Tencent Music: Last News

Patrick Frater Asia Bureau Chief Tencent Music Entertainment, China’s largest digital music conglomerate, managed nearly 7% revenue growth in the July-September quarter as streaming services more than compensated for the continuing retreat of the group’s high-value ‘social entertainment activities. Net profits in the third quarter of its financial and calendar year, climbed by 35% to RMB1.71 billion ($244 million) on revenue of RMB7.02 billion ($1 billion). For nine months, revenues were an unchanged RMB20.9 billion ($2.98 billion) and net profits RMB5.03 billion ($717 million), a 32% gain in local currency terms. Streaming music services managed the double whammy of increasing the number of paying subscribers (by two million quarter-on-quarter to 119 million) and increasing average revenues per subscriber, to RMB10.8.

Patrick Frater Asia Bureau Chief Tencent Music Entertainment, China’s largest online music firm, raised its profits by a third in the April to June second quarter of its financial year, despite a marginal decrease in revenues. The company reported three-month revenues of RMB7.16 billion ($985 million), a year-on-year decrease of 2%, and net profits of RMB1.79 billion ($247 million). On a first-half view, revenues similarly slipped 2% to RMB13.9 billion while net profits grew 30% to RMB3.32 billion. A breakdown of the data shows the company’s lucrative social music businesses (karaoke and other derived music services) suffering a massive 45% decline in average revenue per paying user (ARPPU), a 31% drop in casual users and only modest (5%) subscriber gains. These backward steps, however, were more than offset by growth in its music streaming business.

Patrick Frater Asia Bureau Chief Tencent Music Entertainment, China’s largest online music corporation, got smaller but more profitable in the first quarter of 2024. That continued a trend seen previously in the company’s 2023 accounts. Revenues in the January to March quarter weighed in at $937 million (RMB6.77 billion), a 3% decrease compared with the same quarter last year. But profits after tax increased 28% to $212 million (RMB1.53 billion). Monthly active users across its free and paid for tiers decreased by 2% to 592 million.

Patrick Frater Asia Bureau Chief Tencent Music Entertainment grew its 2022 profits by 21% to $533 million (RMB3.68 billion), helped by cost cutting and a growing subscription base. It achieved this despite a 9% decrease in revenues to $4.1 billion (RMB28.3 billion). The group, which is backed by Chinese tech and entertainment giant Tencent and has stock market listings on the New York Stock Exchange and in Hong Kong, is China’s largest digital music outfit and controls large equity stakes in Spotify and (in a consortium with Tencent) Universal Music Group. Tencent Music’s own operations divide loosely into two clusters: mass market music streaming, with paid-for and free tiers; and “social entertainment,” including karaoke and other derivative products.