Q3前瞻：付费用户净增回归常态化

Investment Rating - The report maintains a "Buy" rating for Tencent Music (TME US) with a target price of $14.25 [5][4][6] Core Views - The report anticipates that Tencent Music's paid user growth will return to a normalized level in Q3 2024, with a focus on refining operations to enhance user retention [1][2] - Total revenue for Q3 2024 is projected to be approximately 70 billion RMB, with adjusted net profit expected to be around 19.5 billion RMB, aligning with market expectations [1][2] - The company is expected to see a slight improvement in overall gross margin and adjusted net margin due to a decrease in the proportion of low-margin social entertainment business and ongoing cost reduction efforts [2] Summary by Sections Revenue and Profit Forecast - For Q3 2024, total revenue is estimated at 69.88 billion RMB, with online music revenue around 55.43 billion RMB, reflecting a year-over-year growth of 21.7% [2] - The net increase in paid users is expected to be about 1.5 million, indicating a return to normalized growth rates [2] - The average revenue per user (ARPU) is projected to increase to 10.8 RMB [2] Business Strategy - Tencent Music continues to expand its multi-device layout and enhance audio quality, which is expected to drive sustainable membership growth [3] - Collaborations with industry partners, such as the partnership with Xiaomi for high-quality audio experiences, are part of the strategy to meet evolving user demands [3] Financial Metrics - The report maintains revenue forecasts for 2024-2026 at 282.3 billion RMB, 294.5 billion RMB, and 311.9 billion RMB respectively, with adjusted net profit forecasts of 74.5 billion RMB, 80.7 billion RMB, and 86.7 billion RMB [4] - The projected PE ratio for 2025 is 19.55x, with a target price adjustment from $17.19 to $14.25 [4][9]