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Warner Music Group Rides Strong Subscription Growth to Hit $6 Billion Revenue Target

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1 year ago

21 November 2024

Warner Music Group Rides Strong Subscription Growth to Hit Billion Revenue Target

Warner Music Group reported on Thursday that total revenue for its fiscal year rose 6% compared to a year-ago on strong digital and streaming subscription revenue.

The company reported $6.43 billion in total revenue for the twelve months ending on Sept. 30, up 6% from the roughly $6 billion the company generated in the 12-months prior. That figure included $5.22 billion in recorded music revenue, which represented a 5% increase from a year ago, and music publishing revenue of $1.2 billion, which was up by 11% increase from a year ago.

WMG’s digital revenues grew by 7.3% and streaming revenue increased 8.2% in a year despite the roll-off of a distribution deal with BMG, which negatively impacted both digital and streaming revenues within recorded music. Music publishing streaming revenue jumped 14.6%, as both divisions benefitted from licensing, physical sales, performance and sync revenues, the company said.

“Our strong streaming performance, underpinned by positive industry trends, and combined with our cost discipline, resulted in robust cash flow generation,” Bryan Castellani, CFO of Warner Music Group, said in a statement. We are excited by the opportunities ahead, and look forward to delivering more culture-shaping music in 2025 and beyond.”

Major sellers during the label’s fourth quarter included Benson Boone, Charli XCX, Zach Bryan and Teddy Swims.

Warner’s stock was up 2.25% in pre-market trading at 8:04 a.m. in New York.

Key WMG financial highlights for its full fiscal year:

Total revenue rose 6% to $6.426 billion for the fiscal year, from $6.037 billion in 2023.
Recorded revenue rose 5% to $5.223 billion from $4.995 billion.
Publishing revenue rose 11% to $1.210 billion from $1.08 billion.
Digital revenue was up 7.3% $4.280 billion from $3.9 billion in 2023.
Recorded music subscription streaming revenue rose 8% to $2.543 billion from $2.349 billion (ad-supported increased 3%).
Operating income was up 4% to $823 million from $790 million, so that means operating margin was down slightly to 12.8% compared to the prior year when it was 13.1% of revenue.

Key WMG financial highlights for its Q4:

Total revenue rose 2.8% to $1.630 billion for the fourth quarter 2024, from $1.586 billion in the same quarter 2023.
Net profit, or net income, was down 69% at $48 million this quarter compared to $154 million.
Digital revenue decreased 0.2%to $1.066 billion from $1.068 billion.
Streaming revenue for both recorded music and publishing rose 1% to $1.048 billion from $1.038 billion.
Recorded music subscription streaming revenue rose 5% to $645 million from $615 million (ad-supported dipped 5%).
Recorded revenue rose 3.6% to $1.338 billion from $1.291 billion.
Publishing revenue dipped 1% to $295 million from $298 million.
Operating income was down 33% to $143 million from $212 million.
OIBDA was down 22% to $226 million compared to $291 million.

Elizabeth Dilts Marshall

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