By Xie Fang
Tencent Music, China’s leading music streaming service provider, is gaining popularity among U.S. investors which have recently agreed to buy private stocks in the company from its earlier shareholders at a valuation between $28 billion and $30 billion, the Cailian Press reported Monday morning.
The valuation, which is significantly higher than the previous one of $11.5 billion estimated last December, not only surpasses the market capitalization of the Chinese tech giant NetEase which is currently valued at $27.1 billion but also approaches its European counterpart, Spotify, whose market value had reached $34.6 billion as of last Friday.
Analysts believe that the strong profitability of Tencent Music, which is rare among music-streaming platforms, is the main reason why the company has become so appealing to the U.S. investors.
The company earned roughly $2 billion in net profits in 2017 and is projected to double that number this year. In contrast, Spotify reported a net loss of around $1.4 billion last year.
The company now operates an online streaming service named QQ Music as well as two live-streaming music apps, Kugou and Kuwo. These three services had a combined 700 million monthly users in China by the end of last September.
It also runs a popular karaoke app named WeSing, which had more than 460 million registered users by the end of last year.
The company kicked off its effort to go public in the U.S. last month after being stripped from its parent company Tencent.
