Tencent Holdings (HKG:0700, OTC:TCEHY) has laid out plans to double buybacks next year after posting its lowest annual profit since 2019.
Reporting on Wednesday, the Chinese video game and social media firm said net profit for the year came in at 115.2 billion yuan (US$16 billion), following a 75% drop in the fourth quarter to 27.025 billion Yuan.
Revenue climbed 7.1% to 155.20 billion Yuan for the fourth quarter meanwhile, contributing to a 10% jump for the full year to 609.0 billion Yuan.
Both fourth-quarter revenue and net profits missed estimates from analysts polled by FactSet though, with the fall in earnings coming after Tencent had received a 106.6 billion Yuan boost in the fourth quarter of 2022 from its disposal of food-delivery giant Meituan.
Dampened growth also comes after a wider state crackdown on the technology sector in 2020, which has since been partially relaxed, but not before bringing an abrupt end to decades worth of rapid growth.
Tencent joined rivals in hiking plans for share buybacks over the coming year as a result, with over 100 billion Hong Kong dollars (US$12.8 billion) set to be spent on repurchases.
Alibaba Group (NYSE:BABA) and JD.com Inc (NASDAQ:JD) have also recently unveiled moves to boost the likes of dividends and buybacks for instance, signalling a shift away from the sector’s former growth-based strategy.
That said, Tencent noted its domestic gaming business should see improvement from the second quarter of 2024, after facing softness last year, aided by the launch of new titles.
US-listed shares were flat at US$36.57 in pre-market trading.