Tencent Music profits soar to over 36% on last year

Changing trends within the divisions

Tencent Music Entertainment (NYSE: TME and HKEX: 1698), China's leading music streaming company, posted an annual net profit of 7.11 billion yuan in 2024 (€890 million/$974 million), up 36.2% year-on-year. The Chinese giant, which operates the QQ Music, Kugou Music and WeSing apps, recorded revenue of 28.40 billion yuan (€3.56 billion/$3.89 billion) in the period, up 2.3% compared to 2023.

Online music services were the main driver, with revenues that jumped by 25.5% to 21.74 billion yuan (2.74 billion euros/$2.98 billion). Subscription revenue, the main driver of TME's growth, saw a dramatic increase of 25.9% to 15.23 billion yuan (1.91 billion euros/$2.09 billion).

Revenue from its social entertainment services (karaoke, live streaming) was only 6.66 billion yuan (830 million euros/$910 million), marking a significant drop of 36.1% compared to 2023. The platform's gross margin improved significantly from 35.3% in 2023 to 42.3% in 2024, thanks to the optimization of its cost of revenue and the success of its SVIP subscription program, which offers exclusive benefits to its subscribers (superior audio quality and advanced sound effects, expanded digital content library, etc.)

The company is undertaking a $500 million share repurchase program.

(Michael Leahy. Source: music_zone/TME Photo : ©Daniel Wu / Unsplash)