Tencent Music Entertainment Group has published its financial results for Q4 and the full year, ended December 31, 2022.
By the end of 2022, the China-based music streaming giant, which operates music services, QQ Music, Kugou and Kuwo, grew its paying users of online music by 3.2 million to reach 88.5 million, representing growth of 16.1% year-over-year.
In spite of its paid user growth, TME saw a 7.8% YoY decline in its online music mobile Monthly Active Users in Q4, from 615 million in Q4 2021, to 567 million in Q4 2022
TME pins this decline on “the surge in COVID-19 cases” [in China] “and churn of our casual users amid competition, along with cost optimization measures aimed at boosting monetization efficiency as a platform of scale”.
In terms of finances, TME’s revenues from online music services increased by 23.6% YoY to RMB 3.56 billion in Q4, which converts to $516 million (see below).
The company’s revenues from music subscriptions specifically in Q4 grew 20.6% YoY to RMB 2.35 billion (USD $341 million).
Revenues from online music services other than subscriptions in Q4 grew 29.8% YoY and by 2.3% quarter-over-quarter to RMB1.21 billion (USD $175 million).
TME’s ARPPU (average revenue per paying user) for its online music services in Q4 increased by 4.7% YoY to RMB 8.9, from RMB 8.5 in Q4, 2021.
Across the full year, TME’s revenues from online music services increased by 8.9% YoY to RMB12.48 billion (USD $1.81 billion).
TME says that this increase was “driven by strong growth in music subscription revenues, supplemented by growth in revenues from long form audio, despite a decrease in sublicensing revenues and advertising revenues”.
Revenues from music subscriptions were RMB8.70 billion (USD $1.26 billion) in 2022, representing an 18.6% year-over-year growth.
ARPPU for the full year was slightly down in 2022 to RMB 8.6 (from RMB8.9 in 2021), due to what TME says was “relatively lower ARPPU in the first half of 2022 due to our promotional efforts”.
“With our relentless focus on executing our growth strategies and operating efficiencies, we are confident to achieve year-over-year growth in total revenues and profitability as well as continuous improvement in user quality in 2023 while fueling the thriving music industry.”
Cussion Pang, TME
Commenting on the company’s latest results, Cussion Pang, Executive Chairman of TME, said that it was the “firm execution of [TM’s] dual-engine content-and-platform strategy” that “fueled solid progress in a fast-changing macro environment”.
Added Pang: “Meanwhile, with our relentless focus on executing our growth strategies and operating efficiencies, we are confident to achieve year-over-year growth in total revenues and profitability as well as continuous improvement in user quality in 2023 while fueling the thriving music industry.”
“In 2023 and in the years to come, we will keep driving industry development, blazing new trails in content and platform innovations, while fulfilling our responsibilities as a leading music industry player.”
Ross Liang, TME
Ross Liang, CEO of TME, added: “On the back of our firm execution of the dual-engine content-and-platform strategy, in 2022 TME launched a lineup of new tools and leveraged our end-to-end production and promotional resources to unlock value for our partners’ content creation, while delivering compelling experiences to all those who are passionate about music as we innovated in each of our four entertainment pillars: listen, watch, sing, and play.
“In 2023 and in the years to come, we will keep driving industry development, blazing new trails in content and platform innovations, while fulfilling our responsibilities as a leading music industry player.”
Music Business Worldwide
