(Reuters) –China‘s Tencent Music Entertainment Group beat analysts‘ estimates for third-quarter profit on Monday, as efforts to bolster content attracted more paying users to its Spotify-like music streaming platform.
Online music paying users jumped 37.7% to 71.2 million from a year earlier, while it increased by 5 million from the prior quarter.
The results come amid a regulatory crackdown in China on sectors from tech to education and property. The company’s parent, Tencent Holdings, said in August it had ended all exclusive music copyright agreements after regulators barred it from such deals.
Excluding items, Tencent Music earned 0.61 yuan per American Depository Share (ADS), topping estimates of 0.49 yuan per ADS, according to Refinitiv IBES.
“While the online music industry in China is adapting to regulatory changes and facing competition for time spent from short video services, we will continue to differentiate both our online music and social entertainment services and execute our dual engine content-and-platform strategy,” Executive Chairman Cussion Pang said in a statement.
Tencent Music’s social entertainment services business, which includes karaoke platforms where users can live stream concerts is its primary source of revenue.
Profit attributable to equity holders of the company fell to 740 million yuan, from 1.13 billion yuan a year earlier.
($1 = 6.3980 Chinese yuan renminbi)
(Reporting by Arunima Kumar and Eva Mathews in Bengaluru; Editing by Sriraj Kalluvila)