Chinese internet giant Tencent said Wednesday its net profit fell 13% in the third quarter even as the company’s revenues continue to climb out of a slump caused by a government crackdown on online gaming.

The Shenzhen-based company said its net profit was 20.4 billion yuan ($2.9 billion) in the three months ending September 30, as costs for content and finttech services rose.

Tencent’s total revenues climbed 21% year-on-year to 97.2 billion yuan, thanks in part to a 15% increase in revenues from value-added services, which includes online games, social networks and streaming services.

Online games revenues grew 11% to 28.6 billion yuan in the three months, Tencent said in a statement.

Tencent was hammered by a Chinese government crackdown on gaming launched last year that led to a months-long license approval freeze.

Although it was showing signs of recovery, the gaming crackdown shaved around $250 billion off Tencent’s stock market value by the end of last year and battered profits toward the end of 2018.

Beijing imposed in November a curfew on gamers under 18, the latest restriction to hit the industry.

Tencent said it believed “the recent regulations that limit younger players’ game play will have limited additional impact” to its business, as the company had already been implementing a system to limit younger players’ screen time.

The increase in gaming revenue in the third quarter “primarily reflected revenue growth from smartphone games in both domestic and overseas markets, including key titles such as Honour of Kings, PUBG MOBILE and Peacekeeper Elite,” Tencent said, despite lower revenue from PC games.

At the same time, Tencent’s “FinTech and Business Services and Advertising segment revenues each increased at double-digit percentage rates from the second quarter thanks to rising user activity and improved advertising technology,” said Tencent CEO Ma Huateng.

– AFP