- Tencent Music Entertainment Group TME reported a fourth-quarter revenue decline of 2.4% year-over-year to $1.08 billion (RMB 7.43 billion), beating the consensus of $1.07 billion.
- Online music service revenues grew by 23.6% Y/Y. Revenues from music subscriptions were RMB2.35 billion ($341 million), an increase of 20.6% Y/Y.
- Online music paying users increased by 16.1% Y/Y to 88.5 million.
- Revenues from social entertainment services and others decreased by 18.2% Y/Y to RMB3.87 billion ($561 million).
- The gross margin increased by 420 bps to 33.0% due to effective control of content costs.
- The operating profit increased by 103.5% Y/Y to RMB1.39 billion ($201 million), driven by effective cost controls.
- Adjusted EPADS of $0.13 is in line with the consensus.
- Net cash provided by operating activities in Q4 was RMB2.49 billion ($362 million), compared to RMB822 million in 2021.
- As of December 31, 2022, the combined balance of the company's cash, cash equivalents, term deposits, and short-term investments amounted to RMB27.4 billion ($3.97 billion).
- Cussion Pang, Executive Chairman of TME, said, "Our diversified suite of monetization tools expanded and made progress during the year, such as ad-supported mode, long-form audio, as well as audio live streaming and our international expansion, among many more. Another meaningful accomplishment was the headway we made with our 'music+public welfare' model, which innovatively combines music's emotional expression and influence to promote social progress... Looking ahead into 2023, as we are repositioning ourselves to better capture future growth areas, we currently expect our quarterly revenues from online music services will exceed those from social entertainment services at some point within this year."
- Price Action: TME shares are trading lower by 1.40% at $7.75 premarket on the last check Tuesday.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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