A deal between 7Digital and Kuaishou sent the share price of 7Digital (AIM: 7DIG) soaring as the company was selected to power music in its hugely popular social media apps.
Kuaishou is a popular community and social media platform with an average of over 760 million monthly active users in China.
Under the terms of the deal, 7Digital will be powering music in the apps globally and will receive a set-up fee, monthly recurring access fee and usage fee for its services.
Commenting on the deal was Paul Langworthy of 7Digital who commented it is expected to be a big driver of revenue of growth:
“We are pleased to sign with Kuaishou, one of the world’s fastest growing social media apps with hundreds of millions of users. This long-term contract expands 7digital’s footprint in this high-growth sector, making us one of the largest providers of licensed music to global social media giants and tech-driven consumer brands.
“Collectively, across all of 7digital’s contracts in this space, we enable 1 billion average monthly active users to access one of the largest music catalogues in the world powered by us. This latest partnership exemplifies the breadth and depth of our capabilities and is expected to be a significant contributor to our revenue growth in this market segment.”
Following the news, the share price of 7Digital edged back into the 2p territory; currently trading at 1.80p with a gain of over 41% today.