Tencent Music Posts $1.32 Billion Q2 Revenue as Ximalaya Acquisition Beds In
Tencent Music Entertainment Group reported second-quarter revenue of RMB 8.93 billion ($1.32 billion) for the three months ending June 30, 2026, up nearly 6% year over year, with the freshly completed acquisition of podcast and audiobook platform Ximalaya contributing its first slice of consolidated income. Billboard
The quarter marks a turning point for China's largest music streaming operator. TME completed its $2.4 billion purchase of Ximalaya on May 18, 2026, and the audio platform's results have been folded into TME's consolidated figures from that date onward, according to the company's earnings release. Ximalaya added RMB 407 million ($60 million) in revenue during the quarter — a partial-period contribution, since the deal closed partway through. The platform reportedly had 303 million global active users in 2023.
TME first announced the Ximalaya acquisition in June 2025, framing it as a push beyond music into the broader audio entertainment market. The deal comprised 100% of Ximalaya's equity and was settled in cash and stock, Reuters reported.
The company's core music business carried most of the quarter. Music-related services revenue rose 11% year over year to RMB 7.61 billion ($1.12 billion), while membership subscription revenue — the money TME collects from paying listeners — grew 8.1% to RMB 4.79 billion ($706 million). Gross profit margin expanded by nearly a percentage point to 44.9%.
CEO Ross Liang pointed to growth in the company's SVIP tier — its highest subscription level — as well as the Ximalaya integration as highlights of the quarter, Billboard reported. On the product side, TME expanded freemium access, added video feeds, and introduced a TikTok-style vertical swipe feature for discovering new music — a bet that short-form, scroll-driven listening habits can be captured inside a music app rather than lost to rival platforms.
The bottom line held steady. Adjusted EBITDA — a profitability measure that strips out interest, taxes, depreciation, and amortisation — rose 5.2% to RMB 3.25 billion ($480 million). Net profit attributable to shareholders totalled RMB 2.69 billion ($396 million), up 4.4% year over year, or RMB 1.70 ($0.25) per share versus RMB 1.66 a year earlier.
TME, listed on the New York Stock Exchange under the ticker TME and on the Hong Kong Stock Exchange under code 1698, operates a suite of apps including QQ Music, Kugou Music, Kuwo Music, WeSing, and now Ximalaya. The company describes itself as China's leading all-in-one music and audio entertainment platform.
The Q2 results put clear distance between TME and its 2024 dip, when revenue fell for four consecutive quarters — including a 1.7% year-over-year decline to RMB 7.16 billion ($999 million) in the second quarter of that year. Two years on, the Ximalaya acquisition and double-digit music services growth have returned the company to a steady upward arc.
