TME 6-K
Tencent Music Entertainment Group (TME)
6-K
2026-09-01
For: 2026-06-30
View Original
Added on
September 01, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO
RULE 13a-16 OR 15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of 2026
Se
ptember
Commission file
number: 001-38751
(Exact Name of Registrant as Specified in Its Charter)
Unit 3, Building D, Kexing Science Park
Kejizhongsan Avenue,
Hi-Tech
Park, Nanshan District Shenzhen, 518057, the People’s Republic of China
Tel: 3388
+86-755-8601
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover
Form 20-F or
Form 40-F.
Form
20-F
☒ Form 40-F
☐
Exhibit Index
| Exhibit |
Description | |
| 99.1 | Unaudited Condensed Consolidated Interim Financial Statement | |
| 101.INS | Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema with Embedded Linkbase Documents | |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Tencent Music Entertainment Group | ||||||||
| Date: | September 1, 2026 |
By: | /s/ Cussion Kar Shun Pang | |||||
| Name: Cussion Kar Shun Pang | ||||||||
| Title: Executive Chairman | ||||||||
Exhibit 99.1
TENCENT MUSIC ENTERTAINMENT GROUP
Unaudited Condensed Consolidated Interim Financial Information for the Six Months Ended June 30, 2025 and 2026
Page |
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F-2 |
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F-3 |
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F-4 |
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F-5 |
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F-7 |
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F-8 |
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F-1
TENCENT MUSIC ENTERTAINMENT GROUP
CONDENSED CONSOLIDATED INCOME STATEMENTS
Six months ended June 30, |
||||||||||||
2025 |
2026 |
|||||||||||
(Unaudited) |
(Unaudited) |
|||||||||||
Note |
RMB’million |
RMB’million |
||||||||||
| Revenue from music related services* |
||||||||||||
| Revenue from social entertainment services and others |
||||||||||||
| |
|
|
|
|||||||||
| Total revenues |
8 | |||||||||||
| Cost of revenues |
( |
) | ( |
) | ||||||||
| Gross profit |
||||||||||||
| Selling and marketing expenses |
( |
) | ( |
) | ||||||||
| General and administrative expenses |
( |
) | ( |
) | ||||||||
| |
|
|
|
|||||||||
| Total operating expenses |
( |
) | ( |
) | ||||||||
| Interest income |
||||||||||||
| Other gains, net |
9 | |||||||||||
| Operating profit |
||||||||||||
| Share of net profit of investments accounted for using equity method |
14 | |||||||||||
| Finance costs |
( |
) | ( |
) | ||||||||
| |
|
|
|
|||||||||
| Profit before income tax |
||||||||||||
| Income tax expense |
11 | ( |
) | ( |
) | |||||||
| |
|
|
|
|||||||||
| Profit for the period |
||||||||||||
| |
|
|
|
|||||||||
| Attributable to: |
||||||||||||
| Equity holders of the Company |
||||||||||||
| Non-controlling interests |
||||||||||||
| |
|
|
|
|||||||||
| |
|
|
|
|||||||||
RMB |
RMB |
|||||||||||
| Earnings per share for Class A and Class B ordinary shares |
12 | |||||||||||
| Basic |
||||||||||||
| Diluted |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Earnings per ADS (2 Class A shares equal to 1 ADS) |
||||||||||||
| Basic |
||||||||||||
| Diluted |
||||||||||||
The accompanying notes are an integral part of this condensed consolidated interim financial information.
* |
Starting from the first quarter of 2026, “online music services” has been renamed to “music related services” to better reflect the nature of the businesses, including long-form audio. Such change does not affect the amounts of historical revenue or its accounting treatment. |
F-2
TENCENT MUSIC ENTERTAINMENT GROUP
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
(Unaudited) |
(Unaudited) |
|||||||
RMB’million |
RMB’million |
|||||||
| Profit for the period |
||||||||
| Other comprehensive income, net of tax: |
||||||||
| Items that will not be reclassified subsequently to profit or loss |
||||||||
| Fair value changes on financial assets at fair value through other comprehensive income |
( |
) | ||||||
| Currency translation differences |
( |
) | ( |
) | ||||
| Items that may be subsequently reclassified to profit or loss |
||||||||
| Currency translation differences |
( |
) | ( |
) | ||||
| Share of other comprehensive (loss)/income of associates |
( |
) | ||||||
| |
|
|
|
|||||
| Total comprehensive income for the period |
( |
) | ||||||
| |
|
|
|
|
||||
| Attributable to: |
||||||||
| Equity holders of the Company |
( |
) | ||||||
| Non-controlling interests |
||||||||
| |
|
|
|
|||||
( |
) | |||||||
| |
|
|
|
|||||
The accompanying notes are an integral part of this condensed consolidated interim financial information.
F-3
TENCENT MUSIC ENTERTAINMENT GROUP
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, |
June 30, |
|||||||||||
2025 |
2026 |
|||||||||||
(Audited) |
(Unaudited) |
|||||||||||
Note |
RMB’million |
RMB’million |
||||||||||
ASSETS |
||||||||||||
Non-current assets |
||||||||||||
Property, plant and equipment |
13 |
|||||||||||
Land use rights |
13 |
|||||||||||
Right-of-use |
13 |
|||||||||||
Intangible assets |
13 |
|||||||||||
Goodwill |
13 |
|||||||||||
Investments accounted for using equity method |
14 |
|||||||||||
Financial assets at fair value through other comprehensive income |
15 |
|||||||||||
Other investments |
15 |
|||||||||||
Prepayments, deposits and other assets |
16 |
|||||||||||
Deferred tax assets |
||||||||||||
Term deposits |
17 |
|||||||||||
Current assets |
||||||||||||
Inventories |
||||||||||||
Accounts receivable |
||||||||||||
Prepayments, deposits and other assets |
16 |
|||||||||||
Other investments |
15 |
|||||||||||
Short-term investments |
15 |
|||||||||||
Term deposits |
17 |
|||||||||||
Restricted cash |
17 |
|||||||||||
Cash and cash equivalents |
17 |
|||||||||||
Total assets |
||||||||||||
EQUITY |
||||||||||||
Equity attributable to equity holders of the Company |
||||||||||||
Share capital |
18 |
|||||||||||
Additional paid-in capital |
18 |
|||||||||||
Shares held for share award schemes |
18 |
( |
) |
( |
) | |||||||
Treasury shares |
18 |
( |
) |
( |
) | |||||||
Other reserves |
19 |
|||||||||||
Retained earnings |
||||||||||||
Non-controlling interests |
||||||||||||
Total equity |
||||||||||||
LIABILITIES |
||||||||||||
Non-current liabilities |
||||||||||||
Borrowings |
21 |
|||||||||||
Notes payable |
22 |
|||||||||||
Other payables and other liabilities |
23 |
|||||||||||
Deferred tax liabilities |
||||||||||||
Lease liabilities |
||||||||||||
Deferred revenue |
24 |
|||||||||||
Current liabilities |
||||||||||||
Accounts payable |
||||||||||||
Other payables and other liabilities |
23 |
|||||||||||
Borrowings |
21 |
|||||||||||
Current tax liabilities |
||||||||||||
Lease liabilities |
||||||||||||
Deferred revenue |
24 |
|||||||||||
Total liabilities |
||||||||||||
Total equity and liabilities |
||||||||||||
The accompanying notes are an integral part of this condensed consolidated interim financial information.
F-4
TENCENT MUSIC ENTERTAINMENT GROUP
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Attributable to equity holders of the Company |
||||||||||||||||||||||||||||||||||||||||
Share capital |
Additional paid-in capital |
Shares held for share award schemes |
Treasury shares |
Other reserves |
Retained earnings |
Total |
Non- controlling interests |
Total equity |
||||||||||||||||||||||||||||||||
Note |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
|||||||||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2025 |
( |
) | ( |
) | ||||||||||||||||||||||||||||||||||||
Profit for the period |
— | — | — | — | — | |||||||||||||||||||||||||||||||||||
Fair value changes on financial assets at fair value through other comprehensive income |
— | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Share of other comprehensive loss of associates |
— | — | — | — | ( |
) | — | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Currency translation differences |
— | — | — | — | ( |
) | — | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Total comprehensive income for the period |
— | — | — | — | ||||||||||||||||||||||||||||||||||||
Transactions with equity holders: |
||||||||||||||||||||||||||||||||||||||||
Exercise of share options/ RSUs |
18,19 | — | — | ( |
) | — | — | |||||||||||||||||||||||||||||||||
Share-based compensation - value of employee services |
19,20 | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||
Shares held for share award schemes |
18 | — | — | ( |
) | — | — | — | ( |
) | — | ( |
) | |||||||||||||||||||||||||||
Repurchase of shares |
— | — | — | ( |
) | — | — | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Dividends to the Company’s shareholders |
— | — | — | — | — | ( |
) | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Non-controlling interests arising from business combination |
— | — | — | — | — | |||||||||||||||||||||||||||||||||||
Dividends to non-controlling interests |
— | — | — | — | — | — | — | ( |
) | ( |
) | |||||||||||||||||||||||||||||
Deemed disposal |
— | — | — | — | ( |
) | — | |||||||||||||||||||||||||||||||||
Recognition of financial liabilities in respect of the put option from business combination |
— | — | — | — | ( |
) | — | ( |
) | — | ( |
) | ||||||||||||||||||||||||||||
Total transactions with equity holders at their capacity as equity holders for the period |
— | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | ( |
) | |||||||||||||||||||||||||||
Balance at June 30, 2025 |
( |
) | ( |
) | ||||||||||||||||||||||||||||||||||||
F-5
TENCENT MUSIC ENTERTAINMENT GROUP
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (CONTINUED)
Attributable to equity holders of the Company |
||||||||||||||||||||||||||||||||||||||||
Share capital |
Additional paid-in capital |
Shares held for share award schemes |
Treasury shares |
Other reserves |
Retained earnings |
Total |
Non- controlling interests |
Total equity |
||||||||||||||||||||||||||||||||
Note |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
RMB’million |
|||||||||||||||||||||||||||||||
(Unaudited) |
||||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2026 |
( |
) |
( |
) |
||||||||||||||||||||||||||||||||||||
Profit for the period |
— |
— |
— |
— |
— |
|||||||||||||||||||||||||||||||||||
Fair value changes on financial assets at fair value through other comprehensive income |
— |
— |
— |
— |
( |
) |
— |
( |
) |
— |
( |
) | ||||||||||||||||||||||||||||
Share of other comprehensive income of associates |
— |
— |
— |
— |
— |
— |
||||||||||||||||||||||||||||||||||
Currency translation differences |
— |
— |
— |
— |
( |
) |
— |
( |
) |
( |
) |
( |
) | |||||||||||||||||||||||||||
Total comprehensive income for the period |
— |
— |
— |
— |
( |
) |
( |
) |
( |
) | ||||||||||||||||||||||||||||||
Transactions with equity holders: |
||||||||||||||||||||||||||||||||||||||||
Exercise of share options/ RSUs |
18,19 |
— |
— |
( |
) |
— |
— |
|||||||||||||||||||||||||||||||||
Share-based compensation - value of employee services |
19,20 |
— |
— |
— |
— |
— |
— |
|||||||||||||||||||||||||||||||||
Shares held for share award schemes |
18 |
— |
— |
( |
) |
— |
— |
— |
( |
) |
— |
( |
) | |||||||||||||||||||||||||||
Repurchase of shares |
— |
— |
— |
( |
) |
— |
— |
( |
) |
— |
( |
) | ||||||||||||||||||||||||||||
Dividends to the Company’s shareholders |
— |
— |
— |
— |
— |
( |
) |
( |
) |
— |
( |
) | ||||||||||||||||||||||||||||
Acquisition of Ximalaya |
18, 19, 25 |
— |
— |
— |
— |
( |
) |
|||||||||||||||||||||||||||||||||
Non-controlling interests arising from business combination |
— |
— |
— |
— |
— |
|||||||||||||||||||||||||||||||||||
Dividends to non-controlling interests |
— |
— |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||||||||||||
Transfer of losses on deemed disposal of financial instruments to retained earnings |
— |
— |
— |
— |
( |
) |
— |
— |
— |
|||||||||||||||||||||||||||||||
Recognition and fair value change of financial liabilities in respect of the put option from business combination |
— |
— |
— |
— |
( |
) |
— |
( |
) |
— |
( |
) | ||||||||||||||||||||||||||||
Transactions with minority interest |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||||||||||||||
Disposal of non-wholly owned subsidiary |
— |
— |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||||||||||||
Total transactions with equity holders at their capacity as equity holders for the period |
— |
( |
) |
( |
) |
( |
) |
( |
) |
( |
) |
( |
) | |||||||||||||||||||||||||||
Balance at June 30, 2026 |
( |
) |
( |
) |
||||||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of this condensed consolidated interim financial information.
F-6
TENCENT MUSIC ENTERTAINMENT GROUP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended June 30, |
||||||||||||
2025 |
2026 |
|||||||||||
(Unaudited) |
(Unaudited) |
|||||||||||
Note |
RMB’million |
RMB’million |
||||||||||
Cash flows from operating activities |
||||||||||||
Cash generated from operations |
||||||||||||
Interest received |
||||||||||||
Income taxes paid |
( |
) |
( |
) | ||||||||
Net cash inflow from operating activities |
||||||||||||
Cash flows from investing activities |
||||||||||||
Net cash payment for business combinations |
( |
) |
( |
) | ||||||||
Purchase of property, plant and equipment |
( |
) |
( |
) | ||||||||
Purchase of intangible assets |
( |
) |
( |
) | ||||||||
Placement of short-term investments |
15 |
( |
) |
( |
) | |||||||
Receipt from short-term investments |
15 |
|||||||||||
Placement of term deposits with initial terms of over three months |
( |
) |
( |
) | ||||||||
Receipt from maturity of term deposits with initial terms of over three months |
||||||||||||
Proceeds from disposal of investments accounted for using equity method |
||||||||||||
Payments for acquisition of investments accounted for using equity method |
( |
) |
( |
) | ||||||||
Proceeds from disposal of investments accounted for as financial assets at fair value through profit or loss |
||||||||||||
Payments for acquisition of investments accounted for as financial assets at fair value through profit or loss |
( |
) |
( |
) | ||||||||
Payments for acquisition of investments accounted for as financial assets at fair value through other comprehensive income |
( |
) |
||||||||||
Payments for loan to third parties |
( |
) |
||||||||||
Dividends received |
||||||||||||
Other investing activities |
( |
) | ||||||||||
Net cash (outflow)/inflow from investing activities |
( |
) |
||||||||||
Cash flows from financing activities |
||||||||||||
Proceeds from short-term borrowings |
||||||||||||
Repayments of short-term borrowings |
( |
) | ||||||||||
Proceeds from long-term borrowings |
||||||||||||
Proceeds from exercise of share options |
||||||||||||
Payments for acquisition of non-controlling interests in non-wholly owned subsidiaries |
( |
) | ||||||||||
Shares withheld for share award schemes |
( |
) |
( |
) | ||||||||
Payments for repurchase of ordinary shares |
( |
) |
( |
) | ||||||||
Dividends paid to the Company’s shareholders |
( |
) |
( |
) | ||||||||
Dividends paid to non-controlling interests |
( |
) |
( |
) | ||||||||
Payments for interests |
( |
) |
( |
) | ||||||||
Principal elements of lease payments |
( |
) |
( |
) | ||||||||
Net cash (outflow)/inflow from financing activities |
( |
) |
||||||||||
Net (decrease)/increase in cash and cash equivalents |
( |
) |
||||||||||
Cash and cash equivalents at beginning of the period |
||||||||||||
Exchange differences on cash and cash equivalents |
( |
) | ||||||||||
Cash and cash equivalents at end of the period |
||||||||||||
The accompanying notes are an integral part of condensed consolidated interim financial information.
F-7
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
1. |
General information and organization |
1.1. |
General information |
Tencent Music Entertainment Group (the “Company” or “TME”), formerly known as China Music Corporation (“CMC”), was incorporated under the laws of the Cayman Islands on June 6, 2012 as an exempted company with limited liability under the Companies Law (2010 Revision) of the Cayman Islands. The registered office in the Cayman Islands is located at the office of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman,
KY1-1104,
Cayman Islands. The Company is controlled by Tencent Holdings Limited (“Tencent”), a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Main Board of the Stock Exchange of Hong Kong Limited (“Hong Kong Stock Exchange”). The Company’s American Depositary Shares (“ADSs”) have been listed on the New York Stock Exchange since December 12, 2018. The Company’s Class A ordinary shares have been listed, by way of introduction, on the Hong Kong Stock Exchange since September 15, 2022. Each ADS of the Company represents two ordinary shares, remain primarily listed and traded on the New York Stock Exchange(“NYSE”). The Class A ordinary shares listed on the Main Board of the Hong Kong Stock Exchange are fully fungible with the ADSs listed on the NYSE. The Company, its subsidiaries, its controlled structured entities (“Variable interest entities”, or “VIE”) and their subsidiaries (“Subsidiaries of VIEs”) are collectively referred to as the “Group”. The Group is principally engaged in operating all-in-one music and audio platforms to provide music streaming, offline concerts, artist merchandise and other IP-centric experiences in the People’s Republic of China (“PRC”). The Company does not conduct any substantive operations of its own but conducts its primary business operations through its wholly-owned subsidiaries, VIEs and subsidiaries of VIEs in the PRC.
In July 2016, Tencent acquired control of the Company through a series of transactions, pursuant to which Tencent injected substantially all of its online music business in the Mainland China (“Tencent Music Business”) into the Company in exchange for certain number of shares issued by the Company (“Merger”). Upon the completion of such transactions, the Company became a subsidiary of Tencent and was renamed to its current name in December 2016. The Merger was accounted for as a reverse acquisition under which Tencent Music Business is regarded as the acquirer, and accordingly this Interim Financial Information have been presented as a continuation of the financial statements of Tencent Music Business.
The condensed consolidated interim financial information comprises the consolidated balance sheet as at June 30, 2026, the related condensed consolidated income statement, the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity and the condensed consolidated statement of cash flows for the six months then ended, and a summary of significant accounting policies and other explanatory notes (the “Interim Financial Information”). The Interim Financial Information is presented in Renminbi (“RMB”), unless otherwise stated. The Interim Financial Information has not been audited.
1.2. |
Significant events and transactions in the current reporting period |
The Group completed the acquisition of entire equity interest of Ximalaya Inc. (“Ximalaya”) on May 18, 2026. Please refer to Note 25 Business Combinations for further details.
2. |
Basis of preparation and presentation |
This Interim Financial Information for the sixth-month reporting period ended June 30, 2026 has been prepared in accordance with International Accounting Standard 34 (“IAS 34”) ‘Interim Financial Reporting’ issued by the International Accounting Standards Board (‘IASB’) and should be read in conjunction with the annual consolidated financial statements for the year ended 31 December 2025 (“2025 Financial Statements”) , which have been prepared in accordance with International Financial Reporting Standards as issued by ISAB (“IFRS Accounting Standards as issued by IASB”).
3. |
Significant accounting policies |
Except as described below, the accounting policies and method of computation used in the preparation of the Interim Financial Information are consistent with those used in the 2025 Financial Statements, which have been prepared in accordance with IFRS Accounting Standards as issued by IASB under the historical cost convention, as modified by the revaluation of financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income, which are carried at fair value.
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
Taxes on income for the interim period are accrued using the tax rates that would be applicable to expected total annual assessable profit.
(a) |
New and amendments to the accounting standards adopted |
The following amendments and improvements to standards have been adopted by the Group for the first time for the financial year beginning on January 1, 2026:
Amendments to IFRS 9 and IFRS 7 |
Amendments to the Classification and Measurement of Financial Instruments | |
Amendments to IFRS 9 and IFRS 7 |
Contracts Referencing Nature-dependent Electricity | |
Annual Improvements to IFRS Accounting Standards |
Annual Improvements to IFRS Accounting Standards - Volume 11 |
The adoption of the above does not have material impact on the Interim Financial Information of the Group.
(b) |
Recent accounting pronouncements |
Certain amendments to accounting standards and interpretation have been published that are not mandatory for June 30, 2026 reporting periods and have not been early adopted by the Group. As at the date of approval of this Interim Financial Information, the Group is still in the process of assessing the effects of adopting IFRS 18, IFRS 19 and these amendments and improvements to IFRS Accounting Standards. The Group will continue to assess the effects of these new and amended standards.
| Effective for annual periods beginning on or after | ||||
IFRS 18 |
Presentation and Disclosure in Financial Statements |
January 1, 2027 | ||
IFRS 19 |
Subsidiaries without Public Accountability: Disclosures |
January 1, 2027 | ||
Amendments to IFRS 19 |
Subsidiaries without Public Accountability: Disclosures |
January 1, 2027 | ||
Amendments to IAS 21 |
Translation to a Hyperinflationary Presentation Currency |
January 1, 2027 | ||
| Amendments to IAS 36, IFRS 18, IAS 1, IAS 37, IAS 8, IFRS 7 |
Disclosures about Uncertainties in the Financial Statements - Illustrative examples |
January 1, 2027 | ||
IFRS 20 |
Regulatory Assets and Regulatory-Liabilities |
January 1, 2029 | ||
4. |
Consolidation of VIEs |
PRC laws and regulations prohibit or restrict foreign ownership of companies that provide Internet-based business, which include activities and services provided by the Group. The Group operates its business operations in the PRC through a series of contractual arrangements (“Structure Contracts”) entered into among the Company, its wholly-owned subsidiaries of the Company (“WOFEs”), domestic entities (“Operating Entities”) that legally owned by individuals (“Nominee Shareholders”) authorized by the Group (collectively, “Contractual Arrangements”). Under the Contractual Arrangements, the Company has the power to control the management, and financial and operating policies of the Operating Entities, has exposure or rights to variable returns from its involvement with the Operating Entities, and has the ability to use its power over the Operating Entities to affect the amount of the returns. As a result, all these Operating Entities are regarded as VIEs that accounted for as consolidated structured entities of the Company and their financial statements have been consolidated by the Company. There were no material changes in any basis of consolidation of VIEs under Contractual Arrangements during the six months ended June 30, 2026 from the preceding financial year.
5. |
Estimates |
The preparation of the Interim Financial Information requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing the Interim Financial Information, the nature of significant judgments made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were consistent with those described in the 2025 Financial Statements.
F-9
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
6. |
Financial risk management |
(a) |
Financial risk factors |
The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, price risk and interest rate risk), credit risk and liquidity risk.
The Interim Financial Information does not include all financial risk management information and disclosures required in the annual financial statements, and should be read in conjunction with the 2025 Financial Statements.
There were no changes in any material risk management policies during the six months ended June 30, 2026.
(b) |
Capital risk management |
The Group’s objectives on managing capital are to safeguard the Group’s ability to continue as a going concern and support the sustainable growth of the Group in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to enhance shareholders’ value in the long term.
Capital refers to equity and external debts (including borrowings and notes payable). In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
As at December 31, 2025 and June 30, 2026, the directors of the Company considers the risk of the Group’s capital structure is remote as the Group has a net cash position.
(c) |
Fair value estimation |
The table below analyzes the Group’s financial instruments carried at fair value as at June 30, 2026 by level of the inputs to valuation techniques used to measure fair value. Such inputs are categorized into three levels within a fair value hierarchy as follows:
| • | Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1); |
| • | Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2); and |
| • | Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3). |
As at June 30, 2026, the Group’s financial instruments carried at fair value comprised financial assets at fair value through other comprehensive income (Note 15) stated in the consolidated balance sheets measured at level 1 hierarchy with amount of RMB19,131 million (as at December 31, 2025: RMB26,217 million) and measured at level 3 hierarchy with amount of RMB16 million (as at December 31, 2025: RMB14 million), while other investments (Note 15) and short-term investment 1,006 million (as at December 31, 2025: RMB386 million) and RMB123 million (as at December 31, 2025: nil ), respectively.
(Note 15)
at level 3 fair value hierarchy with amount of RMBThe fair value of financial instruments traded in active markets is determined with reference to quoted market prices at the end of the reporting period. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price already incorporates the market’s assumptions with respect to changes in economic climate such as rising interest rates and inflation, as well as changes due to ESG risk. These instruments are included in level 1.
The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximize the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required for evaluating the fair value of a financial instrument are observable, the instrument is included in level 2. If one or more of the significant inputs are not based on observable market data, the instrument is included in level 3.
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
The Group has a team of personnel who performs valuation on these level 3 instruments for financial reporting purposes. The team adopts various valuation techniques to determine the fair value of the Group’s level 3 instruments. External valuation experts may also be involved and consulted when it is necessary.
The components of the level 3 instruments mainly include investments in unlisted companies classified as other investments. As these instruments are not traded in an active market, their fair value have been determined using various applicable valuation techniques, including discounted cash flows approach and comparable transactions approach, etc.
During the six months ended June 30, 2025 and 2026, there was no
7. |
Segment reporting |
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision makers, who are responsible for allocating resources and assessing performance of the operating segments and making strategic decisions. The Group’s chief operating decision makers have been identified as executive directors of the Company, who review the consolidated results of operations when making decisions about allocating resources and assessing performance of the Group as a whole.
For the purpose of internal reporting and management’s operation review, the chief operating decision-makers and management personnel do not segregate the Group’s business by product or service lines. Hence, the Group has only one operating segment. In addition, the Group does not distinguish between markets or segments for the purpose of internal reporting. As the Group’s assets and liabilities are substantially located in the PRC, substantially all revenues are earned and substantially all expenses are incurred in the PRC, no geographical segments are presented.
8. |
Revenue |
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
Revenues from music related services |
RMB’million |
RMB’million |
||||||
| Membership services (note i) |
||||||||
| Marketing and consumption services (note ii) |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
Note i: As part of music related services, membership services primarily consist of membership fees paid for membership benefits and privileges, including access to music and audio content, and other benefits and privileges within music related services, majority of which were recognized over time.
Note ii: As part of music related services, marketing and consumption services primarily consist of advertising, offline performance related services and artist-related merchandise sales.
Among the total revenue for
the six months ended June 30, 2025 and 2026, revenue contributed by advertising services amounted to RMB
million and RMB
million, respectively.
During the six months ended June 30, 2025 and 2026, the majority of the revenue from music related services are recognized over time and the majority of the revenue from social entertainment services are recognized at a point in time.
The Group does not disclose the information about the remaining performance obligation as the majority of the performance obligations of the Group have an expected duration of one year or less.
Details of contract liabilities were disclosed in Note 24.
F-11
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
9. |
Other gains, net |
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Gain on deemed disposal (note i) |
||||||||
| Dividends from investments |
||||||||
| Government grants and tax rebates (note ii) |
||||||||
| Fair value changes of consideration liabilities related to acquisition (note 25) |
||||||||
| Fair value change of investments |
||||||||
| Net gains in relation to equity investments |
||||||||
| Others (note iii) |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
Note i: As at December 31, 2024, the Group held 10 % equity interest in a consortium led by Tencent and the consortium held 20 % equity interest in Universal Music Group(“UMG”). With the Group’s ability to exercise significance influence on the consortium, the Group accounted for the investment as investments accounted for using equity method. In March 2025, the consortium completed a transfer of the UMG shares held by the consortium to its members through Following the distribution, the Group held directly 2 % equity interests in UMG and the Group designated the investment as financial assets at fair value through other comprehensive income. The gain with amount of RMB2,373 million on deemed disposal of investment accounted for using equity method was recognized during the six months ended June 30, 2025.
distribution-in-kind.
Note ii: There are no unfulfilled conditions or contingencies related to these subsidies.
Note iii: During the six months ended June 30, 2025 and 2026, sharing of ADS service fee with amount of RMB34 million and RMB30 million, respectively, were included in others.
10. |
Expenses by nature |
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Service costs (note i) |
||||||||
| Advertising agency fees |
||||||||
| Employee benefits expenses (note ii) |
||||||||
| Promotion and advertising expenses |
||||||||
Notes:
| (i) | Service costs mainly comprised content costs of royalties, revenue sharing fees paid to content creators and content delivery costs that primarily consisted of server, cloud services and bandwidth costs. |
| (ii) | During the six months ended June 30, 2025 and 2026, the Group incurred expenses for the purpose of research and development of approximately RMB |
F-12
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
11. |
Taxation |
(a) |
Income tax expense |
Income tax expense is recognized based on management’s best knowledge of the income tax rates expected for the financial year.
| (i) | Cayman Islands |
Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gains. Additionally, upon payment of dividends by the Company to its shareholders, no Cayman Islands withholding tax will be imposed.
| (ii) | Hong Kong |
Under the current tax laws of Hong Kong, TME Hong Kong is subject to Hong Kong profits tax at 16.5 % on its taxable income generated from the operations in Hong Kong. Dividends from TME Hong Kong is not subject to Hong Kong profits tax.
| (iii) | PRC |
Under the Corporate Income Tax (“CIT”) Law in the PRC, foreign invested enterprises and domestic enterprises are subject to a unified CIT rate of 25 %, except for available preferential tax treatments, including tax concession for enterprise approved as “High and New Technology Enterprise” (“HNTE”) and enterprise established in certain special economic development zones. Qualified HNTE is eligible for a preferential tax rate of 15 %.
During the six months ended June 30, 2025 and 2026, certain subsidiaries of the Group have been recognized as HNTE by relevant government authorities and were eligible for a preferential tax rate
of Certain subsidiaries of the Group are entitled to other tax concessions, mainly including the preferential tax rate
of applicable to some subsidiaries located in certain areas of PRC upon fulfillment of certain requirements of the respective local government.
Furthermore, certain subsidiaries of the Group are subject to other preferential tax treatment for certain reduced tax rates ranging from 5 % to 9 %.
| (iv) | Withholding tax |
Under the current CIT Law, dividends for earnings derived from January 1, 2008 and onwards paid by PRC entities to any of their foreign 10 % withholding tax. A lower tax rate will be applied if tax treaty or arrangement benefits are available. Under the tax arrangement between the PRC and Hong Kong, the reduced withholding tax rate for dividends paid by PRC entities is 5 % provided the Hong Kong investors meet the requirements as stipulated by relevant PRC tax regulations, such as the beneficiary owner test.
non-resident
enterprise investors are subject to a | (v) | OECD Pillar Two model rules |
The OECD published Pillar Two model rules in December 2021, with the effect that a jurisdiction may enact domestic tax laws (“Pillar Two legislation”) to implement the Pillar Two model rules on a globally agreed common approach. A Pillar Two legislation applies to a member of a multinational group within the scope of the Pillar Two model rules (i.e., a multinational Group that has annual revenue of EUR 750 million or more in the Consolidated Financial Statements of the Ultimate Parent Entity in at least two of the four Fiscal Years immediately preceding the tested Fiscal Year), which the Group’s ultimate holding company Tencent is reasonably expected to fall into. As a partially owned parent entity (“POPE”) of Tencent, it imposes a 15 %.
top-up
tax on Group’s profits arising in a jurisdiction whenever the effective tax rate determined by the Pillar Two model rules on a jurisdictional basis is below a minimum rate of TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
As at June 30, 2026, the Group mainly operated in Chinese Mainland and Hong Kong. Pillar Two legislation has been effective in Hong Kong since January 1, 2025 and the current tax exposure for the six months ended June 30, 2026 is immaterial. While Pillar Two legislation is not yet enacted or substantively enacted in Chinese Mainland as at June 30, 2026, it is estimated that the Group’s income tax would not be materially different had such legislation been in effect for the six months ended June 30, 2026. The Group will continue assessing the Pillar Two tax exposure and the impacts on its consolidated financial statements accordingly. Regarding deferred income tax accounting, the Group has applied the exception to recognizing and disclosing deferred income tax assets and liabilities related to Pillar Two income taxes, as provided in the amendments to IAS 12 issued in May 2023.
The income tax expense of the Group is analyzed as follows:
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Current income tax |
||||||||
| Deferred income tax |
||||||||
| |
|
|
|
|||||
| Total income tax expense |
||||||||
| |
|
|
|
|||||
12. |
Earnings per share |
(a) |
Basic earnings per share |
Basic earnings per share (“EPS”) is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding during the year.
(b) |
Diluted earnings per share |
For the calculation of diluted earnings per share, weighted average number of ordinary shares outstanding is adjusted by the effect of dilutive securities, including share-based awards in respect of share options and RSU, under the treasury stock method (collectively forming the denominator for computing the diluted earnings per share). Potentially dilutive securities, including share options and RSU, have been excluded from the computation of weighted average number of ordinary shares for the purpose of diluted earnings per share if their inclusion is anti-dilutive. No adjustments is made to earnings (numerator).
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
The following table sets forth the computation of basic and diluted earnings per share:
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Earnings |
||||||||
| Net profit attributable to equity holders of the Company |
||||||||
| |
|
|
|
|||||
Number of shares |
||||||||
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
| Shares |
||||||||
| Weighted average ordinary shares outstanding, used in computing basic earnings per share |
||||||||
| Dilution effect- adjustments for share options and RSUs |
||||||||
| |
|
|
|
|||||
| Shares used in computing diluted earnings per share |
||||||||
RMB |
RMB |
|||||||
| Basic earnings per share for Class A and Class B ordinary shares |
||||||||
| Diluted earnings per share for Class A and Class B ordinary shares |
||||||||
| Basic earnings per ADS |
||||||||
| Diluted earnings per ADS |
||||||||
Note: One ADS represents two Class A ordinary shares of the Company.
For the six months ended June 30, 2025 and 2026, certain share options and certain RSUs that were anti-dilutive and being excluded from the calculation of diluted earnings per share were immaterial on a weighted average basis.
13. |
Property, plant and equipment, land use rights, rights-of-use |
Property, plant and equipment |
Land use rights |
Right-of-use assets |
Intangible assets |
Goodwill |
||||||||||||||||
RMB ’million |
RMB ’million |
RMB ’million |
RMB ’million |
RMB ’million |
||||||||||||||||
| Net book amounts at January 1, 2025 |
||||||||||||||||||||
| Additions |
— |
— |
||||||||||||||||||
| Business combinations |
— |
— |
— |
|||||||||||||||||
| Depreciation and amortization |
( |
) |
( |
) |
( |
) |
( |
) |
— |
|||||||||||
| Disposals |
( |
) |
— |
( |
) |
( |
) |
— |
||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Net book amounts at June 30, 2025 |
||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Net book amounts at January 1, 2026 |
||||||||||||||||||||
| Additions |
— |
|||||||||||||||||||
| Business combinations |
— |
|||||||||||||||||||
| Depreciation and amortization |
( |
) |
( |
) |
( |
) |
( |
) |
— |
|||||||||||
| Disposals |
( |
) |
— |
— |
( |
) |
( |
) | ||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Net book amounts at June 30, 2026 |
||||||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
The Group used the facilities for issuing payment guarantees of the constructions of buildings and has utilized RMB86 million related to the constructions of buildings as at June 30, 2026.
F-15
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
14. |
Investments accounted for using equity method |
As at |
||||||||
December 31, |
June 30, |
|||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Investments in associates |
||||||||
| Investments in joint ventures |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Share of profit/(loss) of investments accounted for using equity method: |
||||||||
| Associates |
||||||||
| Joint ventures |
( |
) |
( |
) | ||||
| |
|
|
|
|||||
| |
|
|
|
|||||
Movement of investments in associates and joint ventures is analyzed as follows:
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| At beginning of the period |
||||||||
| Additions |
||||||||
| Transfer (Note a) |
||||||||
| Business combinations |
||||||||
| Share of profit, net |
||||||||
| Share of other comprehensive (loss)/income |
( |
) |
||||||
| Deemed disposal (Note 9) |
( |
) |
||||||
| Disposal |
( |
) |
( |
) | ||||
| Currency translation differences |
( |
) |
( |
) | ||||
| Dividend income |
( |
) |
( |
) | ||||
| At end of the period |
||||||||
| |
|
|
|
|||||
Note:
(a) During the six months ended June 30, 2026, investment in an investee company of the Group with a carrying amount of RMB954
million, which is engaged in artist management, was transferred from financial assets at fair value through other comprehensive income to investment in an associate, due to changes of certain Group’s shareholder rights in the investment.
(b)Both external and internal sources of information of associates are considered in assessing whether there is any indication that the investments may be impaired, including but not limited to their financial positions, business performances and market capitalization. During the six months ended June 30, 2025 and 2026, no
There are no material contingent liabilities relating to the Group’s interests in the investments accounted for using equity method.
F-16
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
15. |
Financial assets at fair value |
(a) |
Financial assets at fair value through other comprehensive income |
As at December 31, 2025 and June 30, 2026, the Group’s financial assets at fair value through other comprehensive income include equity investments in listed securities and equity investments in unlisted securities as the following table. The investments in listed equity securities mainly represented its investment in Spotify Technology S.A. (“Spotify”) and
UMG
. As at, |
||||||||
December 31, |
June 30, |
|||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Equity investments in listed entities |
||||||||
| Equity investments in unlisted entities |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
Movement of financial assets at fair value through other comprehensive income is analyzed as follows:
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| At beginning of the period |
||||||||
| Additions |
||||||||
| Business combination |
||||||||
| Fair value change |
( |
) | ||||||
| Transfer (Note 14) |
( |
) | ||||||
| Currency translation differences |
( |
) |
( |
) | ||||
| |
|
|
|
|||||
| At end of the period |
||||||||
| |
|
|
|
|||||
(b) |
Other investments |
As at December 31, 2025 and June 30, 2026, the Group’s other investments represented financial assets at fair value through profit or loss. Movement of other investments is analyzed as follows:
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| At beginning of the period |
||||||||
| Additions |
||||||||
| Business combination |
||||||||
| Disposal |
( |
) | ||||||
| Currency translation differences |
( |
) |
( |
) | ||||
| |
|
|
|
|||||
| At end of the period |
||||||||
| |
|
|
|
|||||
| Of which are: |
||||||||
| Current |
||||||||
| Non-current |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
(c) |
Short-term investments |
Short-term investments represent investments issued by commercial banks with a variable return
and
accounted for as financial assets at fair value through profit or loss. Movement of short-term investments is analyzed as follows: Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| At beginning of the period |
||||||||
| Additions |
||||||||
| Business combination |
||||||||
| Fair value change(Note 9) |
||||||||
| Disposal |
( |
) |
( |
) | ||||
| |
|
|
|
|||||
| At end of the period |
||||||||
| |
|
|
|
|||||
16. |
Prepayments, deposits and other assets |
As at |
||||||||
December 31, |
June 30 |
|||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Included in non-current assets |
||||||||
| Prepaid content royalties |
||||||||
| Others |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
| Included in current assets |
||||||||
| Prepaid content royalties |
||||||||
| Interest receivables |
||||||||
| Prepaid promotion and other expenses |
||||||||
| Prepaid vendors deposits and other receivables |
||||||||
| Value-added tax recoverable |
||||||||
| Receivable from Tencent (Note 27(b)) |
||||||||
| Others |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
17. |
Term deposits and cash and cash equivalents |
(a) |
Term deposits |
As at December 31, 2025 and June 30, 2026, the Group’s term deposits were denominated in RMB and US$.
As at December 31, 2025 and June 30, 2026, the carrying amounts of the term deposits with initial terms of over three months approximated to their fair value.
(b) |
Restricted cash |
As at June 30, 2026, restricted cash held at banks of RMB8 million (December 31, 2025: RMB15 million) were mainly denominated in RMB, representing restricted deposits used as security against certain lawsuits.
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
(c) |
Cash and cash equivalents |
As at |
||||||||
December 31, |
June 30, |
|||||||
2025 |
2026 |
|||||||
RMB’million |
RMB’million |
|||||||
| Cash at bank |
||||||||
| Term deposits with initial terms within three months |
||||||||
| |
|
|
|
|||||
| |
|
|
|
|||||
18. |
Share capital |
| Number of issued shares |
Share capital RMB’million |
Additional paid-in capital RMB’million |
Shares held for share award schemes RMB’million |
Treasury Shares RMB’million |
||||||||||||||||
| Balance at January 1, 2025 |
||||||||||||||||||||
| (US$ shares authorized) |
( |
) |
( |
) | ||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Employee share award schemes |
||||||||||||||||||||
| -Exercise of share options/ RSUs (note i) |
— |
— |
— |
|||||||||||||||||
| -Shares held for share award schemes (note ii) |
— |
— |
— |
( |
) |
— |
||||||||||||||
| Repurchase of ordinary shares (note iii) |
— |
— |
— |
— |
( |
) | ||||||||||||||
| Shares allotted and issued for share award scheme |
— |
— |
— |
— |
||||||||||||||||
| Shares cancellation |
( |
) |
— |
— |
— |
— |
||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Balance at June 30, 2025 |
( |
) |
( |
) | ||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Balance at January 1, 2026 |
||||||||||||||||||||
| (US$ shares authorized) |
( |
) |
( |
) | ||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Employee share award schemes |
||||||||||||||||||||
| -Exercise of share options/ RSUs (note i) |
— |
— |
— |
— |
||||||||||||||||
| -Shares held for share award schemes (note ii) |
— |
— |
— |
( |
) |
— |
||||||||||||||
| Repurchase of ordinary shares (note iii) |
— |
— |
— |
— |
( |
) | ||||||||||||||
| Acquisition of Ximalaya |
— |
— |
— |
|||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
| Balance at June 30, 2026 |
( |
) |
( |
) | ||||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|||||||||||
As at December 31, 2025 and June 30, 2026, analysis of the Company’s issued shares is as follows:
As at December 31, 2025 |
As at June 30, 2026 |
|||||||||||||||
| Number of issued shares |
Share capital RMB’million |
Number of issued shares |
Share capital RMB’million |
|||||||||||||
| Class A ordinary shares |
||||||||||||||||
| Class B ordinary shares |
||||||||||||||||
| |
|
|
|
|
|
|
|
|||||||||
| |
|
|
|
|
|
|
|
|||||||||
| * | All issued shares were fully paid as at December 31, 2025 and June 30, 2026. |
| (i) | During the six months ended June 30, 2025 and 2026, the Company transferred |
| (ii) | During the six months ended June 30, 2025 and 2026, the Share Scheme Trust purchased and withheld |
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
As at December 31, 2025 and June 30, 2026, the Share Scheme Trust held 48,550,176 and 42,074,118 Class A ordinary shares, respectively. These shares include those designated for the purpose of granting awarded shares to the participants under the Share Award Schemes, as well as shares that have been purchased and withheld by the Share Scheme Trust.
| (iii) | Repurchase of shares |
In March 2023, the board of directors of the Company authorized a new share repurchase program, under which the Company may repurchase up to USD500 million of its Class A ordinary shares in the form of ADSs during a 24-month period commencing from March 20, 2023 (the “2023 Share Repurchase Program”). During the six months ended June 30, 2025, the Company repurchased 5,943,751 ADSs from the open market, at an aggregate consideration of approximately US$64 million (equivalents to approximately RMB462 million) in cash, under the 2023 Share Repurchase Program.
On March 17, 2025, board of directors of the Company authorized the 2025 Share Repurchase Program under which the Company may repurchase up to US$1 billion of our Class A ordinary shares, including in the form of ADSs, during a two-year period commencing on March 21, 2025. During the six months ended June 30, 2026, the Company repurchased 43,479,650 ADSs from the open market, at an aggregate consideration of approximately US$400 million (equivalents to approximately RMB 2,725 million) in cash, under the 2025 Share Repurchase Program.
The Company accounts for the repurchased ordinary shares as treasury stock under the cost method and records it as a component of the shareholders’ equity.
19. |
Other reserves |
Share-based compensation reserve RMB’million |
Contribution from ultimate holding company RMB’million |
PRC statutory reserve RMB’million |
Foreign currency translation reserve RMB’million |
Fair value reserve RMB’million |
Others RMB’million |
Total other reserves RMB’million |
||||||||||||||||||||||
Balance at January 1, 2025 |
||||||||||||||||||||||||||||
Currency translation differences |
— |
— |
— |
( |
) |
— |
— |
( |
) | |||||||||||||||||||
Fair value changes on financial assets at fair value through other comprehensive income |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
Share of other comprehensive loss of an associate |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||
Share based compensation |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
Exercise of share options/ RSUs |
( |
) |
— |
— |
— |
— |
— |
( |
) | |||||||||||||||||||
Deemed disposal |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||
Recognition of financial liabilities in respect of the put option from business combination |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||
Balance at June 30, 2025 |
||||||||||||||||||||||||||||
Balance at January 1, 2026 |
( |
) |
||||||||||||||||||||||||||
Currency translation differences |
— |
— |
— |
( |
) |
— |
— |
( |
) | |||||||||||||||||||
Fair value changes on financial assets at fair value through other comprehensive income |
— |
— |
— |
— |
( |
) |
— |
( |
) | |||||||||||||||||||
Share of other comprehensive income of an associate |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
Share based compensation |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
Exercise of share options/ RSUs |
( |
) |
— |
— |
— |
— |
— |
( |
) | |||||||||||||||||||
Acquisition of Ximalaya |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
Recognition and fair value change of financial liabilities in respect of the put option from business combinations |
— |
— |
— |
— |
— |
( |
) |
( |
) | |||||||||||||||||||
Transfer of losses on deemed disposal of financial instruments to retained earnings |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
Transactions with minority interest |
— |
— |
— |
— |
— |
|||||||||||||||||||||||
Balance at June 30, 2026 |
( |
) |
||||||||||||||||||||||||||
F-20
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
20. |
Share based compensation |
(a) |
Share-based compensation plans of the Company |
The Group has adopted four share-based compensation plans, namely, the 2014 Share Incentive Plan, the 2017 Restricted Share Scheme, the 2017 Option Plan and the 2024 Share Incentive Plan. The Group adopted 2024 Share Incentive Plan in May 2024. According to the 2024 Share Incentive Plan, 228,775,377 ordinary shares have been reserved to be issued to any qualified employees, directors,
non-employee
directors, and consultants as determined by the board of directors of the Company. Upon the adoption of the 2024 Share Incentive plan, the outstanding options and RSUs under previous plans were all transferred to the 2024 Share Incentive plan and the previous plans ceased to be of any effect. Movements in the number of RSUs for the six months ended June 30, 2025 and 2026 are as follows:
Number of awarded shares Six months Ended June 30, |
||||||||
2025 |
2026 |
|||||||
Outstanding as at January 1 |
||||||||
Granted |
||||||||
Vested |
( |
) |
( |
) | ||||
Forfeited |
( |
) |
( |
) | ||||
Outstanding as at June 30 |
||||||||
Expected to vest as at June 30 |
||||||||
The fair value of the restricted shares was calculated based on the fair value of ordinary shares of the Company. The weighted average fair value of restricted shares granted during the six months ended June 30, 2025 and 2026 was US$5.81 per share (equivalent to approximately RMB41.64 per share) and US$5.77 per share (equivalent to approximately RMB39.14 per share), respectively.
Movements in the number of share options for the six months ended June 30, 2025 and 2026 are as follows:
Number of options |
Weighted- average exercise price (US$) |
Weighted- average grant date fair value (US$) |
||||||||||
Outstanding as at January 1, 2025 |
||||||||||||
Granted |
||||||||||||
Exercised |
( |
) |
||||||||||
Forfeited |
( |
) |
||||||||||
Outstanding as at June 30, 2025 |
||||||||||||
Vested and expected to vest as at June 30, 2025 |
||||||||||||
Exercisable as at June 30, 2025 |
||||||||||||
Non vested as at June 30, 2025 |
||||||||||||
Outstanding as at January 1, 2026 |
||||||||||||
Granted |
||||||||||||
Exercised |
( |
) |
||||||||||
Forfeited |
( |
) |
||||||||||
Outstanding as at June 30, 2026 |
||||||||||||
Vested and expected to vest as at June 30, 2026 |
||||||||||||
Exercisable as at June 30, 2026 |
||||||||||||
Non vested as at June 30, 2026 |
||||||||||||
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
The weighted average price of the shares at the time these options were exercised was US$8.18 per share (equivalent to approximately RMB58.61 ) and US$5.91 per share (equivalent to approximately RMB40.12 ) during the six months ended June 30, 2025 and 2026, respectively.
(b) |
Fair value of options |
The fair value of share options was valued using the Binomial option-pricing model as at the respective grant dates.
Assumptions used in the Binomial option-pricing model are presented below:
Six months ended June 30, |
||||||||
2025 |
2026 |
|||||||
Risk free interest rate |
% | % | ||||||
Expected dividend yield |
% | % | ||||||
Expected volatility |
% | % | ||||||
Exercise multiples |
||||||||
Contractual life |
||||||||
(c) |
Outstanding share options |
Share options
outstanding
as at December 31, 2025 and June 30, 2026 have the following expiry date and exercise prices: Expiry date |
Exercise price |
December 31, 2025 |
June 30, 2026 |
|||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
| US$ |
||||||||||||
Total |
||||||||||||
Weighted average remaining contractual life of options outstanding: |
||||||||||||
(d) |
Expected retention rate of grantees |
The Group has to estimate the expected yearly percentage of grantees that will stay within the Group at the end of the vesting periods of the options and awarded shares (the “Expected Retention Rate”) in order to determine the amount of share-based compensation expenses charged to the condensed consolidated income statement. As at December 31, 2025 and June 30, 2026, the Expected Retention Rate of the Group was assessed to be
%-
%.
F-22
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
21. |
Borrowings |
As at |
||||||||
December 31, 2025 RMB’million |
June 30, 2026 RMB’million |
|||||||
Included in non-current liabilities: |
||||||||
Non-current portion of long-term RMB bank borrowings, unsecured (Note (a)) |
||||||||
Included in current liabilities: |
||||||||
RMB bank borrowings, unsecured (Note (b)) |
||||||||
Current portion of long-term RMB bank borrowings, unsecured (Note (a)) |
||||||||
| (a) | The aggregate principal amounts of long-term bank borrowings and applicable interest rates are as follows: |
As at June 30, 2026 | ||||||||
Amount (RMB’million) |
Interest rate (per annum) | |||||||
RMB bank borrowings |
LPR - |
| ||||||
RMB bank borrowings |
||||||||
The long-term bank borrow
ing
s are repayable as follows: As at |
||||||||
December 31, 2025 RMB’million |
June 30, 2026 RMB’million |
|||||||
Within 1 year |
||||||||
Between 1 and 2 years |
||||||||
Between 2 and 5 years |
||||||||
Over 5 years |
||||||||
| (b) | The aggregate principal amounts of short-term bank borrowings and applicable interest rates are as follows : |
As at June 30, 2026 |
||||||||
Amount (RMB’million) |
Interest rate (per annum) |
|||||||
RMB bank borrowings |
% ~ |
|||||||
As at June 30, 2026, the carrying amounts of borrowings approximated their fair values.
The Group had complied with all of the financial covenants of its borrowing facilities for the six months ended June 30, 2026.
F-23
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
22. |
Notes payable |
As at |
||||||||
December 31, 2025 RMB’million |
June 30, 2026 RMB’million |
|||||||
Included in non-current liabilities |
||||||||
In September 2020, the Company issued two tranches of senior unsecured notes with an aggregate principal amount of US$800
million as set out below. The notes due 2025 have been fully repaid.
Principal amount (US$’million) |
Carrying amount at December 31, 2025 (RMB’million) |
Carrying amount at June 30, 2026 (RMB’million) |
Interest Rate (per annum) |
Due |
||||||||||||||||
2025 Notes |
% | |||||||||||||||||||
2030 Notes |
% | |||||||||||||||||||
Notes payable issued by the Company were recognized initially at fair value and subsequently carried at amortized cost.
The fair value of notes payable as at December 31, 2025 and June 30, 2026 was US$452 million (equivalents to approximately RMB3,176 million) and US$450 million (equivalents to approximately RMB3,066 million). The fair value of notes payable was based on the quoted market prices at the end of reporting period.
Interest is payable semi-annually in arrears on and of each year, beginning in March 2021. The total cash outflow in financing activities for interest paid of notes payable in the six months ended June 30, 2025 and 2026 was RMB51 million and RMB35 million, respectively.
23. |
Other payables and other liabilities |
As at |
||||||||
December 31, 2025 RMB’million |
June 30, 2026 RMB’million |
|||||||
Included in non-current liabilities |
||||||||
Put option liabilities on non-controlling interest |
||||||||
Consideration liabilities related to the acquisition of Ximalaya |
||||||||
Others |
||||||||
Included in current liabilities |
||||||||
Accrued expenses (note) |
||||||||
Investment payables |
||||||||
Other tax liabilities |
||||||||
Put option liabilities on non-controlling interest |
||||||||
Payable for construction in progress |
||||||||
Advances from customers |
||||||||
Consideration liabilities related to the acquisition of Ximalaya |
||||||||
Payable to Tencent Group (Note 27(b)) |
||||||||
Other deposits |
||||||||
Others |
||||||||
Note: Accrued expenses mainly comprise payroll and welfare, advertising and marketing, short-term lease rental and other operating expenses.
F-24
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
24. |
Deferred revenue |
As at |
||||||||
December 31, 2025 RMB’million |
June 30, 2026 RMB’million |
|||||||
Non-current |
||||||||
Current |
||||||||
Deferred revenue mainly represents contract liabilities in relation to the service fees prepaid by customers for membership services, time-based virtual gifts, content sublicensing and digital music singles and albums, for which the related services had not been rendered as at December 31, 2025 and June 30, 2026.
F-2
5
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
25. |
Business Combinations |
| (a) | Acquisition of Ximalaya |
In June 2025, the Group announced its proposed acquisition of Ximalaya, which is a leading online audio company in Chinese Mainland, pursuant to a Merger Agreement dated June 10, 2025. On May 18, 2026, the Group completed the acquisition of entire equity interest of Ximalaya. The total purchase consideration amounted to approximately RMB14.0 8.6 153,795,303 Class A ordinary shares to selling shareholders of Ximalaya. 2,203,466 Class A ordinary shares shall be issued on the first anniversary date of the Closing Date. Meanwhile, the Group reserved Group also granted certain number of RSUs under the 2024 Share Incentive Plan to replace the outstanding options and/or RSUs under Ximalaya’s previous ESOP programs. The portion for
b
illion, which comprised cash consideration of approximately RMBb
illion, and certain ordinary shares issued or to be issued by the Group. On the acquisition date, the Group issued certain number of
Class A ordinary shares (“Founder Indemnity Shares”) at closing as partial security for founders’ obligation. The Founder Indemnity Shares are classified as financial liabilities, presented in “Other payables and other liabilities”. The Group estimated the fair value of the Founder Indemnity Shares at the acquisition date and at each period end based on the best estimate of shares to be issued and the stock price of the Company’s ordinary shares. Accordingly, the Group recognized fair value changes related to the Founder Indemnity Shares with amount of RMB28 million for the six months ended June 30, 2026. The
pre-combination
services is accounted for as part of the consideration and the portion for post-combination services is accounted for as compensation cost. The fair value of total identifiable net assets (including identifiable intangible assets) was approximately RMB4.7 9.2
b
illion. Goodwill of approximately RMBb
illion was recognised as a result of the transaction. It was mainly attributable to the operating synergies and economies of scale expected to be derived from combining the operations. None of the goodwill was expected to be deductible for income tax purpose. The acquired business contributed revenue of RMB
million to the Group for the six months ended June 30, 2026. The Group’s revenue for the six months ended June 30, 2026 would be increased by no more than 10 % and net profit for the six months ended June 30, 2026 would not be materially different should the transaction have occurred on January 1, 2026.
The related transaction costs of the transaction recognised in the Group’s condensed consolidated income statement were not material.
| (b) | Other business combinations |
During the six months ended June 30, 2026, the Group acquired equity interests of companies with total considerations of RMB42
million. The revenue and the results contributed by the acquired subsidiaries subsequent to the acquisition was immaterial to the Group. The Group’s revenue and results for the six months ended June 30, 2026 would not be materially different should these acquisitions had occurred on January 1, 2026.
26. |
Commitments |
The following table summarizes future minimum commitments of the Group as at December 31, 2025 and June 30, 2026:
Within one year |
Later than one year but not later than five years |
Total |
||||||||||
As at December 31, 2025 |
RMB’million |
RMB’million |
RMB’million |
|||||||||
Operating commitments (note i) |
||||||||||||
Content royalties (note ii) |
||||||||||||
Capital commitments (note iii) |
||||||||||||
Investment commitment (note iv) |
||||||||||||
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
Within one year |
Later than one year but not later than five years |
Total |
||||||||||
As at June 30, 2026 |
RMB’million |
RMB’million |
RMB’million |
|||||||||
Operating commitments (note i) |
||||||||||||
Content royalties (note ii) |
||||||||||||
Capital commitments (note iii) |
||||||||||||
Investment commitment (note iv) |
||||||||||||
Note i: Operating commitments represent future minimum commitments under
non-cancelable
operating arrangements of the Group. As at June 30, 2026, the operating commitments are mainly related to offline performances and other services. Note ii: Content royalties represent the minimum royalty payments associated with license agreements which the Group has entered into as at period-end.
Note iii: Capital commitments represent the minimum payments associated with construction of buildings.
Note iv: Investment commitment represents commitments to acquire the equity interests in certain entities.
27. |
Related party transactions |
The table below sets forth the major related parties and their relationships with the Group as at June 30, 2026
Name of related parties |
||
Tencent and its subsidiaries other than the entities controlled by the Group (“Tencent Group”) |
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
(a) |
Transactions |
For the six months ended June 30, 2025 and 2026, significant related party transactions were as follows:
Six months ended June 30, |
||||||||
2025 RMB’million |
2026 RMB’million |
|||||||
Revenue |
||||||||
Music related services to Tencent Group (note i) |
||||||||
Music related services to the Company’s associates and associates of Tencent Group |
||||||||
Social entertainment services and others to Tencent Group, the Company’s associates and associates of Tencent Group |
||||||||
Expenses |
||||||||
Service cost to Tencent Group |
||||||||
Service cost to the Company’s associates and associates of Tencent Group |
||||||||
Other costs and expenses to Tencent Group (note ii) |
||||||||
Other costs and expenses to the Company’s associates and associates of Tencent Group |
||||||||
Note i: Primarily include revenues from online advertising and membership services provided to Tencent Group
pursuant
to the Business Cooperation Agreement, which was renewed in August 2023. Note ii: Primarily include advertising fees charged by Tencent Group for our advertising services sold through Tencent Group.
These related party transactions were conducted at prices and terms as agreed by the respective parties involved.
Note iii: During the six months ended June 30, 2026, the Group completed acquisition of Ximalaya (Note 25), which is one of the existing investee companies accounted for as financial assets at fair value through profit or loss of Tencent Group. The Group paid total consideration of
approximately RMB
m
illion, consisting of cash consideration and Class A Ordinary Shares, to certain subsidiaries of Tencent Group.
(b) |
Balances with related parties |
As at |
||||||||
December 31, 2025 RMB’million |
June 30, 2026 RMB’million |
|||||||
Included in accounts receivable from related parties: |
||||||||
Tencent Group (note) |
||||||||
The Company’s associates and associates of Tencent Group |
||||||||
Included in prepayments, deposits and other assets from related parties: |
||||||||
Tencent Group |
||||||||
The Company’s associates and associates of Tencent Group |
||||||||
Included in accounts payable to related parties: |
||||||||
Tencent Group |
||||||||
The Company’s associates and associates of Tencent Group |
||||||||
Included in other payables and accruals to related parties: |
||||||||
Tencent Group |
||||||||
The Company’s associates and associates of Tencent Group |
||||||||
Note: The balance is mainly arising from user payments collected through various payment channels of Tencent Group pursuant to the Business Cooperation Agreement that renewed in August 2023.
28
TENCENT MUSIC ENTERTAINMENT GROUP
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION
(c) |
Key management personnel compensation |
Six months ended June 30, |
||||||||
2025 RMB’million |
2026 RMB’million |
|||||||
Short-term employee benefits |
||||||||
Share-based compensation |
||||||||
28. |
Contingent liabilities |
The Group is involved in a number of claims pending with various courts, or otherwise unresolved as at June 30, 2026. These claims are mainly related
The Group had made certain accruals in “Accounts payable” in the condensed consolidated balance sheet as at June 30, 2026 and recognized related costs as expenses for the six months ended June 30, 2026. The losses accrued include judgments handed down by the court and settlements after June 30, 2026, but related to cases arising on or before June 30, 2026. All these amounts were not material. The Group is in the process of appealing in certain cases. However, the ultimate timing and outcome of pending litigation is inherently uncertain. The Company is unable to estimate the reasonably possible loss or a range of reasonably possible losses for proceedings in the early stages or where there is a lack of clear or consistent interpretation of laws specific to the industry-specific complaints among different jurisdictions. Although the results of unsettled litigations and claims cannot be predicted with certainty, the Company does not believe that, as at June 30, 2026, there was at least a reasonable possibility that the Company may have incurred a material loss, or a material loss in excess of the accrued expenses, with respect to such loss contingencies. Although management considers the likelihood of a material loss for all pending claims, both asserted and unasserted, to be remote, if one or more of these legal matters were resolved against the Company in the same reporting period for amounts in excess of management’s expectations, the Company’s consolidated financial statements of a particular reporting period could be materially adversely affected.
out-of-court
F-2
9