Tencent Music (NYSE: TME) reported Q2 EPS of $0.10, $0.01 better than the analyst estimate of $0.09. Revenue for the quarter came in at $981 million versus the consensus estimate of $983.07 million.

Financial and Operational Highlights

In the three months ended June 30, 2020:

• Online music paying users grew 51.9% year-over-year to 47.1 million, with ARPPU increasing by 8.1% year-over-year.
• Total revenues were RMB6.93 billion (US$981 million), an increase of 17.5% year-over-year, with online music subscription revenues growing by 64.7% year-over-year to RMB1.31 billion (US$186 million).
• Net profit attributable to equity holders of the Company was RMB939 million (US$133 million).
• Non-IFRS net profit attributable to equity holders of the Company[1] was RMB1.15 billion (US$163 million).

"As the industry leader of China's online music market, we continue to pioneer and make contributions to support the development of the industry. Our efforts include continuous advocation of the pay-for-streaming model, deeper cultivation of indie musicians, promotion of digital albums and our innovative online concert TME Live. To top artists, our platform is not only the preferred destination for digital album releases but also a unique performance venue to interact with fans real time. Our online music revenues in the second quarter of 2020 increased by 42.2% year-over-year, accelerating from 27.4% in the first quarter, which was mainly attributable to nearly 65% year-over-year growth in music subscription revenues as well as strong performance from our digital album sales. With our content leadership, a well-executed paywall strategy, and enhanced recommendation capabilities, we have significantly improved our online music paying ratio to 7.2%, up from 4.8% in the same quarter of last year," said Mr. Cussion Pang, Chief Executive Officer of Tencent Music. "In addition, our social entertainment services performed steadily in the second quarter, registering sequential growth as the COVID-19 situation continued to improve in China. We also carried on with upgrading our products and introducing new features to provide interactive, engaging, and visually stimulating experience, which will strengthen our long-term competitiveness. Supported by our strong financial position and cash flow generation, we will continue to invest in and ramp up our long-form audio services, and expect to achieve significant synergies across all aspects of our businesses and further boost our long-term sustainable growth."

For earnings history and earnings-related data on Tencent Music (TME) click here.