Barclays Lifts Tencent Music Entertainment Group (TME) Price Target on Solid Q3 Results and Strong Growth Trajectory

Core Viewpoint - Tencent Music Entertainment Group (TME) is highlighted as a strong investment opportunity following a positive adjustment in its price target by Barclays, reflecting the company's robust third-quarter performance and growth trajectory [1][2]. Financial Performance - The company reported a 20.6% increase in revenue, totaling $1.19 billion, driven by a 27.2% rise in online music service revenues to $979 million [2]. - Subscription revenues increased by 17.2% year-over-year to $632 million, supported by growth in the SVIP membership program [3]. - Operating profit surged 26.4% to $381 million, while net profit attributed to shareholders rose 36% to $302 million, with diluted earnings per share at $0.19 [4]. Growth Drivers - The revenue growth is attributed to multiple streams, including music subscriptions, offline performances, and advertising services [2]. - The increase in monthly average revenue per user rose to $1.60 from $1.50, reflecting the success of premium tier offerings [3]. - The company is expanding its music catalog through strategic partnerships with labels in South Korea and Japan, and has introduced an ad-supported membership tier to attract more listeners [4]. Company Overview - Tencent Music Entertainment Group provides online music, audio, and karaoke services in China, aiming to create a social and interactive experience for users while offering services for musicians and labels to distribute and monetize their content [5].