Tencent Music Entertainment Group (TME-SW) shares surged 13.70% in pre-market trading on Wednesday, following the release of its better-than-expected fourth-quarter earnings report. The Chinese music streaming giant demonstrated strong performance, beating analyst estimates and showing signs of continued growth in its core business.

The company reported adjusted earnings of CNY1.47 per share for the quarter ended December 31, significantly higher than the CNY1.00 per share reported in the same quarter last year. This result surpassed the mean expectation of CNY1.29 per share from eleven analysts. Revenue rose 8.2% to CNY7.46 billion ($1.03 billion), exceeding analysts' estimates of CNY7.30 billion.

While Tencent Music's social entertainment services business, which includes karaoke app WeSing and live concert platform Kuwo Music, continued to face challenges due to regulatory measures, it showed signs of stabilization. Revenue from this segment was CNY1.63 billion, down year-over-year but up 6% from the previous quarter. CEO Ross Liang noted that the social entertainment business remains in a state of "stabilization with some downward pressure" for this year amid ongoing industry challenges. Meanwhile, the company's premium Super VIP (SVIP) membership, combining long-form audio content, online karaoke services, and high-quality sound, has gained significant traction among users, contributing to the overall growth.