Core Insights - Warner Music Group has acquired a controlling stake in Tempo Music Investments, an investment platform for premium music rights, from Providence Equity Partners, which will remain a minority investor [1][2] - The acquisition aims to expand Warner Chappell's catalog and enhance revenue generation through a diverse portfolio of music rights [3][4] Company Overview - Tempo Music Investments was launched in 2019 as a partnership between Providence Equity Partners and Warner Music Group, combining capital and investment expertise with music industry resources [2] - Tempo focuses on empowering artists and songwriters while delivering compelling financial results through a disciplined investment approach [6] Catalog and Artist Representation - The catalog acquired includes rights from notable artists and songwriters such as Bruno Mars, Twenty One Pilots, Adele, Wiz Khalifa, and Florida Georgia Line, among others [1][4] - Tempo has built a high-quality catalog over the years, representing top artists and songwriters, which aligns with Warner Chappell's existing partnerships [3][4] Strategic Goals - The acquisition is seen as a natural fit for Warner Music Group, aimed at building scale and influence while delivering high-margin revenue [3] - The partnership with Providence Equity Partners will continue, supporting Tempo's next phase of growth [2][3]

NEW YORK, Jan. 09, 2025 (GLOBE NEWSWIRE) -- Warner Music Group Corp. will release its financial results on Thursday, February 6, 2025, for the first quarter ended December 31, 2024, and will hold an earnings conference call that morning at 8:30 a.m. ET. To access the conference call, please register here. Once registered, you will receive an email with the dial-in number along with your personalized pin needed to join the call. We suggest you call in 10 minutes prior to the start time. If you do not anticip ...

Core Insights - Dr. Duru's blog "One-Twenty Two" provides unique perspectives on financial markets, challenging conventional wisdom and covering various asset classes including stocks, options, currencies, and Bitcoin [1] - The blog utilizes both technical and fundamental analysis for short-term and long-term trading and investing strategies [1] Company and Industry Analysis - Dr. Duru has extensive experience in financial markets, having navigated significant events such as the dot-com bubble, the financial crisis, and the coronavirus pandemic [1] - The blog serves as a resource for students and fans of financial markets, offering insights that may differ from mainstream narratives [1] - Dr. Duru's academic background includes a B.S. in Mechanical Engineering and a Ph.D. in Engineering-Economic Systems, indicating a strong analytical foundation for his market analyses [1] - The consulting practice mentioned includes operations research, decision analysis, and business intelligence, suggesting a data-driven approach to investment strategies [1]

Financial Data and Key Metrics Changes - Total revenue increased by 6%, with Recorded Music up 6% and Music Publishing up 5% [12][38] - Adjusted OIBDA grew by 14%, with a margin increase of 150 basis points [12][37] - For the full year, total revenue and adjusted OIBDA grew by 7% and 11% respectively [12][44] - Operating cash flow decreased by 10% to $304 million, while free cash flow also decreased by 10% to $271 million [45] Business Line Data and Key Metrics Changes - Recorded Music revenue increased by 6%, driven by a 11% growth in subscription streaming [38][44] - Music Publishing revenue increased by 5%, with streaming growth of 19% on a normalized basis [28][41] - Licensing revenue surged by 33%, primarily due to copyright infringement settlements [40] Market Data and Key Metrics Changes - In Japan, a new leadership duo was appointed to strengthen market presence [22] - In India, revenue growth exceeded 100% in fiscal 2024, with significant increases in paid subscribers [26][24] - The U.S. remains the largest music market, with ongoing efforts to enhance local talent access to global platforms [14][22] Company Strategy and Development Direction - The company is focused on attracting original artists and songwriters, enhancing their careers and fan engagement [13] - A flatter organizational structure has been implemented to improve efficiency and artist development [14][21] - The company is investing in high-growth markets, particularly India, which is expected to become a significant player in the global music industry [24][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, citing strong subscriber growth and potential for price increases [32][49] - The company anticipates high single-digit growth in subscription streaming over the next few years [49][103] - Management highlighted the importance of adapting to market dynamics and leveraging digital transformation for growth [33][113] Other Important Information - The company has authorized a share repurchase program of up to $100 million, reflecting confidence in its value [34] - A restructuring plan is expected to generate pre-tax cost savings of $260 million by the end of fiscal 2025 [48] Q&A Session Summary Question: Broader music industry dynamics and WMG's opportunities - Management discussed the importance of reducing discounts in family plans and innovating with superfan tiers as key opportunities for growth [58] Question: Management changes and their impact - Management highlighted the digital-first mindset and intensity brought by the new leadership as beneficial for artist development and overall growth [66] Question: Wholesale pricing and Spotify renewal - Management emphasized the need for alignment with industry standards in wholesale pricing and expressed optimism about potential changes [69] Question: Geographic mix and its impact on growth - Management provided insights on the growth potential in both developed and emerging markets, emphasizing the low penetration in high-growth regions like India [78] Question: Impact of artist-centric models on streaming growth - Management acknowledged the importance of evolving the artist-centric model and its collaborative nature with distribution partners [86] Question: Trends in ad-supported streaming - Management noted stable growth in ad-supported streaming, despite some macroeconomic challenges [90] Question: Superfan tiers and monetization opportunities - Management expressed enthusiasm about the potential of superfan tiers and the need for innovative monetization strategies [98] Question: Drivers of subscription streaming growth - Management identified subscriber growth, pricing optimization, and market share as key drivers for high single-digit growth in subscription streaming [103] Question: Expectations for subscription revenue growth in 2025 - Management indicated that while there may be some moderation in growth due to lapping price increases, overall marketplace trends remain positive [108]

Warner Music Group Corp. (WMG) came out with quarterly earnings of $0.08 per share, missing the Zacks Consensus Estimate of $0.28 per share. This compares to earnings of $0.34 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -71.43%. A quarter ago, it was expected that this company would post earnings of $0.25 per share when it actually produced earnings of $0.27, delivering a surprise of 8%.Over the last four quarters, the com ...

Revenue Performance - The company reported a revenue benefit of approximately $73 million for the fiscal year ended September 30, 2022, primarily from Recorded Music streaming revenue due to an additional week in the fiscal calendar[329]. - Total revenues increased by $389 million, or 6%, to $6,426 million for the fiscal year ended September 30, 2024, compared to $6,037 million for the prior year[340]. - Digital revenues increased by $291 million, or 7%, to $4,280 million for the fiscal year ended September 30, 2024, representing 67% of consolidated revenues[342]. - Recorded Music revenues rose by $268 million, or 5%, to $5,223 million for the fiscal year ended September 30, 2024, with U.S. revenues at $2,210 million[343]. - Music Publishing revenues increased by $122 million, or 11%, to $1,210 million for the fiscal year ended September 30, 2024[340]. - The overall increase in Recorded Music revenue was driven by increases in digital, licensing, and physical revenues[427]. Revenue Sources - Recorded Music revenues are derived from four main sources: digital, physical, artist services and expanded rights, and licensing[322]. - Music Publishing revenues are generated from five main sources: digital, performance, mechanical, synchronization, and other[327]. - The company has diversified its revenue streams by entering into expanded-rights deals with recording artists, allowing participation in activities beyond traditional recorded music[322]. Digital Revenue Insights - The company emphasizes the importance of digital revenues, which vary by region and are expected to grow with new technologies[321]. - Total digital revenues for the fiscal year ended September 30, 2024 included U.S. revenues of $2,039 million and international revenues of $2,243 million, representing 48% and 52% of total digital revenues, respectively[342]. - Digital revenue in Music Publishing increased by $94 million, or 14%, with streaming revenue growing by $96 million, or 15%, to $752 million for the fiscal year ended September 30, 2024[346]. - Adjusted for the impacts of the BMG Termination and the Digital License Renewal, Recorded Music streaming revenue grew by 9%[344]. Strategic Restructuring - The Company announced a Strategic Restructuring Plan in February 2024, expecting a 13% reduction in overall headcount and incurring approximately $210 million in total non-recurring restructuring charges[330]. - For the fiscal year ended September 30, 2024, the Company recognized $178 million in restructuring and impairments related to the Strategic Restructuring Plan, including $121 million in severance costs[330]. - The Company expects to allocate cost savings from the Strategic Restructuring Plan to increase investment in core Recorded Music and Music Publishing businesses[330]. - The company plans to reinvest savings from restructuring into technology and other business areas[439]. Financial Performance Metrics - The company’s Adjusted OIBDA is a key performance measure, adjusted to exclude non-cash stock-based compensation and other items affecting comparability[309]. - Adjusted OIBDA increased by $197 million to $1,432 million for the fiscal year ended September 30, 2024, representing a 16% increase from $1,235 million in 2023[388]. - Adjusted OIBDA margin improved to 22% for the fiscal year ended September 30, 2024, up from 20% in 2023, driven by strong operating performance and restructuring savings[390]. - Operating income increased by $33 million to $823 million for the fiscal year ended September 30, 2024, up from $790 million in 2023, due to improved Adjusted OIBDA and lower amortization expenses[407]. Costs and Expenses - Total cost of revenues increased by $178 million, or 6%, to $3,355 million for the fiscal year ended September 30, 2024[363]. - Artist and repertoire costs increased by $169 million to $2,167 million for the fiscal year ended September 30, 2024, representing 34% of revenue[364]. - Total selling, general and administrative expense increased by $53 million, or 3%, to $1,879 million for the fiscal year ended September 30, 2024[373]. - General and administrative expense increased by $98 million to $1,089 million for the fiscal year ended September 30, 2024, representing 17% of revenue[374]. Debt and Liquidity - At September 30, 2024, the company had $4.014 billion of debt and $694 million of cash and equivalents, resulting in a net debt of $3.320 billion[463]. - The company believes its primary sources of liquidity will be sufficient to support existing operations over the next twelve months[479]. - The company's S&P corporate credit rating improved from B in 2017 to BBB- in August 2024, with a stable outlook[480]. - The weighted-average interest rate on outstanding indebtedness decreased from 10.5% in 2011 to 4.3% as of September 30, 2024[480]. International Revenue - International revenue increased by $286 million, or 9%, to $3,563 million for the fiscal year ended September 30, 2024, with international Recorded Music revenue rising by $242 million, or 9%[358]. - U.S. Recorded Music revenues accounted for 42% of total revenues in 2024, while international revenues accounted for 58%[426]. Other Financial Highlights - Net income decreased by $39 million to $478 million for the fiscal year ended September 30, 2024, compared to $439 million in 2023, reflecting various operational factors[420]. - The company recorded a pre-tax gain of $32 million from divestitures during the fiscal year ended September 30, 2024[385]. - Cash provided by operating activities was $754 million for the fiscal year ended September 30, 2024, compared to $687 million for the fiscal year ended September 30, 2023, representing a $67 million, or 10%, increase[466].

Financial Highlights Full-Year Results Reflect Healthy Performance Across Recorded Music and Music PublishingContinued Strong Growth in Subscription Streaming Underpinned by Healthy Macro TrendsMusic Publishing Achieves its Fourth Consecutive Year of Double-Digit Revenue GrowthDelivered Operating Cash Flow Conversion of 53% in line with Guidance For the three months ended September 30, 2024 Total revenue increased 3% (the same in constant currency)Digital revenue was flat compared to prior-year quarterNet i ...

Revenue Performance - Total revenue for the fourth quarter increased by 3% to $1,630 million, while full-year revenue rose by 6% to $6,426 million[1][5]. - Recorded Music revenue for the three months ended September 30, 2024, was $1,338 million, a 4% increase from $1,291 million in the prior year[24]. - Full-year Recorded Music revenue increased by 5.4% to $5,223 million, driven by a 31.2% growth in licensing revenue[30]. - Total revenue for the three months ended September 30, 2024, was $1,630 million, a 3% increase from $1,586 million in the prior year[48]. - For the twelve months ended September 30, 2024, total revenue was $6,426 million, a 7% increase from $6,037 million in 2023[70]. Digital Revenue - Digital revenue remained flat in the fourth quarter but increased by 7% for the full year, reaching $3,800 million[1][16]. - Digital revenue for the same period was $881 million, remaining flat compared to $877 million in the prior year, while streaming revenue increased by 2.1%[25]. - Total digital revenue for the twelve months ended September 30, 2024, increased by 7% to $4,280 million compared to $3,989 million in 2023[54]. - Recorded music digital revenue for the twelve months ended September 30, 2024, was $3,519 million, reflecting a 6% increase from $3,322 million in 2023[54]. - Music publishing digital revenue for the twelve months ended September 30, 2024, rose by 14% to $763 million compared to $669 million in 2023[54]. Income and Profitability - Net income for the fourth quarter was $48 million, down from $154 million in the prior-year quarter, while full-year net income increased by 9% to $478 million[1][19]. - Adjusted OIBDA for the fourth quarter rose by 11% to $353 million, and for the full year, it increased by 16% to $1,432 million[1][18]. - Operating income for the fourth quarter decreased to $143 million, while full-year operating income increased to $823 million[1][17]. - Music Publishing operating income increased to $53 million, with an operating margin of 18.0%, up from 16.4% in the prior year[36]. - The total OIBDA for Warner Music Group Corp. for the twelve months ended September 30, 2024, was $1,150 million, a 2% increase from $1,122 million in 2023[61]. Cash Flow and Balance Sheet - Cash provided by operating activities decreased by 10% to $304 million in the fourth quarter but increased by 10% to $754 million for the full year[1][22]. - Free Cash Flow for the fourth quarter decreased by 10% to $271 million, but increased by 14% to $638 million for the full year[1][22]. - The company reported a cash balance of $694 million and total debt of $4.014 billion as of September 30, 2024[1][12]. - Total current assets increased by 10% to $2,643 million as of September 30, 2024, compared to $2,402 million in 2023[50]. - The company reported a net increase in cash and equivalents of $53 million for the twelve months ended September 30, 2024[52]. Licensing Revenue - The company experienced a 34.7% increase in Recorded Music licensing revenue, primarily due to growth in copyright infringement settlements in the United States[25]. - Licensing revenue for the three months ended September 30, 2024, surged by 33% to $128 million compared to $95 million in Q3 2023[67]. - The company reported a 30% increase in licensing revenue for the twelve months ended September 30, 2024, reaching $501 million compared to $382 million in 2023[73]. Costs and Expenses - Total costs and expenses for the three months ended September 30, 2024, increased by 8% to $1,487 million[48]. - Restructuring and impairments costs rose significantly to $177 million for the twelve months ended September 30, 2024, compared to $42 million in the previous year[61]. - Non-cash stock-based compensation and related costs increased by 17% to $61 million for the twelve months ended September 30, 2024, compared to $52 million in the previous year[61]. Market Outlook - The company anticipates continued growth in subscription streaming and plans to deliver more culture-shaping music in 2025 and beyond[2]. - The company emphasized the importance of constant currency results for evaluating performance, indicating that exchange rates significantly impact revenue comparisons[65].

NEW YORK, Oct. 22, 2024 (GLOBE NEWSWIRE) --  Warner Music Group Corp. will release its financial results on Thursday, November 21, 2024, for the fourth quarter and fiscal year ended September 30, 2024, and will hold an earnings conference call that morning at 8:30 a.m. ET. To access the conference call, please register here. Once registered, you will receive an email with the dial-in number along with your personalized pin needed to join the call. We suggest you call in 10 minutes prior to the start time. I ...

BofA Securities analyst Jessica Reif Ehrlich downgraded Warner Music Group Corp WMG from Neutral to Underperform and lowered the price target from $33 to $30. The price target is approximately 12 times the calendar year 2025 OIBDA (previously 13 times the 2025 OIBDA). Given the analyst's better long-term growth outlook, the multiple represents an approximately 25% premium to its media and entertainment coverage universe. Also Read: Sony Eyes $500M Deal for Pink Floyd's Iconic Music Catalog: Report Warner Mu ...