20251113-招银国际-3Q25_review_investing_to_expand_music_product_offerings_6页_1mb

报告摘要

Revenue Growth: Total revenue for the third quarter of 2025 increased by 21% year-over-year to RMB8.46 billion, exceeding Bloomberg consensus expectations by 4% YoY.
Net Income: Non-IFRS net income grew 33% YoY to RMB2.41 billion, driven by strong performance in non-subscription music businesses (+51% YoY).
Music Business: Online music revenue reached RMB6.97 billion (+27% YoY), supported by subscription growth (subscriber base up 6% YoY to 125.7 million) and non-subscription segments (including offline performances and ads) delivering robust growth.
Valuation Adjustment: Target price lowered to US$28.00 from US$29.50 based on updated DCF model, reflecting increased investment in new opportunities that may impact short-term margins.
Outlook: TME is expected to maintain revenue growth in the fourth quarter, with a deceleration to +12% YoY primarily due to normalized offline performance revenue; however, investments in content and artist-related merchandise could drive sustainable long-term growth.

Q3 Results: Revenue up 21% YoY to RMB8.46bn, net income up 33% YoY to RMB2.41bn.
Segment Analysis: Online music leads growth with a 27% YoY increase; subscription revenue contributes 53% of total revenue and saw a 17% YoY rise in subscribers.

Investor Rating: Maintain BUY, with revised earnings forecasts showing modest reductions due to margin pressure from increased investments.
Analyst Views: Positive on long-term potential but cautious on short-term margins due to targeted spending on offline performances and merchandise.

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