Warner Music Group Rides Strong Subscription Growth to Hit $6 Billion Revenue Target
Written by djfrosty on November 21, 2024
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.
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“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.