Warner Music Group Reports Recorded Music Up 13.8% For Fiscal Third Quarter

Q3 Results

WARNER MUSIC GROUP has released its third-quarter financial results for the period ended JUNE 30th.

Recorded Music revenue grew $111 million or 13.8% (or 16.9% in constant currency). This included a $59 million increase related to the acquisition of EMP and a $7 million increase due to the adoption of ASC 606, which were partially offset by a $21 million decrease related to concert promotion divestitures.  

Growth in digital, licensing and artist services and expanded-rights revenue was partially offset by a decline in physical revenue. Digital growth reflects a continuing shift to streaming. The increase in licensing was due to the impact of ASC 606 as well as higher activity. The increase in artist services and expanded-rights revenue was largely attributable to the acquisition of EMP and higher international touring, domestic merchandising and advertising revenue.  The decline in physical revenue reflects industry trends and timing of releases. Recorded Music revenue grew in all regions. Major sellers included ED SHEERAN, A BOOGIE WIT DA HOODIE, THE YELLOW MONKEY, NIPSEY HUSSLE and CARDI B.

“Our third-quarter results are proof of our continued momentum,” said CEO STEVE COOPER. “To say that streaming is responsible for the recovery of our business is an oversimplification. Without the talent and creativity of our artists and songwriters, and all of the investment and expertise that we put behind them, there would be no growth."

“We had strong growth in revenue, OIBDA and cash flow,” added EVP/CFO ERIC LEVIN. “We expect fiscal 2019 to be another great year.”

The Highlights

• Total revenue grew 10.4% or was up 13.4% in constant currency
• Digital revenue grew 12.5% or was up 15.5% in constant currency
• Net income was $14 million versus $321 million in the prior-year quarter
• OIBDA was $124 million, up 25.3% from $99 million in the prior-year quarter

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