Tencent reported disappointing quarterly earnings on Wednesday, the same week that regulators dealt a blow to its ailing video game business by taking its latest blockbuster release off the shelves.
The tech giant’s net income in the second quarter fell by 2% year-on-year, according to the Wall Street Journal, marking the first y/y decline since 2005. Tencent’s stock price fell 8.5% in New York in the wake of the announcement. The company’s shares have fallen 17% since the start of the year.
Tecent’s president, Martin Lau, said that regulators were a major obstacle to the country’s money-making plans. Two government agencies tasked with overseeing video game content have delayed new game approvals due to an internal restructuring.
“Because of restructuring, it’s now affecting the industry as a whole,” Lau said. “From a revenue-growth perspective, the gaming sector is one key area of weakness. As we have said, the big part of it is our biggest game (PlayerUnkown’s Battlegrounds) is not monetizable.”