Record Labels
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Plans change. Dinner, vacation, date night… leadership transitions at music companies. BMG announced Wednesday it is shortening its long-term succession plan for longtime CEO Hartwig Masuch, with Thomas Coesfeld, the company’s chief financial officer, assuming the role July 1 instead of New Year’s Day.
The Bertelsmann-owned company said Masuch is leaving “at his own request and on the best of mutual terms,” with the longtime CEO explaining the handover between Coesfeld and himself has “gone so smoothly” that he decided to move up his exit date by six months. (In January, Masuch, 69, explained that he wanted to retire before turning 70.)
Masuch will remain in an advisory role after the transition until 2026, the company said.
“Hartwig has written many chapters in BMG’s success story, which Thomas will now continue,” said Bertelsmann CEO Thomas Rabe in making the updated announcement, adding that “as CFO, he got to know BMG well, drove forward its digital orientation, and invested considerable funds in the acquisition of music rights. I am certain that BMG will continue to grow under [his] leadership.”
Coesfeld was named deputy CFO at BMG in October 2021 before taking over as CFO the following spring. He previously served as chief strategy officer on the executive committee of the Bertelsmann Printing Group, a division of BMG’s parent company Bertelsmann. He began his career in 2014 as a management consultant at McKinsey in Munich.
Upon taking the top office at BMG, Coesfeld will also become a member of Bertelsmann’s Group Management Committee (GMC), which advises the Group Executive Board.
Replacing Coesfeld as CFO will be Mathis Wolter, who joins from Bertelsmann-owned RTL Group, where he has been senior vice president of controlling and investment for over three years. Prior to that, Coesfeld was svp of controlling and reporting at BMG. Joining Coesfeld and Wolter on the BMG Executive Board will be Sebastian Hentzschel (promoted from chief technology officer to chief operations officer), Dominique Casimir (chief content officer) and Nikola Holle-Spiegel (chief human resources officer).
Also joining BMG’s top management team is Alberto Chullen Llamas, arriving from Bertelsmann Education Group to be executive vp of investments to focus on future catalog acquisitions at the label. “After 45 acquisitions in 2022 alone, acquisitions remain central to BMG’s growth into 2023 and beyond,” said Coesfeld. “We are delighted to have secured the services of such a heavy-hitter as Alberto from within the Bertelsmann family, and one who knows BMG well.”
Coesfeld added, “We have a strong team at the helm of BMG… Together we will drive the company’s progress, and I very much look forward to working with them all. I would like to thank Hartwig Masuch for handing over a company which is both highly creative and successful. Hartwig’s clear focus on building a company which works for artists and songwriters has resulted in a globally relevant music company which has redefined what a music company can be in the streaming age.”
Hartwig Masuch
Barbara Dietl
Masuch joined Bertelsmann in 1991, overseeing Germany, Switzerland and Austria as part of BMG Music Publishing’s first incarnation. In 2008, he advised Bertelsmann when the company sold its share of Sony BMG Music Entertainment to Sony in 2008, and soon, helped start BMG Rights Management — which later became BMG.
Under Masuch’s leadership, BMG has grown to be the fourth-biggest recorded music and publishing company in terms of revenue, trailing only the three majors.
In March, the label and publisher reported that it generated 866 million euros ($912.6 million) in 2022 compared to 663 million euros in 2021 ($784 million) — an increase of 30% year-over-year. The company’s publishing division, which makes up 60% of BMG’s revenues, grew by 26% to 518 million euros ($546 million) on new hits by Bebe Rexha and Lewis Capaldi, and catalog works by Blondie and Nirvana.
In recent years, BMG has acquired music rights from The Pointer Sisters, Peter Frampton, Harry Nilsson, Simple Minds, Tina Turner and Mötley Crüe, among others, and through a partnership with KKR the company has acquired catalogs from John Legend and ZZ Top. On the label side, BMG has signed Duran Duran, Santana, Bryan Adams, Maxwell and Louis Tomlinson. BMG has also moved into the live business, first by acquiring a majority stake in German live music promoter Undercover GmbH in 2020 and later with a similar alliance with KARO Konzert-Agentur Rothenburg GmbH, the organizer of the German Taubertal-Festival. The company also oversees Berlin’s historic 1,600-capacity Theater des Westens.
“BMG has set sales records in recent months, signed outstanding artists, acquired iconic music rights catalogs and developed new lines of business,” Hartwig said. “The values of transparency, service, and fairness are now an inseparable part of what has become the company’s DNA, much respected by the entire music industry. So I’m leaving on a high note – and in the firm conviction that with Thomas Coesfeld and his management team, a new generation will successfully lead the music company into a new era.”
The Black Music Action Coalition (BMAC) unveiled a tepid assessment of the music industry’s progress toward addressing historical racism and inequity on Monday (May 15). The organization expressed particular concern about Universal Music Group’s commitment to the cause and the live music sector’s lack of “attent[ion] to Black professionals.”
The BMAC established its “Music Industry Action Report Card” in 2020 “to keep tabs on the promises music companies made in the wake of The Show Must Be Paused” — noting that real progress is unlikely without some type of accountability mechanism. The latest edition of the report, authored by Naima Cochrane, concludes that the music business outlook was “not negative.”
“Why that phrasing?” the report asks. “Because it’s not ‘all good,’ either.”
The report notes that “for the most part, companies that outlined measurable goals and plans in 2020 and 2021 have either continued in forward progression or at least held the line.” But BMAC points out that “there is a history of music companies… being called out for unfair, unjust, or otherwise imbalanced practices.” In the past, when “public pressure rescinds… things revert to how they were before, if not worse.” The report wonders: Is history set to repeat itself?
The BMAC report assesses each music company’s commitment to a more diverse industry according to four criteria: Corporate commitments, partnerships and giving; company representation on a senior level; internal culture and business practices; and transparency and public accountability.
The BMAC praises Sony Music (which earned grades of A, B, B and B+ in the four categories, respectively) and Warner Music Group (A, B, B, B) for “sharing more info about the makeup of their staff by gender, age, and race/ethnicity.” But the report expressed “concern” about Universal Music Group (B-, B+, C+, C), the biggest of the major-label groups.
While the report notes that UMG’s “Taskforce for Meaningful Change was a strong presence in the conversation around justice and change” in 2020 and 2021, the BMAC states that “the group’s presence and visibility felt significantly diminished in 2022.” Why the sudden change? Firstly, the report questions the sudden departure of Ethiopia Habtemariam, “a significant leader,” who unexpectedly left Motown in November.
The BMAC also calls out Capitol Music Group’s “massive cultural blunder” and “especially egregious misstep” with the virtual rapper FN Meka, who was widely viewed as perpetuating racist stereotypes and subsequently dropped from the label’s roster. (“We offer our deepest apologies to the Black community for our insensitivity in signing this project without asking enough questions about equity and the creative process behind it,” Capitol said in a statement at the time.) “The project was a perfect illustration of how music companies have historically commodified a distilled or skewed version of Black culture without including Black decision-makers and/or voices in the process,” the BMAC writes.
In addition to evaluating the major label groups, the BMAC scrutinized the Recording Academy (B, B+, B, B) — which it praises for working “to increase diversity in the voting membership and remove the more opaque aspects of Grammy voting” — and streaming services: “Amazon Music stood out this year for its visible representation among senior staff and its partnerships.” The BMAC also notes approvingly that Spotify has been “diligent in the execution of [its] BLK 5-Star Strategy for diversity, inclusion, and combating inequity.”
In the live music business, where “Black people were systematically shut out for decades,” the BMAC observed that “the impact of that exclusion still reverberates both in offices and on tours.” Promoting diversity “needs to be as much of a concentrated focus at [live music] companies as it is on the record music side,” the BMAC argued. The talent agencies UTA, CAA and WME/Endeavor were all given grades of “needs improvement,” as was AEG Presents. Wasserman and Live Nation were deemed “satisfactory.”
Finally, the BMAC turned its attention to radio, which continues to adhere to “genre lines” that limit the “visibility and opportunity for both our Black artists and Black executives,” according to the report. “The media conglomerates that control the majority of the pop and urban airwaves still have an enormous impact on artist success but also still operate on often arbitrary and outdated music standards,” it continues. BMAC added that “radio is on watch.”
The latest Music Industry Action Report Card acknowledged that “racism, a 400+ year-old disease, will not be cured in 24 months.” “However,” it continues, BMAC hopes that “through music’s reach, power, and influence, the industry can set a new standard of inclusion, diversity, and equity.”
A move by Barry Weiss to reconfigure ownership over his RECORDS label has resulted in deal that buys out his former partners with a new going-forward joint venture directly between him and Sony Music, sources say.
Weiss — the former Jive/Zomba impresario — launched RECORDS in 2015 with his then-partners at the SONGS publishing firm, Matt Pincus and Ron Perry, and in 2017 they soon entered into a joint venture with Sony Music for the label. That deal was renewed for another three years in 2020, but with that arrangement coming to term Weiss and his original partners recently hired Artisan’s Brian Richards to selectivity shop for a new equity partner. The original 2017 deal, sources say, had a buy/sell mechanism in place that when it expired, either partner — Sony or the original RECORDS founders — could chose to buy out the other partner. While that mechanism never officially kicked in, sources say that if Sony decided to trigger the buy/sell option, Weiss and his partners apparently wanted to be prepared.
By the end of 2022, sources say, RECORDS was generating about $20 million in annual revenue and the original partners were seeking a valuation above $100 million. The label’s roster and catalog includes music from 24K Goldn and Noah Cyrus, who each have racked up over 1 million album consumption units in the U.S.; rapper Nelly’s 2021 country-crossover album Heartland, which is approaching 600,000 album consumption units in the U.S.; and the Labrinth-Sia-Diplo collaboration LSD and Stella Lennon, who are each approaching 500,000 album consumption units in the U.S.
As part of the deal, Sony now owns outright that part of the RECORDS catalog and all of its other masters from the original joint venture, although Weiss and his team will continue to work those records. Meanwhile, the recent singings that sources say are likely part of the new joint venture owned collectively by Sony and Weiss, include Matt Stell, who has scored two No. 1 records at country radio — the double platinum “Prayed For You” and the platinum “Everywhere But On”; former Band Perry member Kimberly Perry, whose “If I Die Young Pt. 2,” is just hitting country radio; and iCandy, whose “Keep-Dat-N—a” has become a TikTok hit.
As one source puts it, “while RECORDS may have been slow-going at the start, Weiss did a really nice job of building up the label and creating a valuable business.”
The search for a new equity partner received a number of interested offers from suitors that were said to be in the ballpark of the asking price. But it turned out that Sony — which sources say also had matching rights — came up with the most attractive offer and a deal was struck, one that had the added advantage of likely being the easiest deal to make since Sony was already familiar with the label.
In the original joint-venture deal with Sony from 2017, the major became RECORDS’ majority owner with a stake slightly over 50%. Of the remaining stake, sources say Weiss had the largest remaining equity piece, around 25% to 30%. Perry had the second largest stake, while Pincus — who originally had the largest stake at the label’s founding — had been left with the smallest slice of equity.
The new deal, according to sources, sees a 50/50 partnership between Sony and Weiss, with Pincus and Perry bought out completely from RECORDS as they received their second payday from selling a stake in the label to Sony. Moreover, even Weiss received a payday by cashing out his stake in the original joint venture, besides the new joint-venture deal, those same sources say.
While Pincus and Perry are no longer owners in RECORDS, Perry is chairman and CEO of Columbia Records, the distributing label for many of the releases from RECORDS, so he will still be involved in the label he helped found.
In the last six months, this marks the third deal involving music assets in the Sony Music Group orbit that were or are up for sale, either wholly or in partially, where the company has moved aggressively to keep — or try to keep — the music assets under its umbrella.
Two other deals that are likely still up in the air but close to fruition involve Rimas Entertainment and the Michael Jackson Estate. In the former situation, Sony is helping Noah Assad to buy out his partner in another deal that will rejigger the ownership structure of that company; while in the latter deal, Sony is negotiating to purchase outright the Jackson estate but the executors want to keep their hand in running that operation, according to sources. No formal announcements have been made for either deal.
Weiss and Pincus didn’t respond to requests for comment, while Sony Music declined to comment.
Asake leans back in his chair, phone glowing in the darkened studio, as Olamide hunches over his right shoulder. Suddenly, the engineer signals, and the backbone of a song swirls through the speakers while Asake begins teasing out melodies and lyrics in Yoruba, a language of his native Nigeria. The engineer cuts, rewinds and plays, and the loop once again floods the vacuum-like silence that envelops a recording studio.
Outside the room, the building is bubbling with activity and energy as artists, songwriters and engineers mill about, playing unreleased records and eating from a buffet of Nigerian food — smoked mackerel, okra soup, goat, garlic shrimp and crab — prepared by local chefs. But this is not West Africa; it’s San Francisco, at the new studio headquarters of Bay Area-based music company EMPIRE. In early March, EMPIRE was in the midst of a two-week writing camp for three of its biggest Nigerian talents: budding Afrobeats superstar Asake, his YBNL Nation label boss and Nigerian music legend/mogul Olamide and Fireboy DML, another emerging YBNL/EMPIRE artist, whose 2021 single, “Peru,” was remixed with Ed Sheeran and exploded into a global hit. “Peru” was the first song Fireboy created at EMPIRE’s studios near San Francisco’s Mission District, which the company just expanded and overhauled into a first-class, multipurpose creative hub.
The studio is now the epicenter for all that EMPIRE intends to be: a fully operational label group that can sit at the top table alongside the majors and compete at the highest levels of the global music business and beyond — TV, film, podcasts, gaming, social media, nightlife and more. And it’s currently the platform for one of EMPIRE’s biggest achievements: The company is among the foremost global distributors of Afrobeats, the umbrella term for a variety of musical genres emerging from sub-Saharan Africa, where recorded-music revenue has ballooned 34.7% year over year, according to IFPI, the fastest pace in the world.
“The music that they’re making here is, honestly, the most culturally important thing I’ve done in my entire career, and I’ve been in the music business since I was 14,” says EMPIRE founder/CEO Ghazi while walking through the space. “These guys are the kings of where they come from, and they’re about to be the kings of everywhere if we keep doing what we’re doing. It’s phenomenal to see what’s happening.”
From left: Ghazi, Asake and Fireboy DML on February 27, 2023 during EMPIRE’s Africa writing camp in San Francisco.
Matthew Fong/Courtesy of Empire
EMPIRE’s dominance in Nigeria, in particular, is immense. On the country’s TurnTable Charts, EMPIRE ended 2022 with the top three artists (Asake, Burna Boy and BNXN), the top two songs (Kizz Daniel’s “Buga,” and Asake and Fireboy’s “Bandana”) and the top album (Asake’s Mr. Money With the Vibe), while also earning the distinctions of top label and top distributor for the year. At one point, EMPIRE artists held the top slot on the Nigeria 100 for 26 consecutive weeks, and an EMPIRE song was No. 1 for 35 weeks over the course of the year. (The song Asake recorded in San Francisco was released in April as “2:30” and became his ninth No. 1 on the Nigeria 100.) EMPIRE’s relationship with Olamide and YBNL, which began in 2016 before being formalized as a partnership in early 2020, has given it both credibility and a draw to attract artists, and has become a significant success story in the region.
“They are a major organization in Nigerian music,” says Ayomide Oriowo, co-founder/head of operations of TurnTable Charts. “After 2019, when they did the deal with Olamide, they capitalized on that and became a bigger deal. It was also at the moment when the ‘Afrobeats to the world’ [movement] was really taking off. So the timing worked for them, and it was just perfect. Word travels fast when you’re an artist — this idea of, ‘They have the power to get us here.’ ”
Now the challenge is to replicate that success elsewhere — in the Middle East/North Africa region, in the Asia-Pacific, in South America and beyond — without losing the drive and identity that Ghazi and his company have cultivated over the past 13 years.
The evening runs late — it’s past 10 p.m. — but suddenly, the room is buzzing with energy, and everyone moves into the building’s marble-floored lobby. After a beat, Ghazi brings Fireboy in to surprise him with an RIAA platinum plaque for “Peru” as the staff gather around, taking photos and popping champagne. “This is the first platinum plaque we hang on the wall here for a song that was created here — the first of many,” Ghazi says amid the jubilation.
Later, he takes a more reflective tone. “It’s like a zenith point in my life,” he says. “It brought me all the way back to my beginning: in a studio, making a record, and then taking that record and putting it into a company that was a culmination of many years; to be able to put out that record and market it, promote it, distribute it, manufacture it and create accolades and international nominations. And then that record became the record that made a bunch of other African artists say, ‘I want to go to the studio where this was made. I want to have that same experience and that same magic.’ ”
Two days later, Ghazi is sitting at a Mediterranean restaurant in downtown San Francisco near the EMPIRE offices, explaining how he built a company that credibly grew into its name.
EMPIRE’s realm is not limited to West Africa — over the past decade-plus, it has also become one of the Bay Area’s biggest and most successful homegrown music companies. Half of its nearly 200 employees are based in the city (a distinction Ghazi is particularly proud of), and it’s a significant player in the independent hip-hop scene across the United States, which provided the fertile ground from which the company was born. Having its headquarters in Ghazi’s hometown has given EMPIRE a domain of its own, along with access to the best minds in technology and media that flock to Silicon Valley.
Ghazi launched EMPIRE in 2010 as a tech-first digital distributor amid the fervor of Digital Music Industry 2.0 zeal then sweeping through the Bay. He had started working at Ingrooves in 2006, which had an office down the street; IODA, which eventually merged with The Orchard, was in the same building; farther down the hallway, two guys were building Twitter. Additionally, SoundCloud, Pandora, Rdio and Mog (which, after several iterations, morphed into what became Apple Music) all had offices in San Francisco.
Ghazi had essentially come up within the cultures of two of his home city’s best exports: first as a recording engineer turned studio owner, working with some of the legends of Bay Area hip-hop, and then building servers for computer companies in Silicon Valley.
“I’d be at my Silicon Valley job from 9 to 6, and then I would jump in the car and drive an hour through traffic straight to the studio, order pizza to the studio, then work there until three, four in the morning,” he says. “Then I would go home, take a shower, sleep like four hours and go right back to my Silicon Valley job. I would sleep in my car on lunch breaks and put my pager on vibrate so it would wake me up. Then I’d go right back to work.”
Ghazi photographed on April 12, 2023 at EMPIRE in San Francisco.
Katie Lovecraft
That background — a base in tech, plus deep connections to the Bay’s hip-hop scene — led him to Ingrooves, which was trying to break into the rap market. But after three years navigating the company’s bureaucracy while continuing to run a studio, Universal Music Group (UMG) bought half of Ingrooves (it now owns the company outright), and Ghazi left to form EMPIRE. Early on, he relied on his connections to make not just new releases available, but also offer rappers’ catalogs digitally, sometimes for the first time — and to get them paid monthly, rather than quarterly or not at all. The ability to move quickly, with one-off nonexclusive deals and a client-friendly front end, helped the company expand rapidly through word-of-mouth, first through the Bay, then down to Los Angeles — where EMPIRE put out indie albums by the likes of Kendrick Lamar, ScHoolboy Q and Anderson .Paak — then to Houston and beyond.
EMPIRE truly began making its mark in 2016, when it distributed D.R.A.M.’s hit “Broccoli,” which was picked up by Atlantic Records, and the Fat Joe and Remy Ma record “All the Way Up”; both songs earned Grammy nominations. The following year, it released XXXTentacion’s debut album, 17, which debuted at No. 2 on the Billboard 200 and has racked up 3.5 million equivalent album units in the United States, according to Luminate. Without much fanfare, the company had become a hip-hop heavyweight, filling in the gaps that the traditional industry couldn’t, or wouldn’t, serve: the up-and-coming artists who hadn’t yet caught the majors’ eyes and veteran acts who had phased out of the hit-driven system.
At the same time, the industry was shifting. Apple Music had debuted in 2015, streaming had finally begun to return the music business to growth, and EMPIRE’s flexible offering forced rival music companies, including the major-label groups, to offer deals with similar terms and services as they competed for talent. Suddenly, the label pipeline burst into a fire hose, and everyone wanted in on the nimble, flexible and global distribution model that EMPIRE had made its bread and butter. New companies like UnitedMasters, Stem and Create popped up with seed money to buy into the distribution market; labels launched distribution-first imprints (Capitol’s Priority, Republic’s Imperial); and streaming services and social media companies like SoundCloud and, briefly, Spotify began offering independent artists the ability to distribute their music through them. Before long, it seemed that almost every label had a distribution-first option, while the label groups beefed up their own offerings, flooding the zone that EMPIRE helped establish.
“Now every major has an EMPIRE quote-unquote system, where they try to implement that,” says CSH Management’s Kenny Hamilton, who has had several clients work with EMPIRE over the years. “But it’s not the same relationships; it kind of sounds like they’re just trying to find the next quick thing that they can upstream to a major system, but you’re really not doing artist development. At EMPIRE, that’s what they do. They’re patient with the artists, and if they see promise and they believe in it, then they put their all into it as well. It’s often imitated but never duplicated.”
From left: Edgar Esteves of Blank Square Productions, Tina Davis, Ezegozie Eze of EMPIRE and Dayo Ademola Ayoyemi of Salpha Energy at the Forbes 30 Under 30 Summit Africa on April 24, 2023 in Gaborone, Botswana.
Tuhenye Dan Muatjitjeja
As the industry started to shift toward the EMPIRE model, EMPIRE itself was moving toward the one used by major-label groups, incorporating A&R, marketing, PR, promotions and social media into its offerings on top of pure distribution and starting to provide label deals and joint ventures. In 2018, EMPIRE struck a nonexclusive deal with UMG to distribute select UMG artist projects; in 2019, it added a vertical to handle original content, which now includes several high-traffic Instagram accounts and a music video department, and expanded into Nashville, the United Kingdom and Europe. By 2020, EMPIRE had started a merch operation by acquiring a majority stake in Top Drawer Merch/Electric Family, then officially announced a publishing division, which had already been informally part of the company for several years. The studio technically opened in 2019, but because of the pandemic and continued expansion and renovations, it is only now becoming the one-stop content shop that Ghazi had envisioned.
“I’m a practice-makes-perfect type of person,” he says. “I always knew the intention was to be a label, but I knew I couldn’t be a label without taking a lot of shots. If you want to be a great free-throw shooter, you’ve got to take a lot of shots, find your technique and the right approach.”
The right approach, at this point, is there; the goal — a full suite of music and cultural offerings — within sight. All of which has brought the kind of attention Ghazi has instinctively shied away from over the years. The offers to sell, to divest, to assume the final form of what it means to be a Major Label in the Traditional Sense is not something he’s interested in. He owns the company outright, has it rooted in his home city and has no investors or board of directors to answer to — only his staff of 200 around the world and, most importantly, his artists. Still, the questions and offers persist.
“I would call it a tug of war,” he says. “I’ve always been a firm believer that attracting too much attention sometimes gets you off your A-game. But, I also understand the balance of, every once in a while, you’ve got to shine a spotlight on something for people to see the magic.
“It was always about autonomy; if you go to my office right now, behind my desk there’s a sign on my floor, written in Arabic. It says, ‘Freedom.’ I just always wanted the freedom to just be my own man.”
The summer of 2016 was dominated by Drake’s single “One Dance,” featuring Wizkid and Kyla, which held the No. 1 spot on the Billboard Hot 100 for the entirety of June and July, making Wizkid the first Nigerian artist to chart on, let alone top, the tally. At the same time, EMPIRE made another subtle move, one that would pay off years later: getting into business with one of Nigeria’s biggest talents, Olamide.
Today, the 34-year-old rapper, singer, songwriter, producer and YBNL Nation founder has cemented his legacy on his native continent. For nearly 15 years, he has been a prolific artist and executive, helping shape the sounds of hip-hop and Afrobeats, and growing into one of the pillars of modern West African music while championing and boosting a number of young artists along the way, through features or label deals.
“Olamide is almost like a street hero,” says Phiona Okumu, Spotify’s head of music, sub-Saharan Africa. “It’s him understanding the best of American, Western hip-hop culture, but also understanding the grace and vibrancy of where he is from and bringing it together and making it so palatable that’s been his main influence. He’s able to spark a star, he’s able to hear a sound, and he’s able to make it go.”
Olamide in the San Francisco studio on February 20, 2023 during EMPIRE’s Africa writing camp.
Matthew Fong/Courtesy of Empire
By 2016, streaming services began to slowly open on the continent. IFPI didn’t even begin tracking revenue in Africa until the last few years. In 2019, South Africa ranked No. 31 among countries tracked by IFPI in recorded-music revenue, at $59.9 million; the entirety of the rest of sub-Saharan Africa, lumped together, came in at No. 59, at $4.3 million. (IFPI has not released hard figures since.)
“While we were growing up in Africa, all an artist depended on was shows,” says Mobolaji Kareem, EMPIRE’s regional head of West Africa, as he stands in Studio C with YBNL Nation head of brand and talent management Alex Okeke and DJ Enimoney, Olamide’s DJ and brother. “From 2010, 2011, until 2016, all of it was free music on SoundCloud, Audiomack. We dropped things on Twitter. Streaming money started coming around maybe 2016; if Apple Music was around in 2010, we’d be doing like a billion streams right now.”
Olamide broke onto the scene in 2010, primarily as a rapper, mixing English and Yoruba, and signed to a label called Coded Tunes, through which he distributed music and made songs available as ringtones. In 2012, he left that label and launched YBNL Nation, distributing his own music through telcos, as was standard in Africa at the time, and YBNL artists through Bolaji’s Ingle Mind distribution company, which also handled music by the likes of Wizkid, Burna Boy and Tiwa Savage. Olamide signed rising artists such as Lil Kesh, Adekunle Gold and Viktoh while steadily putting out his own music and being a hands-on label executive. By 2016, Olamide was out of his telco deal and began working with Bolaji, who had started using EMPIRE’s distribution framework to expand his artists’ reach beyond Africa.
At the time, the two sides didn’t know each other. EMPIRE was distributing around 500 projects a month, and Ghazi was more focused on building its label structure than dealing with distribution; Bolaji was working through an intermediary to release his artists’ projects through the EMPIRE system. That was the state of affairs for several years until 2018 or 2019, when the numbers began to change. “The money kept getting so much every year. At some point, Ghazi just said, ‘F–k it, who is this boy from Africa? This artist that is making up to like $40,000, $50,000, $60,000 a month out of Africa with no marketing, no pitch, nothing?’ ” Bolaji says. “They had to fly down.”
Ghazi remembers it a little differently. “One day, Tina [Davis, EMPIRE’s vp of A&R] runs in my office and is like, ‘Yo, there’s this dude from Africa on the phone right now, and I don’t know what he wants because he’s screaming at me. You need to help me deal with this,’ ” he recalls. “So I get on the phone, and if I remember correctly, it was like a payment issue — something went wrong with their account, we didn’t respond fast enough or whatever. We fixed it. And then right around that same time, Nima [Etminan, EMPIRE’s COO] came into my office and was like, ‘Man, I think we should go meet these people.’ ”
Nima Etminan photographed on April 12, 2023 at EMPIRE in San Francisco.
Katie Lovecraft
It was a fortuitous meeting — and a well-timed one. Ghazi and Etminan flew to Lagos, Nigeria, and met with Olamide, Bolaji and Okeke, who introduced them to the Nigerian music scene and some of its leading figures, including then-Universal Music Nigeria GM Ezegozie Eze. “Us being personally there was a big deal,” Ghazi says. “Because most people were just sending out reps or just hiring somebody locally to deal with it. We were running around all week, concert to concert, festival to festival, visiting other people’s houses; we went to Fela [Kuti]’s shrine; we were all over the place. We were learning about the country and the music infrastructure. And it was very gratifying that we were received the way we were received, like we’re family. That made me go 10 times harder.”
“Olamide didn’t come to meet EMPIRE. EMPIRE came to meet Olamide,” Bolaji stresses. “And that was how we started EMPIRE Africa, through YBNL. So one of the things I tell people is, ‘The catalog for EMPIRE Africa sits on YBNL.’ Because if YBNL wasn’t making that much money, [EMPIRE] wasn’t going to see Africa that early.”
Within months, EMPIRE had hired Bolaji and Eze to run EMPIRE Africa, an informal entity that was officially incorporated and announced in 2022, with YBNL as its centerpiece. The timing, once again, was fortuitous: After the first seeds of a breakthrough with “One Dance,” momentum had gradually built for a global Afrobeats movement, with artists like Burna Boy, Davido, Mr Eazi, Savage and Nasty C making gains on the Billboard charts year by year. But it was during the pandemic, just as EMPIRE was putting down roots in Lagos, that Afrobeats truly crossed over into the United States, with Wizkid’s “Essence,” featuring Tems, which ultimately peaked at No. 9 on the Hot 100 and ruled the R&B/Hip-Hop Airplay chart for 27 weeks.
“When things like this happen, it’s almost like a domino effect — that sets off the labels, and they get interested and curious about who can be next in terms of what the sound is like,” says Spotify’s Okumu. “All of the major labels were in the space before EMPIRE, and all of them had the same interests, the same pursuits — they all wanted the next big African star. But EMPIRE focused on A&R, and that is incredibly important when you have an emerging genre. I feel like that was the win in the joint venture between EMPIRE and YBNL.”
California State Assembl ymember Matt Haney presents Fireboy DML, Asake, Olamide and EMPIRE with a Certificate of Recognition from the State of California for their contributions to Afrobeats worldwide and their work in San Francisco
Daniel Aziz
It has also been reflected in the numbers. In 2021, recorded-music revenue in sub-Saharan Africa grew 9.6%, according to IFPI, with ad-supported streaming revenue up 56.4%. That number exploded in 2022, with overall revenue up 34.7% — the only region globally with growth north of 30% — taking over as the fastest-growing region for recorded-music revenue in the world. IFPI opened its first African office in mid-2020, reflecting the continent’s growing importance and potential, and all three major labels now have presences in West Africa and South Africa. In the United States, seven of the top 10 on-demand streaming songs Luminate classified under “world music” — which encompasses several African genres, as well as genres like K-pop — were by West African artists in 2022.
IFPI regional director of sub-Saharan Africa Angela Ndambuki says she expects that massive growth to continue at the same rate this year. “With the digital growth and the advances in technology and new platforms coming in, we’re able to see the labels investing even more, and their presence in the region helps drive the development of those scenes,” she says. “And that then creates a healthy music market.”
In the summer of 2021, Fireboy came to San Francisco for the first time to record in the EMPIRE studio. The young Nigerian singer had signed to YBNL in late 2018 and released his debut album, Laughter, Tears and Goosebumps, in November 2019 through YBNL/EMPIRE, then a second, Apollo, the following year. “He came to just record for a few days or a week, and we brought in three or four different producers and writers, and he wasn’t very used to having writers. He’s used to doing all his own stuff,” Davis recalls, sitting in the expansive Studio A. “So it was new for us because he hadn’t recorded here, and it was new for him because he had never been to San Francisco.”
“Peru” emerged from that session the following summer, with its lyric “I’m in San Francisco jammin’,” and almost immediately took off in Nigeria and the United Kingdom. The remix with Sheeran was released on Christmas Eve 2021, which propelled it even further. “That record was a way for us to show people that we could break a record outside of Africa and make it larger than just a record for the club and for the diaspora,” Davis says. “But what it taught the African team is that you don’t give up on a hit. I think it just opened it up for people to recognize how much we care about it, and it also gave us a bar to reach.”
Tina Davis photographed on April 12, 2023 at EMPIRE in San Francisco.
Katie Lovecraft
EMPIRE has grown beyond its YBNL foundations in West Africa. Acts like Daniel, Wande Coal, BNXN, L.A.X., Navy Kenzo and Black Sherif on its roster are expanding the limits of the Afrobeats, amapiano, highlife, fuji and Afropop genres, among others, while the company also distributes Burna Boy in Africa. (Atlantic is Burna’s label stateside, and Warner distributes his music outside of Africa.) And Asake, who officially signed to YBNL/EMPIRE in mid-2022, lit the Afrobeats world on fire with his debut album, Mr. Money With the Vibe. Released last October, it immediately topped the Spotify and Apple Music charts, and has accrued 197.5 million streams in the United States, according to Luminate. Meanwhile, streams for Asake, Fireboy and Olamide have grown more than 500% outside of Africa on Apple Music, according to the company, which greatly over-indexes in African music streams compared with competitors.
That doesn’t mean EMPIRE has cornered the market. Wizkid, Davido, Tems and rising star Libianca are all signed to RCA in the United States; CKay is distributed by Warner in partnership with local indie label Chocolate City, while Omah Lay goes through Sire; UMG’s Virgin distributes Rema’s “Calm Down,” while Larry Jackson’s new venture, gamma, has its African distribution rights, and Def Jam just signed Gold. As the industry’s attention has shifted to opportunities on the continent, the competition has gotten fierce — but EMPIRE’s reputation has allowed it to keep building organically in the region. “EMPIRE’s a family, and all the other labels are labels,” says Okeke. “That’s the difference.”
Now EMPIRE’s task is to build upon that success and keep expanding its dominion — not an easy task in a globalized climate sagging under the weight of an increasing amount of new music every day. The company has already established an operation covering the Middle East/North Africa, bringing on Spotify’s Suhel Nafar to oversee it. It is also making inroads in South Africa and recently hired people in Tokyo to oversee efforts in the Asia-Pacific region and Brazil to begin developing a foothold in South America. In each new region, EMPIRE is looking to build on the model that worked so well in West Africa, making strategic hires based on partnerships with well-connected industry players in local markets rather than signing artists to fit a sound. And even as that old Digital Music Industry 2.0 has long since drifted away from the Bay, relocating to the likes of L.A. and New York, EMPIRE has remained in San Francisco. “We’ve plotted a lot of dots on the map, and I want to plot more dots and create more connectivity, more brainpower,” says Ghazi.
YBNL Founder and CEO/Artist, Olamide, and EMPIRE Founder and CEO, Ghazi, present Fireboy DML with RIAA Platinum Plaque for his hit single “Peru”.
Daniel Aziz
On a Thursday afternoon in mid-April, Ghazi pulls over to the side of the road to explain, over the phone, the next iteration of the vision. He’s about to fly to Johannesburg, then drive to Botswana, then return to the Bay for a few days with his family before another trip down to Rio de Janeiro — around the world and back again. “When you watch those movies from 15, 20 years ago and they put a globe up on the screen and then they push a button, and all the lines fly around the globe and connect to all the different epicenters? It’s kind of like that,” he says.
Which is to say, the journey may have hit one zenith, but that has only established a new jumping-off point, a new foundation on which to build. “You’re always trying to go to greater heights, right? Man makes it to the moon, now you want to make it to Mars,” he says. “As long as we live limitless and we continue to chase ourselves rather than other people, I think that we’ll be OK. We’re already successful; this already looks like success. It’s just, how do you breed more success?”
The answer? In the studio. After the plaque presentation in March, a half-dozen A&Rs and engineers piled back into Studio C to gush over the record that Fireboy made the night before, which has a first verse; an epic, soaring hook; and a second verse left open — maybe for a stateside collaborator, or a fellow Afrobeats star, or maybe for Fireboy himself to finish off. Pop star names are tossed around, and a particular alt-R&B singer is mentioned. But one A&R stands up indignantly, voice rising above the others: “Hang on, hang on, hang on,” he says to quiet the crew before adding nearly incredulously: “Did Bob Marley get someone else to put a second verse on ‘I Shot the Sheriff’? This is all you!” The feeling is euphoric, the room is filled with laughter, the possibilities endless. The beat comes back in: rewind, cut, play, forget about the time. The vibe is here; the night is far from over.
This story will appear in the May 13, 2023, issue of Billboard.
LONDON — Russia’s invasion of Ukraine in February 2022 led to a rapid exodus of global music companies from Russia. All three major labels say they ceased operations there. So did touring giant Live Nation and streaming platforms Spotify, TikTok, Deezer and Amazon Music. Paris-headquartered Believe, however, publicly pursued a different path, and a year later is still operating in Russia — releasing, distributing and promoting new music by local artists and labels on Russian streaming platforms Yandex. Plus, VK Music and Zvuk.
Executives at rival music companies have privately expressed outrage, accusing Believe of exploiting the sudden breakup of Russia’s music market — the 13th largest in 2021, generating $328 million in revenue that year, according to IFPI — to gain market share in the absence of Western competitors.
Denis Ladegaillerie, Believe’s founder and CEO, denies that charge and says the major labels and platforms are being hypocritical for criticizing how the French company is operating in Russia. Believe’s ongoing presence in the country “is really not an economic decision,” he tells Billboard in a rare interview addressing the issue. “We are not looking at building or growing or extracting value [in Russia].”
Following the start of hostilities, Universal Music Group, Sony Music Entertainment and Warner Music Group said they stopped distributing and promoting new releases in Russia. If new titles are being made available on local streaming services, the majors say, it’s through piracy.
The Believe CEO is skeptical about those assertions and defends his company’s continued presence in the isolated nation. “What I see is that all global artists are still available on all local platforms [in Russia],” Ladegaillerie says, noting that YouTube and Apple Music are also still active in the market, albeit in a reduced capacity. “So, my question is: ‘You’ve pulled out of Russia? Really?’”
After Billboard discovered in December that Russian streaming service VK was allowing users to upload albums from major label artists like Taylor Swift (UMG’s Republic Records) and Red Hot Chili Peppers (Warner Music), all three major labels declined to comment; labels body IFPI did not condemn the apparent copyright violations, nor confirm if they or its label members had issued takedown orders to VK.
Ladegaillerie says Believe, for its part, has “very strictly” abided by all international sanctions placed against Russia since the start of the war — “both in law and spirit” — and has halted all new investments in the now-isolated country. “Our No. 1 priority, both in Russia and Ukraine, has been to protect our teams locally and support our artists,” he says.
Despite those claims, Believe’s revenue from Russia, where it retains just over 40 employees, has been growing. Combined revenue from Russia and Ukraine rose 9.9% to 57 million euros ($62.5 million) in 2022, according to the company’s year-end financial figures. (That was 7.5% of Believe’s overall revenue.)
While the economic sanctions against Russia were meant to starve the country of funds and further isolate it from the world financial system, they have been limited in scope and hundreds of Western companies continue to operate in the country. Global music companies have not completely extracted themselves from the country, either. Universal Music and Warner Music — which had the largest presence in Russia among the majors, with almost 100 employees — continue to pay their staff and maintain offices there, although they say those offices have been effectively closed since the war started.
In September, Sony Music announced it had decided “to exit the Russian marketplace completely” and was transferring its Sony Music entity there to a fully independent local company that would only represent locally signed artists. “As the war continues to have a devastating humanitarian impact in Ukraine, and sanctions on Russia continue to increase, we can no longer maintain a presence in Russia, effective immediately,” Sony Music said in a statement at the time.
YouTube continues to operate in Russia in compliance with U.S. sanctions but has suspended ads and monetization features (Russian creators can still make money from ads and other monetization products shown to users outside of the country). The Russian subsidiary of YouTube parent company Google filed for bankruptcy last year after authorities seized its bank account, making it impossible to pay employees, suppliers and vendors, a YouTube spokesperson tells Billboard.
Apple Music is still available in Russia, although there are fewer subscription payment options, as MasterCard and Visa cards issued by Russian banks can no longer be used to pay for subscriptions. Music from the major labels that left Russia is not available. (An Apple Music spokesperson did not reply to a request for comment.)
The French government of President Emmanuel Macron, for its part, has supported Believe’s decision to “maintain links” with Russia, Ladegaillerie says. That rings true for other French companies, which established deep ties with Russia in the wake of the Cold War. In March, French retailer Auchan said it planned to open a new store in Russia, doubling down on its brick-and-mortar presence in the market. And auto maker Renault, which is 15%-owned by the French state, has been scrambling to restart its assembly lines in Russia, where it owns the country’s biggest car maker, The Wall Street Journal reported.
In fact, French companies are among Russia’s biggest foreign employers, providing more than 150,000 jobs across a range of sectors that include energy, food products and wholesaling, according to figures from the French Economy Ministry.
The situation “is not black and white, it’s grey,” Ladegaillerie says. He identifies Believe’s humanitarian support for Ukraine — which includes donations and regularly publishing a playlist of Ukrainian artists — as part of the “difficult” balance his company is trying to maintain in Eastern Europe. “We realized that different countries have different perspectives on the situation but that’s really the line that we are trying to navigate.”
Additional Reporting By Vladimir Kozlov
Universal Music Group shareholders approved on Thursday (May 11) the 2022 compensation packages for CEO Lucian Grainge and his deputy, Vincent Vallejo, plus a special $100 million stock option awarded to Grainge to stay on the job for five more years.
The company did not immediately disclose the percentage of votes cast in support of the advisory vote on the pay packages or other voting items at its annual general meeting held in the Amsterdam, and the meeting was live-streamed only to registered shareholders.
Since the global financial crisis, these kinds of annual meetings become a stage for shareholders to express their gripes about a company’s policies or performance. The vote of support for the world’s largest music company’s pay practices comes despite criticism raised by influential shareholder advisory groups, Institutional Shareholder Services and Glass Lewis, who had advised investors to reject Grainge’s pay packages.
Shareholders approved Grainge’s 2022 pay, which totaled more than 47 million euros (roughly $50 million), and re-appointed him as executive director, along with Sherry Lansing and Luc van Os as non-executive directors. Entertainment mogul Haim Saban was also appointed as non-executive director.
Shareholders declined to reappoint Anna Jones as a non-executive director, and her current term will run until the company’s next annual meeting in 2024.
Shareholders also approved a final 2022 dividend payout of 0.27 euros per share, which investors will receive in June. The vote brings UMG’s full year 2022 dividend to 0.51 euros per share.
In an April report, ISS recommended shareholders vote against UMG’s 2022 remuneration policy, saying the pay packages were out of step with industry standards in part due to “excessive” base salaries. That Grainge’s total pay was 12.4 times higher than the median of peers “raises substantial concerns,” ISS wrote.
Grainge’s 2022 pay package included a base salary of about 15.4 million euros and short-term incentives totaling 28.77 million euros, including a portion equivalent to 1% of UMG’s consolidated earnings before interest, taxes and amortization (EBITA) that was part of an agreement reached prior to UMG going public.
In its annual report, the company says that full-time UMG employees receive an average of 142,039 euros annually,up from 131,961 euros in 2021.
The board explained its reasoning for the remuneration for its executive directors saying that Grainge was a one-of-a-kind executive, and that certain incentive payments were due to legacy arrangements agreed to before the company went public.
In the proposed future pay agreement, which was part of an extension of Grainge’s contract through May 2028, the board said it did away with the incentive that paid Grainge 1% of UMG’s consolidated EBITA. In addition, the new agreement transitions Grainge from an all-cash compensation package to a combination cash and equity package “with a broad set of performance-based objectives aligned with shareholders’ interest and corresponding to the company’s long-term growth strategy.”
UMG ended the European trading day up 0.43% at 18.79 euros ($20.52).
Promotions are pouring in at Elektra Entertainment, with the Warner Music cohort of Elektra, Fueled by Ramen and Roadrunner elevating Chris Brown, Katie Robinson and Johnny Minardi to various leadership roles across the company.
Effective immediately, Brown is elevated to executive vp of Elektra and co-head of Roadrunner, while Minardi is promoted to head of Fueled by Ramen, co-head of Roadrunner and senior vp of A&R at Elektra. Rounding things out, Robinson is named head of marketing across all of Elektra Entertainment.
The elevations arrive following a major change at Elektra, where co-president Mike Easterlin recently announced his shift to a consultant role “as part of the recent changes at the company.” As a result, Gregg Nadel now has the president title to himself, with Robinson and Minardi (Los Angeles) and Brown (New York City) all reporting to him.
“Elektra’s fierce commitment to artist development is only equaled by our dedication to executive development, and it’s been a privilege to watch Chris, Katie, and Johnny grow into their own as leaders,” said Nadel in a statement. “Elektra wouldn’t be what it is today without them. They’ve all individually made such a strong, tangible impact and delivered exceptional results that have elevated our artists on the global stage.”
Brown was most recently head of marketing at Elektra while his successor, Robinson, was svp of marketing. Their department’s big wins in recent years include successful campaigns for Slipknot, Fall Out Boy, Turnstile, twenty one pilots, Maisie Peters, jxdn, Alec Benjamin and others. Minardi, previously vp of A&R for Elektra, is credited with signing Tones and I, Fall Out Boy, The Band CAMINO and Grandson, among others, and played a key role in bringing Travis Barker’s DTA Records into the Elektra fold.
In the Warner family tree, Elektra Entertainment (formerly Elektra Music Group) is one of the branches of 300 Elektra Entertainment (3EE), led by chairman & CEO Kevin Liles. WMG, the third-largest label group, disclosed quarterly earnings this week that were saddled by flat results across its recorded music division but showed a strong three months for publishing.
Ben Platt signs with Interscope Records, both for his own recordings and a deeper relationship that will enable the award-winning entertainer to operate an imprint, Billboard can exclusively reveal.
Currently, Platt is working on new music which will be released through Interscope at an unconfirmed future date.
“Ben is an extraordinary artist in every way,” comments John Janick, chairman and CEO of Interscope Geffen A&M, in a statement. “He’s as comfortable on a Broadway stage as he is headlining Madison Square Garden. We’re so excited to have him on the label and are looking forward to working with him and his team on his future releases.”
The Grammy, Tony and Emmy Award-winning singer and actor has two full-length solo albums to his name, 2019’s Sing To Me, which peaked at No. 18 on the Billboard 200; and 2021’s Reverie, which reached No. 84 on the chart.
Set to be announced Thursday (May 11), the new arrangement is an extension to an alliance which has included the Dear Evan Hansen OST, released in 2021 via Interscope. Platt won the Tony Award for best actor in a musical for his performance in the titular role and went on to reprise his role in the Universal film adaptation.
In a joint-statement, Platt pays tribute to Interscope’s Janick, Steve Berman, Sam Riback, Michele An and the entire team as “wonderful, deeply creative collaborators on our Parade and Theater Camp albums, and I so look forward to teaming up on my next solo record and on many projects of all kinds to come.”
Details remain sketchy on Platt’s imprint, for which the artist will have the opportunity to sign and develop talent.
“I’m thrilled for Ben’s future recorded music to be coming out on Interscope, a label known for its roster of culture moving iconic artists,” enthuses Platt’s manager, Adam Mersel. “We’re looking forward to working alongside John, Steve Berman and the entire IGA team on the next phase of Ben’s career.”
Maria Becerra has signed a deal with Warner Music Latina in a new joint venture with 300 Entertainment, Billboard can exclusively announce today (May 10).
“I am thrilled to be a part of the Warner Music Latina family,” Becerra said in a statement. “I know that together we will achieve incredible things and that this union will allow me to go even further in my career and solidify my global expansion. I’m honored to be part of their roster and look forward to working with such a skilled and talented team.”
For Alejandro Duque, president of Warner Music Latin America, having the Argentine singer-songwriter on the roster is an honor.
“She’s a standout artist with a strong team behind her, and her past successes are a testament to that. We’re excited to continue the path that was started by 300 Entertainment and Kevin’s team, and are very excited for our future together,” he added.
The news of the signing comes on the heels of Becerra receiving the Visionary Award at the inaugural Billboard Latin Women in Music gala.
Maria Becerra at Billboard Latin Women In Music held at the Watsco Center on May 6, 2023 in Coral Gables, Florida. The show airs on Sunday, May 7, 2023 on Telemundo.
Natalia Aguilera
To date, the YouTuber-turned-artist has achieved three entries on the Billboard Hot Latin Songs chart, including her hit “Qué Más Pues?” with J Balvin, as well as two top 10 entries on Latin Airplay (the No. 1 hit “Te Espero” with Prince Royce, and “Éxtasis” with Manuel Turizo at No. 9), and five entries on Latin Rhythm Airplay.
In 2021, Becerra was nominated for best new artist at the Latin Grammys, and her latest album La Nena de Argentina (2022) has garnered more than 300 million plays on Spotify alone, to name a few career highlights. Additionally, she signed with 300 Entertainment in 2020, becoming the first Latin artist to join the label’s roster.
“We are very happy and deeply grateful to 300 Entertainment, Kevin Liles, and his entire team, for the support they have provided Maria since the beginning, because due to their dedication, efforts, and teamwork, Maria has been able to achieve the success she celebrates today, which leads us to this important next step with Warner Music Latina, spearheaded by Alejandro Duque, to continue growing with the next albums,” noted Jose Levy, Becerra’s manager.
Kevin Liles, chairman and CEO of 300 Elektra Entertainment, added: “It’s been amazing to see the growth of Maria as an artist, and I’m so proud of everything that we’ve been able to accomplish together so far. Tapping into the vast, global reach of our Warner Music Group family with the addition of Warner Music Latina to the team behind her, there is absolutely no limit on where she can go.”
Up next, Becerra is working on new music to be released under the Warner/300 venture and is expected to announce a tour.
Maria Becerra signs with Warner Music Latina.
Miguel Valencia/Warner Music Latina
Warner Music Group’s share price fell nearly 10% on Tuesday (May 9) following the release of the company’s second quarter earnings report, which showed that revenue from the recorded music division was effectively flat over last year ($1.143 billion vs. $1.147 billion in the year-ago quarter).
On Tuesday, Warner’s stock fell from $28.50 at the start of the day to $25.76 at the market’s close — a 9.58% drop.
This marks the second straight quarter of disappointing results in recorded music for Warner, the world’s third-largest label. Last quarter, revenue in the division fell 10.6%, or 5.6% in constant currency, on lower digital, physical and artist services and expanded rights revenue.
In the current quarter, streaming revenue was down 0.4% (or, in constant currency 2.2% higher) on fewer releases and a slowdown in ad-supported revenue due to macroeconomic uncertainty. By contrast, music publishing revenue grew 12% to $257 million, up from $230 million a year ago.
“While our publishing was best in class, we underperformed in recorded music,” said CEO Robert Kyncl on an earnings call Tuesday.
In attempts to bolster confidence, WMG executives on the call stressed that the company is already seeing improvement with the late-April releases of Jack Harlow’s Jackman., Tïesto’s Drive and Ed Sheeran’s Subtract, which was released earlier this month. CFO Eric Levin noted that the label’s release slate “was a little lighter in the first two quarters of the year and will be weighted to (the third quarter) and (the fourth quarter),” with upcoming releases expected from Dua Lipa‘s Barbie soundtrack, among others.
“We absolutely expect this to improve our results in recorded music streaming in the second half of the year,” Levin added.
Nonetheless, investors appear to be growing skittish over the lackluster performance. Tuesday’s closing price marked a sharp drop of nearly 20% of Warner’s stock over the past month, with the share price falling from $32.12 on April 10.