Expenses by nature

12 Months Ended

Dec. 31, 2023


	Year ended December 31,
	2021		2022		2023
	RMB’million		RMB’million		RMB’million
Service costs (note i)		18,992		16,540		14,176
Advertising agency fees		667		609		790
Employee benefits expenses (note ii and note iii)		3,915		4,224		3,990
Promotion and advertising expenses		2,387		852		603

Notes:

(i)

Service costs mainly comprised licensing costs, revenue sharing fees paid to content creators and content delivery costs that primarily consisted of server, cloud services and bandwidth costs.

(ii)

During the years ended December 31, 2021, 2022 and 2023, the Group incurred expenses for the purpose of research and development of approximately RMB2,339 million, RMB2,580 million and RMB2,525 million, which comprised employee benefits expenses of RMB2,050 million, RMB2,297 million and RMB2,303 million, respectively. No material development expenses had been capitalized for the years ended December 31, 2021, 2022 and 2023.

(iii)

Employee benefits expenses


	Year ended December 31,
	2021		2022		2023
	RMB’million		RMB’million		RMB’million
Wages, salaries and bonuses		2,518		2,688		2,562
Welfare, medical and other expenses		453		508		566
Share-based compensation expenses		752		823		670
Contribution to pension plans		192		205		192
		3,915		4,224		3,990

Majority of the Group’s contributions to pension plans are related to the local employees in the PRC. All local employees of the subsidiaries in the PRC participate in employee social security plans established in the PRC, which cover pension, medical and other welfare benefits. The plans are organized and administered by the governmental authorities. Other than the contributions made to these social security plans, the Group has no other material commitments owing to the employees. According to the relevant regulations, the portion of premium and welfare benefit contributions that should be borne by the companies within the Group as required by the above social security plans are principally determined based on percentages of the basic salaries of employees, subject to certain ceilings and caps imposed. These contributions are paid to the respective labor and social welfare authorities and are expensed as incurred.