Tencent

For Alphabet, formerly Google, advertising remains its bread and butter and Tencent has been ramping up its efforts to earn cash from advertising to add new meaningful revenue streams to its core gaming cash cow. The Chinese social networking king has been succeeding in its endeavour.

In the most recent quarter, online advertising revenue almost doubled from the year earlier quarter and came in at 4.94 billion yuan. More than 65% of that was sourced from mobile ads according to the company. We believe there is much more monetisation for the company to come. Performance-based ads are relatively new territory for the company, after it started sponsored ads in its “moments” section, a personal newsfeed page earlier this year.

Tencent’s QQ and Weixin/WeChat platforms provide a mammoth wave of mobile traffic that Tencent can ply for ads and also for digital payments, taking a clip out of the latter when users buy products or services.

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