Tencent Music's quarterly revenue rises as more Chinese users pay for music
China's Tencent Music Entertainment Group said on Tuesday second-quarter revenue rose 5.5% from a year ago, driven by growth in paying users on its Spotify-like music streaming platform and a recovery in the advertising market. Total revenue of the company, controlled by Chinese tech giant Tencent Holdings Ltd, stood at 7.29 billion yuan ($1.00 billion) in the quarter ended June 30, in line with Wall Street estimates, according to Refinitiv data.
The number of paying users of its online music streaming service rose more than 20% to 100 million, a milestone for the company. «We have seen users become increasingly accustomed and willing to pay for copyrighted music,» Cussion Pang, the company's executive chairman, said.
«This trend is evidenced by the all-time high paying ratio and average revenue per paying user recorded.» Net profit attributable to equity holders rose to 1.30 billion yuan from 856 million yuan a year earlier. To attract more users and stave off competition from the likes of NetEase-owned Cloud Music and ByteDance's short-video sharing platform Douyin, Tencent Music has been aggressively adding original content in recent quarters.
But Pang said that the company has in the second quarter implemented «several service enhancement and risk control measures» to improve its live streaming music products, which are expected to weigh on revenues from its social entertainment services throughout the rest of the year. «We believe such measures can provide users with an optimized user experience while paving the way for our healthier and more resilient business development in the long run.»
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