China’s Tencent plans secondary listing after posting a 15% drop in revenue at its main services unit, according to a press release by Tencent Music Entertainment on Monday.

  • Even though most of Tencent Music users are in its music streaming division, social entertainment services, including karaoke sites, are its biggest sources of revenue.
  • Revenue from social entertainment services and other units dropped 15.2% to 4.73 billion yuan ($742 million while subscribers in the social entertainment unit plunged 16.7%).
  • Cussion Pang Executive Chairman stated that the weakness was caused by intense competition from rivals and changing macro environment.
  • On a positive note, Tencent Music’s online music services business posted revenue growth of 4.3%. Total revenue of the Tencent Holdings-controlled company plunged 8.7% to 7.61B yuan, in line with market estimates.

Excluding core items, the company reported earnings of 0.50 yuan per American Depositary Shares (ADS), in line with analysts’ estimates. TME: NYSE is up +1.72%