Tencent Music Entertainment Group (TME) investor relations material

Executive summary

• Achieved total revenue of RMB 8.93 billion in Q2 2026, up 5.8% year-over-year, driven by music-related services, membership growth, and Ximalaya integration.

• Monetization from music-related services reached RMB 7.61 billion, up 11% year-over-year.

• Expanded IP-driven offerings, live concerts, merchandise, and premium content, strengthening the content ecosystem.

• Product innovation, AI-driven personalization, and deeper Tencent ecosystem integration enhanced user experience and engagement.

Financial highlights

• Membership services revenue grew to RMB 4.79 billion, up 8.1% year-over-year; Ximalaya contributed RMB 407 million to overall revenues.

• Gross margin was 44.2% in Q2 2026, slightly down from 44.4% in Q2 2025; adjusted EBITDA was RMB 3.25 billion, up 5.2% year-over-year.

• Net profit attributable to equity holders reached RMB 2.5 billion, with non-IFRS net profit at RMB 2.78 billion, up 5.3% year-over-year.

• Cash, term deposits, and short-term investments totaled RMB 44.22 billion as of June 30, 2026.

• Share repurchase: 43.5 million ADSs repurchased for $400 million in Q2 2026; $1 billion program ongoing.

Outlook and guidance

• Expect gross margin to decrease slightly year-over-year in the second half due to revenue mix and seasonal changes.

• Continued focus on SVIP membership growth, innovative products, and diversified benefits.

• Ongoing investment in quality content, IP development, and deeper Tencent ecosystem collaboration.

• Ximalaya integration expected to unlock further growth and enhance platform differentiation.