Company: TME
Filing Date: 2025-04-23
Form Type: 20-F
Source: 0000950170-25-056949
Chunk: 53

Company: Tencent Music Entertainment Group
Filing Date: 2025-04-23
Form: 20-F
Item: Item 3
Chunk 53
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 material adverse effect on our business, financial condition and results of operations and could cause the market price of our Class A ordinary shares and/or the ADSs to drop significantly.
Our business expansion subjects us to increased and additional business, legal, financial, reputational, and competitive risks.
As part of our growth strategy, we have continued to expand our offerings and explore new, innovative ways to attract and engage with users. Our business expansion involves numerous risks and challenges, including increased capital requirements, new competitors, the use of emerging and advanced technologies, and the need to develop new strategic relationships, among other things. The implementation of our expansion strategy may also require additional changes to our existing business model and cost structure, modifications to our infrastructure, and exposes us to new regulatory, legal and reputational risks, any of which may require additional expertise that we currently may not have. For example, we promote the commercialization of AI-generated content and actively offer users interactive AI features. While AI offers innovative capabilities, it also presents risks associated with technology failures, unexpected operational challenges, and the need for continuous updates and improvements to stay competitive and effective. The rapidly evolving regulatory landscape around AI technologies and digital content distribution could impose new compliance requirements or restrictions. Changes in copyright, data protection laws, and regulations governing AI could impact our operations, necessitating significant adjustments to our platform and operational practices. As users may create music using AI and distribute them through our platform, there may be complexities surrounding the ownership and copyright of AI-generated or AI-enhanced content. The ambiguity in intellectual property rights for AI-generated or AI-enhanced works could lead to legal disputes and

challenges in monetizing the content. Also see “- We are subject to risks and uncertainties associated with the evolving AI regulations, potential infringement claims and increasing costs for regulatory compliance.”
In addition, we offer artist-related merchandise, including a diverse range of products designed, endorsed, or inspired by various artists, such as branded apparel, posters and art prints, and accessories. These products may expose us to certain risks that could adversely affect our financial condition and operational results. Our artist-related merchandise could face product liability claims if the products are found to be defective, harmful, or if they fail to meet consumer safety standards. The value and appeal of artist-related merchandise are closely tied to the public image and popularity of the associated artists, and any negative publicity involving these artists, such as involvement in legal issues, scandalous behavior, or controversial statements, could significantly diminish the desirability of the merchandise.
There is no guarantee that we