Billboard Global Music Index
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YG Entertainment shares gained 4.3% this week as “APT” by ROSÉ and Bruno Mars continued its hot streak. A week after YG’s stock gained 6.1% following the track’s blockbuster start on streaming services, the track topped both the Billboard Global 200 and Billboard Global Excl. U.S. charts. ROSÉ, a member of YG recording artist BLACKPINK, released “APT” through Atlantic Records in partnership with THEBLACKLABEL, a YG sub-label co-founded in 2015 by BLACKPINK producer Teddy Park. While YG continues to manage BLACKPINK, ROSÉ signed with THEBLACKLABEL for the management of her solo career.
Universal Music Group (UMG) shares fell 0.7% over the week but gained 1.6% to 23.45 euros ($25.52) on Friday (Nov. 1) following the company’s third-quarter earnings the prior day. Morgan Stanley raised its price target to 35 euros ($38) from 33 euros ($35.90). “Our conviction on UMG is as high as it’s ever been,” Morgan Stanley analysts wrote in an investor note. Guggenheim called UMG’s third-quarter results “encouraging” and maintained a 25.50 euros ($27.74) price target and its “neutral” rating on UMG shares.
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SiriusXM gained 4.7% to $27.65 after the company’s third-quarter earnings release on Thursday (Oct. 31) showed a net gain of 14,000 self-pay subscribers in the quarter. Despite the uptick, average revenue per user fell due to a “higher proportion of subscribers on self-pay promotional and streaming-only plans,” the company said.
Deezer shares gained 2.1% to 1.43 euros ($1.56) after the company’s third-quarter earnings showed 11% revenue growth and a 9% uptick in subscribers. New CEO Alexis Lanternier sounded upbeat about partnerships with MeLi+ and Mercado Libre, which has converted free trials at a rate “higher than our expectations,” in his words. Still, Deezer’s share price is down 32.9% year to date.
Reservoir Media fell 3.5% to $8.25 following its earnings release on Wednesday (Oct. 30) which showed solid 6% revenue growth. The stock did not get a bump from Reservoir’s slightly upgraded full-year guidance nor B. Riley’s increase of its price target to $12.50 from $11.50.
The 20-company Billboard Global Music Index (BGMI) was essentially flat for the week, rising 0.3% to 1,995.67 despite having just seven gainers as opposed to 13 stocks that lost ground. The small increase brought the index’s year-to-date gain to 30.1% and reversed the BGMI to the win category after it dropped 0.6% the prior week, breaking a streak of six consecutive weeks of gains.
Even a small gain outperformed many major stock indexes. In the United States, the Nasdaq composite fell 1.5% to 18,329.92 and the S&P 500 fell 1.4% to 5,728.80. Both indexes rose on Friday, however, as investors paid little attention to a weak jobs report and both Amazon and Intel jumped after reporting quarterly earnings. On Thursday (Oct. 31), Meta and Microsoft shares fell following their respective earnings reports, with Meta dropping 3% and Microsoft falling more than 5%.
Music streamer LiveOne was the greatest gainer of the week after jumping 32.8% to $0.77. The company announced on Thursday that it has engaged MZ Group to increase the visibility of PodcastOne in the investment community. LiveOne spun off PodcastOne in 2023 and retained an 81% stake. Investors may have taken note of MZ Group’s Chris Donovan’s statement that PodcastOne “owns intellectual property that can be sold for a significant return on investment.”
Outside of YG Entertainment, the other four K-pop stocks lost ground. HYBE fell 3.1% and increased its year-to-date loss to 20.0%. JYP Entertainment fell 4.2%. SM Entertainment slipped 0.7%. Collectively, the four K-pop companies’ share prices are down 28.6% in 2024.
iHeartMedia jumped 16.1% to $2.09 a week before the company reports third-quarter earnings on Thursday (Nov. 7). Another radio company, Cumulus Media, dropped 19.0% to $0.94 following its release of third-quarter earnings on Friday. The company’s revenue fell 1.8% to $204 million and it saw a net loss of $10.3 million, down from a net profit of $2.7 million in the prior-year period. “Looking forward, the advertising environment remains uncertain,” warned Cumulus CEO Mary Berner.
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As earnings season prepares to get underway, K-pop companies were among the week’s rare winners as music stocks broke a six-week winning streak.
YG Entertainment surged 6.1% this week as the company appears to have scored a hit with “APT” by ROSÉ, a member of the girl group BLACKPINK, featuring Bruno Mars. The track got off to a blistering start this week, topping Spotify’s global and U.S. daily streaming charts and earning 13.3 million streams in the U.S. in its first four days of release. SM Entertainment, home to NCT 127 and RIIZE, rose 4.1%, while HYBE, with a roster including Seventeen and Tomorrow X Together, improved 2.1%. JYP Entertainment, the agency behind Stray Kids and ITZY, improved 1.4%.
Stock prices are likely to see movement in the coming weeks as companies release their results for the quarter ended Sept. 30. The first music companies out of the gate are Reservoir Media (Oct. 30), SiriusXM (Oct. 31), Universal Music Group (Oct. 31) and Cumulus Media (Nov. 1). Other companies that have announced earnings release dates include Sony Corp. (Nov. 8), Tencent Music Entertainment (Nov. 12), Live Nation (Nov. 12) and Spotify (Nov. 12).
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The 20-company Billboard Global Music Index (BGMI) fell 0.6% to 1,974.72 in the week ended Oct. 25 after breaking 2,000 for the first time the prior week and posting gains the previous five weeks. In the week ended Oct. 18, the BGMI reached 2,001.28, more than doubling in value since the index launched in February 2022. After the recent decline, the index’s year-to-date gain stood at 29.7%, ahead of both the Nasdaq composite (up 23.4%) and S&P 500 (up 21.8%).
Stock markets were mixed this week. In the U.S., the S&P 500 rose 0.2% to 18,518.61 while the Nasdaq composite fell 1.0% to 5,808.12 despite Tesla’s 22% gain after the electric vehicle maker beat earnings expectations and upgraded its growth outlook. In the U.K., the FTSE 100 dropped 1.6% to 8,248.84. South Korea’s KOSPI composite index dipped 0.4% to 2,583.27. China’s Shanghai Composite Index rose 1.2% to 3,299.70.
Outside of South Korean companies, one of the biggest movers of the week was Live Nation. Ahead of the company’s Nov. 12 earnings release, numerous analysts increased their price targets on the concert promoter’s stock this week: Redburn Atlantic (to $126 from $118), Jefferies (to $132 from $113), JP Morgan (to $137 from $118) and Goldman Sachs (to $132 from $128). Given that the third quarter is historically Live Nation’s strongest period and the company has set all-time records in previous quarters, Q3 results are likely to boast more all-time highs.
Spotify was one of the index’s few stocks to post a weekly gain — albeit with just a 0.1% increase. Morgan Stanley raised its price target on Spotify on Wednesday to $430 from $400. Analysts see much upside for Spotify. Global subscription penetration (excluding China) “remains relatively low” at 15%, Goldman analysts explained in a Tuesday (Oct. 22) investor note, and Spotify has the ability to further raise prices. Additionally, they wrote, Spotify’s growing audiobook business proved the company can generate more revenue from its subscribers than was possible when it offered just music.
Most music stocks had modest, single-digit declines this week. Warner Music Group fell 0.1% to $32.38, Universal Music Group dropped 1.9% to 23.61 euros, Tencent Music Entertainment declined 3.2% to $11.50, Reservoir Media dipped 3.4% to $8.55, iHeartMedia was down 4.3% to $1.80, and both Sphere Entertainment Co. and SiriusXM were off 4.4%.
LiveOne was the week’s biggest loser after falling 10.6% to $0.58. The music streamer has fallen 38% since its Oct. 1 announcement that Tesla will no longer subsidize the LiveOne-powered streaming service in new vehicles. Radio broadcaster Cumulus Media dropped 9.4% to $1.16, bringing its year-to-date decline to 78.2%.
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Chinese music streaming companies had another big week after authorities unveiled an economic stimulus plan that will encourage the purchase of Chinese equities, with Cloud Music gaining 10.7% to 134.50 HKD ($17.32) and Tencent Music Entertainment rising 9.9% to $13.48. Last week, Cloud Music and Tencent Music gained 31.5% and 24.6%, respectively.
The Billboard Global Music Index (BGMI) increased 0.4% to 1,964.44, a fourth-consecutive weekly gain and the third straight week the index set a new record high. With winners and losers evenly split amongst the index’s 20 stocks, the BMGI improved its year-to-date gain to 28.1%.
Outside of China, where the Shanghai Composite Index rose 8.1% to 3,336.50, stocks were generally muted this week as investors were uncertain about how the widening war in the Middle East would affect the global economy. Oil prices increased 10% this week in part due to President Joe Biden’s comment that the U.S. was discussing possible strikes by Israel on Iranian oil production sites. Prices remained well below levels reached following Russia’s invasion of Ukraine in February 2022, however.
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In the U.S., the Nasdaq composite rose 0.1% and the S&P 500 gained 0.2%. In the U.K., the FTSE 100 fell 0.5% to 8,280.63. South Korea’s KOSPI composite index dropped 3.0% to 2,569.71.
iHeartMedia was the BGMI’s biggest gainer of the week, rising 15.2% to $1.97; the radio company’s shares have fallen 3.9% year to date but have risen 142% since hitting a 52-week low of $0.813 on May 28. Elsewhere, the index’s most valuable companies had either modest gains or losses. Live Nation gained 2.0% to $110.87. Spotify rose 0.6% to $371.45. HYBE increased 0.3% to 173,500 KRW ($128.82). Universal Music Group fell 2.0% to 23.37 euros ($25.66).
Sphere Entertainment Co. shares rose 4.4% to $45.26 as Wolfe Research upgraded the company on Wednesday (Oct. 2) to “outperform.” The company’s flagship venue, Sphere in Las Vegas, has added more shows to existing residencies. The Eagles will perform four additional shows in February, bringing its residency to 24 dates. In addition, Anyma added dates on Jan. 10 and 11 — the seventh and eighth shows at the venue for the Italian producer, who will break a string of legacy rock bands to become the first EDM artist to perform at Sphere.
Guggenheim reiterated its “buy” rating on Warner Music Group (WMG) and slightly lowered its estimate for ad-supported streaming revenue ahead of the company’s fiscal fourth-quarter earnings. BofA Securities downgraded WMG to “underperform” from “neutral” on Friday and lowered its price target to $30 from $33. WMG shares finished the week at $31.14, down 0.2%.
LiveOne shares fell 35.8% after the company lowered its fiscal 2025 guidance following a revised partnership with Tesla in which the auto manufacturer will no longer subsidize some customers’ in-auto streaming platform powered by LiveOne’s Slacker Radio. The Los Angeles-based company’s stock has fallen 51.4% year to date.
K-pop stocks, which have fallen sharply in 2024, were muted this week. HYBE, YG Entertainment, SM Entertainment and JYP Entertainment fell by an average of 0.1%, which nudged their average year-to-date loss down to 32.0%.
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Two Chinese music streaming companies, Cloud Music and Tencent Music Entertainment, led all music stocks in a second consecutive record-setting week.
Cloud Music surged 31.5% to 121.50 HKD ($15.63) and Tencent Music Entertainment jumped 24.6% to $12.27, benefitted from a surge in Chinese stocks this week. Cloud Music set a new 52-week high of 123.40 HKD ($15.88) on Friday and brought its year-to-date gain to 35.4%. Before the current upswing, Tencent Music had lost more than half its value since hitting its 52-week high of $15.77 on May 16. Now, Tencent Music’s year-to-date gain stands at 36.2%.
Chinese stocks had their best week since 2008 as investors reacted to the country’s stimulus plan announced Tuesday. Among the components of the plan is a provision to allow banks to lend to companies to repurchase their shares and allowing major shareholders to buy larger stakes in companies. As a result, the Shanghai Composite Index, which measures all stocks traded on the Shanghai exchange, shot up 12.8% this week.
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Led by China’s two largest music streaming companies, the Billboard Global Music Index, a float-adjusted index of 20 music business stocks, rose 4.4% to a record 1,956.63 in the week ended Sept. 27. The BGMI has gained 12.2% in the last three weeks and reached a new record high for the second consecutive week. The index had 14 stocks in positive territory and just six of the 20 stocks in the red.
Music stocks easily outperformed most major indexes. In the United States, the Nasdaq composite gained 1.0% to 18,119.59 and the S&P 500 rose 0.6% to 5,738.17. In the United Kingdom, the FTSE 100 was up 1.1% to 8,320.76. South Korea’s KOSPI composite index rose 2.2% to 2,649.78.
K-pop stocks also had an outstanding week. The four leading South Korean music companies, which have all shed significant value in 2024, posted an average gain of 14.4%. YG Entertainment rose 18.3%, SM Entertainment jumped 16.9%, JYP Entertainment improved 14.2% and HYBE climbed 8.1%.
Spotify, the BMGI’s most valuable component, rose 1.1% to $369.13. During the week, Spotify shares rose as high as $389.96—a new all-time high—but fell $20 by the end of Friday. Universal Music Group, the BGMI’s second-most valuable component, gained 4.9% to 23.86 euros ($26.66). On Friday, Kepler Cheuvreux upgraded UMG to “hold” from “reduce” and lowered its price target to 23.50 euros ($26.25) from 27.00 euros ($30.16).
SiriusXM was one of the week’s few losers, dropping 2.2% to $24.39. Morgan Stanley on Tuesday told investors that SiriusXM faces the risk of “further multiple compression” due to a limited outlook for subscriber and revenue growth. In other words, if SiriusXM was valued at, say, 15 times earnings before interest, taxes, depreciation and amortization (EBITDA), its growth prospects might merit a lower multiple.
Music streaming company LiveOne had the week’s biggest decline of 23.2%. Radio broadcaster Cumulus Media fell 8.6% and French music streamer Deezer dropped 8.0%.
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Shares of Spotify rose 8.0% to $365.00 this week to lead all music stocks in a week the Billboard Global Music Index reached a new high and many of its largest components posted mid- to high-single digit gains.
The Swedish music streaming giant was boosted by a report by Pivotal Research Group that increased its price target to $510 from $460 and reiterated its “buy” rating. Spotify’s intraday high of $368.29 on Thursday set a new 52-week high for the stock and was its best mark since Feb. 21, 2021.
Spotify led the 20-company Billboard Global Music Index (BGMI) to a record high 1,873.87, up 4.1% for the week, as ten of the stocks posted gains this week, nine lost value and one was unchanged. After a 4.8% drop the week ending Sept. 6 and stagnating since March, the BGMI has gained 7.4% in the last two weeks and raised its year-to-date gain to 22.2%—more than two percentage points above the gains of the Nasdaq composite (up 19.6%) and the S&P 500 (also up 19.6%).
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Stocks generally had a good week after the U.S. Federal Reserve announced on Wednesday a rate cut of half a percentage point, the first time the central bank lowered the overnight borrowing rate since the early days of the COVID-19 pandemic. Investors had expected the Fed’s move, though, and had priced the effect of a rate cut into stock prices. Still, the Nasdaq composite climbed 1.5% to 17,948.32 and the S&P 500 rose 1.4% to 5,702.55. South Korea’s KOSPI composite index improved 0.7% to 2,736.81 and China’s Shanghai Composite Index rose 1.2% to 2,736.81. In the United Kingdom, the FTSE 100 fell 0.5% to 8,229.99.
Warner Music Group gained 4.9% to $30.44. WMG’s Atlantic Music Group laid off about 150 people Thursday as part of a restructuring plan that began in February. The week’s intraday high of $30.88 was WMG’s highest price since reaching $32.34 on July 24. The company also announced in an SEC filing this week it secured a $1.3 billion term loan that will be used to repay an existing loan and pay associated fees and expenses.
Live Nation shares also gained 4.9% to $103.65 and brought its year-to-date improvement to 10.7%. Thursday’s intraday high of $105.42 was its highest mark since April 1 and less than $2 below its 52-week high of $107.24. The concert promoter scored a win in Portland, Ore., this week after the city council upheld an August decision to allow the development of a 3,500-capacity music venue that will be operated by Live Nation.
Two other promoters also posted gains this week. MSG Entertainment, rose 4.6% to $42.16, while CTS Eventim improved 1.2% to 87.90 euros ($98.23). Another live entertainment company, Sphere Entertainment Co., dropped 2.7% to $41.09.
K-pop companies’ modest decline was an improvement from their consistently steep drops in recent weeks. The four South Korean companies had an average loss of 1.2% this week. HYBE fell 2.4%, JYP Entertainment dipped 1.2%, YG Entertainment slipped 0.9% and SM Entertainment lost 0.2%. After surging in previous years, the quartet has an average year-to-date loss of 40.4%.
Universal Music Group fell 3.6% to 22.75 euros ($25.42) following its Capital Markets Day on Tuesday. Analysts generally felt UMG set reachable financial targets and presented a believable roadmap about its strategy for the next four years. The Amsterdam-listed company laid out a strategy to achieve 8% to 10% cumulative annual growth rate (CAGR) for its subscription revenue and above 7% CAGR for total revenue.
Music streamer LiveOne had the biggest decline of the week, dropping 6.1% to $1.38. That put shares of LiveOne into the red for 2024 with a 1.4% year-to-date loss.
Music stocks were off sharply this week as global markets were roiled by worries about the health of the U.S. economy and Friday’s disappointing jobs report.
K-pop stocks suffered big declines this week as a major Korean stock market index had its biggest one-day decline ever. South Korea’s KOSPI composite index fell 8.8% on Monday as investors were gripped with fear about a U.S. recession. The market improved the following day, but the KOSPI ended the week down 4.9% to 2,544.81.
South Korean music companies were unfortunate casualties during the week of upheaval. The four main K-pop companies fell an average of 10.8% and their average year-to-date loss increased to 40.9%. HYBE fell 10.2% to 165,000 won ($123.25), bringing its year-to-date loss to 29.1%. YG Entertainment slipped 9.8% to 30,800 won ($23.01). SM Entertainment fell 10.4% to 56,300 won ($42.05). JYP Entertainment fared the worst, dipping 13.0% to 44,450 ($33.20) and bringing its year-to-date loss to 56.1%.
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The Billboard Global Music Index fell 4.8% to 1,744.64, reducing the year-to-date gain to 13.7% and marking the index’s worst week since it fell 5.1% in the week ended Feb. 24, 2023. The broader stock market had a miserable week. In the United States, the Nasdaq composite fell 5.8% and the S&P 500 slipped 4.2%. In the United Kingdom, the FTSE 100 lost 2.3%. China’s Shanghai Composite Index fell 2.7%.
Just three of the BGMI’s 20 stocks finished the week in positive territory, and two of the three winners are among the index’s smallest contributors. The top stock, Believe, which gained 3.7% to 15.06 euros ($16.69), has a float of less than 4% after a consortium led by CEO Denis Ladegaillerie acquired nearly the entire share capital.
The second-best performer, Anghami, has the smallest market capitalization of all index companies at $23 million. The Abu Dhabi-based music streamer gained 2.3% to $0.90 after announcing Thursday (Sept. 5) that its video streaming subscriptions increased 18% since the majority investment by OSN Group, owner of MENA-based video-on-demand streaming platform OSN+, in April.
Live Nation fell 5.0% to $92.81 despite two positive analyst opinions this week. BofA Securities initiated coverage of Live Nation this week with a $125 price target and a “buy” rating. Oppenheimer, which dropped its Live Nation price target from $120 to $110 in May, raised it back to $120 on Friday.
Sphere Entertainment Co. dropped 7.1% to $43.27 after Benchmark downgraded Sphere shares to “sell” with a $40 price target, well below the prior day’s $46.60 closing price. Benchmark analyst cited concerns about “scalability, high production costs, and a potentially underwhelming profitability outlook” for the $2.3 billion Las Vegas venue.
The week’s largest decline came from SiriusXM, which fell 17.0% to $2.73. On Wednesday (Sept. 4), SiriusXM and Liberty Media announced the final exchange ratio for the pending merger of SiriusXM’s and Liberty Media’s tracking stock, Liberty SiriusXM Holdings. On Monday (Sept. 9), Liberty Media will redeem each outstanding share of Liberty SiriusXM common stock for 0.8375 shares of the new SiriusXM stock. SiriusXM shareholders will receive 0.1 shares of the new SiriusXM stock, which will trade under the same SIRI ticker as the current SiriusXM stock. Following the merger, former holders of Liberty SiriusXM stock will own roughly 81% of the new shares.
The BGMI’s most valuable component, Spotify, fell 5.9% to $322.75. Another major stock on the index, Universal Music Group (UMG), dropped 3.0% to 22.93 euros ($25.42). UMG will host investors and analysts at its Capital Markets Day on Tuesday (Sept. 10).
CTS Eventim shares finished the week up 5.3% after the company sounded upbeat about the second half of 2024 in its Thursday (Aug. 22) earnings release.
Based on its performance in the first half of the year, the German promoter and ticket seller expects adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) “to grow significantly” in the latter half of the year. Second-quarter adjusted EBITDA improved 23.3% to 110.0 million euros ($118.4 million) with the help of the June acquisition of See Tickets from Vivendi.
CTS Eventim is among the best-performing music stocks of 2024, having gained 34.5% year to date. That gain outstrips fellow promoter Live Nation (up 25.0%) and lags behind only Believe (up 43.3%), Sphere Entertainment Co. (up 47.3%) and Spotify (up 82.3%).
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As well as CTS Eventim fared this week, three other music companies had larger gains. iHeartMedia jumped 19.0% to $1.42, continuing its tendency to rise and fall in the absence of any market-moving news or financial releases. SiriusXM rose 6.7% to $3.00, perhaps assisted by news the company signed Gen Z podcaster Alex Cooper (Call Her Daddy) in a move that could help bring a younger audience to its new streaming app. HYBE improved 6.1% to 166,400 won ($125.60).
Chinese music streamer Cloud Music gained 1.4% to 91.60 HKD ($11.75) after the company posted revenue of 4.07 billion RMB ($571 million), up 4.1%, in the first half of 2024, it announced Thursday (Aug. 22). Like the leading Chinese music streamer, Tencent Music Entertainment, Cloud Music has two segments that are headed in opposite directions. Music subscription revenue grew 26.6% to 2.56 billion RMB while social entertainment and other revenue fell 19.9% to 1.51 billion RMB ($212 million).
An unusually large majority of music stocks posted gains this week. The Billboard Global Music Index gained 2.7% to 1,829.18, bringing its year-to-date increase to 19.2%. Of the 20 stocks on the index, 17 were gainers and just three lost ground. Three radio companies (iHeartMedia, Cumulus Media and SiriusXM) led the way with an average gain of 8.8%. Multi-sector companies (including Universal Music Group, Warner Music Group and HYBE) rose an average of 3.4%. Live music companies had an average gain of 3.0%.
Streaming companies fell by an average of 0.2%. In fact, all three companies in the red this week were music streamers: Deezer (down 0.5%), Tencent Music Entertainment (down 2.8%) and Anghami (down 3.3%). Spotify, the index’s largest component, gained 1.5% to $337.38.
Stocks were up in the U.S. on positive economic news. After U.S. Federal Reserve chair Jerome Powell suggested on Friday (Aug. 23) it would soon cut interest rates, both the S&P 500 and Nasdaq finished the week up 1.4%. In South Korea, where trading was closed by the time the Federal Reserve statement made news, the KOSPI composite index rose 0.2% to 2,701.69. Likewise, China’s Shanghai Composite Index fell 0.9% to 2,854.37. In the United Kingdom, the FTSE 100 rose 0.2% to 8,327.78.
Sphere Entertainment Co. shares spiked 22.3% this week after the company’s fiscal fourth-quarter earnings on Wednesday (Aug. 14) showed that the Las Vegas venue brought in $151 million in the quarter and $489 million in its first three full quarters of operation. Total revenue of $273 million — a figure that includes MSG Networks — was in line with analyst estimates while earnings per share beat estimates.
During Wednesday’s earnings call, CEO James Dolan said the company is learning how to get the most out of the $2.3 billion venue with not just concerts but corporate and sporting events and Sphere’s current cash cow, motion pictures. “Our plan for Sphere is to create widespread demand for our offerings and drive utilization far in excess of traditional venues,” Dolan said.
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After hosting residencies by U2, Phish and Dead & Company, Sphere will begin a string of concerts by the Eagles from September to November and will host its first EDM events in December with Italian producer Anyma. Dolan didn’t provide specifics about additional residencies but said to expect an artist in “the country category” in 2025.
LiveOne’s shares rose 16.3% this week after the Los Angeles-based music streamer announced its fiscal first-quarter earnings on Tuesday (Aug. 13). A 29% increase in paid members, to 653,000, helped revenue improve 19% to $33.1 million from $27.8 million in the year-ago period. Adjusted earnings before interest, taxes, depreciation and amortization jumped 31% to $2.9 million.
The 20-company Billboard Global Music Index (BGMI) fell 0.7% to 1,780.54 despite most of the stocks gaining and the market enjoying one of its best weeks of 2024 thanks to a host of positive news. Driven by stronger-than-expected retail sales data on Thursday (Aug. 15) and encouraging inflation news earlier in the week, the tech-heavy Nasdaq rose 5.3% to 17,631.72 and the S&P 500 finished its best week of the year, gaining 3.9% to 5,524.25.
The BGMI’s largest companies fell in the middle of the pack. Live Nation shares were up 3.2% to $95.18 and Universal Music Group rose 0.9% to 22.35 euros ($24.66). Among the losers were Warner Music Group, down 0.4% to $28.22, and Spotify, down 0.7% to $337.38.
Stock gains were seen globally. In the United Kingdom, the FTSE 100 rose 1.8% to 8,311.41. South Korea’s KOSPI composite index jumped 4.2% to 2,697.20. China’s Shanghai Composite Index edged up 0.6% to 2,879.43.
Tencent Music Entertainment (TME) dropped 18.8% this week following its second-quarter earnings release on Tuesday (Aug. 13). TME revenues were 1.7% lower as gains in music were overshadowed by losses in social entertainment. Despite the sharp decline, TME shares are still up 16.9% year-to-date.
TME’s latest quarterly results weren’t unlike those that preceded it, with strong music subscription growth at music apps QQ Music, Kugou Music and Kuwo Music helping offset a decline at its karaoke business. While music average revenue per user grew 10% and TME finished the quarter with 117 million music subscribers, the company’s weak guidance on future subscriber growth likely caused its share price to fall.
JYP Entertainment’s 11.3% decline following its second-quarter earnings results marked the second-worst performance for BGMI stocks. The K-pop company’s revenue dropped 37% due to an 82% decline in album sales. Other K-pop companies experienced lighter declines: HYBE fell 3.4%, SM Entertainment slipped 3.8% and YG Entertainment dropped 1.3%. Those losses deepened the K-pop companies’ already significant losses in 2024. Year to date, the four South Korean companies have lost an average of 34.8% while the KOSPI composite index has gained 1.6%.
During a chaotic week for stock markets around the world, Universal Music Group (UMG) shares rose 3.3% to 22.15 euros ($24.20), enough to make the Amsterdam-listed company the top-performing music stock of the week.
Stocks were hammered on Monday (Aug. 5) as markets reacted to a disappointing U.S. jobs report the prior Friday (Aug. 2), leading to mounting concerns the economy could fall into a recession. The Billboard Global Music Index fell 2.0% on Monday, though it experienced a lighter decline than both the Nasdaq (down 3.4%) and the S&P 500 (down 3.0%). Investors didn’t panic, however, and markets made gains over the remainder of the week. On Friday (Aug. 9), the Nasdaq closed down 0.2% for the week while the S&P 500 broke even.
UMG received a boost on Wednesday (Aug. 7) from Warner Music Group’s quarterly earnings report — a welcome change after a second-quarter slowdown in UMG’s streaming growth so worried investors that the company’s shares fell 24% the following day. WMG’s latest earnings results, which showed that recorded music streaming revenue grew 8.7% after a few adjustments, may have convinced some UMG investors that they overreacted. In light of this new information, UMG shares jumped 6.6% to 22.74 euros ($24.85) on Wednesday. Notably, this Friday’s closing price is 14% above the lowest closing price — 21.12 euros ($23.08) — since the 24% decline occurred on July 25.
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WMG shares rose 0.3% to $28.34 this week after the company announced that quarterly revenue dropped 1% and net profit improved 14%. The third-largest major’s streaming gains satisfied some, but not all, analysts. Morgan Stanley analysts cited “lowered streaming growth outlook” in lowering their price target to $35 from $41. Guggenheim, encouraged by WMG’s subscription revenue growth acceleration and performance relative to UMG, maintained its $44 price target. JP Morgan, which sees WMG as “well positioned” to capture paid streaming adoption, left its $41 price target unchanged.
The Billboard Global Music Index, a float-adjusted measure of 20 companies’ market capitalizations, rose 3.1%, breaking a streak of four consecutive weeks with a loss. Spotify, the index’s largest component, gained 2.6% to $339.69. Tencent Music Entertainment, which will report earnings on Tuesday (Aug. 13), rose 2.8% to $12.97.
In the United Kingdom, the FTSE 100 declined 3.6% to 8,168.10. South Korea’s KOSPI composite index fell 3.3% to 2,588.43. China’s Shanghai composite index dropped 1.5% to 2,862.19.
iHeartMedia shares fell 10.7% to $1.33 following the company’s second-quarter earnings on Thursday (Aug. 8). The company reported a 1% increase in second-quarter revenue and sounded optimistic that political advertising will provide a boost to the full-year results. Both third-quarter and full-year revenue are expected to be up by mid-single digits.
Shares of radio broadcaster Townsquare Media dropped 5.8% following the company’s second-quarter results on Tuesday. Revenue fell 2.5% and net loss increased to $48.9 million from $2.7 million in the prior-year period. Its $0.14 earnings per share missed the Zacks Consensus Estimate of $0.42.
Radio stocks struggled this week as companies’ second-quarter earnings revealed additional revenue losses.
SiriusXM shares fell 15.6% after the company’s second-quarter earnings on Thursday (Aug. 1) showed a loss of 173,000 satellite radio subscribers and 41,000 Pandora subscribers. Revenue fell 3% to $2.18 billion, although net profit improved 2% to $316 million. In the first quarter, SiriusXM lost 594,000 subscribers, although revenue improved 0.8% to $2.16 billion.
SiriusXM is trying to thread the needle as it expands its product line and gives consumers more options. The new $9.99-per-month streaming service is intended to appeal to a broader audience than potential satellite radio subscribers. At the same time, the company is introducing new pricing tiers for satellite radio, including a $9.99 music-only subscription that can expand to news, talk and sports for additional fees. The trick is not cannibalizing its core, higher-priced satellite offering. “The early results in our testing have been encouraging,” CEO Jennifer Witz said during Thursday’s earnings call. “It shows that we’re getting consumers into the right packages for them.”
Shares of radio broadcaster Cumulus Media fell 21% to $1.62 and dropped as far as $1.29 on Friday (Aug. 2) — a 52-week low — after the company’s second-quarter earnings showed that revenue fell 2.5% and net loss increased to $27.7 million from $1.1 million a year earlier. iHeartMedia, which doesn’t report earnings until Thursday (Aug. 8), appeared to be a casualty of Cumulus Media’s results as its shares fell 12.9% to $1.49.
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Collectively, radio companies have had the worst stock performance of all music companies this year. Year to date, Cumulus Media is down 69.5%, iHeartMedia has fallen 44.2% and SiriusXM is off 42.6%. Only JYP Entertainment, which has fallen 44.3% year to date, has suffered a similar drop.
The Billboard Global Music Index (BGMI), a measure of the market capitalizations of 20 publicly traded music companies, fell 1.1% to 1,739.18. Even though 13 of the 20 stocks lost ground — five of them suffering double-digit declines — gains by some of the index’s most valuable companies nearly offset the losses. HYBE improved 5.3% to 180,800 won ($139.01). Spotify gained 2.8% to $331.02. And Universal Music Group (UMG) rose 0.5% to 21.44 euros ($23.41).
Music stocks have had a case of the summer doldrums after soaring in the winter and spring. The BGMI has fallen for four consecutive weeks and stands 5.9% below its all-time high of 1,847.64 set on May 17. On Friday, the index reached its lowest point since April 19.
Music companies’ losses were compounded by sharp declines in U.S. stock markets on Friday after news that the unemployment rate rose in July stoked fears the economy could enter a recession. The tech-heavy Nasdaq fell 3.4% this week and stood in “correction” territory, at 10.1% below its all-time high set on July 11. Amazon fell 8.0% after missing revenue expectations and providing investors with a disappointing forecast. Intel fell 31.5% after announcing broad layoffs, reporting a decline in quarterly revenue and issuing weak guidance.
The S&P 500 dropped 2.1% to 5,346.56. In the United Kingdom, the FTSE 100 gained 2.3% to 8,474.71. South Korea’s KOSPI composite index dropped 2.0% to 2,676.19. China’s Shanghai Composite Index improved 0.5% to 2,905.34.
The week’s greatest gainer was K-pop company JYP Entertainment, which rose 6% to 56,400 won ($41.53). JYP was added to the BGMI this week after Hipgnosis Songs Fund was removed from the London Stock Exchange once its acquisition by Blackstone was completed. Three other K-pop companies were among the week’s few gainers: HYBE improved 5.3%, YG Entertainment rose 2.1% and and SM Entertainment increased 1.0%.
Reservoir Media dropped 14.4% to $7.37 after releasing its quarterly earnings on Wednesday (July 31). Tencent Music Entertainment, which will report earnings on Aug. 13, fell 10.5% to $12.62. Warner Music Group (WMG) fell 5.3% to $28.26. In the wake of UMG’s latest earnings results, which showed a slowdown in subscription revenue, J.P. Morgan dropped its price target on shares of WMG — which will report earnings on Aug. 7 — to $41.00 from $42.00.