The following is a summary of the Tencent Music Entertainment (TME) Q1 2024 Earnings Call Transcript:
Financial Performance:
Tencent Music reported a 43% YoY increase in online music revenues in Q1 2024, driven by subscriber growth and its advertising business.
Despite a 3% drop in total revenues to RMB 6.8 billion due to a decline in social entertainment, it saw an uptick in net profit margin, evidencing the effectiveness of its high-quality growth strategy.
The company reported an IFRS net profit rise of 28% YoY to RMB 1.5 billion and a non-IFRS net profit rise of 24% to RMB 1.8 billion.
Tencent Music announced a new annual cash dividend policy and $210 million in cash dividends for 2023, reflecting their solid financial position.
Business Progress:
The company's innovation in implementing AI and interactive features on its platform has attracted 113.5 million paying users in Q1 2024.
Through partnerships with record labels as well as new generation groups and Indie artists, Tencent Music has enhanced its content library substantially.
The company is focused on expanding its live-performance business and is working on an AI-powered concert in collaboration with Tencent AI Labs.
Anticipating improved user retention, Tencent Music is prioritizing child-friendly content as part of its long-term audio strategy.
In order to drive growth, Tencent Music plans to optimize its ad services focusing on the e-commerce, gaming, and content information industries, in tandem with practising three business models: price competition, contracted advertising, and investment advertising.
Foreseeing growth in the GP margin due to in-house content, Tencent Music expects an increase in net profit rates in 2024.
More details: Tencent Music IR
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