(Yicai Global) May 17 -- Shares of Tencent Music Entertainment Group, China's biggest online music platform operator, fell after the number of its monthly active users fell for a sixth consecutive quarter and despite the firm also reporting a 89 percent surge in first-quarter net profit.

Tencent Music [HKG: 1698] closed 4.5 percent lower at CNY29.45 (USD3.76) a share in Hong Kong today. Its US-listed stock [NYSE: TME] fell 3.7 percent to USD7.67 yesterday, after earlier tumbling by as much as 9.4 percent. In pre-market trading, the stock was up 2.7 percent at USD7.88 as of 7.19 a.m. in New York today.

The average number of MAUs of Tencent Music's online music services fell 6.9 percent to 592 million in the three months ended March 31, according to the Shenzhen-based firm’s earnings report released late yesterday. MAUs of social entertainment services sank 16 percent to 136 million.

First-quarter net profit was USD167 million, its financial report showed. Revenue rose 5.4 percent to USD1 billion. Income from online music services jumped 34 percent to USD510 million, while that from social entertainment and other services fell 13 percent to USD510 million.

“We are pleased to see that the revenue size of our online music services has now caught up with social entertainment services for the first time,” Executive Chairman Cussion Pang. “This signifies that our long-term commitment to developing a sustainable online music business model is bearing fruit.”

In August 2021, Tencent Music, which owns streaming platforms QQ Music, Kuwo Music, Kugou Music, and WeSing, said it gave up all of its exclusive music copyrights after pressure from anti-monopoly watchdogs in China. Its subscriber count has continuously fallen since then.

Tencent Music’s users remain willing to spend, with the number of paying users of its online music services jumping 17.7 percent to 94.4 million in the first three months of this year, it noted. The average monthly income per paying user rose 10.8 percent to CNY9.20 (USD1.32).

The company is trying to apply artificial intelligence-generated content technology to music creation, and launched TME Studio and Vocal Producer last quarter. The products can enhance an artist’s lyric writing, composition, and music content analysis and editing, the firm said.

Editors: Dou Shicong, Martin Kadiev