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Facebook comes out of the top 5 of the most powerful technology companies in the world

Facebook comes out of the top 5 of the most powerful technology companies in the world

Tencent surpassed Hong Kong’s 4.08 trillion dollars (about $ 523 billion) in market capitalization, topping Facebook’s $ 519 billion.

The Chinese company Tencent, known for its WeChat application and its video games, surpassed Facebook in market capitalization on Tuesday and entered the list of the five most powerful tech giants in the world.

Tencent shares, traded on the Hong Kong Stock Exchange, have doubled in value so far this year driven by company profits, that each time exceed the expectations of analysts.

This Tuesday they surpassed the 4.08 trillion of Hong Kong dollars (about 523,000 million dollars) of market capitalization, surpassing the 519,000 million dollars of Facebook.

However, Tencent is still far from Apple, a world technology leader with a capitalization of 873,000 million dollars. They complete the world’s top-5 technology Amazon, Microsoft and Alphabet, the parent company of Google.

Last week the Chinese company announced a 70% increase in its profits in the third quarter of the year, compared to the previous quarter, far exceeding analyst expectations, a result that skyrocketed the value of their shares.

Faced with recurring criticism of Chinese technology companies for simply copying their American competitors, Tencent has managed to transform WeChat into an application that goes far beyond messaging.

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“Tencent is a company focused on innovation,” says Huang Hao, a researcher at the National Academy of Economic Strategy of the Chinese Academy of Social Sciences. “Produce ideas that are not just copies of foreign businesses”, it states.

Tencent also has a competitive advantage over its competitors due to the fact that social networks such as Facebook and Twitter are banned in China, a market of 1.3 billion potential consumers.

The nearly 1 billion users who use WeChat and its predecessor QQ on their mobile phones they can not only exchange messages and post photos but also play games, transfer money and pay for numerous services in China.

WeChat, where some 38,000 million messages are exchanged daily, has revolutionized the daily lives of millions of Chinese and the entire technology sector of the country.

QR codes, similar to barcodes and making it easy to pay with a mobile phone, are seen in many shops and restaurants in China and are even used by street vendors and beggars to facilitate payments.

This service, along with a similar one from Alibaba, another Chinese internet giant that competes with Tencent, They have transformed China in a very short time from an economy based on cash payments to one of mobile phone payments.

WeChat has also revolutionized the media and publishing industry, which now offer its products directly through the app.

Another of Tencent’s great successes is its online game “Honor of Kings”, a success that increased its revenues in this sector by 84% in the third quarter of this year.

But this revolution will have to face the reluctance of traditional business giants in sectors such as telecommunications or banking, and could pose a problem for Tencent in the future, analysts say.