten-Up Stocks to Buy That Could Be Saved By An Acquisition * 4 Startup Stocks Getting Smashed The post IQ Stock Is Heating up Just as the Trade War Appears to Be Cooling appeared first on InvestorPlace.

  • Alibaba Seeks to Raise Up to $15 Billion in Hong Kong Share Sale

    Alibaba Seeks to Raise Up to $15 Billion in Hong Kong Share Sale

    (Bloomberg) -- Alibaba Group Holding Ltd. is moving ahead with plans to raise as much as $15 billion in a Hong Kong share sale, people with knowledge of the matter said, a major win for a city rocked by months of civil unrest.Asia’s largest company by market value is now preparing for a listing hearing as mandated by companies that debut on the Hong Kong bourse early next week, the people said, requesting not to be named discussing a private matter. The company declined to comment in an email.Alibaba’s share sale, which could be the largest globally this year, will be a triumph for a Hong Kong stock exchange that lost many of China’s brightest technology stars to U.S. rivals. The Chinese e-commerce giant had aimed to list as early as over the summer before pro-democracy protests rocked the financial hub, while trade tensions between Washington and Beijing clouded the market’s outlook. On Thursday, the U.S. and China agreed to roll back tariffs on each other’s goods in phases as they work toward a deal.“They probably want to minimize the risk from a U.S. trade war,” said Danny Law, a Hong Kong-based analyst at Guotai Junan International Holdings Ltd. “It makes a lot of sense.”Alibaba Seizes a Brief Window of Opportunity: Culpan and GopalanHong Kong’s stock exchange, which reported its worst slide in profit in almost three years, could face pressure from local protesters pushing back on influence from mainland China. Demonstrations are expected to escalate over the weekend as the death of a student inflames rioters who are calling for “flash-mob”-style rallies.Yet listing closer to home has been a long-time dream of billionaire Jack Ma -- a move that curries favor with Beijing and hedges against trade war risks. A successful Hong Kong share sale could also help finance a costly war of subsidies with Meituan Dianping in food delivery and travel, and divert investor cash from rivals like Meituan and WeChat-operator Tencent Holdings Ltd.Alibaba could put the capital to work investing in new technologies such as artificial intelligence or fast-expanding affiliates such as Ant Financial. Courting investors closer to home also serves as a buffer of sorts should U.S.-Chinese tensions worsen. Already, U.S. lawmakers such as Senator Marco Rubio are agitating for measures to curb investment flows to Chinese companies, including the extreme option of tossing U.S.-listed firms off American bourses.Alibaba -- which had roughly $57 billion of cash and equivalents as of September -- rode a national e-commerce boom that stemmed from an increasingly affluent middle class. But like arch-foe Tencent, it’s struggling to sustain growth as the world’s No. 2 economy slows, and China clashes with the U.S. over everything from trade and technology to investment.At home, signs of strain are growing. China’s gross domestic product growth is expected to slump below 6%, which would be the economy’s slowest pace of expansion in three decades. Still, Alibaba last week reported a 40% surge in quarterly revenue, underscoring the resilience of consumer spending. The company on Monday will wrap up its most important sales event of the year -- Singles’ Day -- offering further clues on the health of consumption.How Singles’ Day Became Biggest Shopping Spree Ever: QuickTake(Updates with analyst’s comment in the fourth paragraph)To contact the reporters on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net;Carol Zhong in Hong Kong at yzhong71@bloomberg.net;Manuel Baigorri in Hong Kong at mbaigorri@bloomberg.netTo contact the editors responsible for this story: Peter Elstrom at pelstrom@bloomberg.net, ;Tracy Alloway at talloway@bloomberg.net, Edwin Chan, Philip LagerkranserFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Baidu’s Revenue Beat in Defiance of Slowing Economy

    Baidu’s Revenue Beat in Defiance of Slowing Economy

    (Bloomberg) -- Baidu Inc. reported quarterly revenue that beat estimates after the Chinese search giant’s business proved resilient to an economic slowdown and competition from ByteDance Inc.Third-quarter revenue came in at 28.1 billion yuan ($4 billion). That was down slightly from a year earlier but exceeded the 27.5 billion yuan average of analysts’ projections. The company also projected revenue of 27.1 billion yuan to 28.7 billion yuan, generally in line with estimates. The shares jumped about 5% in extended trading.Baidu’s Netflix-style iQiyi Inc., which competes with Alibaba Group Holding Ltd. and Tencent Holdings Ltd., also reported revenue ahead of expectations. The results may assuage investors who are worried that the 19-year-old company is losing advertising sales to upstart ByteDance, which offers lower rates and more than a billion users on popular apps such as video services TikTok and Douyin. ByteDance also recently entered the online search business, Baidu’s main product. To offset a slowdown, the company has reduced spending.What Bloomberg Intelligence SaysBaidu’s sales growth may pick up mildly in the coming quarters as advertisers’ demand stabilizes and increases in competitive ad inventory slow. The company is building its own content ecosystem using Baijiahao, smart mini-programs and managed landing pages in a bid to retain users for its search engine, which is increasingly blocked from accessing competitor apps.\- Vey-Sern Ling, analystClick here for the research.Longer term, China’s economy is growing at its slowest pace in 30 years, which could diminish spending on Baidu ads. The company fell off the list of China’s five most valuable internet companies, trailing Meituan Dianping and NetEase Inc., after shedding more than 30% of its market value this year. In May, it posted its first loss since going public in 2005.(Updates with BI analyst’s comment in the fourth paragraph. A previous version of the story corrected currency of outlook in the second paragraph.)To contact the reporter on this story: Zheping Huang in Hong Kong at zhuang245@bloomberg.netTo contact the editors responsible for this story: Edwin Chan at echan273@bloomberg.net, Colum Murphy, Molly SchuetzFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Reuters

    UPDATE 1-China mobile payment giants Alipay, WeChat open to international cards

    China mobile payment giants Alipay and WeChat Pay have started allowing overseas users to link their accounts to international bank cards, in a move cheered by foreign payment firms like Visa and Mastercard. Tencent, the parent company of WeChat Pay, said on Wednesday it was opening up in a statement on one of its official websites, while Alibaba-backed Alipay announced the change on its official media service platform.

  • Financial Times

    Chinese cryptomining giant Bitmain’s civil war breaks into open

    A civil war broke out at the cryptocurrency giant Bitmain on Thursday after ousted co-founder Micree Ketuan Zhan threatened to take legal action to seize back control of the company. Mr Zhan said he was unwillingly removed from his position as chairman of the company, which claims to supply three-quarters of the world’s bitcoin minting machines, while he was away on a business trip. “As Bitmain’s founder and largest shareholder, it’s embarrassing that I never knew a government registered legal representative of a firm could suddenly be changed when he was away on a business trip and without him knowing anything,” Mr Zhan wrote.

  • How the latest steps by Alipay and WeChat bring China closer to replacing cash with cellphones

    How the latest steps by Alipay and WeChat bring China closer to replacing cash with cellphones

    China’s two leading mobile-payment platforms announced this week that they will begin allowing foreign visitors to utilize their digital wallets on the Chinese mainland.

  • Financial Times

    China fears weigh on launch of Hong Kong virtual banks

    Passers-by near Xiaomi’s flagship store in Hong Kong’s busy Mongkok shopping district were last month confronted with a jarring sight: the Chinese smartphone maker’s shop was a burnt-out shell after being trashed and set alight by protesters. The Beijing-based electronics company has more to lose from Hong Kong’s pro-democracy protests, which are now entering their sixth month, than a shopfront. Along with Chinese tech giants Alibaba and Tencent, Xiaomi is one of several mainland entities hoping to tap into Hong Kong’s $15bn virtual banking market.

  • Reuters

    China regulator warns e-commerce platforms to stop monopolistic practices

    China has warned top e-commerce platforms including Alibaba and JD.com to stop practices that could be deemed as monopolistic, as industry frictions grow ahead of the country's banner Singles Day shopping event on Nov. 11. State news agency Xinhua reported on Tuesday that China's State Administration for Market Regulation (SAMR) called more than 20 platforms to a meeting and urged them to stop a practice that requires merchants to sign exclusive cooperation agreements preventing them from selling products on rival platforms. The regulator's move comes as Alibaba's Tmall marketplace has in recent weeks been accused by a number of competitors and merchants of adopting such a practice, which is also known as "choosing one from two".

  • PR Newswire

    Serverless Inc. and Tencent Announce Strategic Partnership

    Tencent Cloud and Serverless, Inc. join forces to create a next generation, serverless cloud BEIJING , Nov. 6, 2019 /PRNewswire/ --  Tencent Cloud Computing  ( Beijing ) Co., Ltd. and Serverless, Inc. ...

  • Alipay, WeChat Pay Open Apps to Foreigners Visiting China

    Alipay, WeChat Pay Open Apps to Foreigners Visiting China

    (Bloomberg) -- Chinese payments giants Alipay and WeChat Pay, long a source of worry among competitors abroad, plan to open up their platforms to foreigners visiting the mainland as regulators ease restrictions.The apps, which dominate payments across the world’s second-largest economy and have even supplanted cash at some businesses, announced the plans in rapid succession after previously requiring users to have local accounts. Opening up to visitors may give an incremental boost to spending on the platforms -- but for overseas firms, it has big implications, potentially helping pave the way for future adoption abroad.“Although there will be some revenue coming from the foreigners using the card, the more interesting aspect is how seamless the cross-border Alipay and WeChat Pay experience is becoming,” said Zennon Kapron, founder and director of research consultant Kapronasia.Behind the scenes, China’s central bank recently told a number of payments firms they will soon be allowed to plug foreign cards into their apps for use in China, according to two people with knowledge of the situation. Previously, regulatory concerns about money laundering and cross-border cash flows had prevented that from happening. The central bank offered no immediate comment to an inquiry sent by fax.The move will provide relief to some of the more-than 30 million people who visit China annually and sometimes struggle to find alternate payment methods. Alipay and Tencent account for 94% of the country’s mobile-payment market.Already, Alipay and WeChat Pay’s logos are visible in stores and taxis in major cities around the world as the firms focus on helping Chinese travelers there. The expectation across the industry is that the apps will someday use that infrastructure to attract locals in those destinations.To be sure, the ability to work with credit cards is still pending. In its announcement, Ant Financial’s Alipay laid out a system that will work around current restrictions and can start immediately.Alipay said it’s letting travelers use a prepaid card service provided by the Bank of Shanghai. That means customers will have to periodically top off that account, which will be limited in amount.In contrast, Tencent Holdings Ltd.’s WeChat Pay intends to let people more directly connect their existing cards to its app. Visa described that plan in a statement of support early Wednesday in China, saying it will essentially enable its cards to work across China.“This is a great step forward, both for consumers traveling to China and the overall payments industry,” Visa said. “This partnership means that we’ll be working towards an environment where Visa cardholders will be able to use their Visa card in China at the millions of places where WeChat Pay is accepted, instead of having to rely on cash.”The companies didn’t provide a time frame.Tencent, acknowledging that it’s working under guidelines from regulators, said it has been discussing cooperation with U.S. card-network operators Visa, Mastercard, American Express and Discover as well as Japan’s JCB to support the linking of overseas credit cards to Wechat Pay.(Updates with researcher’s comment, regulatory guidance, statistics on market from third paragraph.)To contact Bloomberg News staff for this story: Lucille Liu in Beijing at xliu621@bloomberg.net;Heng Xie in Beijing at hxie34@bloomberg.net;Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.netTo contact the editors responsible for this story: Jun Luo at jluo6@bloomberg.net, David ScheerFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Reuters

    UPDATE 4-Malaysia OKs Gojek's entry, ride-hailing firm says talks still on

    Malaysia will allow motorcycle-hailing firms such as Indonesia's Gojek to start limited operations from January, a minister said on Tuesday, which could help end Grab's near-monopoly in Malaysia's broader ride-hailing market. Gojek - whose investors include Alphabet's Google and Chinese tech companies Tencent and JD.com - told Reuters it has yet to decide how or when it will enter the Malaysian market, pending clarity on the regulatory framework being drafted by the country's transport ministry.

  • Financial Times

    China 5G rollout to boost cloud gaming

    The rapid rollout of 5G mobile phone services in China, the world’s largest video games market, will create the world’s largest cloud gaming market and create a new rivalry between Alibaba and Tencent. Cloud technology allows video games with complicated graphics and storylines to be streamed and played via low-powered devices such as mobile phones. The technology requires the fast transmission speeds promised by 5G mobile networks, and China should have 600m 5G mobile subscribers by 2025, according to London-based trade body GSMA.

  • Credit cards have gone out of style in China — will the U.S. be far behind?

    Credit cards have gone out of style in China — will the U.S. be far behind?

    WeChat and Alipay are the most widely accepted forms of payment in China which has allowed merchants to avoid paying credit card fees

  • Tencent and Alibaba Gap Widen After NBA Clash

    Tencent and Alibaba Gap Widen After NBA Clash

    Nov.11 -- Tencent shares have vastly under-performed rival Alibaba this year, creating a gap of more than $90 billion in their respective market valuations. Tencent has been dealt a number of headwinds this year, including rising competition and a clash with the NBA. Meanwhile, Alibaba has posted record sales of $38 billion in sales on Singles' Day. Bloomberg's Selina Wang reports and breaks down her interview with Alibaba Chief Marketing Officer Chris Tung.

  • Alibaba Reportedly Moves Ahead with Hong Kong IPO Plans

    Alibaba Reportedly Moves Ahead with Hong Kong IPO Plans

    Nov.11 -- Alibaba Group Holding Ltd. is moving ahead with plans to raise as much as $15 billion in a Hong Kong share sale, according to people familiar with the matter. Bloomberg's Selina Wang has the story at Alibaba's Hangzhou Headquarters on Singles' Day.