Tencent Music ($TME) Beats First Quarter Revenue Estimates

Tencent Music Entertainment Group, (NYSE: TME ) a Chinese audio entertainment platform, beat Q1 revenue estimates by a steady rise in paid subscriptions and advertising services on its Spotify-like music streaming platform. The platform reported revenue of 6.77 billion yuan ($935.9 million) for the quarter ended March 31, beating analysts' expectations of 6.63 billion yuan.

However, revenue declined 3.4% from the previous year. Tencent has capitalized on its position as the largest Chinese music-streaming platform with an attractive licensed music library while continuing to focus on advertising services and artist merchandise. Paying users at its online music streaming service rose 20.2% to 113.5 million from a year earlier.

The company's revenue from online music services rose 43%, driven by solid growth in music subscription revenue. However, revenue from its social entertainment services dropped 49.7% due to the government's crackdown on online gambling in 2023 and increased competition from rival NetEase's Cloud Music and Bytedance-owned short video-sharing platform Douyin.

Technical Outlook
We are expected to see an Upside Gap or gapping effect prior to the earnings report. Tecent Music ( TME ) stock has a Relative Strength Index (RSI) of 66.56, which clearly indicates an uptrend. The stock has been in a Rising wedge at the end of September 2023 towards this year consecutively surging towards new highs.