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China’s Tencent Music Entertainment Group (TME) faced a mixed financial landscape in the first quarter of fiscal year 2024, as announced on Monday.
Tencent Music revenue dips, but profits grow
While the company saw a slight revenue decrease of 3.4%, falling to $937 million, it successfully boosted its net profit by 27.5% to reach $212 million compared to the same period in 2023.
This growth in profitability underscores a significant recovery and efficiency in operations.
Subscriber numbers on the rise
The company also reported a notable increase in diluted earnings per share (EPS), which rose by 24.7% year-on-year to $0.13.
Another highlight of Tencent Music’s quarterly performance was the substantial growth in its subscriber base, which saw an addition of 6.8 million subscribers — the largest quarter-over-quarter rise to date for the company.
Strategic marketing and operations optimization
CEO Ross Liang attributed the positive changes in subscriber numbers to strategic marketing initiatives timed around the Chinese New Year, which resulted in higher-than-expected growth.
“Drawing on our extensive industry experience and capitalizing on the Chinese New Year seasonality, our effective marketing campaigns led to higher-than-expected first-quarter music subscriber growth.”
The mixed financial outcomes highlight the challenges and opportunities Tencent Music faces in a competitive digital music market.
While the dip in revenue reflects broader industry trends, the significant gains in profit and subscriber growth demonstrate the company’s potential to leverage its market position and operational strengths effectively.
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