机构：中银国际 研究员：Raphael CHEN 9% YoY topline and RMB2.1bn (up 25% YoY) adj. net profit in 1Q25 exceeds consensus by 1% and 3% respectively. 16% YoY core music revenue meets streets' expectation. We deem Co. has strong financial visibility along the road on solid music growth trajectory driven by ARPPU-prioritised subs and diversified non-subs monetisation channels given its enriched contents, expanded privileges and solidified operational expertise. Along with its committed shareholder return executions, healthy ...

北京时间5月13日港股盘后、美股盘前，腾讯音乐发布了2025年一季度财报。 财务层面，腾讯音乐在一季度持续实现高质量的增长：实现营收73.6亿元、调整后净利润22.3亿元，分别同比增长8.70%和22.8%。其中，成为核心引擎的 在线音乐业务继续"高飞"，在线音乐服务、在线音乐订阅两项业务收入分别为58.0亿元、42.2亿元，同比分别增长15.9%和16.6%。 业务层面，核心数据——付费用户和付费率也沿着过去几个季度的上升曲线平稳发展。季度内，在线音乐付费用户数同比增长8.3%至1.229亿，单个付费 用户月均收入（ARPPU）从2024年同期的10.6元增长至11.4元。 一切看起来是那么的欣欣向荣，可当我们穿透表面的繁华，深入探究后会发现，在看似蓬勃的发展图景下，腾讯音乐仍有焦虑如藤蔓般肆意生长，紧紧缠 绕着它前行的每一步。 成长确幸背后的掣肘 实际上，我们对腾讯音乐一季度报最客观的解读，应该是有喜有忧。 喜，开篇已经说明，在线音乐成为腾讯音乐最具优势的一张底牌，一季度占总收入近八成，而忧之所在也很明晰——这张底牌并非坚不可摧。 自2021年四季度首次出现同比下滑至今年一季度，腾讯音乐的在线音乐月活跃用 ...

Financial Data and Key Metrics Changes - In Q1 2025, Tencent Music Entertainment Group (TME) reported revenues of RMB 7.4 billion, reflecting a 9% year-over-year growth [22] - Online music revenues increased by 16% year-over-year to RMB 5.8 billion, driven by strong growth in music subscription and advertising revenues [22] - Music subscription revenues reached RMB 4.2 billion, representing a 70% year-over-year increase and a 5% sequential rise [23] - The gross margin improved to 44.1%, up 3.2 percentage points year-over-year, attributed to strong subscription and advertising revenue growth [27] Business Line Data and Key Metrics Changes - The music subscription business remains the cornerstone of TME's revenue, with significant growth in SVIP membership and reduced promotional activity contributing to revenue increases [23][31] - Advertising revenues showed strong year-over-year growth, primarily due to the success of the ad-supported model [24] - Artist-related merchandise sales and offline performances also contributed to revenue growth, with notable sales from physical albums and concerts [25] Market Data and Key Metrics Changes - The company has strengthened partnerships with record labels, enhancing its music library and user engagement through exclusive content and immersive audio experiences [6][7] - There is a growing popularity of diverse music genres, including Korean, English, and Japanese tracks, indicating a shift in user preferences [9] - The company is expanding its presence in the international market, particularly in Southeast Asia, to capture growth opportunities [76] Company Strategy and Development Direction - TME is focused on high-quality growth in its music business, expanding SVIP memberships, and diversifying offerings across the music value chain [31] - The company aims to enhance user engagement through innovative technologies and original content production [31] - TME is committed to building a comprehensive content ecosystem and improving operational efficiency to sustain growth [12][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the 2025 outlook, expecting year-over-year growth rates to accelerate and margins to expand [36] - The company is optimistic about the long-term potential of the music industry and plans to continue investing in high-quality content and user engagement [31] - Management highlighted the importance of adapting to user preferences and market dynamics to drive future growth [41][53] Other Important Information - TME released its 2024 ESG report, detailing practices in intellectual property protection, user privacy, and fostering diverse music communities [12] - The company declared a cash dividend of US$0.09 per ordinary share for the year ended December 31, 2024, with payments made in April 2025 [31] Q&A Session Summary Question: Outlook for top line profit growth for the next quarter and full year 2025 - Management expressed confidence in achieving strong results in Q1 and expects full-year growth to accelerate, driven by rich service offerings and user engagement [36] Question: Growth opportunity of podcasts in China and long-form audio user metrics - Management noted that while podcast growth in China is limited, long-form audio content is expected to complement existing services and enhance user experience [42] Question: SVIP progress and retention metrics - Management reported strong growth in SVIP membership and ARPPU, with plans to enhance the membership system and improve user satisfaction [48] Question: Contribution of Super VIP to ARPPU growth - Management indicated that the reduction in promotional activities has positively impacted ARPPU, with expectations for continued growth from the SVIP business [52] Question: Monetization strategy for non-paying subscribers - Management emphasized converting non-paying users into subscribers while leveraging advertising and merchandise sales to generate revenue from this segment [58] Question: Future drivers for gross margin improvement - Management highlighted subscriber growth, effective cost management, and strong partnerships with content creators as key drivers for future gross margin expansion [70] Question: International opportunities, especially in Southeast Asia - Management confirmed that international markets are a key part of their strategy, with ongoing investments in content and platform development in Southeast Asia [76] Question: Outlook for advertising and offline events business - Management remains optimistic about advertising revenue growth and plans to enhance the quality of offline performances to provide comprehensive musical experiences [82]

Core Viewpoint - The article discusses the evolution and current state of the Chinese folk music scene, particularly focusing on the impact of popular songs like "South of the South" and the artists behind them, highlighting the tension between artistic integrity and commercial success [4][11][20]. Group 1: Popularity of Folk Music - The peak popularity of folk music occurred between 2013 and 2017, largely due to the "Folk Music Three Illusions" represented by songs like "South of the South" [6][14]. - The rise of folk music was significantly influenced by television shows, with "South of the South" gaining fame through performances on "The Voice of China" [8][11]. - Folk music's mainstream success has led to a perception that it lacks depth, with artists like Ma Di expressing discomfort with their most popular works [11][19]. Group 2: The Dichotomy of Folk Music - The article contrasts the concepts of "circulation" and "popularity" in folk music, suggesting that while folk music has become popular, it may not reflect the true essence of the genre [12][13]. - Artists like Ma Di and Zhao Lei have moved away from their earlier hits, seeking to create music that resonates more deeply with their artistic values rather than commercial trends [20][19]. - The influx of new artists into the folk scene has led to a proliferation of songs that mimic earlier hits, further complicating the genre's evolution [18][19]. Group 3: Challenges Facing Folk Music - The article notes that while folk music has enjoyed periods of popularity, it faces challenges in maintaining relevance against genres like rock and rap, which have seen a resurgence [24][25]. - The technical aspects of folk music are often criticized, with the genre perceived as easier to produce compared to rock or rap, leading to a decline in its artistic credibility [27][29]. - Despite efforts to revitalize folk music through various platforms, such as the "Our Folk Music" show, the genre struggles to capture the same audience engagement as other music styles [26][30].

Group 1 - The article discusses the resurgence of interest in a 2005 concert performance by singer 古巨基, particularly a segment featuring the song "任天堂流泪" which has drawn attention from younger audiences due to its unique themes and presentation [1][6][8] - The performance included elements from popular video games and anime, showcasing a blend of music and pop culture that was considered ahead of its time [13][14][36] - The song "任天堂流泪" is part of the album "游戏·基," which was released in 2003 and is notable for its video game-themed content, reflecting 古巨基's personal interests in gaming [16][18][28] Group 2 - The album "游戏·基" marked a significant turning point in 古巨基's career, helping him regain popularity after a period of stagnation in the music industry [19][28] - The production of the album involved notable collaborators, including 雷颂德 as the producer and 林夕 as the primary lyricist, indicating a high level of artistic investment [23][25] - The album's unique concept and its success in the market demonstrate the potential for thematic albums in the music industry, particularly those that resonate with niche interests like gaming [28][36]

Financial Data and Key Metrics Changes - The company's revenue increased by 1% in Q2, with recorded music revenue growing by 1% and music publishing revenue growing by 3% [9][25] - Adjusted OIBDA decreased by 1%, with an adjusted OIBDA margin of 20.4%, a decrease of 50 basis points compared to the prior year quarter [9][25] - Operating cash flow increased to $69 million from a use of $31 million in the prior year quarter, primarily due to timing of working capital items [28] - Free cash flow increased to $33 million from a use of $57 million in the prior year quarter [29] Business Line Data and Key Metrics Changes - Subscription streaming revenue grew by 3%, while ad-supported streaming declined by 3% due to a soft overall ad environment [25][26] - Physical revenue increased by 2% due to strong releases in the U.S. and Japan, partially offset by the BMG roll-off [26] - Artist services and expanded rights revenue decreased by 6% due to lower concert promotion revenue, primarily in France [26] - Music publishing total revenue increased by 3%, with streaming revenue increasing by 2% [27] Market Data and Key Metrics Changes - Market share pressure was noted in China, contributing to the overall performance challenges [9] - The company has seen real progress in high-growth markets such as MENA, Nigeria, and India, where market share has meaningfully increased [13] Company Strategy and Development Direction - The company is focused on three strategic priorities: growing market share, growing the value of music, and increasing efficiency to free up capital for reinvestment [10][20] - The company is increasing its M&A activity to augment growth alongside organic strategies [16][21] - A new app, WMG Pulse, was launched to provide real-time insights for artists, reflecting the company's investment in technology [22] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a transition period in the industry and expressed optimism about the resilience of music as an art form [9][10] - The company expects challenges experienced in Q2 to persist for the remainder of the fiscal year, resulting in lower subscription streaming growth than previously expected [23] - Management emphasized the importance of protecting artists and songwriters, particularly in the context of AI developments [18][19] Other Important Information - The company announced plans to achieve over $300 million in annualized cost savings, with the majority being reinvested in music and technology [20] - The company welcomed a new CFO, Armin Zerza, who brings a strong track record from Activision Blizzard [7] Q&A Session Summary Question: What confidence can you give investors regarding Warner Music's growth goals? - Management highlighted a strategy focused on growing market share, value of music, and efficiency, with early signs of success in chart performance and market share growth [34][35] Question: Can you provide an update on subscription streaming growth expectations? - Management expects similar trends to Q2 for the remainder of the year, with challenges persisting [39] Question: What is the strategy for growing global market share, particularly in emerging markets? - Management noted success in markets like Mexico and Brazil and emphasized the importance of a new head of Asia to drive growth in China [44][45] Question: What changed regarding expectations for high single-digit subscription growth? - Management cited tough comparisons from the previous year, market pressure, a lighter release schedule, and weakness in China as contributing factors [52][53] Question: Can you elaborate on the investments in ANR and market share goals? - Management indicated a focus on capital allocation and a shift towards a repertoire lens for evaluating opportunities [67]

Financial Performance - Total revenue increased by 1%[12] - Recorded Music (RM) streaming revenue increased by 2%[12,22] - Music Publishing (MP) revenue increased by 3%[34] - Adjusted OIBDA increased by 1%[12,22] - Adjusted OIBDA margin increased by 50 basis points to 20.9%[13] - Operating Cash Flow (OCF) / Adjusted OIBDA conversion was 23%[12] Debt Maturity - Debt maturities are scheduled as follows: $352 million in 2025, $535 million in 2026, $2576 million in 2027, $540 million in 2028, $17 million in 2033 and $311 million in 2050[16] Strategic Initiatives and Partnerships - Armin Zerza joined as EVP and CFO[19] - Launched a beta version of WMG Pulse, an artist and songwriter app[19] - Launched 5 Junction, a JV label focused on breaking artists of South Asian heritage in North America[20] - Launched Adore Music, a new French dance label[20] - Partnered with Rocketfuel Entertainment, a Malaysian talent management and record label[20] - Inked a global distribution deal with independent label Three Six Zero Recordings[20]

Core Insights - Warner Music Group Corp. reported a total revenue of $1,484 million for Q2 2025, a decrease of 1% compared to $1,494 million in Q2 2024 [3][24] - The company experienced a significant decline in net income, which fell 63% to $36 million from $96 million in the prior-year quarter [4][8] - Operating income increased by 41% to $168 million, driven by cost savings and a decrease in restructuring charges [6][14] Financial Performance - Total revenue decreased by 1% (or increased by 1.2% in constant currency) [4] - Recorded Music revenue was down 1% to $1,175 million, while Music Publishing revenue increased by 1% to $310 million [3][16] - Adjusted OIBDA decreased by 3% to $303 million, with a margin of 20.4% [7][31] Revenue Breakdown - Digital revenue decreased by 0.8% to $841 million, with streaming revenue down 0.4% [4][28] - Physical revenue increased by 0.9% to $112 million, driven by new releases [13][17] - Licensing revenue increased by 1% to $105 million, primarily due to deals in Japan and the U.S. [13][17] Cash Flow and Debt - Cash provided by operating activities increased to $69 million from a use of $31 million in the prior-year quarter [11] - Free Cash Flow improved to $33 million from a use of $57 million in the prior-year quarter [11] - As of March 31, 2025, the company reported a cash balance of $637 million and total debt of $4.292 billion [10][26] Strategic Initiatives - The CEO highlighted that the company's strategy is beginning to yield results, with an expanding market share in the U.S. [2] - Cost savings plans are on track, and reinvestment initiatives are accelerating [4][5] - The company aims to replicate its successful strategy across other labels and geographies to drive growth and profitability [2]

Core Insights - Universal Music Group N.V. (UMG) reported strong financial results for Q1 2025, highlighting a successful execution of its strategic plan and growth in key revenue areas [3][4][5]. Financial Performance - Revenue for Q1 2025 reached €2,901 million, marking an 11.8% increase year-over-year, or 9.5% in constant currency, driven by growth in Recorded Music and Music Publishing [6][8]. - EBITDA for the quarter grew 23.1% year-over-year to €603 million, with an EBITDA margin of 20.8%, up from 18.9% in Q1 2024 [7][8]. - Adjusted EBITDA was €661 million, reflecting an 11.8% increase year-over-year, with a consistent Adjusted EBITDA margin of 22.8% [7][8]. Revenue Breakdown - Recorded Music revenue was €2,241 million, up 12.7% year-over-year, with subscription revenue growing 11.5% and streaming revenue increasing 2.9% [10]. - Physical revenue saw a significant increase of 17.6% year-over-year, driven by vinyl sales growth in the U.S. and Europe [10]. - Music Publishing revenue reached €555 million, an 11.9% increase year-over-year, with digital revenue growing 19.4% [12]. Strategic Initiatives - The company emphasized its focus on developing successful artists and songwriters, connecting them with fans through innovative methods [4][5]. - UMG's strategic initiatives are expected to support its mid-term financial objectives, as indicated by the healthy growth across various revenue streams [5]. Market Trends - The shift in consumption from video platforms to short-form platforms is impacting streaming revenue growth, which remains a focus area for UMG [10]. - The decline in downloads and other digital revenue by 13.0% year-over-year reflects ongoing industry trends [10]. Upcoming Events - UMG will host a conference call on April 29, 2025, to discuss these results in detail [15].

Core Insights - Warner Music Group (WMG) is launching a new joint venture label named 5 Junction, aimed at discovering and nurturing U.S.-based artists of South Asian heritage and amplifying the success of existing South Asian artists within WMG [1][2] - The initiative is led by Anjula Acharia, who emphasizes the importance of representation and the global power of South Asian stories in music [2][3] - WMG's India team has expanded its presence in South Asia, attracting notable regional talent with global potential, such as Diljit Dosanjh and King [2][3] Group 1 - 5 Junction will collaborate closely with Warner Records in Los Angeles, focusing on the intersection of culture and commerce to enhance the visibility of South Asian music in the U.S. [1][2] - Robert Kyncl, CEO of WMG, highlights the early recognition of the global potential in South Asian music and the strategic positioning to capitalize on this market [2][3] - The label aims to amplify South Asian music, which has a significant diaspora and cultural rhythm, to thrive in the U.S. music market [2][3] Group 2 - Anjula Acharia is recognized for her role in launching Priyanka Chopra Jonas' career and connecting global talent with opportunities [3] - Acharia's previous work includes introducing Western superstars to South Asian audiences, showcasing her expertise in cross-cultural collaborations [3] - The partnership with 91 North Records, a joint venture between Warner Music India and Warner Music Canada, will further enhance the fusion of South Asian music in Canada [2]