Chinese internet giant Tencent said Wednesday net profit soared nearly 17 percent in the first quarter as the company appeared set to emerge from the battering it received from Beijing's crackdown on gaming.

Shenzhen-based Tencent said net profit came in at 27.2 billion yuan ($4 billion) in the three months ending March 31, beating a Bloomberg average analyst estimate of 19.4 billion yuan.

Revenues were up 16 percent at 85.5 billion yuan, primarily driven by commercial payment services and other FinTech, and digital content businesses.

Tencent was hammered by a Chinese government crackdown on gaming launched last year that had choked off game approvals as authorities took aim at titles they felt were inappropriate, overly violent or addictive.

Chinese regulators stopped Tencent monetising the hugely popular battle-royale style mobile game "PlayerUnknown's Battlegrounds" on the mainland with the tech giant eventually dropping the title entirely earlier this month.

The crackdown shaved around $250 billion off the company's stock market value by late last year and battered profits towards the end of 2018.

Shares have largely recovered as some game approvals subsequently resumed.

Mobile game revenues fell two percent year-on-year in the first quarter to 21.2 billion yuan "due to fewer new games releases", the company said.

But analysts said the results showed the company's hugely profitable gaming sector was bouncing back.

"Missing consensus top-line estimates is not ideal, but the bright spot is growth came where it mattered — in games, which is their most profitable segment," said Vey-sern Ling, an analyst at Bloomberg Intelligence cited by Bloomberg News.

"The 11 percent sequential jump in mobile game sales bodes well for the sustained recovery of the business over 2019, especially with the addition of new games."

Shares in the Hong Kong-listed company rose 0.92 percent Wednesday ahead of the report.

Last week Tencent released a new game that looks remarkably similar to "Battlegrounds" called "Game for Peace", which was developed in conjunction with China's air force and cleared regulators.

The game took in $14 million within 72 hours, according to Sensor Tower which monitors mobile gaming data revenue.

With China's economy slowing down, major tech giants such as Tencent and Alibaba are increasingly looking overseas for growth, often competing with each other in key areas like cloud computing and Fintech.

Tencent said Thursday its cloud business "sustained a rapid year-on-year revenue growth rate" thanks to an expanding paying customer base.

Alibaba is expected to release its results later Wednesday.

Alibaba results beat analyst estimates
Shanghai (AFP) May 15, 2019 –

Chinese e-commerce leader Alibaba on Wednesday announced revenue for the latest quarter that beat analyst estimates, indicating that the Sino-US trade tiff and a slowing domestic economy were having little impact on the bottom line.

Revenue for the January-March period rose 51 percent year on year to 93.5 billion yuan ($13.6 billion), a company statement said, outpacing an average analyst estimate of 91.7 billion yuan compiled by Bloomberg News.

Net profit was 25.8 billion yuan, up more than three-fold compared to the same period a year earlier.

Revenue in the Hangzhou-based company's core e-commerce segment, which accounts for the vast majority of its business, jumped 54 percent, while the smaller but fast-growing cloud computing unit surged 76 percent.

"Our cloud and data technology and tremendous traction in new retail have enabled us to continuously transform the way businesses operate in China and other emerging markets, which will contribute to our long-term growth," Chief Executive Officer Daniel Zhang said in the statement.

Alibaba has been pouring money into what it calls "new retail", which optimises in-store sales and service using data culled online.

Alibaba dominates China's rapidly expanding consumer culture and its corporate results are typically closely watched for any signs that a Chinese economic deceleration and the US-China trade tensions were turning off shoppers.

Earlier on Wednesday, Hong Kong-listed Chinese social media and gaming giant Tencent announced that its quarterly profit also beat expectations.

Tencent said its commercial-payment services and digital content business lines helped offset a government crackdown on its cash-cow gaming segment.

Alibaba was on Tuesday named the world's most valuable retail brand outside the US, according to rankings by global marketing and communications group WPP and research and consulting firm Kantar.

Their report put Alibaba ahead of McDonald's, Home Depot, Nike and Louis Vuitton, and it was the only Asian brand in the top 10.

It put Alibaba's brand value at $131.2 billion in 2018, up 48 percent on the previous year.

Companies like Alibaba are at the nexus of a national economic strategy to encourage more domestic consumer spending and thereby lessen the reliance on fickle foreign demand for Chinese exports.