(Yicai Global) May 17 -- Shares in Tencent Music Entertainment, China's biggest online music group, advanced in after-hours trading despite first-quarter profit and revenue plunging by double digits as hopes rise that the recent crackdown on the country’s internet-based giants will ease soon.

Tencent Music’s share price [NYSE:TME] rose 3.37 percent to USD4.29 in after-market trading.

Tencent Music’s net profit plunged 34.2 percent in the three months ended March 31 from the same period last year to CNY609 million (USD96 million), according to the Shenzhen-based company’s latest earnings report released yesterday. Revenue sank 15.1 percent to CNY6.6 billion (USD970 million).

Despite the blow to investors’ pockets, the results were to be expected after regulators began to rein in internet-based giants last year. Among other restrictions, last August Tencent Music was stripped of its exclusive music copyright deals to allow freer competition. There are expectations that the curbs will be loosened after the government recently pledged support for the platform economy.

“In the first quarter, we further strengthened our cooperation with parent firm Tencent Holdings’ ecosystem in content production and promotion, with the rewards becoming increasingly manifest,” said Chief Executive Officer Ross Liang. In addition, our long-form audio continued to gain traction thanks to differentiated content, and we are working on improving its monetization efficiency mainly through memberships.”

Revenue from social entertainment services plunged 20.6 percent to CNY4 billion (USD592 million) and that for its online music services sank 4.8 percent to CNY2.6 billion. The number of monthly active users for online music dipped 1.8 percent to 604 million due to a drop in casual users and less expenditure on marketing, it said.

But the number of paid subscribers jumped 31.9 percent to 80.2 million year on year. The average revenue per paid subscriber slumped 10 percent to CNY8.3 (USD1.23).

Tencent Music is building closer ties with Tencent's social media platform WeChat such as through holding online concerts on WeChat video accounts, an executive said at the earnings call. This model has seen some success during the pandemic. The company is also looking at livestreaming artists’ performances through WeChat accounts, he added.

No guidance was given for this quarter.

Editors: Dou Shicong, Kim Taylor