Can Tencent Music (TME) Sustain Its Momentum as Online Revenues and Partnerships Accelerate?

• Tencent Music Entertainment Group reported third-quarter 2025 earnings, with revenue rising to CNY 8.46 billion and net income reaching CNY 2.15 billion from the prior year's results.
• The company’s growth was fueled by a 27.2% increase in online music service revenues, expanded partnerships with major international labels, and continued success in live music and innovative content offerings.
• We'll now explore how the momentum in online music service growth could influence Tencent Music Entertainment Group's investment narrative.

Find companies with promising cash flow potential yet trading below their fair value.

Tencent Music Entertainment Group Investment Narrative Recap

To be a Tencent Music Entertainment Group shareholder right now, you need to believe in the company's ability to maintain strong user engagement and revenue momentum, particularly as it expands beyond streaming into live events and global partnerships. The latest earnings report showcased notable revenue and net income growth, driven by a surge in online music services, an encouraging sign for the company's most important short-term catalyst: ongoing digital subscription and engagement growth. However, the results do not materially change the biggest risk, which remains the volatility and thinner margins associated with expanding offline and "fan economy" activities.

Of the recent corporate developments, Tencent Music's global data partnership with Luminate stands out as especially relevant, allowing the company to integrate China's music data into Billboard's global charts for the first time. This move increases Tencent Music's international presence and could amplify the impact of user and revenue growth in its online music segment, potentially boosting investor visibility and market appeal as global expansion continues.

But in contrast, investors should still watch for how expanding reliance on live events could lead to less predictable profits in coming quarters...

Read the full narrative on Tencent Music Entertainment Group (it's free!)

Tencent Music Entertainment Group's narrative projects CN¥45.8 billion revenue and CN¥13.7 billion earnings by 2028. This requires 14.8% yearly revenue growth and a CN¥3.5 billion earnings increase from CN¥10.2 billion.

Uncover how Tencent Music Entertainment Group's forecasts yield a $28.34 fair value, a 37% upside to its current price.

Exploring Other Perspectives

Five fair value estimates from the Simply Wall St Community range dramatically from CNY 14.06 to CNY 17,578.19. While subscription revenues continue to accelerate, these diverging views highlight the importance of reviewing multiple outlooks before making decisions.

Explore 5 other fair value estimates on Tencent Music Entertainment Group - why the stock might be a potential multi-bagger!

Build Your Own Tencent Music Entertainment Group Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Tencent Music Entertainment Group research is our analysis highlighting 5 key rewards that could impact your investment decision.
• Our free Tencent Music Entertainment Group research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Tencent Music Entertainment Group's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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