The logo of China's Tencent Music Entertainment Group is seen next to an earphone in this illustration picture taken March 22, 2021. REUTERS/Florence Lo/Illustration/ File Photo
(Reuters) -Tencent Music Entertainment surpassed second-quarter revenue expectations on Tuesday, driven by strong subscriber growth in online music services and rising engagement with long-form audio content such as podcasts and audiobooks.
U.S.-listed shares of the company rose 3.3% in premarket trading.
The Chinese streaming giant has ramped up investments in long-form content and other music-related services, including advertising, concerts and artist merchandise. Its Super VIP program, which has about 15 million subscribers, bundles high-quality audio, online karaoke and access to exclusive events to boost engagement.
In June, Tencent Music agreed to buy domestic long-form audio platform Ximalaya for about $2.4 billion in cash and stock, a move aimed at deepening its catalog, strengthening creator partnerships and drawing more paying users across its apps.
The company's total revenue rose 17.9% to 8.44 billion yuan ($1.17 billion) during the quarter, compared with analysts' average estimate of 7.96 billion yuan, according to data compiled by LSEG.
Revenue from music subscriptions grew 17.1% to 4.38 billion yuan, while that from social entertainment services decreased 8.5% to 1.59 billion yuan.
Tencent Music's adjusted profit of 1.66 yuan per American depository share also came above the estimate of 1.46 yuan.
($1 = 7.1903 Chinese yuan renminbi)
(Reporting by Kritika Lamba in Bengaluru; Editing by Shilpi Majumdar)
