腾讯音乐2023年Q4业绩报告.pdf

Tencent Music Entertainment GroupInvestor Presentation(NYSE:TME&HKEX:1698)March 2024DisclaimerThis presentation has been prepared by Tencent Music Entertainment Group(the“Company”)solely for informational purposes and has not been independently verified.No representations,warranties orundertakings,express or implied,are made by the Company or any of its affiliates,advisers or representatives as to,and no reliance should be placed upon,the accuracy,fairness,completeness orcorrectness of the information or opinions presented or contained in this presentation.None of the Company nor any of its affiliates,advisers,or representatives accept any responsibility whatsoever(innegligence or otherwise)for any loss howsoever arising from any information presented or contained in this presentation or otherwise arising in connection with the presentation.The information presented orcontained in this presentation is subject to change without notice and its accuracy is not guaranteed.Certain statements in this presentation,and other statements that the Company may make,are forward-looking statements.These statements reflect the Companys intent,beliefs or current expectationsabout the future.These statements can be recognized by the use of words such as“expects,plans,will,estimates,projects,intends,anticipates,believes,confidentor words of similarmeaning.These forward-looking statements are not guarantees of future performance and are based on a number of assumptions about the Company s operations and other factors,many of which arebeyond the Companys control,and accordingly,actual results may differ materially from these forward-looking statements.Neither the Company nor any of its affiliates,advisers or representatives have anyobligation and they do not undertake to revise forward-looking statements to reflect future events or circumstances.This presentation does not constitute an offer to sell or issue or an invitation to purchase or subscribe for any securities of the Company for sale in the United States or anywhere else.No securities of theCompany may be sold in the United States without registration with the United States Securities and Exchange Commission or an exemption from such registration pursuant to the Securities Act of 1933,asamended(the“Securities Act”)and the rules and regulations thereunder.No part of this presentation shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.Specifically,these materials do not constitute a“prospectus”within the meaning of the Securities Act.This presentation does not contain all relevant information relating to the Company or its securities,particularly with respect to the risks and special considerations involved with an investment in the securities of the Company.In evaluating its business,the Company uses certain non-IFRS measures as supplemental measures to review and assess its operating performance.These non-IFRS financial measures have limitations asanalytical tools,and when assessing its operating performances,investors should not consider them in isolation,or as a substitute for profit or other consolidated statements of operation data prepared inaccordance with IFRS.201COMPANY OVERVIEWRelentless Commitment to the Healthy Development of Chinas Online Music Industry4Q171Q182Q183Q184Q181Q192Q193Q194Q191Q202Q203Q204Q201Q212Q213Q214Q211Q222Q223Q224Q221Q232Q233Q234Q23TME online music paying users(mm)TME paying ratioHigh-quality content and services continuously driving paying user loyalty4Note:1.Paying ratio is calculated by dividing the number of online music paying users by online music MAUs.18.5%106.71Our Dual Engine Content-and-Platform Strategy5UsersWatchSingListenDiscoverPerformSocializeMonetizationUnique user experienceEnrich content offeringsEmpower creation and distributionPlatformContentTME LiveQQ MusicLazy AudioKugou MusicWeSingKuwo MusicOnline MusicOnline KaraokeLive StreamingLong-form AudioConcertReachMonetizationCopyright ProtectionEmpower CreationTechnologyContent ProviderCreate Endless Possibilities with Music and TechnologyAll-in-one Online Music and Audio Entertainment Destination6Proprietary TechnologyLarge User BaseInnovative Product MatrixComprehensive Content LibraryDiversified MonetizationAll-around suite of music and audio entertainment products and servicesOnline MusicKugou MusicQQ MusicKuwo MusicOnline KaraokeKugou ChangchangWeSingLive StreamingKuwo LiveKugou LiveLong-form AudioLazy AudioLive EventsTME LiveVirtual Music PlaygroundTMELANDMusician PlatformTencent Musician PlatformOriginal ContentVenus Music AssistantProducer StudioLeading Online Music and Audio Entertainment Platform in ChinaNote:1.Four out of top five music mobile apps in terms of mobile MAUs in 2022;2.In 4Q2023.For the definitions of the cited key operating metrics,please refer to the introduction section in the Companys 2022 20-F filed on April 25,2023.Beginning in the first quarter of 2023,“online music MAUs”includes unique mobile and certain IoT devices.“Online music MAUs”for any given period(i)refers to the monthly average of the sum of the MAUs for that period;and(ii)includes QQ Music,Kugou Music,Kuwo Music and other music products,through which such product is accessed at least once in that month;duplicate access of different services by the same device is not eliminated from the calculation;3.As of December 31,2023;4.As of December 31,2023;5.Last twelve months as of December 31,2023.Extensive ContentStrong MonetizationRMB27.8bnLTM 20235total revenuesRMB32.22bnTotal cash,cash equivalents andterm deposits422.4%LTM marginLeading Platform4 out of Top 5Music mobile apps in China1Massive User Scale106.7mmOnline music subscribers120.6%YoY growthWorld recordin the MIREX song prediction technology competition Innovative TechnologyWinnerof the world-renowned MIREX global song recognition technology competition7200mm+Total music&audio tracks3480K+Number of indie musicians3576mmOnline music MAUs1104mmSocial entertainment mobile MAUs202BUSINESS OVERVIEWOur Content:Chinas Most Comprehensive Music Library9Note:1.As of December 31,2023.Tencent Musician PlatformCultivate and empower indie musicians&original music Rich variety of creation scenarios and opportunities to explore socialand cultural values through musicOne-stopplatformtoempowermusicianswithcomprehensiveresources and services as well as holistic support ranging from onlineand offline promotions to diverse monetization avenuesPromotional CapabilitiesIntegrated internal and external promotion resourcesVaried promotional channels such as variety shows,films,videos andperformance eventsBroader Tencent ecosystem for music promotionLabelsLeading music library with diversified genresHundreds of domestic and international music label partners1with200mm+music and audio tracks1Head-start period partnerships with top domestic and overseas labelsand artistsVarious trendy genres including Chinese ancient style,Hip-hop,J-POP,K-POP,ACG,EDM;and diverse music verticals such as gaming,classical,and electronic musicAdvanced technology-driven production capabilitiesProprietary technology and deep understanding of music trends tosystematically and efficiently create,evaluate and promote musicCooperationwithwell-knownIPsacrossvariousentertainmentverticals at home and abroadBroader Tencent EcosystemIn-house StudiosAIGC tools&full-suite of resources and services for efficient originalcontent productionWeixin Video AccountsTencent VideoTHE TREASURED VOICEBillboardSee You Tomorrow Beast Summer LoveNo More BetsContent ProductionMore expansive and vibrant musician ecosystem co-built with Weixinto widen artists exposure Partner with popular brands to host sponsored music festivalBathing in the LightXilou ErnvUtilized LLMs to better promote and distribute new songs,identifyingthe content that resonates most with users.Largest Dolby Atmos music library,offering users a more immersive listening experience,available on mobile,in-car,and PC platforms.Our Platform:Listen,Watch,Sing and Play104Q184Q194Q204Q214Q224Q23Online music paying usersPaying ratioWatch Makes music content more visually memorablePlay New ways to interact virtuallyProduct matrix caters to the varying needs of music consumersLong-form audio:leading IP+radio drama,to enhance overall user engagementMusic subscriptions exhibit robust growth momentum and potential4Q23 Online music paying users and paying ratio106.7mm18.5%TME Live integrates offline concerts with online live streaming experienceTME platform capitalizes onthe publics growing demandsfor music events and hosts agrowingnumberofofflineconcerts632023 Online and offline concertsVocal ProducerVirtual karaoke rooms to sing&chat with friendsLeading online karaoke social community with enriched real-time interaction scenarios&recording and singing optimization features to offer unique and engaging experienceEngaging song guessing function built upon listening experienceAI music companion:Xiaoqin,along with other specific virtual DJs for each genre,brings interactive and fun experience with newly added music recommendation featureMusic PetsSingFrom singing to multi-dimensional performanceListen Innovative and nimble features to elevate listening experienceSound optimization featureCollaborate with WexinVideo Accounts to create vibrant music ecosystem and strengthen promotion capabilitiesOur Industry-leading TechnologyListening/watching/download historyFavorite songs/artists/genresLikes/shares/commentsDigital album purchasesLocationsBullet chatsVirtual gifting activitySaved playlistsFeed browsing activityNote:1.MIREX(Music Information Retrieval Evaluation eXchange)is a community-based formal evaluation framework coordinated and managed by the International Music Information Retrieval System Evaluation Laboratory(IMIRSEL)at the University of Illinois at Urbana-Champaign.Industry-leading TechnologyDataValue PropositionsTechnologySuperior Sound Quality and EffectsOptimized sound quality and effects:DolbySurroundSound,AdaptiveSoundAdjustment,etc.Data Analytics and PredictionAlgorithmsandmulti-dimensionaldatainsights,recommending music based on users music tastesTargetedpromotion systembasedonreal-time data analysis,helping artistsand songs reach the right audienceSong RecognitionIdentifysongsbyplayingsongtracksamples or short videosFacilitateusercontentdiscoveryandsearchingAward-winningtechnology:winnerofMIREX12020 global song recognitiontechnology competition;New world recordinMIREX2020songpredictiontechnology competitionAI Capabilities&AIGC ToolsAI reading technologyProprietary sound effects:panoramic,DJmode,super bass,acoustic clear voice,4Dvibe and many others,Viper PanoramicSurround SoundProprietary PDM predictive model at eachkey stage of the music production process,enablingcreatorstoquicklymakedecisions11Lingyin Engine and LyraSinger Engine:patentedAI-basedvoicesynthesistechnologyMuse Engine:enable automated large-scale music poster productionVirtual performers:LUCY(鹿晓希),Xiaoqin(小琴),Shanbao(扇宝)and Anko(安可)Premium Sound series:QQMUSIC AUDIO,Premium Master Tape,Premium SurroundSound and Premium Sound Quality 2.0,enhancingsoundclarityandexpressivenessVenus:introduced zero-shot AI-poweredmusic production toolAIGC-empoweredvirtualgiftsandfunctions for live streamingVocalProducer:createAI-generatedmusic content in multiple languagesQQ Musics Quick Listen mode:chorus-focused content discovery featureKugouMusic12.0:featuringfastdiscovery of multiple song coversLLMs to better promote and distribute new songsStrong growth of online music paying users driven by premium content and servicesSubscriptionOur Diverse Monetization OpportunitiesPremium Membership AdvertisingAd-supported modeSponsored music events12Multi-faceted ModelsDigital albumscontinue to innovate service modelsArtist merchandiseSuper VIP MembershipLong-form audioCopyright licensingMobileIoTInnovative and Diverse Ad FormatsMusic-centric Live StreamingFor Live StreamersTalent discoveryCuration and promotionPrivate domainMusic career pathConnect and interact with fansLeading music-centric live streaming platform in collaboration with online music servicesOverseas ExpansionFor UsersDiversified categoriesLeading technologiesCommunity&interest groupsHealthy contentOrganic TrafficMusic Content EnrichmentArtist DiscoveryMonetizationCollaboration with MusicMusic-centric Live StreamingKugou Live Kuwo Live QQ Music Live Virtual Interactive Offerings13 Replicate successful domestic operational experiences in overseas markets ROI-focused M&A strategy Virtual idol cultivation and AI companion creation AIGC-empowered features,e.g.automatically analyzing and providing personalized advice based on users singing on WeSing03FINANCIAL HIGHLIGHTS4Q23 Gross margin4Q23 Non-IFRS net profitProfitability4Q23 Online music monthly ARPPU1 4Q23 Subscription revenueMonetizationStrong Monetization and ProfitabilityNote:1.Refers to the monthly average of(i)the subscription revenues of online music services for 4Q2023 divided by(ii)the number of paying users of online music services for 4Q2023.15Record high,with 7consecutive quarters of sequential growthRMB10.7RMB3.42bn45.3%YoY+38.3%5.3pptYoY+RMB1.68bn12.5%YoY+Total RevenuesRobust online music revenue performanceDiverse Revenue Streams and Healthier Revenue Mix(RMB mm)162,351 2,598 2,890 3,193 3,416 1,208 903 1,359 1,360 1,606 3,559 3,501 4,249 4,553 5,022 4Q221Q232Q233Q234Q23SubscriptionNon-subscription8.9 9.2 9.7 10.3 10.7 14.7%15.9%16.7%17.3%18.5%5.0%7.0%9.0%11.0%13.0%15.0%17.0%19.0%78899101011114Q221Q232Q233Q234Q23 Online music ARPPU(RMB)Paying ratioSubscription as a key growth driverOnline Music Revenues(RMB mm)3,559 3,501 4,249 4,553 5,022 3,866 3,503 3,037 2,016 1,871 7,425 7,004 7,286 6,569 6,893 48%50%58%69%73%(0)00000111101,0002,0003,0004,0005,0006,0007,0008,0009,00010,00011,00012,00013,0004Q221Q232Q233Q234Q23Social entertainment services and othersOnline music servicesOnline music services as%of total revenues2,447 2,315 2,497 2,342 2,641 33.0%33.1%34.3%35.7%38.3%4Q221Q232Q233Q234Q23Gross profitGross marginExpanded Gross Margin and Healthy Profitability17(RMB mm)Gross profit and margin1,492 1,463 1,579 1,503 1,678 20.1%20.9%21.7%22.9%24.3%4Q221Q232Q233Q234Q23Non-IFRS net profitNon-IFRS net marginNon-IFRS net profit1and margin(RMB mm)Note:1.For non-IFRS net profit,please refer to the appendix for reconciliation details.Solid Cash Position and Valuable InvestmentNote:1.As of December 31,2023;2.In 4Q2023.Strong cash position&cash generation ability Equity investments18Cash and cash equivalents,term deposits1Operating cash flow2Financial assets at fair value through other comprehensive income1Investments accounted for using equity method1RMB32.22bnRMB1.98bnRMB6.54bnRMB4.27bnShare countADSs used in computing diluted earnings per ADS21.57bnUnaudited Non-IFRS Financial MeasureAppendix19