Streaming Growth Helps Tencent Music Lift Profits by a Third in Second Quarter
variety.comPatrick 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. Paying user numbers climbed by 17% year-on-year to 117 million, while ARPPU simultaneously increased by 10%.
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