TME – Miss on Revenue and Margins; Earnings Continue to Remain Under Pressure
Revenue and OP fell below consensus and online music revenue declined YoY for the first time in 1Q22. Having given up on exclusive music licensing agreements, competition has shifted based on pricing
- Tencent Music (TME US) reported 1Q2022 results today. Revenue declined 15% YoY to RMB6.64bn (vs consensus RMB6.69n) while reported OP dropped 35.7% YoY to RMB749m (vs consensus RMB817m).
- Revenue from Online music services declined YoY for the first time since 2017 while revenue from Social Entertainment services further declined during the quarter.
- We expect TME’s earnings to remain under pressure with increased competition and regulatory restrictions on livestreaming sector.
By Shifara Samsudeen, ACMA, CGMA - https://www.smartkarma.com/profiles/shifara-samsudeen-acma-cgma?utm_source=tiger_community
On Tencent Music (TME US) - https://www.smartkarma.com/entities/tencent-music-entertainment?utm_source=tiger_community
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