Tencent Music Entertainment Group (NYSE:TME) Releases Earnings Results, Beats Expectations By $0.01 EPS

Posted by Francis Steltz on Aug 12th, 2026

Tencent Music Entertainment Group (NYSE:TME – Get Free Report) issued its earnings results on Tuesday. The company reported $0.25 EPS for the quarter, beating analysts’ consensus estimates of $0.24 by $0.01, reports. The business had revenue of $1.32 billion during the quarter. Tencent Music Entertainment Group had a net margin of 26.45% and a return on equity of 11.20%. Tencent Music Entertainment Group’s quarterly revenue was up 5.8% on a year-over-year basis. During the same quarter last year, the company earned $1.55 earnings per share.

Here are the key takeaways from Tencent Music Entertainment Group’s conference call:

Q2 revenue increased 6% year over year to RMB 8.9 billion, with music-related services up 11% and membership revenue up 8% to RMB 4.8 billion. Adjusted EBITDA rose 5% to RMB 3.3 billion, while net profit reached RMB 2.5 billion.
IP-driven businesses—including concerts, merchandise, digital albums, and artist-related services—continued to deliver strong double-digit growth. Management expects these diversified monetization channels to provide relatively steady growth despite competitive pressure on subscriptions and advertising.
The consolidation of Ximalaya contributed approximately RMB 0.4 billion in Q2 revenue and expands Tencent Music into a broader music-and-audio platform. Management highlighted potential long-term synergies from audiobooks, podcasts, children’s content, advertising, shared technology, and richer SVIP benefits.
Competition and weaker traffic trends moderated underlying music subscription growth, particularly among casual and light users, while advertising faced macroeconomic and market headwinds. Management expects full-year operating expenses to rise modestly, net profit margin to come under slight pressure due partly to higher interest expense, and second-half gross margin to decline slightly year over year.
Tencent Music ended the quarter with RMB 44.2 billion in cash, deposits, and short-term investments and repurchased 43.5 million ADSs for USD 400 million during Q2. Management said it remains on track to complete the existing USD 1 billion buyback program and is preparing for a potential new repurchase plan.

Tencent Music Entertainment Group Trading Down 3.3%

Shares of TME stock traded down $0.29 on Wednesday, hitting $8.43. 8,485,928 shares of the stock traded hands, compared to its average volume of 9,248,015. The company has a debt-to-equity ratio of 0.06, a quick ratio of 2.08 and a current ratio of 2.09. Tencent Music Entertainment Group has a twelve month low of $7.94 and a twelve month high of $26.70. The firm’s 50-day moving average price is $8.98 and its two-hundred day moving average price is $10.86. The stock has a market capitalization of $13.27 billion, a PE ratio of 10.54, a PEG ratio of 1.49 and a beta of 0.84.

Analysts Set New Price Targets

Several brokerages recently issued reports on TME. UBS Group set a $15.00 price objective on shares of Tencent Music Entertainment Group in a research note on Wednesday. Weiss Ratings raised shares of Tencent Music Entertainment Group from a “hold (c-)” rating to a “hold (c)” rating in a research note on Wednesday, July 1st. China Renaissance cut Tencent Music Entertainment Group from a “buy” rating to a “hold” rating and set a $9.30 target price on the stock. in a report on Wednesday. Zacks Research upgraded Tencent Music Entertainment Group from a “strong sell” rating to a “hold” rating in a research report on Tuesday, May 19th. Finally, JPMorgan Chase & Co. cut their price target on Tencent Music Entertainment Group from $12.00 to $10.00 and set a “neutral” rating for the company in a report on Thursday, May 14th. Four investment analysts have rated the stock with a Buy rating and nine have given a Hold rating to the company’s stock. Based on data from MarketBeat.com, the stock has a consensus rating of “Hold” and a consensus target price of $18.80.

Get Our Latest Stock Report on TME

Hedge Funds Weigh In On Tencent Music Entertainment Group

A number of institutional investors have recently bought and sold shares of the company. Allworth Financial LP raised its position in shares of Tencent Music Entertainment Group by 63.2% in the third quarter. Allworth Financial LP now owns 1,480 shares of the company’s stock valued at $35,000 after purchasing an additional 573 shares during the period. O Shaughnessy Asset Management LLC lifted its position in shares of Tencent Music Entertainment Group by 0.5% during the 4th quarter. O Shaughnessy Asset Management LLC now owns 132,635 shares of the company’s stock worth $2,325,000 after purchasing an additional 610 shares during the last quarter. Vise Technologies Inc. boosted its stake in Tencent Music Entertainment Group by 5.0% during the 4th quarter. Vise Technologies Inc. now owns 14,648 shares of the company’s stock valued at $257,000 after purchasing an additional 692 shares during the period. Smartleaf Asset Management LLC boosted its stake in Tencent Music Entertainment Group by 61.3% during the 4th quarter. Smartleaf Asset Management LLC now owns 2,123 shares of the company’s stock valued at $37,000 after purchasing an additional 807 shares during the period. Finally, Cerity Partners LLC increased its position in Tencent Music Entertainment Group by 1.8% in the 4th quarter. Cerity Partners LLC now owns 52,583 shares of the company’s stock worth $922,000 after buying an additional 929 shares during the period. 24.32% of the stock is owned by hedge funds and other institutional investors.

Key Headlines Impacting Tencent Music Entertainment Group

Here are the key news stories impacting Tencent Music Entertainment Group this week:

Positive Sentiment: TME reported second-quarter revenue of RMB8.93 billion (approximately $1.32 billion), up 5.8% year over year and ahead of expectations. Growth was driven primarily by music-related services, subscription expansion, concert activity, and the integration of Ximalaya. Tencent Music second-quarter 2026 financial results
Positive Sentiment: The company signaled another share-buyback round while combining Ximalaya with its music business into a broader music-and-audio platform. Buybacks could support per-share value, while the acquisition may expand TME’s addressable market and cross-selling opportunities. TME buyback and Ximalaya integration
Neutral Sentiment: Mizuho lowered its price target from $18 to $15 but maintained an “outperform” rating. The revised target still implies substantial upside, indicating continued long-term confidence despite lower near-term expectations. Mizuho rating update
Negative Sentiment: China Renaissance downgraded TME from “buy” to “hold” and assigned a $9.30 target. Although that target remains above the recent trading level, the downgrade adds pressure and suggests limited near-term upside in the analyst’s view. China Renaissance rating update
Negative Sentiment: The stock declined after the earnings release even though revenue exceeded expectations. Investors may be focused on the modest 5.8% growth rate, uncertainty surrounding Ximalaya integration, and whether the strong reported earnings comparison will translate into sustained operating momentum. Tencent Music shares slide after second-quarter results

About Tencent Music Entertainment Group

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Tencent Music Entertainment Group (NYSE: TME) is a China-based digital music and audio entertainment platform that operates a portfolio of leading music streaming and social entertainment services. Its core consumer-facing products include streaming apps, online karaoke (KTV) services and live music and entertainment broadcasts. The company monetizes its content through a mix of subscriptions, digital music sales, in-app purchases, virtual gifting, advertising and licensing arrangements with rights holders.

The company traces its roots to the consolidation of Tencent’s music assets and was established in the mid-2010s to unify several prominent music properties under a single operating entity.