You will be redirected back to your article in seconds

Warner Music Group Posts Solid Second-Quarter Earnings

Warner Music Group posted strong fiscal second-quarter financial results this morning, with total revenue up 16.7% (10.4% in constant currency) and digital revenue up 24.6% (19.7% in constant currency). Digital revenue represented 56.8% of total revenue, compared to 53.2% in the prior-year quarter.

The company also announced that it has sold 75% of its shares in Spotify, worth around $400 million.

“We’re having another excellent year with strong momentum around the world in both Recorded Music and Music Publishing,” said Steve Cooper, Warner Music Group’s CEO.  “We’re investing heavily in A&R, digital innovation and the transformation of our operations to ensure that we are positioned for long-term success.”

“We showed strong revenue and OIBDA growth in our second quarter,” added Eric Levin, Warner Music Group’s Executive Vice President and CFO.  “This is our eleventh consecutive quarter of year-over-year revenue growth and we’re proud of our ability to deliver robust results on a consistent basis.”

Growth in Recorded Music digital, physical and licensing revenue and all segments of Music Publishing revenue were partially offset by a decline in Recorded Music artist services and expanded-rights revenue.  Revenue increased in all regions.

Operating income was $83 million compared to $78 million in the same quarter last year, while OIBDA rose 7.8% to $152 million from $141 million. According to the release, the increase in operating income and OIBDA was largely the result of higher revenue partially offset by restructuring costs and an increase in facilities costs related to the Company’s Los Angeles office consolidation.

Net loss was $1 million compared to net income of $20 million in the prior-year quarter and Adjusted net income was $28 million compared to Adjusted net income of $25 million in the prior-year quarter.  The net loss was primarily attributable to a loss on extinguishment of debt of $23 million related to the partial redemption of the Company’s 6.75% Senior Notes, and higher non-cash tax expense in the quarter related to a one-time tax benefit in the prior-year quarter, offset by higher operating income.

Recorded Music revenue grew 15.3% (9.1% in constant currency), although rowth in digital, physical and licensing revenue was partially offset by a decline in artist services and expanded-rights revenue. Licensing revenue rose due to higher broadcast fee income and greater synchronization activity. Recorded music operating income was $80 million up from $69 million in the prior-year quarter, and operating margin was flat at 10.1%. Top sellers included Ed Sheeran, “The Greatest Showman” soundtrack album, Bruno Mars, Dua Lipa and the Japanese rock band Wanima.

Music publishing revenue rose 20.0% (13.7% in constant currency) and grew in all segments – digital, performance, synchronization and mechanical – although operating income was flat at $41 million.


More Digital

  • Lisa Utzschneider - IAS

    IAS Taps Ex-Yahoo Sales Boss Lisa Utzschneider as CEO of Ad-Verification Firm

    Integral Ad Science (IAS), a digital ad verification company, hired Lisa Utzschneider as CEO and board member. Most recently, she was Yahoo’s chief revenue officer, exiting Yahoo with Verizon’s acquisition of the company last year. Utzschneider starts at IAS effective Jan. 7, 2019, replacing president and CEO Scott Knoll, who after eight years in the [...]

  • ‘Bumblebee’ Again Tops Studios’ TV Ad

    ‘Bumblebee’ Again Tops Studios’ TV Ad Spending

    In this week’s edition of the Variety Movie Commercial Tracker, powered by the TV advertising attention analytics company iSpot.tv, Paramount Pictures claims the top spot in spending for the second week in a row with “Bumblebee.” Ads placed for the sci-fi/action film had an estimated media value of $6.31 million through Sunday for 941 national [...]

  • Kathreen Khavari

    Kathreen Khavari Tapped by Refinery29 for 'Embrace' Comedy Pilot

    Refinery29 will begin production in 2019 on “Embrace,” a pilot from writing duo Kathreen Khavari (“Big Little Lies”) and Chuck Neal. “Embrace” will star Khavari as she comes up with an unconventional solution to prevent her Iranian immigrant parents from having to move back to Iran. Refinery29 bills the show, set in Khavari’s hometown of [...]

  • Outlander Season 4

    Starz Available for $5 a Month for Three Months Through the Holidays

    Starz is having an online holiday sale: The premium cable network is selling three months of its online streaming service for $5 per month, down from the regular price of $8.99 per month. The offer is available to new users who sign up until the end of December. Subscribers also get a 7-day free trial, [...]

  • Meg Whitman and Jeffrey Katzenberg Strictly

    Listen: Jeffrey Katzenberg, Meg Whitman Go Long on Short-Form Entertainment

    One is a legend in the media business, the other in the tech world. But together Jeffrey Katzenberg and Meg Whitman are intent on bringing the best of both worlds together for their ambitious new venture: Quibi. On the latest episode of the Variety podcast Strictly Business, the dynamic duo shared their battle plan to [...]

More From Our Brands

Access exclusive content