Tencent Music's quarterly revenue beats on subscriber growth


  • Corporate News
  • Tuesday, 12 Nov 2019

Although China's Tencent Music Entertainment Group music streaming unit has more users, the company's biggest revenue drivers are its social entertainment services — Karaoke platform 'WeSing' and 'Kugou Live' and 'Kuwo Live' — where users can live stream concerts and shows.

BEIJING: China's Tencent Music Entertainment Group reported better-than-expected third-quarter revenue on Monday, as the music streaming company added more paying users.

However, the company recorded the slowest rise in a widely watched growth metric for its biggest business, social entertainment services, in the quarter.

Tencent Music's U.S.-listed shares rose as much as 2% before trading down about 1% in volatile extended trading.

The company's monthly average revenue per paying user from its social entertainment services unit rose 7.4% to 127.3 yuan ($18.20), the slowest growth since it went public in December last year.

Although its music streaming unit has more users, the company's biggest revenue drivers are its social entertainment services — Karaoke platform 'WeSing' and 'Kugou Live' and 'Kuwo Live' — where users can live stream concerts and shows.

The social entertainment business reported 12.2 million paying users during the quarter, a rise of 23.2% from a year earlier.

Although Tencent Music's user base is nearly three times that of world's largest music streaming service Spotify, a peer and a stakeholder in the company, its paying users are comparatively fewer.

As of the third quarter, Spotify Technology SA has over a 100 million paid subscribers, whereas Tencent Music has about 35 million.

Tencent Music, which has a user base of more than 900 million, has been shifting more of its content behind a paywall since May.

The company, controlled by Chinese tech giant Tencent Holdings Ltd, said paid users of its online music service jumped about 42% in the reported quarter.

Tencent Music's net income rose to 1.02 billion yuan, in the quarter ended Sept. 30 from 964 million yuan, a year earlier.

Revenue rose about 31% to 6.51 billion yuan, above estimates of 6.45 billion yuan, according to IBES data from Refinitiv.

Excluding items, the company earned 0.74 yuan per American depositary share, above estimates of 0.66 yuan. - Reuters


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