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SiriusXM shares rose 11.1% to $4.52 this week following an offer from Liberty Media on Tuesday (Sept. 26) to combine its tracking stock, The Liberty SiriusXM Group, with SiriusXM’s stock to form a new public company.
Liberty Media, which owns 83% of SiriusXM’s outstanding shares, proposed a complicated transaction that would “provide value to all shareholders with a more flexible and attractive currency” in the newly formed SiriusXM stock, Liberty Media president/CEO Greg Maffei said in a statement. SiriusXM said in a statement that a special committee of its board of directors is evaluating the proposal and provided no assurance a deal would eventually happen.
The effect appeared to be a short squeeze — albeit one smaller than the instance that inflated SiriusXM’s share price by 49% in one week in July. Because SiriusXM shares are heavily shorted and have a small float, sudden demand for the stock can create large price fluctuations. SiriusXM shares rose 15% on Thursday (Sept. 28) alone, while shares of The Liberty SiriusXM Group tracking stock finished the week up 13.4%.
While overall stocks were mixed this week, music stocks performed well. The 21-stock Billboard Global Music Index improved 1.1% to 1,344.99, better than the 0.1% gain eked out by the tech-heavy Nasdaq composite and easily besting the S&P 500’s 1.3% loss. In the United Kingdom, the FTSE 100 fell 1%, while South Korea’s KOSPI composite index dropped 1.7%. Eleven of the Billboard Global Music Index’s 21 stocks finished the week in positive territory, eight lost ground and two were unchanged.
Helped by Deezer’s double-digit improvement, streaming stocks had an average gain of 3.1%. Chinese music streamers Cloud Music and Tencent Music Entertainment gained 6.5% and 1.3%, respectively. Spotify shares dropped 2.1% to $154.63 but have gained 95.9% year to date. LiveOne shares fell 8.6% to $0.96, marking its third successive weekly loss since spinning off its PodcastOne division. This week, Billboard reported that LiveOne took out a high-interest loan to lure UFC fighter-turned-podcaster Brendan Schaub after Kast Media failed to pay him advertising money. LiveOne agreed to acquire Kast Media in May and offered Schaub and other podcasters settlements that included a mix of cash, promissory notes and PodcastOne stock.
Music’s greatest gainer this week was French streaming company Deezer. Despite there being no news — neither a press release nor a regulatory filing — that normally leads to such a substantial change, Deezer shares rose 21.8% to 2.735 euros ($2.90), including a 14.8% gain on Thursday with one of the highest trading volumes since the company went public in September 2022. Nothing indicated the company has substantially improved its earnings outlook in recent days, but Deezer had been in the news prior to this week. Three weeks ago, Deezer announced a partnership with Universal Music Group to create a new system for calculating artist royalties; and last week, the company revealed plans to increase subscription prices for new individual and family plans in the United Kingdom, Spain, Italy, the Netherlands and its largest market, France.
Live Nation shares rose 4.1% to $83.05 following news the company will help developing artists by providing a financial stipend and eliminating fees charged on merchandise sales at a number of its owned and operated clubs in the United States. Although the move will cost Live Nation money, it also comes with some strategic advantages, according to LightShed Partners analyst Brandon Ross. The decision is “great for Live Nation because it actually throws up another barrier to entry,” Ross said in the Friday (Sept. 29) episode of the LightShed podcast. “Artists are going to want to play your venue where the economics for them are better rather than somebody else’s venue.”
Hipgnosis Songs Fund has set a date of Oct. 26 for its shareholders to vote on the proposed sale of some 29 song catalogs and a separate vote on whether to keep the fund going under founder Merck Mercuriadis‘ advisory, the company said on Thursday (Sept. 29).
Earlier this month, Hipgnosis announced its plans to sell a package of assets that includes rights to songs performed by Shakira, Barry Manilow, Rick James and others to its sister fund — the privately held Blackstone-backed entity, Hipgnosis Songs Capital — for $440 million.
Hipgnosis Songs Fund — or SONG, as it’s abbreviated on the London Stock Exchange — has struggled with a sagging share price that values the company at a discount to its assets’ worth. The Oct. 26 shareholder vote represents a key milestone in the young company’s five-year lifespan.
In its statement on Thursday, Hipgnosis Songs Fund’s board said it’s in talks with third parties to consider outside bids for the package of assets, with those discussions set to resolve by Oct. 23. The board previously said it would use proceeds of any asset sales to buy back up to $180 million of the company’s stock and pay down its revolving debt balance, two measures aimed at achieving a “re-rating of the share price.”
If a majority of shareholders vote “yes” on the company’s continuation vote, the board has committed to holding the next continuation vote in January 2026, followed by a third in 2028.
The board also said that if the discount between Hipgnosis Songs Fund’s share price and operative net asset value reaches 10% or more on average over the month of January 2025, it will terminate its investment advisory agreement with Mercuriadis’ Hipgnosis Song Management. The agreement with the founder as an investment advisor will be “terminable by the company on 12 months’ notice,” according to the statement.
The board added that chair Andrew Sutch will retire as a director before the next annual meeting in 2024, and that Andrew Wilkinson will retire from his director role by the end of this year. Cindy Rampersaud will take Wilkinson’s place after he retires. The departures mean Hipgnosis Songs Fund will have five directors in the future.
In a vote of support for retaining Mercuriadis’ Hipgnosis Song Management as SONG’s investment adviser, the board said its approach had led to a 44% total return on the 29 music catalogs that Hipgnosis Songs Fund proposes to sell to its private sister fund since the initial dates of purchase.
“The board and the investment adviser firmly believe that the company has a unique portfolio of iconic, culturally significant songs that will deliver strong long-term value as they benefit from the structural tailwinds in the music industry,” according to the statement. “Furthermore, the board believes that the investment adviser’s approach to song management should enable the company to outperform the wider music market.”
Shares of YG Entertainment plummeted 16.3% this week amidst speculation the agency has not renewed the contracts of the members of girl group BLACKPINK. Following a spate of reports out of South Korea, the company’s share price dropped 13.3% on Thursday (Sept. 21) and another 4.1% on Friday (Sept. 22).
On Thursday, Korean news outlet Daily Sports Seoul reported that three members of BLACKPINK — Jennie, Jisoo and Lisa — will leave YG Entertainment and spend just six months out of the year as part of the group. In response to that report and the flurry of media attention that followed, YG Entertainment issued a brief statement: “Currently, BLACKPINK’s contract renewal has not been confirmed and is being discussed.”
BLACKPINK became the first K-pop girl group to play Coachella in 2019 and headlined the festival in 2023. The quartet was also the first K-pop girl group — and the third K-pop group overall — to top the Billboard 200, with its 2022 album, Born Pink.
A week ago, YG Entertainment’s share price was up 80.8% year to date and was outpacing its K-pop competitors. Following the BLACKPINK news, shares of YG Entertainment fell to 130,300 KRW ($97.56), dropping its year-to-date gain to 51.4%. That put YG Entertainment below SM Entertainment’s 69.9% year-to-date gain and JYP Entertainment’s 55.6% improvement.
Overall, the 21-stock Billboard Global Music Index fell 1.9% to 1,330.12 this week, lowering its year-to-date gain to 13.9%. Eleven stocks ended the week in negative territory and two were unchanged. Of the eight stocks that finished in positive territory, only Cumulus Media, which gained 7.9% to $4.80, appreciated more than 3%.
Music stocks outperformed some major indexes, though. In the United States, the S&P 500 dropped 2.4% to 4,345.64 and the Nasdaq composite fell 3.6% to 13,211.81. Overseas, the United Kingdom’s FTSE 100 fell 0.4% to 7,683.91 while South Korea’s KOSPI composite index declined 3.6% to 2,508.13.
Led by Cumulus Media’s 7.9% gain, the three radio companies in the index had an average gain of 3.8% — the only segment in positive territory — with SiriusXM gaining 2% to $4.07 and iHeartMedia rising 1.5% to $3.45. Meanwhile, the eight stocks covering record labels and music publishers lost an average of 1.1%, and four live music stocks fell by an average of 1.7%. The six streaming companies in the Billboard Global Music Index lost an average of 6.9%.
Two streaming companies, LiveOne and Anghami, had the sharpest declines of the week. Abu Dhabi-based Anghami dropped 19% to $0.68, bringing its year-to-date loss to 57.4%. U.S. music streamer LiveOne fell 23.4% to $1.05 and has lost 36% of its value since spinning off its PodcastOne division on Sept. 11 and attracting media attention over allegations its Kast Media division did not pay some advertising revenues to podcasters. The spinoff hasn’t helped the company’s combined value: Trading under the name Courtside Group, the podcast company’s share price fell to $2.05 this week, 52% below its opening trading price on Sept. 8. The other streaming stocks almost broke even this week: Spotify, Tencent Music Entertainment, Cloud Music and Deezer had an average share price decline of just 0.2%.
Hipgnosis Songs Fund rose 2.8% to 0.832 pounds ($1.02) a week after dropping 12.8% on news the publicly traded investment trust plans to sell some catalogs for $465 million. The sale proceeds would fund share buybacks and repurchase debt, which Hipgnosis believes will support the beleaguered share price and reset the company’s net asset value.
Shares of Warner Music Group (WMG) dropped 4.7% to $30.76 this week following the announcement on Monday (Sept. 18) that BMG is taking control of its digital distribution and will no longer use WMG’s ADA Distribution (though it will continue to outsource its physical distribution). The news didn’t impact WMG’s share price until Wednesday (Sept. 20), when a report by analysts at Guggenheim stated that BMG’s decision would cause “a staggered reduction in WMG gross revenue” beginning Dec. 31 of roughly $250 million annually. Losing BMG’s digital business won’t be a major hit to WMG’s earnings before interest, taxes, depreciation and amortization (EBITDA), however: Guggenheim believes WMG’s revenue from BMG had an EBITDA margin in the low single digits and would have “minimal free cash flow impact.” Guggenheim has a $37 price target on WMG, which implies 20% of upside from Friday’s closing price.
PodcastOne debuted its long-awaited listing Friday (Sept. 8), with officials from parent company LiveOne ringing the opening bell on the trading floor of the NASDAQ to celebrate what CEO Rob Ellin says is first ever spinoff of a minority stake in a publicly traded company. Shares of the new LiveOne subsidiary Courtside Group, better known as PodcastOne, fell 45% shortly after trading opened, dropping from $8 per share to close at $4.39.
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The tumble came amid growing criticism of one of PodcastOne’s acquisition targets — California-based Kast Media — by major podcasters like comedian Theo Von who accused Kast of failing to pay out $4 million in advertising fees collected by Kast on behalf of its podcaster clients.
In a video viewed more than 1 million times, titled “This Man Defrauded Our Podcast,” Von alleges that Kast Media founder and CEO Colin Thomson did not pay his show This Past Weekend with Theo Von for the advertisements it sold and booked for Von’s show. Von claimed This Past Weekend eventually cut ties with Kast Media, only to later be approached by Thomson and Ellin and was told on a phone call, “If you come over to our new network PodcastOne, we’ll pay some of what you’re owed in stock,” Von said, adding “it felt like to me they’re trying to leverage our podcast and other podcasts to then make their stock do well and if that happens, then we’ll get a share of our money.”
Von told viewers he declined the offer.
Ellin addressed the Kast Media scandal on Friday during a post-market opening interview with Yahoo News. He noted that PodcastOne is no longer hiring Thomson to join his the publicly traded company, but noted he hoped to help creators hurt by the Kast Media controversy.
“We’ve bought a distressed asset called Kast Media, a very distressed, troubled asset (that) owed a lot of money to its podcasters and couldn’t really afford to pay them. And the banks pulled out. And that host pulled out. So we acquired those and have added some very serious revenues to it,” he said.
Von isn’t the only podcaster to go public about the Kast Media scandal. Pro Wrestling podcaster Jim Cornette and cohost Brian Last have detailed their own experience with Kast Media and PodcastOne in a series of at least seven podcast episodes over the last two months. Former Sirius XM host Jason Ellis has also spoken out against Kast Media in a recent viral video.
Von said he will continue pursuing Thomson for the money he is owed by Kast Media.
“You f—ed with the wrong rat, homie” Von said while a picture of Thompson aired on the screen. “You can’t get me to shut up.”
Thomson did not respond to multiple requests for comment.
News that Concord plans to buy Round Hill Music Royalty Fund for $1.15 per share sent Round Hill shares soaring 64.4% on Friday (Sept. 8), from $0.6875 to $1.13 per share. They finished the week up 62.6%, leading all music stocks by a wide margin.
The deal, which must be approved by at least 75% of Round Hill’s shareholders at the company’s Oct. 18 general meeting, values the rights in the fund at nearly $469 million. On March 6, an independent valuation from Citron Cooperman put Round Hill’s economic net asset value at $519.6 million, according to the company’s 2022 annual report. That puts Concord’s bid at a 9.7% discount to economic NAV — a vast improvement from the 46% discount the stock had been trading at before the deal was announced.
Round Hill competitor Hipgnosis Songs Fund was also a beneficiary of Concord’s announcement. Shares of Hipgnosis rose 15.7% to 0.923 pounds ($1.15) on Friday, bringing the stock’s one-week gain to 16.8%. Hipgnosis shares have been trading at a steep discount to the company’s net asset value — a measure of the company’s catalog, less liabilities — and hadn’t closed above 0.923 pounds since Sept. 27, 2022. The fact that Concord found a buyer at a price close to its NAV could have signaled to Hipgnosis investors that its shares should be trading closer to its NAV. Some Hipgnosis investors may have also believed that, like the Concord deal, Hipgnosis could also find a suitor that would bid close to the NAV.
Round Hill and Hipgnosis were — by far — the biggest gainers of the week. Overall, the 21-stock Billboard Global Music Index dropped 0.8% to 1,348.41. Year-to-date, the index has gained 15.5%.
No other music stocks had a double-digit gain, and just six others finished the week in positive territory. Twelve stocks lost ground this week and one stock, music streamer Anghami, was unchanged. French music streamer Deezer gained 6.8% and was probably helped by its announcement of a partnership with Universal Music Group to adopt a new system for calculating streaming royalties. Universal Music Group shares improved 3.8% to 23.52 euros ($25.20).
Stocks were down around the world this week. In the United States, the S&P 500 fell 1.3% and the Nasdaq composite dropped 1.9%. South Korea’s KOSPI composite index lost 0.6%. In the United Kingdom, the FTSE 100 was a bright spot with a slight 0.2% gain.
With the help of Round Hill and Hipgnosis, the eight stocks in the record labels and publishing category on the Billboard Global Music Index had an average gain of 10.3%. The other categories saw losses; four live music stocks had a 0.9% average decline, six streaming stocks dropped an average of 3.9% and three radio stocks had a 4.7% average decline.
LiveOne shares fell 10.4% on Friday following the company’s spin-off of its PodcastOne segment on the Nasdaq exchange. That brought its shares’ one-week loss to 21.8%. LiveOne distributed about 19% of PodcastOne shares to LiveOne shareholders of record as of Sept. 5, but the podcast company’s trading debut got off to a rocky start on Friday. Trading under the ticker PODC, shares of PodcastOne owner and operater Courtside Group fell 45.1% to $4.39 from a starting price of $8 per share.
Spotify led a group of high-flying streaming stocks this week by gaining 14.8% to $157.54 per share, increasing its market capitalization by nearly $4 billion to $30.7 billion. The world’s largest streaming company, which boasted 220 million subscribers as of June 30, has clawed back nearly all its losses since its share price dropped 14% […]
Live music companies’ stocks fell an average of 4.4% on this week’s Billboard Global Music Index despite their optimism about sustained consumer spending and healthy revenue and ticket sales in the second half of the year. While Live Nation shares rose 0.5% to $84.79, the other promoters and ticketing companies in the index had down weeks: Madison Square Garden Entertainment fell 2.7%, CTS Eventim dropped 5.7% and Sphere Entertainment Co. plunged 9.6%.
Sphere Entertainment shares have gained over 19% since the company turned on the external display on its state-of-the-art Las Vegas venue and showcased the potential inside the structure on July 5. The company’s second quarter results, released Tuesday, showed revenue of $129.1 million — with the Sphere contributing just $700,000 and the remainder coming from MSG Networks. Sphere’s share price rose nearly 8% to $39.58 following Tuesday’s earnings results but fell nearly 15% over the next three days. The $2.3-billion Sphere will open on Sept. 29 with a 25-date residency by U2.
iHeartMedia shares rose 6.6% for the week to close at $3.56 on Friday (Aug. 25), making the radio giant the week’s greatest gainer on the Billboard Global Music Index. However, radio companies’ struggle with weak national advertising has hurt their share prices overall in 2023. Year to date through Friday, iHeartMedia was down 41.9% and Cumulus Media had lost 41.9%. Audacy, troubled by debt on top of the soft advertising market, was de-listed by the New York Stock Exchange on May 16 and currently trades over the counter at 75 cents per share despite a reverse stock split on June 30 raising the price from 7 cents to $2.13. Audacy was removed from the Billboard Global Music Index following the de-listing.
Overall, the 21-stock Billboard Global Music Index was flat this week at 1,298.80. Ten stocks finished the week in positive territory, ten stocks lost ground and one stock, Round Hill Music Royalty Fund, was unchanged. Record labels and music publishers were the top performing sector with an average gain of 1.7% and only one company, Universal Music Group (down 0.7%), finished in negative territory. Streaming companies and radio companies suffered average weekly losses of 1.3% and 1.7%, respectively.
Year-to-date, the index has increased 11.2%, even as it’s now on its fifth straight week without a gain.
Stocks in general performed better than music stocks. In the United States, the S&P 500 gained 0.8% and the tech-heavy Nasdaq composite gained 2.3%. In the United Kingdom, the FTSE gained 1%. South Korea’s KOSPI composite index gained 0.6%.
The week’s biggest loser, streaming company Anghami, fell 17.5% to 94 cents per share. The stock traded below $1 per share from Wednesday to Friday, marking the first time since July 18 the stock has dropped below $1. On Monday, Anghami announced the sale of a convertible note worth $5 million to SRMG Ventures, a venture arm of Saudi Research and Media Group. The company plans to use the proceeds for working capital, growth and other corporate purposes.
LiveOne will capitalize on the booming podcast industry by spinning off its PodcastOne business as a standalone entity through a dividend to shareholders as of August 28, the company announced Thursday. PodcastOne shares were approved for listing on the Nasdaq exchange on Monday (Aug. 14) and will begin trading under the “PODC” symbol on Sept. 8.
LiveOne, which also owns the music streaming platform Slacker Radio, will issue a dividend of about 19% of PodcastOne shares to its shareholders and retain the remaining roughly 81% of the outstanding shares. LiveOne CEO Robert Ellin said he expects PodcastOne stock will be priced between $8 — the minimum price for Nasdaq-listed stocks — and $12 per share. A third-party valuation of PodcastOne in February put the company at between $230 million and $274 million.
“We will be very aggressive to continue to grow that and it’s a big part of the reason we’re taking the company public,” Ellin said during a conference call for investors on Thursday (Aug. 17). The company currently has a pipeline “of over 10 additional acquisitions that we’re carefully taking a look at,” he added.
PodcastOne has a number of popular podcasters including Adam Carolla, Dr. Drew Pinsky and Jordan Harbinger. It ranked 10th in Podtrac’s publisher ranking for July 2023. Last week, LiveOne obtained the exclusive network distribution and advertising rights to comedian Brendan Schaub’s portfolio of podcasts including The Schaub Show and The Fighter.
PodcastOne already has two important acquisitions in 2023. LiveOne entered into a letter of intent to acquire Kast Media, a podcast network expected to add up to $10 million in annual revenue and boost earnings for PodcastOne. The company also has a binding letter of intent to acquire Guru Fantasy Reports, owner of fantasy football website Fantasy Guru, that Ellie said he expects will close “in the next few weeks.” The all-stock deal is expected to add annual revenue of $2.5 million and over $600,000 in earnings before interest, taxes, depreciation and amortization.
PodcastOne had revenue of $10.6 million in the quarter ended June 30, accounting for roughly 38% of LiveOne’s total revenue. Last week, LiveOne raised its guidance for PodcastOne’s full fiscal year revenue from $34 million to a range of $42 million to $47 million.
Separately, LiveOne also plans to make Slacker Radio a standalone, publicly traded entity through a merger with Roth CH Acquisition V Co., a special purpose acquisition company. LiveOne and Roth have signed a letter of intent but no merger date has been announced. LiveOne said it expects Slacker to have a pre-money valuation of $160 million.
Boosted by K-pop’s growing popularity and artists’ return to concert stages, the four publicly traded South Korean music companies — HYBE, SM Entertainment, YG Entertainment and JYP Entertainment — posted average revenue growth of 71% in the second quarter of 2023, according to Billboard’s analysis of their recent earnings reports.
Sky-high growth rates in recent quarters have helped make the K-pop companies a wise investment in 2023: Through Wednesday (Aug. 16), the four share prices increased an average of 63.6% year to date, adding more than $4.7 billion in market capitalization cumulatively to the companies’ stocks. In contrast, stocks of the two largest standalone music companies, Universal Music Group and Warner Music Group, have gained 3.6% and lost 6%, respectively, year-to-date through Tuesday (Aug. 15).
In terms of revenue growth, the leader in the second quarter was JYP Entertainment, home to the groups Stray Kids and Twice. JYP’s revenue grew 124% to 151.7 billion won ($115.2 million), with new albums by Stray Kids, Twice and NMixx driving a 298% increase in physical sales to 74.1 billion won ($56.3 million). Republic Records, JYP’s partner in the United States, accounted for 14.5 billion won ($11 million) of physical sales, or about 20% of the total amount. Elsewhere, JYP’s concert revenue grew 44% year-over-year to a record 14.4 billion won ($10.9 million) while merchandise sales climbed 151% to 21.7 billion won ($16.5 million). Domestic streaming revenue grew 18% to 2.2 billion won ($1.7 million) while overseas streaming revenue jumped 82% to 10.3 billion won ($7.8 million).
YG Entertainment boasts the greatest share price gain among the group at 75.6% year to date. The company behind breakthrough girl group BLACKPINK, YG posted revenue of 158.3 billion won ($120.2 million) in the second quarter, up 108% from the prior-year period.
JYP Entertainment’s operating income grew 88% to 45.6 billion won ($34.6 million) but missed its 51-billion won estimate, causing the company’s share price to fall 8.2% the following day. Although its revenue grew 124% in the quarter, JYP was hurt by what it called a “temporary increase in content product costs.” As a result, its cost of goods sold rose 162% while gross margin percentage — gross profit as a percent of sales — declined 1.6 percentage points to 47.7%.
Expenses also grew faster than revenue at HYBE, where cost of sales grew 25% while sales, general and administrative expenses climbed 32%. HYBE’s operating profit declined 8% as a result, while net income improved 19% despite a 21% growth in revenue. HYBE’s share price declined just 0.9% the day after the results were released; with a 38.9% gain year-to-date, its stock boasts the lowest appreciation of the four K-pop companies.
Warner Music Group’s share price didn’t improve much this week, but its 5.6% gain nevertheless led the 21 music stocks in the Billboard Global Music Index.
On Tuesday (Aug. 8), Warner Music Group (WMG) reported that its quarterly revenue increased 9% year over year in the fiscal quarter ended June 30. That was music to investors’ ears after WMG’s revenue grew just 1.7% in the previous quarter, but it wasn’t exactly a surprise: WMG executives had previously told investors that the company’s new release schedule was weighted in the back half of its fiscal year and that its financials would pick up accordingly. And a Billboard analysis of Luminate data found that the company’s U.S. market share had started to improve by early May.
Only four of the Billboard Global Music Index’s 21 stocks finished the week in positive territory. Sphere Entertainment Co., the company behind the state-of-the-art Las Vegas venue set to open in September, improved 5.5% to $39.77 and German promoter CTS Eventim gained 4.8% to 61.80 euros ($67.76). Elsewhere, Hipgnosis Songs Fund rose 3.9% to 79.8 pence ($1.01).
This was the third consecutive week the index declined in value after reaching an all-time high in the week ended July 21.
LiveOne shares dropped 4% this week despite the company raising guidance on its fiscal 2024 revenue and adjusted EBITDA. In the fiscal quarter ended June 30, the company — which is behind music streaming platform Slacker and podcast brand PodcastOne — posted revenue of $25.7 million, up 24% year over year, and adjusted EBITDA of $4.9 million, up 46% year over year.
iHeartMedia shares fell 24.9% to $3.38 this week after the company warned of continued softness in advertising. The U.S. radio giant posted second quarter revenue of $920 million, down 3.6% year over year. Other radio companies also declined. Cumulus Media fell 5.9% to $4.96, while Townsquare Media — not a member of the Billboard Global Music Index — fell 19.7% on Wednesday following the company’s second-quarter earnings results but recaptured some of the losses on Thursday and Friday to finish the week down 7.2% at $10.50.
French streaming company Deezer fell 9.4% to 2.12 euros ($2.32) this week and has lost 16% since reporting mid-year earnings on Aug. 3. The company lowered its forecast for full-year revenue growth slightly to a range of 7% to 10%, down from a more than 10% increase. Although the company’s decision to raise its price in 2022 helped its average revenue per user to increase 8.3%, its subscribers declined by 100,000 to 9.3 million from the prior-year period.
In related news, Disney shares rose 4.9% after the company’s second quarter beat earnings expectations, even as it revealed that its Disney+ subscriber count fell 7.4% to 146.1 million in the second quarter. Starting in October, Disney will raise the prices for both ad-free and ad-supported tiers of Disney+ and Hulu by at least 20%. Following the price increases, ad-free Disney+ will cost $13.99 per month and ad-free Hulu will cost $17.99 per month.
Music services have been far more hesitant than streaming video-on-demand services to raise prices. Spotify just increased its individual plan price in the United States — by $1 to $10.99 — for the first time since launching in 2011. By contrast, Hulu last raised its prices in October 2022 and has increased its the price of its ad-free tier by 39% in less than a year.
Music stocks’ decline mirrored stocks’ broad declines this week. In the United States, the S&P 500 and the Nasdaq composite fell 0.3% and 1.9%, respectively. In the United Kingdom, the FTSE 100 was down 0.5%. South Korea’s KOSPI composite index declined 0.4%. News that the U.S. producer price index, a gauge of wholesale prices, rose 3% in July — the biggest one-month gain since January — was a factor in U.S. stock prices falling Friday.