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In a miserable week for stock markets worldwide, Spotify continued to fall from its all-time high, K-pop stocks sank and one of the smallest companies on the Billboard Global Music Index posted a double-digit gain.
LiveOne was the week’s biggest gainer as the music streaming company’s shares rose 19.6% to $1.22 after it announced on Wednesday (Dec. 18) that its partnership with Tesla surpassed 350,000 subscribers. On Friday (Dec. 20), the company also said it has regained compliance with the Nasdaq exchange’s minimum bid price requirement.
Only two other music stocks posted gains this week. Sphere Entertainment Co. rose 2.5% to $38.74, bringing its year-to-date gain to 14.0%. Sphere Entertainment shares have lost 12.1% since the company announced its fiscal first-quarter results on Nov. 12. Reservoir Media also improved 2.3% on the week after jumping 4.8% to $9.26 on Friday.
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The Billboard Global Music Index (BGMI) fell 3.3% to 2,168.69, lowering its year-to-date gain to 41.4%. Just three of the index’s 20 stocks finished the week in positive territory. After increasing each week from late October to early December, the BGMI lost 4.9% over two consecutive weekly losses. The latest 3.3% weekly decline is only the fourth time in 2024 that the index has dropped more than 3% in a calendar week.
Stocks’ bad week extended beyond music companies. In the United States, the Nasdaq composite dropped 1.8% to 19,572.60 and the S&P 500 declined 2.0% to 5,930.85. In the United Kingdom, the FTSE 100 was down 2.6% to 8,084.61. South Korea’s KOSPI composite index fell 3.6% to 2,404.15. China’s Shanghai Composite Index dipped 0.7% to 3,368.07.
Among other music companies, Live Nation had a modest decline of just 2%, dropping to $133.17 despite more analysts increasing their price targets on the stock this week. Morgan Stanley raised its price target to $150 from $140 and Benchmark increased it to $160 from $144 and maintained its “buy” rating.
Spotify, the index’s most valuable company, fell for the second consecutive week. After closing above $500 on December 4, Spotify shares dropped 8.3% and closed at $460.88 on Friday, down 4.8% for the week. Overall, streaming had more losers than winners this week. Cloud Music fell 7.9% to 116.60 HKD ($14.99), marking the second-largest decline of the week. SPDB International began coverage of Cloud Music this week at a 145 HKD ($18.64) price target and “buy” rating. Elsewhere, Anghami fell 3.7% to $0.79.
Four K-pop stocks declined an average of 5.1% this week, reflecting the ongoing political uncertainty in the South Korean market. SM Entertainment was down 6.3%, JYP Entertainment fell 5.8%, HYBE dropped 4.3% and YG Entertainment sank 3.9%. Year-to-date, the four South Korean companies are down an average of 18.3%, a far deeper deficit than Universal Music Group (down 5.6% YTD) or Warner Music Group (down 12.9% YTD).
iHeartMedia, the week’s biggest loser, dropped 17.5% to $1.89. The radio company’s stock was trading at $1.00 on July 21 and rose to $2.61 on Dec. 6. In the last two weeks, however, its shares have slipped 27.6%.
K-pop stocks rebounded this week from a slump caused by the country’s political turmoil. HYBE, which was also dragged down by news of an investigation of its chairman, Bang Si-Hyuk, regarding the company’s 2020 initial public offering, led the group of South Korean music companies by gaining 8.7% to 205,500 won ($143.16), bringing the stock back to its level from one month ago. Elsewhere, YG Entertainment gained 7.2% to 48,250 won ($33.61) to recapture losses from the previous three weeks while SM Entertainment and JYP Entertainment had smaller improvements of 3.3% and 2.6%, respectively.
The 20-company Billboard Global Music Index (BGMI) dropped 1.6% to 2,243.59, marking its first weekly decline in seven weeks. After reaching record highs in each of the previous five weeks, the index was overcome by the losses among 13 of its 20 stocks. The BGMI fared worse than many major indexes. In the United States, the Nasdaq composite gained 0.3% and the S&P 500 fell 0.6%. In the United Kingdom, the FTSE 100 lost 0.1%. South Korea’s KOSPI composite index gained 2.7% while China’s Shanghai Composite Index fell 0.4%.
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The week’s biggest gainer was Abu Dhabi-based music streaming company Anghami. In the absence of any market-moving news or regulatory filing, the company’s shares spiked 17.4% on Tuesday (Dec. 10) on heavy trading volume. On an average day, 80,000 shares of Anghami trade hands. But nearly 3.5 million shares — 5% of the company’s shares outstanding — were traded on Tuesday, and another 616,000 shares exchanged hands over the next two days.
Other than Anghami and K-pop stocks, only two companies posted gains this week. Universal Music Group, the index’s second-largest company, gained 4.6% to 24.46 euros ($25.69), its best closing price since it lost 24% following second-quarter earnings on July 25. Warner Music Group improved 0.3% to $32.52.
Spotify, the hottest music stock of 2024, had a losing week for the first time since September. The streaming company’s share price dropped 3.1% to $483.31, finishing the week 4.6% off its all-time high of $506.47 set on Dec. 4. Still, investors have renewed faith in Spotify after the company improved its margins and bottom line while maintaining the same rapid growth rate before it laid off nearly a quarter of its workforce in 2023. Spotify shares are up 157.2% year to date and the company’s market capitalization briefly surpassed $100 billion a week ago.
Live Nation shares fell 0.6% to $135.95 despite more analysts raising price targets on the concert promoter’s share price this week. Wolfe Research increased its price target to $160 from $152. JP Morgan upped its price target to $150 from $137. And Roth MKM raised Live Nation to $152 from $132. Live Nation’s stock is up 45.2% year to date and is one of the best performers on the BGMI.
SiriusXM had the week’s biggest loss after dropping 14.8% to $24.11. On Tuesday, the company announced guidance for 2025 revenue that would represent a 2% decline from full-year 2024 revenue guidance. The company also revealed it is doubling down on in-car listening and refocusing on satellite radio after its year-old streaming app delivered disappointing results. Following the news, Seaport Global lowered its recommendation on SiriusXM’s stock to “neutral” from “buy.”
In other stock moves, German concert promoter CTS Eventim fell 4.9% to 34.37 euros ($36.10). The company announced this week that it acquired a 17% stake in French ticketing company France Billet. Lastly, New York-based live events company Madison Square Garden Entertainment dropped 8.5% to $34.37 and radio giant iHeartMedia was down 12.3% to $2.29.
Spotify continued its remarkable run this week by briefly surpassing a $100 billion market capitalization before falling slightly by the close of trading on Friday (Dec. 6). The company’s shares rose 4.5% to $498.63, marking the music streamer’s second-best closing price ever. The best closing price of $502.38 came on Wednesday (Dec. 4) when Spotify reached a new intraday high of $506.47, valuing the Swedish company at approximately $100.8 billion.
The $100 billion threshold arrived the same day Spotify launched its 2024 Wrapped, the personalized, data-driven product that breaks down listeners’ streaming time and ranks their most popular artists and tracks. Wrapped, first launched in 2015, has become both a major media event and an immensely successful product that listeners share incessantly on social media.
At Friday’s closing price, Spotify has gained 165.4% in 2024, making it the only music company to have a triple-digit gain. This improvement is three times higher than that of Live Nation, which has risen 46.1% this year. Cloud Music is close behind with a 44.2% gain year-to-date.
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With a valuation of more than double the next-largest music company, Spotify is a major driver of the 20-stock Billboard Global Music Index, which rose 2.8% to an all-time high of 2,280.51. That brings its year-to-date gain to 48.7%. Ten of the 20 stocks were gainers while nine lost ground and one was unchanged. Radio companies, buoyed by iHeartMedia’s 14% gain, led the way with an average gain of 5.9%. Streaming companies posted a 4.4% average gain. Live music companies were essentially flat. Multi-format companies (record labels, music publishers) fell 2.1% on average.
Most other streaming companies were gainers this week. Tencent Music Entertainment rose 10% to $11.54. Cloud Music increased 9.7% to 129.40 HKD ($16.63). LiveOne jumped 6% to $0.88. Deezer improved 2.9% to 1.37 euros ($1.45). Abu Dhabi-based Anghami fell 6.8% to $0.73.
On the live front, MSG Entertainment improved 1.6% to $36.26 this week. The company announced on Tuesday (Dec. 3) that it spent $25 million repurchasing its Class A common shares due to their price “relative to the company’s long-term growth potential.” Elsewhere, Live Nation fell 1.1% to $140.26 while Sphere Entertainment Co., which announced additional Dead & Company dates this week, fell 5.1% to $40.27.
In other noteworthy stock moves this week, HYBE dropped 3.2% to 214,000 won ($150.15) after news broke that South Korean authorities are investigating chairman Bang Si-hyuk for possible violations of the country’s Capital Markets Act. The move came after a report claimed Bang had a secret agreement with shareholders prior to HYBE’s initial public stock offering that gave him a $285 million profit when the company went public in 2020. HYBE shares fell 6.7% over the two trading days following the news report but recovered more than half its losses later in the week. Other K-pop stocks fell in unison with HYBE. JYP Entertainment dropped 5.2%, YG Entertainment lost 5.8% and SM Entertainment sank 7.5%.
Elsewhere, stocks were mostly up globally. In the United States, the Nasdaq composite rose 3.3% and the S&P 500 gained 1%. In the United Kingdom, the FTSE 100 improved 0.3%. China’s Shanghai Composite Index grew 2.4%. Dragged down by political turmoil, South Korea’s KOSPI composite dropped 1.1%.
South Korea’s Financial Supervisory Service is investigating HYBE and its chairman, Bang Si-hyuk, over allegations he earned $285 million from the company’s 2020 initial public offering through profit-sharing deals with three large shareholders.
HYBE, then named Big Hit Entertainment, went public in 2020 after building its primary act, BTS, into global stars. The IPO raised approximately $820 million and confirmed HYBE’s arrival as a major player in the global music business. But while the IPO was a success for the company, many individuals who bought shares for well above the IPO price lost money as the price retreated in the following weeks.
Last week, The Korea Economic Daily broke the story that Bang personally pocketed about 400 billion won ($285 million) from agreements made with private shareholders STIC Investments, Estone Equity Partners and New Main Equity a few years before the IPO. Those agreements, according to the report, called for Bang to receive 30% of the shareholders’ profits from their sale of Big Hit shares following the IPO. But if Big Hit failed to go public before an agreed-upon time, Bang would have had to repurchase the shares plus interest.
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In a statement posted to HYBE’s investor relations website on Friday (Nov. 29), the company confirmed the existence of a shareholder agreement but dismissed the notion that Bang broke any securities law. “During the process of preparing for the listing, our company provided the relevant shareholder agreement to the listing underwriters, and the listing underwriters also reviewed the relevant shareholder agreement in accordance with the listing-related laws,” the statement reads. “In this regard, we have determined that our company did not violate any relevant laws during the listing process.”
A HYBE official provided more detail about the shareholder agreement in a statement to The Korean Herald. Prior to the IPO, one of HYBE’s investors requested to know the IPO timeline, which HYBE refused to share. Worried about unnamed uncertainties, the shareholder demanded a “put-back option,” or a right to sell an equity at a pre-determined price and time. But HYBE “couldn’t sustain itself under such conditions,” this person stated, and Bang “took on the risk himself” and personally agreed to the option.
South Korea’s Financial Supervisory Service was quoted in media reports as saying it’s investigating HYBE and Bang for possible violations of the country’s Capital Markets Act, including how a private equity fund acquired Big Hit shares prior to the IPO and whether Big Hit omitted information from its securities filing. The Korea Exchange stock market is also examining relevant documents for potential violations.
When Big Hit shares debuted on the Korea Exchange on Oct. 15, 2020, strong demand drove the share price from the 135,000 won ($118) IPO price to 351,000 won ($308) on its opening day. But Big Hit’s price fell 22.3% the next day and dropped another 29% over the next two weeks, leaving many individual investors with losses. (The stock rebounded over time. An investor who bought at the peak on the stock’s opening day could have sold for a profit had they waited one year.) The Korea Economic Daily article contended the drop-off was “largely driven” by the private equity fund’s “massive selloff” of Big Hit shares after the IPO.
JYP Entertainment, the K-pop company behind such artists as TWICE and Stray Kids, is on a roll, with its stock closing Friday (Nov. 22) at 66,100 won ($47.06) — up 11.3% for the week and marking its highest closing price since May 10. This week, the company seemingly got a nudge from the Monday (Nov. 18) announcement of Stray Kids’ 20-date, Live Nation-produced stadium tour in 2025 that will cover North America, Latin America and Europe. But the momentum has been building for a while; over the last three weeks, JYP shares have gained 35.6%.
Other K-pop stocks also posted gains this week: YG Entertainment rose 7.7% as “APT” by ROSÉ and Bruno Mars spent a fourth week atop the Billboard global charts and reached No. 1 in Japan. Elsewhere, HYBE improved 4.4% and SM Entertainment increased 4.3%. Collectively, the four K-pop companies have gained an average of 20.7% in the last three weeks and narrowed their average year-to-date deficit to 15%.
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Another high-flying music stock was Live Nation, which jumped 8.7% to an all-time high of $140.26 on Friday after more analysts increased their price targets. Citigroup increased its target on the concert promoter to $163 from $130, while Deutsche Bank upped its target to $150 from $130. As of Friday’s closing price, Live Nation shares have gained 49.8% in 2024 and 19.8% in just the last three weeks. The company’s third-quarter earnings on Nov. 11 can take credit for some of the recent gains, though Donald Trump’s victory in the U.S. presidential election played a part, too, as investors believe Live Nation’s ongoing lawsuit brought by the Department of Justice will see a more favorable resolution with the incoming administration.
In other music stocks news, Spotify continued its hot streak by gaining 3.7% to $475.27, marking its second-highest closing price ever. A week earlier, Spotify shares gained 14.5% after the company’s third-quarter earnings showed the company achieved a record operating profit. The streaming company’s stock has gained 153% in 2024 and is up 23.6% in the last three weeks alone.
The 20-company Billboard Global Music Index rose 2.1% to a record 2,208.32 as 14 stocks finished the week with gains, putting it in line with stocks around the globe. In the United States, both the Nasdaq composite and S&P 500 increased 1.7%. In the United Kingdom, the FTSE was up 2.5%. South Korea’s KOSPI composite index gained 3.5%. Only China’s Shanghai Composite Index was an exception, dropping 1.9%.
Elsewhere, music streamer LiveOne gained 12.8% to $0.88, while iHeartMedia improved 8.6% to $2.40 after the radio giant announced terms for a debt exchange that will ease the company’s financial burden and extend most of the maturity dates for its debts. As of Nov. 14, note holders representing approximately 85% of outstanding debt have agreed to exchange notes under the new terms.
Just six of the index’s 20 stocks finished the week in negative territory. The sharpest drop came from German concert promoter CTS Eventim, which fell 9.7% this week after the company’s third-quarter earnings showed an increase in revenue but a drop in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) margin for both the promotion and ticketing segments.
Lastly, label giant Warner Music Group (WMG) dropped 3.3% to $31.85 following the release of its latest quarterly earnings on Thursday (Nov. 21). JP Morgan dropped its price target to $40 from $41 after lowering its estimate for fiscal 2025 adjusted operating income before depreciation and amortization (OIBDA) to $1.49 billion from $1.527 billion. Meanwhile, Deutsche Bank cut its WMG price target to $34 from $36.
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Spotify is on such a hot streak that the streaming company nearly reached a $100 billion market capitalization this week. After the company’s third-quarter earnings showed cost-cutting has led to record profitability, shares peaked at a new all-time high of $489.69 on Thursday (Nov. 14), briefly putting its market capitalization above $98 billion. However, the stock fell on Friday (Nov. 15) to a final closing price of $458.32, valuing the company at $92.04 billion. While the stock was still up 14.5%, that marked a bit of a letdown from its previous high.
During the height of the pandemic, Spotify benefitted from a rush into streaming stocks as consumers spent more time with audio and visual media. Investors were also attracted to its push into podcasts, which provided an opportunity to improve upon the margins of its core music service. But investors eventually grew tired of Spotify’s growth-over-profitability mantra, sending the company’s share price from $387 in February 2021 to under $70 in November 2021. But a focus on cost-cutting and expansion into audiobooks helped bring investors back; Spotify shares gained 138% in 2023 and have already increased 144% in 2024.
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After delivering solid results and showing investors a pathway to greater profitability, Guggenheim increased its price target for Spotify to $500 from $420 and raised its estimate for 2025 operating profit to 2.5 billion euros ($2.63 billion) from 2.1 billion euros ($2.21 billion). Analysts cited management’s confidence in usage growth and ability to raise prices and further improve margins. Morgan Stanley raised Spotify to $460 from $430, also citing the company’s ability to further raise prices and management’s “commitment to financial discipline and driving profitability.” At JPMorgan, analysts upped Spotify to $530 from $425 for the aforementioned reasons, in addition to the stock’s coming inclusion in the MSCI World Index on Nov. 25.
A bevy of analysts also increased their price targets for Live Nation following the company’s earnings report on Monday (Nov. 11), which showed that the promoter achieved a record adjusted operating income in the third quarter. Among them: Rosenblatt Securities ($146 from $123), Goldman Sachs ($148 from $132), Benchmark ($145 from $108), Evercore ISI ($150 from $110), Oppenheimer ($155 from $120) and Wolfe Research ($152 from $125). Live Nation shares finished the week at $129.00, up 4.9%, and reached a new intraday high of $130.83 on Friday.
Spotify’s big gain was the primary reason the Billboard Global Music Index grew 5.8% to 2,162.50 despite just six of its 20 stocks finishing the week in positive territory. The float-adjusted, unweighted index measures the aggregate market values of the 20 member companies; Spotify is the most valuable company on the index and is more than twice as valuable as the next company, Universal Music Group (UMG). The week’s other five gainers are among the index’s largest companies: Live Nation, CTS Eventim, JYP Entertainment, HYBE and SM Entertainment all have market capitalizations exceeding $1 billion.
Stock markets hit a post-election hangover this week that stalled the gains seen after Donald Trump won the presidential election on Nov. 5. In the United States, the Nasdaq fell 3.1% and the S&P 500 dropped 2.1%. The United Kingdom’s FTSE 100 lost just 0.1%. South Korea’s KOSPI composite index fell 5.6%. China’s Shanghai Composite Index lost 3.5%.
Despite the KOSPI’s decline, K-pop stocks — which have recovered ground in the second half of the year and now have a collective year-to-date deficit of 20.2% — were up across the board. JYP Entertainment gained 8.2%, HYBE improved 3.2%, SM Entertainment added 2.8% and YG Entertainment rose 2.7%.
On the live front, Sphere Entertainment Co. fell 8.6% after its latest earnings showed a slowdown in revenue at its Sphere division, with Macquarie lowering the company’s price target to $45 from $47. And at MSG Entertainment (MSGE), shares dropped 6.8% to $40.00 after Bernstein reduced its MSGE price target to $44 from $45 earlier in the week.
Over at radio, Cumulus Media fell 19.3% to $0.71 after it reportedly conducted layoffs at stations in Central Pennsylvania, Indianapolis, Detroit and San Francisco as part of broader job cuts ahead of the holiday season — all on the heels of recent layoffs at competitor iHeartRadio. Elsewhere music streamer LiveOne dropped 12.4% to $0.78 this week.
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Saudi Arabia’s Public Investment Fund (PIF), the oil-rich country’s sovereign wealth fund, has sold its entire stake in Live Nation, according to an SEC filing dated Thursday (Nov. 14). In April 2020, the $925-billion PIF acquired approximately 12.5 million shares that amounted to a 5.7% stake in Live Nation, making it the fourth-largest shareholder behind […]
In calling for Universal Music Group (UMG) to move its stock listing and legal headquarters to the U.S. from Amsterdam by next year, board member and billionaire activist investor William Ackman argued the move could make the company more valuable. But financial sources are split on whether that would be the case.
On Friday (Nov. 8), Ackman said his hedge fund, Pershing Square Capital Holdings, which owns 10.25% of UMG’s stock, will exercise its right to require the company to register with the U.S. Securities and Exchange Commission following violent attacks on Israeli soccer fans on Thursday night (Nov. 7) in Amsterdam, where UMG’s stock is listed on the Euronext exchange. But would the move actually benefit the company, as Ackman seems to believe?
“It could noticeably increase UMG’s value because even though it will make your taxes a little higher and you’re going to spend a whole lot more on expensive securities lawyers, it gives you access to the giant U.S. retail market, and UMG is the perfect kind of company for retail investors,” says Erik Gordon, a professor at University of Michigan’s Ross School of Business.
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In the U.S., more than 62% of individual adults own stocks, a group referred to as retail investors. While big institutional investors, like Pershing, account for about three-quarters of the trading volume on U.S. stock markets, like the Nasdaq or New York Stock Exchange, retail investors are a powerful and growing group. Since the start of the pandemic, when retail investors on Reddit fueled a run-up in the share price of companies like GameStop and AMC, more than 30 million new investors have opened brokerage accounts, according to a University of Missouri study.
Right now, four institutional investors control nearly 60% of UMG’s current pool of stock. In his post last week, Ackman argued that lack of liquidity — in part because only a slim portion of UMG’s stock frequently changes hands — could improve if UMG listed in the U.S.
“UMG trades at a large discount to its intrinsic value with limited liquidity in significant part due to it not having its primary listing on the [New York Stock Exchange] or Nasdaq Exchange and not being eligible for S&P 500 and other index inclusion,” he wrote.
Ackman’s argument is essentially that if UMG lists and starts trading in the U.S., its value will make it an important stock in U.S. financial markets, which in a few years will earn it inclusion in a major index, says Gordon. Getting included in an index, like the S&P 500, creates more demand for a company’s stock because mutual funds and exchange traded funds that track the S&P begin to buy the stock.
Over the weekend, UMG stated that Pershing can request that UMG list in the U.S. if it sells at least $500 million worth of its own UMG shares as part of that listing.
“If I had to guess, Ackman will end up with the right to sell his shares in the U.S. public market and that the company will issue new shares in the U.S. so that Ackman isn’t the only guy selling,” Gordon says.
One equity analyst believes UMG would not become a more valuable company if it moved to a U.S. exchange because its shares already trade at a premium to shares of Warner Music Group (WMG). In a Nov. 1 investor note, J.P Morgan analysts wrote about the premium, arguing that “UMG should trade at a significant premium to WMG…to reflect greater scale, a better track record for growth and consistent margin expansion, best-in-class management and better governance.”
According to Billboard’s calculations, UMG shares were recently trading at a roughly 17 times multiple trailing 12 months adjusted EBITDA, while WMG shares were trading at about 11 times multiple.
UMG moving its stock to an American exchange also comes with another downside: the operational expense that U.S.-listed public companies face from shareholder lawsuits.
“One area U.S. issuers have to manage, unlike non-U.S. issuers, is the volume of shareholder litigation that gets brought in the U.S.,” says Michael Poster, a music industry lawyer at Michelman & Robinson. “It’s expensive to deal with litigation, there are a lot of fees associated with managing, settling and litigating the claims, and it’s frankly a distraction for management. Those things contribute to making trading in the U.S. more expensive from an operational point of view.”
Spotify rode a post-election wave of market enthusiasm to close above $400 for the first time on Friday (Nov. 8), valuing the music-streaming giant at nearly $80.5 billion. Before finishing at $400.68, up 4.1% for the week, the company’s stock reached an all-time high of $405.88.
The Stockholm, Sweden-based company’s stock price has increased 113% in 2024 as the company overtook Universal Music Group (UMG) as the most valuable music company. When investors began to tire of high-growth streaming companies with little to show in profitability, Spotify underwent two major rounds of layoffs in 2023, helping reduce costs without sacrificing subscriber growth or revenue. With third-quarter earnings coming on Tuesday (Nov. 12), Spotify will show whether it has maintained that momentum. At least one analyst is optimistic ahead of earnings: Deutsche Bank raised its Spotify price target on Wednesday to $440 from $430.
U.S. stock markets soared this week following the election of Donald Trump on Tuesday (Nov. 5) and the U.S. Federal Reserve’s decision on Thursday (Nov. 7) to lower interest rates by a quarter of a percentage point. On Friday, the Nasdaq composite closed at an all-time high of 19,286.78, up 5.7%. The S&P 500 gained 4.7% to close at a record high of 5,995.54. China’s Shanghai Composite Index rose 5.5% to 3,452.30. South Korea’s KOSPI composite index improved just 0.7% to 2,561.15. In the U.K., the FTSE 100 fell 1.3% to 8,072.39.
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The 20-company Billboard Global Music Index gained 2.4% to an all-time high of 2,043.02, bringing its year-to-date gain to 33.2%. The index had 13 stocks in positive territory while six lost ground and one was unchanged.
The week’s top music stock was iHeartMedia, which jumped 16.7% to $2.44 after the company announced it will restructure much of its retiring debt and plans to save $200 million in 2025 through cost cuts and the embrace of technology. “Technology is the key to increasing our operating leverage and is a constant focus for us,” CEO Bob Pittman said during an earnings call on Thursday. “It allows us to speed up processes, streamline legacy systems and it enables our folks to create more, better and faster.” iHeartMedia shares are down 8.6% year to date but have risen 180% since May 24.
LiveOne gained 15.6% to $0.89 per share after the music streamer announced that revenue increased 14% to $32.6 million and paid members rose 27% to 645,000 in its fiscal second quarter ended Sept. 30. Reservoir Media was another top gainer, improving 9.1% to $9.00.
On the live front, Live Nation shares rose 5.1% to $123.02 following a post-election day boost. The concert promoter is currently facing a lawsuit from the U.S. Department of Justice but could find a better outcome from new appointments made by the Trump administration. The election wasn’t the only reason for the stock’s gains: Morgan Stanley upped its price target to $140 from $120 based on “a combination of strong underlying consumer demand and powerful artist incentives to tour,” analysts wrote in an investor note on Tuesday. Deutsche Bank also increased its Live Nation price target to $130 from $122.
K-pop stocks surged this week despite HYBE and SM Entertainment both reporting sharp drops in profit last quarter due partly to weaker recorded music revenues. HYBE shares jumped 6.4% after the company reported a 99% drop in net income. Likewise, SM Entertainment gained 7.2% the same week the company announced quarterly net profit fell 96% on a 9% revenue decline and a 36% drop in recorded music revenue. Investors may have gained optimism from SM Entertainment’s announcement it will launch a new girl group — its first since aespa debuted five years ago — in 2025 with a single and album release in the first quarter.
JYP Entertainment, which has not yet announced quarterly earnings, shot up 12.6%, and YG Entertainment continued its hot streak, rising 6.3% and bringing its gain in the last three weeks to 17.6%. YG has received a boost from the success of “APT” by ROSÉ featuring Bruno Mars. The song is currently in its second week atop both the Billboard Global 200 and Billboard Global Excl. U.S. charts.
Tencent Music Entertainment (TME) shares rose 2.4% to $11.39 ahead of the company’s third-quarter earnings on Tuesday (Nov. 12). Bernstein initiated coverage of TME with a $14 price target. Barclays initiated coverage with an “overweight” rating and a $16 price target.
German concert promoter CTS Eventim was the worst-performing music stock of the week, dropping 10.4% to 87.70 euros ($94.05). The company will release third-quarter results on Nov. 21. Elsewhere, Cumulus Media dropped 6.4% to $0.88, adding to the prior week’s 19% decline, while SiriusXM dropped 5.5% to $26.13.
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Live Nation, which is facing a lawsuit brought by the Department of Justice (DOJ) under President Joe Biden, saw its share price jump on Wednesday (Nov. 6) following Donald Trump’s victory in the U.S. presidential election a day earlier.
Live Nation shares gained 7.1% to $125.99 and rose as high as $127.64, just shy of its all-time high of $127.75 set on Nov. 5, 2021. Investors could see Trump’s re-entrance into the White House as a good sign for Live Nation’s efforts to thwart efforts by the DOJ to break up the company.
In a lawsuit filed in May, the DOJ alleged Live Nation abused its market power to hurt competition through exclusive ticketing contracts and threats and retaliations against venues that choose competing ticketing companies, among other actions the DOJ claims are illegal and violate the consent decree that placed competition-enhancing restrictions on the 2010 merger of Live Nation and Ticketmaster.
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“The change in administration typically brings a change in the climate around anti-trust efforts and could impact a case such as Live Nation,” says Bill Morrison, a partner at Haynes and Boone. “It depends on the who are in those key spots, and then what the priorities are of those offices. We’ve seen big pivots in the past.”
Faced with the prospect of fewer regulations and an administration perceived to be pro-market, U.S. indexes posted big gains on Wednesday. The Dow Jones Industrial Average gained 3.6% to a record high. Similarly, the Nasdaq composite rose 3.0% and the S&P 500 improved 2.5% as both reached all-time highs. The NYSE composite gained 1.9% but fell short of its all-time high.
Stocks associated with Trump also fared well, including Tesla, whose CEO, Elon Musk, campaigned heavily for Trump. The company’s shares rose 14.8% while its competitors Rivian and Lucid Group fell 8.3% and 5.3%, respectively. Trump Media & Technology Group Corp., owner of the Truth Social app used by Trump, rose 5.9%.
Bitcoin rose 9.4% to an all-time high of $76,012 on Wednesday. Trump has signaled a laissez-faire approach to cryptocurrency and said he would quickly fire Securities and Exchange Commission chair Gary Gensler, a critic who has punished numerous crypto companies and favors tighter regulations. Trump himself is involved with a new cryptocurrency through World Liberty Financial, a decentralized finance startup that sells a token called WLFI.
In other music stocks news, music streamer LiveOne jumped 28.5% a day ahead of the company’s earnings release for the quarter ended Sept. 30 while iHeartMedia shares fell 12.6% following news that the radio broadcaster cut dozens of jobs at stations across the country this week.