Tencent Music posts growth from music subscriptions in Q4, FY 2019

Tencent Music Entertainment released its financial results for the fourth quarter and fiscal year of 2019. Tencent Music reversed its quarterly loss of 875 million yuan from Q4 2018 to a profit of 1.04 billion yuan ($149 million). The company said that for the quarter ending December 31, it had total revenue of 7.29 billion yuan ($1.05 billion), up 35.1% on-year.

Within that quarterly revenue total, music subscription revenue increased 60.1% from the year-ago period to 1.11 billion yuan ($160 million). All online music services generated 2.14 billion yuan ($307 million) for the company, an increase of 40.7%.

For the full fiscal year, Tencent Music had a net profit of nearly 3.98 billion yuan ($571 million), up from 1.83 billion yuan in 2018. Annual revenue rose 34% to 25.43 billion yuan ($3.65 billion). Online music service revenue increased 29.2% to 7.15 billion ($1.03 billion) and music subscription revenue reached 3.56 billion ($512 million).

Executives had glowing words in the press release, but one of the more notable statements came from CEO Cussion Pang. “Our strategic transition to pay-for-streaming service has started to pay off, contributing to paying ratio expansion for online music services to 6.2% in the fourth quarter of 2019, up significantly from 4.2% for the same quarter of 2018,” he said. “As a further testament to the quality of our online music paying user growth, we recorded a 4.5% quarter-over-quarter ARPPU expansion, in addition to continuously improved user retention.”

Anna Washenko