Tencent Music Repurchases 43.5M American Depositary Shares for About $400M

Tencent Music Entertainment Group Announces Second Quarter 2026 Unaudited Financial Results

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(Moderate)
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(Very Positive)
Tags
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Tencent Music Entertainment Group (NYSE:TME, HKEX:1698) reported second quarter 2026 revenues of RMB8.93 billion, up 5.8% year over year, driven mainly by music related services revenue of RMB7.61 billion, up 11.0%. Membership services revenue reached RMB4.79 billion, growing 8.1%, supported by SVIP expansion and the consolidation of Ximalaya, which contributed RMB407 million of revenue.

IFRS net profit attributable to equity holders was RMB2.47 billion and diluted EPS was RMB1.57. Non-IFRS net profit attributable to equity holders rose 4.4% to RMB2.69 billion, with adjusted EBITDA of RMB3.25 billion, up 5.2%. Cash, cash equivalents, term deposits and short-term investments totaled RMB44.22 billion as of June 30, 2026.

During the quarter, Tencent Music repurchased 43.5 million ADSs for about US$400 million. Social entertainment services and other revenues declined 16.4% to RMB1.33 billion, while operating expenses increased 12.0% to RMB1.30 billion, partly due to Ximalaya-related amortization.

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Positive

• Total revenue RMB8.93 billion, up 5.8% year over year
• Music related services revenue RMB7.61 billion, up 11.0% year over year
• Membership services revenue RMB4.79 billion, up 8.1% year over year
• Non-IFRS net profit attributable RMB2.69 billion, up 4.4% year over year
• Adjusted EBITDA RMB3.25 billion, up 5.2% year over year
• Cash, cash equivalents and investments RMB44.22 billion, up from RMB41.00 billion on March 31, 2026
• Share repurchases 43.5 million ADSs for approximately US$400 million at US$9.2 per ADS
• Ximalaya contribution RMB407 million in revenue, with positive impact on gross margin

Negative

• Social entertainment services and others revenue down 16.4% to RMB1.33 billion year over year
• Cost of revenues up 6.2% year over year to RMB4.98 billion
• Gross margin slightly lower at 44.2% versus 44.4% a year earlier
• Total operating expenses up 12.0% year over year to RMB1.30 billion
• Operating expense ratio increased to 14.5% of revenue from 13.7%

Tencent Music Entertainment completed its acquisition of Ximalaya on May 18, 2026
; results from that date are included in second-quarter consolidated statements, while backend integration had begun but was still underway.

Tag-specific earnings reactions averaged -4%, adding a cautionary benchmark to this release. Revenue growth and the buyback provided positive operating context, while declining social-entertainment revenue and low short positioning were relevant factors to watch.

Total RevenueRMB8.93 billion (US$1.32 billion), up 5.8% year over yearQ2 2026
Music-Related Services RevenueRMB7.61 billion (US$1.12 billion), up 11.0% year over yearQ2 2026
Membership Services RevenueRMB4.79 billion (US$706 million), up 8.1% year over yearQ2 2026
IFRS Net Profit AttributableRMB2.47 billion (US$364 million)Q2 2026, compared with RMB2.41 billion in Q2 2025
Adjusted EBITDARMB3.25 billion (US$480 million), up 5.2% year over yearNon-IFRS basis, Q2 2026
Cash and InvestmentsRMB44.22 billion (US$6.52 billion)As of June 30, 2026
Social Entertainment RevenueRMB1.33 billion (US$196 million), down 16.4% year over yearQ2 2026
ADS Repurchase43.5 million ADSs for approximately US$400.0 millionThree months ended June 30, 2026

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

TME’s tag-specific earnings history showed divergence more often than alignment, with three negative reactions following positive earnings announcements.

ifrsfinancial
“On an IFRS basis:Net profit attributable to equity holders”
International Financial Reporting Standards (IFRS) are a set of common accounting rules used by many companies worldwide to prepare financial statements, so numbers like revenue, profit and assets are measured in the same way across borders. For investors, IFRS matters because it makes it easier to compare the financial health and performance of different companies—like using the same ruler to measure different objects—reducing surprises and helping informed investment decisions.
non-ifrsfinancial
“On a non-IFRS basis:Adjusted EBITDA was RMB3.25 billion”
Non-IFRS refers to financial measures that companies report outside the standard accounting rules set by the International Financial Reporting Standards; these figures exclude or adjust certain items such as one-time costs, stock-based pay, or restructuring charges. Investors care because non-IFRS numbers try to show the business’s underlying performance — like a chef presenting a dish with optional toppings removed to highlight the core flavor — but they can be shaped to look more favorable, so compare them with the official IFRS statements.
adjusted ebitdafinancial
“Adjusted EBITDA was RMB3.25 billion (US$480 million)”
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
adsfinancial
“Diluted earnings per ADS was RMB1.57 (US$0.23)”
Ads are paid promotional messages a company places across media — online, on TV, in print, or on social platforms — to attract customers, explain products, or shape public perception. For investors, ads matter because they drive sales growth, affect how much a company must spend to win customers, and influence brand strength and long-term value. Ads can also create regulatory or reputational risk if claims are misleading, which can affect profits and stock price.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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SHENZHEN, China, Aug. 11, 2026 /PRNewswire/ — Tencent Music Entertainment Group (“TME,” or the “Company”) (NYSE: TME and HKEX: 1698), the leading all-in-one music and audio entertainment platform in China
, today announced its unaudited financial results for the second quarter ended June 30, 2026.

SecondQuarter 2026Financial Highlights

• Total revenueswereRMB8.93 billion
  (US$1.32 billion
  ), representing a 5.8%
  year-over-year increase, primarily due to strong growth in revenues from music related services^[1].
• Revenues from music related services^[1] were RMB7.61 billion
  (US$1.12 billion
  ), representing 11.0%
  year-over-year growth, driven by solid growth in revenues from marketing and consumption services^[2], such as offline performance related services, as well as revenues from membership services^[3].Revenues from membership services^[3] were RMB4.79 billion
  (US$706 million
  ), representing 8.1%
  year-over-year growth.
• On an IFRS basis:
  • Net profit attributable to equity holders of the Companywas RMB2.47 billion
    (US$364 million
    ), compared with RMB2.41 billion
    in the same period of 2025.
  • Diluted earnings per ADS was RMB1.57
    (US$0.23
    ), compared with RMB1.55
    in the same period of 2025.
• On a non-IFRS basis:
  • Adjusted EBITDA^[4] wasRMB3.25 billion
    (US$480 million
    ), representing 5.2%
    year-over-year growth.
  • Non-IFRS net profit attributable to equity holders of the Company^[4]was RMB2.69 billion
    (US$396 million
    ), representing 4.4%
    year-over-year growth.
  • Non-IFRS diluted earnings per ADS was RMB1.70
    (US$0.25
    ), up from RMB1.66
    in the same period of 2025.
• Totalcash, cash equivalents, term deposits and short-term investments as of June 30, 2026 were RMB44.22 billion
  (US$6.52 billion
  ).
• In the second quarter of 2026, the Companyrepurchased43.5 million ADSs with cash for an aggregate consideration of approximatelyUS$400.0 million
  .

Mr. Cussion Pang, Executive Chairman of TME, commented, “Our second-quarter results reflect the continued strength of our content-and-platform strategy. Concerts, merchandise, and other IP-driven experiences drove another quarter of solid growth in our marketing and consumption services, underscoring our ability to unlock greater value from premium music IP. Our expansion into digital audio through the integration of Ximalaya broadened our reach and enriched our ecosystem. As the industry evolves, we continue to champion copyright protection, foster a healthy ecosystem, and safeguard the value of creative work.”

Mr. Ross Liang, CEO of TME, continued, “Amid a rapidly evolving market, we remain steadfast in building an ecosystem where our users can discover, connect, and be inspired through music and audio experiences. Our focus on differentiated content and a vibrant community continues to deepen engagement with our core users, and SVIP membership continues to grow. The addition of Ximalaya is an exciting milestone that will allow us to deliver an even richer audio experience and serve our users more effectively. Together, we are shaping the future of music and audio entertainment and unlocking long-term growth.”

SecondQuarter 2026 Operational Highlights

Products & Services – Elevated the music experience through continuous product innovation, ecosystem integration, and thoughtful AI application, to expand user reach and deepen engagement. 

• Enhanced the user experience through a more seamless discovery-to-playback journey, introducing vertical swipe-based discovery, video feeds, and expanded freemium access to drive higher daily time spent per user.
• Expanded distribution and user acquisition through deeper integration with the broader Tencent ecosystem. We strengthened music content distribution through Weixin Video Accounts and improved click-through and conversion to our apps. We also collaborated with Weixin Pay to drive traffic to our lightweight apps, such as Bodian Music and Kugou Concept, which cater to users seeking a simpler music experience.
• Harnessed AI agents to make music discovery more intuitive and personalized. We recently integrated with Weixin XiaoWei, and are pleased that by tapping into Weixin’s massive user base, more users can discover songs, generate playlists, stream music with easy commands and instantly share favorite tracks with friends. Within QQ Music and Kugou Music, our upgraded AI agents now act as personal DJs, creating personalized playlists in real time that match what users want to hear in the moment.

IP-Centric Content Ecosystem – Deepened strategic partnerships, strengthened proprietary IP capabilities, and expanded presence in digital audio to reinforce long-term IP value. 

• Expanded strategic partnerships beyond traditional music licensing to unlock greater value. 1) Deepened our partnerships with Dream Music Group, securing first-release for its top artists while expanding into new areas of collaborations including content co-creation, physical offerings, and offline experiences. 2) To enrich how users experience music beyond audio, we partnered with Huace Film & TV, RUYI FILM, and Zhejiang Satellite TV to bring original soundtracks and popular music variety shows to our platform, creating a more immersive connection between music and visual entertainment.
• Advanced our proprietary content creation capabilities and deepened artist development efforts to support growth of IP-driven experiences. 1) Produced hit releases for leading artists and major IPs, including Zhou Shen’s Blaze into Bloom,Liu Yuning’s Borrow a Little Light from Ordinary Days, and the theme song for the hit animated film All Wishes Come True!. 2) Following rapper Zhou Yan’s (GAI) successful EVOLUTION tour in Asia
  , we elevated his latest tour, REAL G, to stadium scale. We also supported renowned actor and singer Steven Zhang’s first-ever arena tour, New Journey. 3) Made a strategic investment in THE BLACK LABEL to help artists deepen connection with Chinese audiences.
• The addition of Ximalaya strengthened our position as a leading music and audio ecosystem. Its extensive content library broadened our user reach and enriched our SVIP offering. Meanwhile, we have begun the backend integration journey, laying the foundation for operational efficiency gains over time.

Holistic IP Value Creation – Extended the value of premium IPs beyond streaming through digital and physical experiences, deepening fan engagement and driving diversified growth.

• Continued to enhance our SVIP offering with differentiated IP-driven benefits, driving growth in user scale, engagement, and consumption of premium ancillary experiences. New benefits, including digital albums and tailored gift packages for artists and groups such as RENJUN, Lay Zhang, aespa, and RIIZE^[5], deepened fan engagement.
• Expanded music IP into more immersive offline experiences, contributing to strong growth in concert-related revenue. 1) Hosted three fan meetings in Macau
  , China
  for SM Entertainment’s trainee group, SMTR25, attracting tens of thousands of attendees and generating strong merchandise sales. 2) Building on last year’s success, we scaled up our proprietary international IP event, TIMA, expanding to a much larger venue to welcome more fans amid growing enthusiasm.
• Extended the value of music IP through end-to-end IP merchandise development and distribution. Physical releases from KUN, Chen Chusheng, Eazin Poe, and Zhou Shen were met with strong demand, highlighting fans’ growing appetite for premium music collectibles.

SecondQuarter 2026Financial Review 

Total revenuesincreased by RMB491 million
, or 5.8%
, to RMB8.93 billion
(US$1.32 billion
) from RMB8.44 billion
in the same period of 2025. The revenue generated from Ximalaya was RMB407 million
(US$60 million
)^[6].

• Revenues from music related services increased by 11.0%
  to RMB7.61 billion
  (US$1.12 billion
  ), compared with RMB6.85 billion
  in the same period of 2025. The increase was driven by solid growth in revenues from marketing and consumption services, such as offline performance related services, as well as revenues from membership services. Revenues from membership services were RMB4.79 billion
  (US$706 million
  ), representing 8.1%
  year-over-year growth, compared with RMB4.43 billion
  in the same period of 2025. The consolidation of Ximalaya contributed to the increase of our membership revenues. Additionally, our SVIP membership continued to expand and contributed to our membership revenue growth. Revenues from offline performances related services achieved robust year-over-year growth as we successfully staged several concerts for our strategically collaborated artists.
• Revenues from social entertainment services and othersdecreased by 16.4%
  toRMB1.33 billion
  (US$196 million
  ) fromRMB1.59 billion
  in the same period of 2025.

Cost of revenues increased by 6.2%
year-over-year to RMB4
.98 billion (US$735 million
), mainly due to increased costs related to offline performances, and higher long-form audio content costs due to expansion of content library. Meanwhile, revenue sharing fees decreased, resulting from declines in both revenue sharing ratio and revenues from social entertainment services. 

Gross marginwas 44.2%
, compared with 44.4%
in the same period of 2025. The consolidation of Ximalaya had a positive impact to our gross margin of this quarter.

Total operating expensesincreased by 12.0%
year-over-year to RMB1.30 billion
(US$191 million
). Operating expenses as a percentage of total revenues increased to 14.5%
from 13.7%
in the same period of 2025. The increase was primarily due to the consolidation of Ximalaya, including the amortization of intangible assets arising from the acquisition.

On an IFRS basis, net profitand net profit attributable to equity holders of the Company for the second quarter of 2026 were RMB2
.55 billion (US$376 million
) and RMB2.47 billion
(US$364 million
), respectively. Basic and diluted earnings per American Depositary Shares (“ADS”)for the second quarter of 2026 were RMB1.58
(US$0.23
) and RMB1
.57 (US$0.23
), respectively. The Company had weighted averages of 1.56 billion basic and 1.58 billion diluted ADSs outstanding, respectively. Each ADS represents two of the Company’s Class A ordinary shares.

On a non-IFRS basis, adjusted EBITDA for the second quarter of 2026 were RMB3.25 billion (US$480 million
). Non-IFRS net profitwas RMB2.78 billion
(US$410 million
) and non-IFRS net profit attributable to equity holders of the Company was RMB2.69 billion
(US$396 million
). Non-IFRS basic and diluted earnings per ADS were RMB1.72
(US$0.25
) and RMB1.70
(US$0.25
), respectively. Please refer to the section in this press release titled “Non-IFRS Financial Measures” for details.

As of June 30, 2026, the combined balance of the Company’s cash, cash equivalents, term deposits and short-term investmentsamounted to RMB44.22 billion
(US$6.52 billion
), compared with RMB41.00 billion
as of March 31, 2026.

Under our previously announced share repurchase programs, during the three months ended June 30, 2026, we repurchased a total of 43.5 million ADSs in the open market with cash for an aggregate consideration of approximately US$400.0 million
at an average price of US$9.2
per ADS.

Environmental, Social, and Governance (“ESG”)

We continued to enhance tailored music experiences for users of all ages. This quarter, we enhanced Youth Mode across our core products and introduced a curated, age-appropriate content library for younger users to safely discover and enjoy music.

This announcement contains translations of certain RMB amounts into U.S
. dollars (“USD”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of RMB6
.7851 to US$1.00
, the noon buying rate in effect on June 30, 2026, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or USD amounts referred could be converted into USD or RMB, as the case may be, at any particular rate or at all. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this earnings release.

The Company uses non-IFRS financial measures for the period, including non-IFRS net profit, adjusted EBITDA(inc.SBC) and adjusted EBITDA, in evaluating its operating results and for financial and operational decision-making purposes. TME believes that non-IFRS financial measures help identify underlying trends in the Company’s business that could otherwise be distorted by the effect of certain expenses that the Company includes in its profit for the period. TME believes that non-IFRS financial measures for the period provide useful information about its results of operations, enhances the overall understanding of its past performance and future prospects and allows for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.

Non-IFRS financial measures for the period should not be considered in isolation or construed as an alternative to operating profit, net profit for the period or any other measure of performance or as an indicator of its operating performance. Investors are encouraged to review non-IFRS financial measures for the period and the reconciliation to its most directly comparable IFRS measure. Non-IFRS financial measures for the period presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company’s data. TME encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.

Adjusted EBITDA(inc.SBC) for the period represents net profit for the period excluding income tax expense, finance cost, share of profit/loss of associates and joint ventures, other gains/losses, interest income, depreciation of property, plant and equipment and right-of-use assets, and amortization of intangible assets.

Non-IFRS net profit for the period represents profit for the period excluding amortization of intangible and other assets arising from business acquisitions or combinations, share-based compensation expenses, net losses/gains from investments and related income tax effects.

Please see the “Unaudited Non-IFRS Financial Measures” included in this press release for a full reconciliation of adjusted EBITDA(inc.SBC), adjusted EBITDA and non-IFRS net profit for the period to its net profit for the period.

About Tencent Music Entertainment

Tencent Music Entertainment Group (NYSE: TME and HKEX: 1698) is the leading all-in-one music and audio entertainment platform in China, operating the country’s highly popular and innovative music and audio apps: QQ Music, Kugou Music, Kuwo Music, WeSing and Ximalaya. TME’s mission is to create endless possibilities with music and technology. Powered by its content-and-platform dual-engine strategy, TME’s expansive offerings extend the value of IP beyond online streaming into offline concerts, artist merchandise, and other IP-centric experiences. TME continuously innovates to deliver a seamless experience where users can discover, listen, sing, watch, perform, and connect across diverse scenarios, while unlocking the enduring value of music and audio IP. For more information, please visit ir.tencentmusic.com.

This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC and the HKEX. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.

Investor Relations Contact 
Tencent Music Entertainment Group
ir@tencentmusic.com
+86 (755) 8601-3388 ext. 885034

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-music-entertainment-group-announces-second-quarter-2026-unaudited-financial-results-302848218.html

How did Tencent Music (TME) perform financially in Q2 2026?

Tencent Music reported moderate growth in Q2 2026, with revenue and profits both increasing year over year. According to Tencent Music, total revenue rose 5.8% to RMB8.93 billion and non-IFRS net profit attributable to equity holders grew 4.4% to RMB2.69 billion.

What drove Tencent Music (TME) revenue growth in the second quarter of 2026?

Revenue growth was mainly driven by music related services, especially membership and marketing and consumption services. According to Tencent Music, music related services revenue rose 11.0% to RMB7.61 billion, with membership services up 8.1% to RMB4.79 billion and Ximalaya contributing RMB407 million.

How much profit did Tencent Music (TME) generate in Q2 2026?

Tencent Music generated solid profitability in Q2 2026 on both IFRS and non-IFRS bases. According to Tencent Music, IFRS net profit attributable to equity holders was RMB2.47 billion, while non-IFRS net profit attributable reached RMB2.69 billion, supported by adjusted EBITDA of RMB3.25 billion.

What was Tencent Music (TME) cash position as of June 30, 2026?

Tencent Music held a large cash and investment balance at quarter end. According to Tencent Music, combined cash, cash equivalents, term deposits and short-term investments totaled RMB44.22 billion on June 30, 2026, up from RMB41.00 billion as of March 31, 2026.

How did Ximalaya impact Tencent Music (TME) results in Q2 2026?

Ximalaya provided additional revenue and influenced margins and expenses after consolidation. According to Tencent Music, Ximalaya contributed RMB407 million of revenue and had a positive impact on gross margin, while also increasing operating expenses through amortization of acquired intangible assets.