Tencent Music's earnings climbed by a substantial 43% during the second quarter.
Tencent Music Entertainment Group (TME) has shown a strong upward trend in both user growth and revenue over the past few quarters, particularly highlighted in Q2 2025. The company reported revenue of RMB 8.44 billion (US$1.18 billion) in Q2 2025, marking a 17.9% increase year-over-year.
The growth was primarily driven by robust growth in online music services. Music subscription revenue rose 17.1% to RMB 4.38 billion, while the monthly average revenue per paying user (ARPPU) increased to RMB 11.7 from RMB 10.7 the prior year. Paying users expanded about 6.3% to approximately 124.4 million, indicating ongoing user base growth.
Net profit also surged significantly, with GAAP net profit attributable to equity holders up 43.2% year-over-year to RMB 2.41 billion, demonstrating improved profitability alongside revenue growth.
Key Trends
The total revenue for Q2 2025 stood at RMB 8.44 billion, up roughly 18% year-over-year, driven mainly by a 26.4% rise in online music services revenue to RMB 6.85 billion.
Paying users increased by 6.3%, with music subscription revenue growing 17.1%. ARPPU increased by roughly 9.3%, indicating the company is successfully monetizing its growing user base.
Net income attributable to shareholders jumped by more than 40%, with a profit margin improving to about 28% from 24% in the prior year’s Q2, reflecting operational efficiency gains alongside revenue growth.
However, there is a discrepancy in one source indicating a revenue decline (RMB 7.6 billion, down 8.7%), but multiple other sources including Tencent's official announcements and major financial news clearly confirm robust revenue and profit growth for Q2 2025, suggesting that the negative figure might be an error or misinterpretation.
Looking Forward
Tencent Music’s recent quarters show a clear trend of growing users, higher subscription revenue, increased monetization per user, and stronger net profitability, driven predominantly by its expanding online music service segment.
The key focus for the near future includes sustaining subscriber growth, improving monetization, and enhancing profitability margins.
Stock Performance
TME's stock opened 12.8% higher on Wednesday in Hong Kong and closed at HK$101.7 by the midday break, up 15.18%.
References:
- Tencent Music Entertainment Q2 revenue increases 17.9% to RMB 8.44 billion
- Tencent Music Entertainment reports Q2 revenue of RMB 7.6 billion, down 8.7%
- Tencent Music Entertainment Group Reports Second Quarter 2021 Unaudited Financial Results
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