Tencent Music Entertainment Group (TME) Q2 2025 earnings summary

Executive summary

• Achieved record total revenues of RMB 8.44 billion in Q2 2025, up 17.9% year-over-year, driven by strong growth in music subscriptions, advertising, artist merchandise, and offline performances.

• Online music revenues rose 26.4% year-over-year to RMB 6.9 billion, with music subscription revenues up 17.1% to RMB 4.4 billion, supported by subscriber base and ARPPU expansion.

• SVIP subscribers exceeded 15 million, and total subscribers surpassed 124 million, reflecting deepening user engagement and loyalty.

• Expanded content ecosystem through partnerships with major Korean, Chinese, and global labels, original content production, and innovative artist-fan engagement initiatives.

• Staged successful large-scale concerts and live events, including G-DRAGON's international tour and the Wave Music Awards.

Financial highlights

• Gross margin increased by 2.4 percentage points year-over-year to 44.4%, driven by music subscription and advertising growth, and improved cost efficiency.

• Net profit attributable to holders rose 43.2% year-over-year to RMB 2.41 billion; non-IFRS net profit reached RMB 2.57 billion, up 37.4%.

• Operating profit reached RMB 2.98 billion, up 35.5% year-over-year.

• Diluted earnings per ADS was RMB 1.55, up 45% year-over-year; non-IFRS diluted EPS was RMB 1.66, up 39%.

• Cash, cash equivalents, term deposits, and short-term investments totaled RMB 34.92 billion at quarter end.

Outlook and guidance

• Revenue for full year 2025 expected to exceed previous guidance, with continued focus on operational efficiency and bottom-line improvement.

• Confident in sustainable long-term growth, with ongoing investments in SVIP privileges, product innovation, and global expansion.

• Anticipates continued high-quality growth in music subscriptions and scalable non-subscription revenue streams such as advertising, concerts, and merchandise.

• Management remains focused on product innovation, immersive user experiences, and expanding music-related services.

• Continued investment in new initiatives to create lasting value for music creators and consumers.