Warner Music Group Corp. Reports Results for Fiscal First Quarter Ended December 31, 2024

Core Insights - Warner Music Group reported a 5% decrease in total revenue for Q1 2024, amounting to $1.666 billion compared to$1.748 billion in Q1 2023 [4][5] - The company experienced a 40% decline in operating income, falling to $214 million from$354 million year-over-year [4][9] - Net income increased by 25% to $241 million, driven by favorable foreign exchange impacts and gains on hedging activities [4][11] Financial Performance - Recorded Music revenue decreased by 7$1.345 billion, while Music Publishing revenue increased by 6% to $323 million [4][20] - Adjusted OIBDA fell by 20$363 million, with a margin decrease to 21.8% from 25.8% in the prior year [4][10] - Cash provided by operating activities rose by 13% to $332 million, and free cash flow increased by 12$296 million [4][14] Revenue Breakdown - Digital revenue for Recorded Music decreased by 4% to $873 million, with streaming revenue down by 3.7$207 million, with streaming revenue up by 6.2% [4][22] - The decline in Recorded Music revenue was attributed to licensing agreement changes and the termination of a distribution agreement with BMG [7][17] Strategic Developments - Warner Music Group announced a new multi-year agreement with Spotify, enhancing their collaboration in recorded music and music publishing [5][25] - The company acquired a controlling stake in Tempo Music Investments, aiming to expand its portfolio of premium music rights [5][26] - Increased A&R spending and catalog acquisitions are part of the company's strategy to drive long-term growth and shareholder value [3][5]