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Chinese pop star G.E.M. is looking to grow her Latin American fan base — and break the mold for Chinese artists — by putting out a full-length Spanish version of her latest album, Revelation. And the idea to do it didn’t come from an executive or carefully plotted strategy by her new label, Warner Music China, which released the original Mandarin version in September.
“It wasn’t necessarily something we sat down with her and sort of guided her towards,” Simon Robson, Warner Music Group’s president, international, for recorded music, tells Billboard. “It was more that she wanted to do this, and we wanted to support her.”
Robson says G.E.M.’s Revelación, which Warner Music plans to release on July 10, will be the first Spanish-language album by a major Chinese music artist at any label (as far as WMG is aware). The experiment, the executive says, is “quite indicative of what’s happening with music at the moment and just how impactful Spanish music is becoming.”
Like her Chinese original, the Spanish album — which G.E.M. says she wrote on her own, after essentially teaching herself the language — will feature 14 songs. After debuting in 2008 with her self-titled EP G.E.M, the Shanghai born, Hong Kong-raised singer, whose real name is Gloria Tang Sze-wing (G.E.M. stands for Get Everybody Moving), became one of the top-selling female artists in Asia. Often dubbed China’s Taylor Swift, she holds the record for most-viewed music video on YouTube among all Chinese artists with “Light Years Away” (267 million views), the Chinese theme song for the sci-fi movie “Passengers.”
“It has been an incredible journey working on this project as I do not speak Spanish, but I was determined to fulfill a prophecy that was made to me 10 years ago that one day I would sing in the language,” G.E.M. says in a press release announcing Revelación. “After receiving support from South America for my Chinese album Revelation, I taught myself Spanish and wrote the entire album by myself.”
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A devout Christian, the singer rose to fame in 2014 after appearing on the TV competition show, “I Am A Singer 2.” Her second-place finish boosted her popularity in mainland China. She also received a nomination for an MTV Europe Music Award for Best Mainland China & Hong Kong Act and in 2016 Forbes named her to its 30 Under 30, the only Asian artist featured on the list. She composes songs in Cantonese and Mandarin, and also speaks English.
G.E.M. signed with Warner Music China last July, after a sticky separation from her Hong Kong-based label, Hummingbird Music, which sued her in 2019 to enforce their 2014 contract, which the label said was valid until 2022. Hummingbird was seeking HK $120 million ($15.3 million) in damages, according to Chinese media reports. G.E.M. filed a countersuit for unspecified damages, claiming Hummingbird had failed to fulfill its contractual duties. Both parties were seeking exclusive rights to her copyrighted works, including her stage name. (It is unclear if the suits have been resolved. A WMG spokesperson says he does not have any information about the situation.)
Revelation, G.E.M.’s seventh studio album, is named after the New Testaments’s Book of Revelation. In the wake of the pandemic last summer, the artist found herself prone to melancholy and other negative emotions, and developed the habit of praying, she told Billboard China. Her album was a “direct dialogue between me and heaven,” she said. “I write letters to heaven, and they write back. This is what gradually gave shape to the concept behind Revelation.”
Warner Music released two songs from the album every week — accompanied by videos — for seven weeks leading up to Sept. 22. G.E.M. began noticing that user-generated content and remakes of the song in local languages by Spanish-speaking content creators were appearing on social media platforms, particularly in South America. “Whether it was due to the album’s themes or its vibes, it was evident that it was connecting strongly with Spanish speakers globally,” a WMG spokesperson says. So, she decided to learn Spanish and convert the songs into Spanish “to better share her message and music with this fanbase.”
While the plan is still in its preliminary stages, G.E.M. is planning to perform the Spanish version of the song throughout the next year, with live performances in Latin America, the spokesperson tells Billboard.
Robson says WMG currently has no plans to release any other Chinese artists’ albums in Spanish. “But I think that obviously there is an element of seeing how successful this album is,” he says. “It’s something I wouldn’t be surprised if we see more of just because Spanish music, in the broadest terms, is becoming increasingly influential around the world.”
The Warner Music executive acknowledged that there is an element of risk for G.E.M. and the label with the Spanish project but declined to define what success would look like for the artist. “It’s more about building her fan base in Latin America,” he says. “It’s step by step, really.”
WMG continues to lean into Latin music, at a time when the genre is exploding globally. Between 2020 and 2022, Latin music grew 55.29% in album consumption in the U.S., according to Luminate, more than double the overall industry’s 21.61%.
Robson points to recent tracks like Peso Pluma’s remix of Yng Lvcas’ “La Bebe,” which is holding at No. 16 on the Billboard Hot 100 this week, and the upcoming album or EP from Mexican rapper Natanael Cano, which is scheduled to drop at the end of June, as signs of Warner Music’s efforts on the Latin front. (Yng Lvcas performed last week at a songwriting camp in Madrid organized by Warner Music Spain and Warner Chappell Music Spain, part of an effort by the company, Robson says, to host more joint writing camps for both publishing and recorded music.)
Two years ago, the label named former Universal Music Group executive Alejandro Duque as president of Warner Music Latin America. Duque helped oversee the release of Anitta’s Versions of Me, whose signature single, “Envolver,” reached No. 2 on the Billboard Global 200. But now the Brazilian pop star is gone, after separating with the label in April and signing with UMG’s Republic Records, a definite blow to WMG.
“We’re already starting to build up our roster [in Brazil],” Robson says, noting the recent signing of Brazilian urban funk artist Kayblack.
More broadly, “when you look back two years prior, although we were sort of active, [it is] nothing like to the degree we are now, and are not having the success we have,” Robson says. “Alejandro is an incredibly strong executive and we’re trying to support him as much as possible.”
The three major label groups have been in talks with the big music streaming services to find a way to get them to remove recordings with AI-generated vocals created to sound like popular artists, Billboard has learned. The idea under discussion with Spotify, Apple Music and Amazon Music would operate much like the one laid out by the Digital Millennium Copyright Act but would cite violations of rights of publicity, rather than copyright, according to sources at all three majors. Unlike the DMCA, however, this arrangement appears to be voluntary.
The 1998 DMCA gives online services that use, store or transmit copyrighted works a “safe harbor” from secondary liability for copyright infringement as long as they abide by a notice-and-takedown system that allows rightsholders to ask them to remove copyrighted content. That law would not apply to most AI-generated soundalike tracks because they do not infringe protected elements of copyrighted recordings or compositions but rather a trademark or a right of publicity, the protection celebrities may be able to receive to protect their names and likenesses from unauthorized commercial exploitation.
Songs that imitate the voices of big-name talent have become a trend over the past month, reaching widespread attention in mid-April when the track “Heart on My Sleeve,” which apparently used AI to mimic the style and tone of vocals by Drake and The Weeknd, was uploaded to streaming services and then swiftly removed. (The song did not credit those artists, although they were referred to in social media posts about it.)
Citing rights of publicity can be more complicated than copyright, because they are matters of state law in the U.S., backed by limited legal precedent. Rights vary by state, protections for deceased artists vary even more widely, and the use of soundalike vocals for creative purposes may in some cases be protected as free speech. Further complicating matters, these rights almost always belong to artists, not labels, which would presumably file notices on their behalf with authorization. Right now, however, this is the most obvious legal argument with which to keep AI-generated soundalikes off major streaming platforms.
In an April 26 earnings call, UMG CEO and chairman Lucian Grainge seemed to signal this approach to investors. “The recent explosive development in generative AI will… create rights issues with respect to existing copyright law, in the US and other countries, as well as laws governing trademark, name and likeness, voice impersonation, and right of publicity,” he said. “Further, we have provisions in our commercial contracts that provide additional protections.” It is not clear if takedowns issued by the majors would rely on these provisions, state law, goodwill, or some combination.
Some executives have raised concerns that AI soundalikes that imitate the voices of popular artists could result in consumer confusion. Still, a few artists like Grimes and Holly Herndon have embraced the technology, training their own AI voice models and making them available to the public.
Meanwhile, companies like Uberduck, Supertone, Lingyin Engine, and Covers.ai are marketing models with which to replicate voices. Covers.ai, which launched last week, has said that it received over 100,000 sign-ups in anticipation. Tencent Music Entertainment executives announced in November that with the company’s Lingyin Engine they had created and released over 1,000 songs containing synthetic AI voices already, one of which amassed 100 million streams.
This stance taken by the leading streaming services counters a recent announcement from the blockchain-based music platform Audius, which announced that artists can now “opt-in” to allow AI-generated works on their artist page. To organize this new music and avoid confusion, Audius would create a separate tab on the artists’ page especially for user-generated content.
Representatives for Universal, Sony, Warner, Spotify, Apple Music and Amazon Music did not respond to requests for comment.
Warner Music Group reported quarterly revenues grew 1.7% to $1.399 billion (4.6% in constant currency) as strong revenues from its music publishing revenue helped offset a slow quarter for recorded music releases.
WMG, the music industry’s third largest major label, reported revenue from its recorded music revenue was effectively flat at $1.143 billion for the second fiscal quarter ending March 31, compared to $1.147 billion in the year ago quarter. (In constant currency, recorded music revenue rose 2.5%.) Streaming revenue in the quarter 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.
In contrast, music publishing revenue rose 12% to $257 million from $230 million a year ago.
“While our publishing was best in class, we underperformed in recorded music,” Robert Kyncl, chief executive officer, said on a conference call.
WMG executives have said throughout this fiscal year that the label’s major releases of the year would come in the second half, and on the call, they stressed they are already seeing improvement with the late-April releases of Jack Harlow’s Jackman., Tïesto’s Drive and Ed Sheeran’s Subtract, released in early May.
“Our 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),” Warner chief financial officer Eric Levin said, flagging releases expected from Dua Lipa with her Barbie soundtrack track, among others.
“We absolutely expect this to improve our results in recorded music streaming in the second half of the year.”
Key Points From WMG’s Q2:
WMG’s revenues grew 1.7% (or 4.6% in constant currency, a measure that standardizes foreign exchange fluctuations) to $1.399 billion
Digital revenue increased 1.2% (or 3.7% in constant currency) to
Streaming revenue increased 1.9% (or 4.5% in constant currency) on growth in music publishing streaming
Music publishing revenue increased 12%, or 14.2% in constant currency
Music publishing streaming revenue grew 16.4% (18.3% in constant currency)
Recorded music streaming revenue decreased 0.4% (an increase of 2.2% in constant currency) on a lighter release schedule, foreign exchange currency fluctuations and slowdown in ad-supported revenue.
Net income was $37 million this quarter, down 60% from $92 million one year ago, primarily driven by the negative impact of currency fluctuations on the company’s Euro-denominated debt. Adjusted net income up 5% to $116 million from $111 million a year ago.
Operating income was $124 million, down 25% from $166 million a year ago, with adjusted operating income up 10% to $203 million from $185 million.
Adjusted net income of $116 million was up 5% from $111 million in the year ago quarter.
Warner Music México has announced the launch of Gorgona, a label which will be “completely” run and managed by women, and will also be focused on promoting women talent.
According to a statement issued by the company Wednesday (April 12), the “historically low” presence of women in key senior industry roles initially led to the formation of Warner Music México’s Gender Equality Committee, comprised exclusively of women across the organization. Then came the idea of creating a label in which all roles — from songwriting to digital music services — would be executed by women.
The creation of Gorgona — a creature who is a protective deity of women according to Greek mythology is — led to their first songwriter’s camp attended by Ali Stone, Erika Vidrio, Escarlata, Ingratax, Marian Ruzzi, and other artists, producers and songwriters.
“The atmosphere in our first camp was very friendly because everyone felt that their opinions and voices were validated in the studio,” says Andrea Fernández, A&R manager at Warner Music Mexico and the label’s creative leader. “They had practically never attended a camp where the participation of women was greater than that of men. We came out with a network of creative women who were able to get to know themselves and their work and produced spectacular songs.”
“Cypher 1: Ella”, which dropped on International Women’s Day, was the first release under Gorgona. A collaboration between singers and emcees Mabiland, Emjay, Mare Advertencia and Delfina Dib, the alternative, urban-leaning song was produced by Maria Vertiz, mixed by Marcella Araica and mastered by Natalia Schlesinger.
The underrepresentation of women in the industry in Mexico reflects the reality of music in general. A report on inclusion issued by The University of California Annenberg Inclusion Initiative earlier this year found that women have been woefully underrepresented across the recorded music industry.
The number of women with producer credits continues to be low. In 2022, only 3.4% of producers were women across all songs included on the year-end Hot 100 chart, according to the report, which examines the gender of artists, songwriters and producers across all 1,100 songs included on Billboard’s Hot 100 year-end charts spanning from 2012 to 2022. Moreover, women represented only 30% of the 160 artists on the Hot 100 year-end chart, while men made up 69.4% and artists who identified as non-binary made up less than 1%.
Anitta and Warner Music Group are parting ways, both parties announced in a joint statement the Brazilian star posted on social media on Tuesday (April 4).
“After eleven years of successful partnership, we’ve agreed to go our separate ways,” reads the post. “Anitta would like to thank the Warner Music team for all their support. And the Warner team wishes Anitta all the best in the future.”
Anitta signed with Warner Music in the U.S. in 2020 after previously linking with Warner Music Brazil in 2013. Under the U.S. contract, she produced Versions of Me, which was executive produced by Ryan Tedder. The trilingual album was recorded mostly in English with a few songs in Spanish and one in Portuguese. It included the hit song “Envolver,” which reached No. 1 on Billboard’s Global Excl. U.S. chart and on Spotify’s Global list, making Anitta the first Brazilian artist to achieve either feat. Meanwhile, the self-directed video for the song claimed the top spot on YouTube’s Global Top Music Videos chart. It currently has more than 500 million views on YouTube.
The news comes after Anitta took to Twitter in March to say she would have “auctioned off her organs” to be let out of her Warner contract. “If there was a fine to pay, I would have already auctioned off my organs, no matter how expensive it was to get out. But unfortunately, there isn’t,” she wrote. “When you’re young and still don’t know a lot, you need to pay close attention to the things you sign… if you don’t, you could spend a lifetime paying for the mistake.”
It wasn’t the first time Anitta has complained about her relationship with WMG. According to Anitta, Warner refused to produce a video when they saw that the song’s performance on streaming platforms was falling below expectations.
“They only invest after it pays off on the internet,” Anitta said in an Instagram livestream in May. “Unfortunately, there are things I can’t get, that’s why I don’t buy millionaire cars, because when I want to do something, I pay for it.”
Recently, it was announced that Anitta has joined the Elite cast for season seven of the hit Netflix show.
Warner Music Group’s chief financial officer Eric Levin told staff on Tuesday that after a “transformative decade” for the company, he will retire at the end of the year, according to an internal memo viewed by Billboard.
Levin said he decided to announce his retirement early in the year to allow the company to move forward with a public search for his successor, similar to WMG’s handling of the successor search for former WMG CEO Stephen Cooper, who stepped down Feb. 1.
Levin joined WMG in 2014, overseeing the company’s global financial operations at a time when piracy and streaming were overhauling the fortunes of companies across the music industry.
“He helped WMG return to growth and profitability, making important contributions to its long-term strategy and the funding of its global expansion and major acquisitions,” WMG CEO Robert Kyncl wrote in a staff memo about Levin’s planned retirement. “Eric will be leaving WMG in a much better place than when he joined it.”
Prior to WMG, Levin was based in China as the North Asia CFO and regional controller for Ecolab, a leading maker of disinfectants, and prior to that he was the CFO of the Hong Kong-based English language newspaper the South China Morning Post.
Levin saw WMG through its 2020 initial public offering, which valued the company at around $12.5 billion, and managed through the leadership transition from Cooper to Kyncl. On Tuesday, Levin wrote that he is “ready to pass the baton to a new CFO.”
“It’s going to be a natural progression, at a natural time,” Levin wrote. “Whoever takes this role will be very fortunate. I’m looking forward to helping set them up for another successful decade of growth.”
Daniel Mora has been appointed managing director of Warner Music Andes, where he will oversee the company’s operations in Colombia and Peru, and will report to president of Warner Music Latin America, Alejandro Duque, the company announced. Mora replaces Maria Montejo who left the company earlier this month.
Mora first joined Warner Chappell Music in 2013 as an A&R/Sync consultant at the Colombian office and was later promoted to managing director of WCM Colombia in 2019.
“After spending so many enjoyable years at Warner Chappell Music, I’m pleased to be staying within the WMG family and stepping into this role on the Recorded Music side,” he said in a press statement. “Latin music is in my blood, and I’m delighted to see how it’s currently growing and connecting with people around the world. There are so many great opportunities for our artists to become global stars and I’m looking forward to helping them achieve their dreams. I’d like to thank Alejandro for this new opportunity, and Gustavo Menendez, Guy Moot, and Carianne Marshall for all their support during my time at Warner Chappell Music.”
In addition to his experience as an industry executive, Mora is also an artist and entrepreneur. He previously toured Latin America as part of the tropipop band, Bonka, which made waves with their debut single “El Problemón” (2006) and freshman studio album Lo Que Nunca Nos Contamos; and launched his own audiovisual company in Bogotá, producing films and commercials for brands such as Chevrolet and Adidas, to name a few.
“Daniel is a brilliant exec who has experience of being on both sides of the fence – first as an artist and now as a leading industry figure,” Duque added. “His understanding of both perspectives makes him the perfect fit for Warner Music and our artist-first philosophy. His appointment will enable us to work even closer with our partners at Warner Chappell Music and will open up more opportunities for collaboration. Latin music is exploding around the world and I’m excited to see how Daniel can further propel our Colombian and Peruvian artists internationally.”
Newly minted Warner Music CEO Robert Kyncl and his wife, psychotherapist Luz Avila Kyncl, have signed on for another five years of scholarship support for select computer science and engineering students at their alma mater, SUNY New Paltz.
The five-year-old Robert Kyncl ’95 and Luz Avila Kyncl ’96 Computer Science & Engineering Scholarship Fund is designed to benefit underrepresented students, especially women and minorities, seeking careers in STEM. Each year, at least six new transfer students or current Hawks will be selected for the scholarship, which offsets tuition costs.
The success of the scholarship has led to the creation of a group of alumni called the Kyncl Scholars.
“State education provided us with great opportunities, both professionally and personally, and we want to help more students access those same benefits,” said the Kyncls in a joint statement. “In turn, this talented next generation will help drive change and contribute to a more representative workforce in dynamic industries.”
The Kyncls’ most recent gift also supports the Fund for New Paltz and the AMP/CSTEP (AC²) Program Fund, which provides economic support for a number of traditionally underrepresented students who earn degrees in STEM fields and certain other majors such as Psychology.
SUNY New Paltz is a short drive north of New York City in Ulster County. As the name of the scholarship suggests, Robert graduated in 1995 (International Relations) and Luz a year later (Psychology).
“The Kyncls’ generosity in this area sends an important message to prospective and current students that people in leadership positions believe in their ability to succeed,” said Erica Marks, vice president for development & alumni relations and executive director of the SUNY New Paltz Foundation. “The University is continually evolving to remain competitive in offering high-quality computer science and engineering education that prepares students for their future. Each year, a powerful new cohort of Kyncl Scholars will be equipped with the training to be effective and collaborative contributors in the community.”
Robert Kyncl joined WMG on Jan. 1 after a decade as chief business officer at YouTube and seven years as vp of content acquisitions at Netflix. Read his first interview as CEO here. Luz Kyncl is a longtime licensed psychotherapist, and a certified health coach and mindfulness teacher. She is also the author of Liberate Yourself.
New Warner Music Group CEO Robert Kyncl addressed investors for the first time since taking over the company at the top of the year, acknowledging the “tough quarter” for the major label while also laying out a vision for how he sees the music industry’s present and future.
The company posted revenues of $1.48 billion for the quarter that ended Dec. 31, 2022, down 8% from the same period the year before, which the company noted contained an extra week, skewing comparisons slightly. Growth came from the publishing sector, which saw revenues up 9.2%, or 14.2% in constant currency, while recorded music revenue fell 10.6%, or 5.6% in constant currency, with recorded streaming revenue down an 6.7%, though the company said that streaming revenue was up half a percentage point when adjusted for the extra week, with a lighter release schedule and falling ad-supported streaming revenue the causes.
That led to Kyncl’s acknowledgement that WMG had a tough quarter, noting that, “like most companies, WMG has been dealing with macroeconomic headwinds and the impact of currency exchange rates.” He added that WMG’s release schedule for this year is weighted toward the second half of the year, with releases from Ed Sheeran, Cardi B, David Guetta, Aya Nakamura and Bebe Rexha on the horizon.
Kyncl then spoke about both his decision to join Warner after 12 years at YouTube and seven at Netflix, as well as his vision for growth for the music industry and the effects of artificial intelligence and TikTok on how that future will look, both creatively and monetarily.
“This industry has achieved something rare: It’s built mutually beneficial, long-term partnerships with many of the world’s biggest companies — Amazon, Apple, Google, Meta, Spotify and Tencent among them,” he said. “As successful as music has become, there’s still meaningful upside ahead for three reasons. One, as technology opens up emerging economies, the industry’s addressable market will continue to expand even further. Two, innovation is constantly creating new use cases for music, giving us the opportunity to diversify our revenue sources. Three, music is still undervalued, especially when compared to other forms of entertainment, like video.”
On the last point, Kyncl pointed out that Netflix’s subscription price has roughly doubled since 2011, the year that Spotify debuted in the U.S., while the price of a music subscription has remained largely flat, even though music subscriptions contain access to a wide swath of the world’s available music, whereas video streamers — of which nearly 80% of U.S. households subscribe to three — are segmented.
He also spoke about his vision for WMG’s role in that future, noting that he hired two former YouTube employees in his first five weeks — Tim Matusch as executive vp of strategy and operations, and Ariel Bardin as president of technology — which should “tell you something about our priorities” in the future.
“We will continue to invest in new artists and songwriters, our catalog and our global expansion,” he said. “At the same time, we plan to thoughtfully reallocate some resources to accelerate how we use technology and data to empower artists and songwriters, as well as drive greater efficiency in our business.” That, he added later in the Q&A section of the call, will come “with continued focus on financial discipline and cost containment.”
That doesn’t necessarily mean layoffs, however; he noted that WMG “has actually been much more measured in its headcount growth, for instance, over the last few years than others in the industry who are now undergoing significant layoffs,” and had been addressing financial initiatives even before the recent fluctuations in the market. “But again, I’d like to reiterate that I’ll be focusing on reallocating our internal resources in order to invest in technology and drive not only more tools for our creators, but also greater efficiencies for us,” he added.
On the topic of AI — which he called “probably one of the most transformative things that humanity has ever seen” — Kyncl said that the conversation falls into four buckets in how content owners need to work with AI platforms: “One is the use of existing copyrights to train generative AI. The second is sampling of existing copyrights as the basis for new and remixed AI generated content. The use of AI to help and support creativity — so an assistive way to do that. And most importantly, find ways to protect the craft of artists and songwriters from being diluted or replaced by AI-generated content.”
But he also stressed that the conversation is not just about the future of AI, but about how things can be handled today to prepare for that future — namely, that the processes for identifying and tracking copyrighted material on platforms and making sure they are monetized for the copyright owner need to be better in the present to prepare for what is to come. That’s something Kyncl has plenty of experience with from his time with YouTube, whose ContentID system was overseen by new WMG exec Bardin, and something he says Warner will be focusing on under his purview.
Another benefit from his YouTube days, Kyncl says, is his experience being on the other side of the negotiating table from the major labels when it came to developing YouTube as a partner with and contributor to the music industry. During his tenure, Kyncl helped steer the relationship between YouTube and the labels from one of animosity to one of mutual benefit, which he stressed came from a collaborative approach — one he intends to bring to Warner in its approach to its relationship with TikTok, which is currently in a similar situation to the YouTube of old, in terms of being under fire from the music business for its perceived low payouts and under-valuation of music on its platform. Kyncl described how YouTube’s position changed in answering a question about whether the labels will push for changes with its relationship with TikTok.
“At YouTube, we looked at this problem very closely, and we decided that music was very important to us, and that’s why we did it,” he said, referencing YouTube’s push into subscription streaming, tools like Shorts and improvements to ContentID, among other initiatives. “TikTok needs to do that. It’s the right decision for them to evaluate. And you can see from YouTube’s execution what the results of the finding was for us. But I can’t speak to what TikTok finds. That’s up to them. But my answer is, a holistic relationship is what we’re looking for.”
Warner Music Group’s net revenues fell nearly 8% to $1.48 billion, despite growth in streaming revenues and its music publishing business, as the company suffered from a tough comparison to the year-ago quarter, it reported on Thursday.
WMG reported net profits declined by 34% to $124 million compared to the year ago period when the company reported $188 million in net income. This quarter, which ended Dec. 31, 2022, had one fewer week than the quarter ending Dec. 31, 2021, which resulted in outsized earnings in the year-ago period.
Executives said that beneath those headline figures, the company saw a 9% growth in music publishing revenue, 13.2% in music publishing streaming revenue and 11% increase in operating income.
“The foundations of this company are strong, and our addressable market is continuously growing,” Warner’s new CEO Robert Kyncl said in a statement. “Music’s value, power, and ubiquity are among the many reasons I decided to join WMG and lead the next phase of our evolution. As we navigate a challenging business environment, we expect to have a strong release schedule in the second half of 2023 while managing our costs throughout.”
The company’s music publishing division contained most of the quarter’s highlights, with revenues up 9.2%, or 14.2% in constant currency, driven by increases in digital and performance revenue. Digital revenue increased by 12%, or 15.5% in constant currency, and streaming revenue increased 13.2%, or 16.8% in constant currency, on growing streaming and timing of new digital deals, the company said. Digital revenue now represents 59.6% of total music publishing revenue, up from 58.1% last year. Performance revenue increased thanks to continued growth from the hospitality industry, concerts and live events, while mechanical revenue was flat. Synchronization revenue declined on lower commercial licensing activity in the U.S.
In the recorded music division, revenue fell 10.6%, or 5.6% in constant currency, on lower digital, physical and artist services and expanded rights revenue. While streaming revenue was down 6.7% in the quarter, when adjusted for the impact of the extra week in 2021, WMG said recorded music’s streaming revenue was up half a percent, impacted by al ighter release schedule and a slowdown in ad-supported revenue due to macroeconomic conditions.
WMG revenue fell 7.8%, or 2.7% in constant currency, compared to the year ago quarter, which had an extra week
Digital revenue decreased 5%, 0.9% in constant currency
Streaming revenue decreased 4%
Music publishing revenue increased 9.2%, or 14.2% in constant currency
Music publishing streaming revenue grew 13.2%, or 16.8% in constant currency
Recorded music streaming revenue decreased 6.7%, or 2.6% in constant currency, on a lighter release schedule impacted by the fewer number of weeks in the quarter
Net income was $124 million this quarter, down 34% from $188 million one year ago
Adjusted net income of $110 million was down 51% from $223 million in the year ago quarter