May 13 (Reuters) - Tencent Music Entertainment ( TME )

exceeded analysts' expectations for first-quarter revenue on

Tuesday, driven by growth in subscribers for its online music

services.

Tencent Music's premium Super VIP (SVIP) membership, which

combines long-form audio content, online karaoke services and

high-quality sound, has gained significant traction among users.

The company is taking the right steps by providing

affordable entertainment options to users amid a slowing

economy, analysts said last month.

Revenue from music subscriptions grew 16.6% to 4.22 billion

yuan ($586.1 million), while paying users increased by 8.3% to

122.9 million.

However, the social entertainment division remains a drag on

overall growth due to the removal of certain live-streaming

features to adhere to Beijing's anti-gambling regulations.

For the first quarter, revenue from the social entertainment

services business, which includes karaoke app WeSing and live

concert platform Kuwo Music, fell 11.9% to 1.55 billion yuan.

The company posted an 8.7% increase in revenue to 7.36

billion yuan for the quarter ended March, beating analysts'

estimates of 7.27 billion yuan, according to data compiled by

LSEG.

The music firm is also in advanced talks to acquire China's

largest online audio platform, Ximalaya, which would

significantly enhance its portfolio.

($1 = 7.2001 Chinese yuan renminbi)