Warner Music Group has announced its fiscal third-quarter financial results for the period ended June 30, 2021.
Revenue was up 32.7% year-on-year (or 26.5% in constant currency). The revenue increase in the quarter was driven by digital revenue growth of 28.9% (23.4% in constant currency) across recorded music and music publishing.
As revealed in Music Week’s calendar Q2 analysis, the latest quarter is comparing results year-on-year with the 2020 quarter when Covid hit the industry, particularly physical sales. According to WMG’s results, recorded music physical revenue increased 154.9% year-on-year (or 136.4% in constant currency) thanks to increasing demand for vinyl and increasing retail sales as businesses began to recover from Covid disruption.
Streaming revenue grew 32.6% (27.2% in constant currency) due to the strong performance of new and carryover releases, as well as accelerated revenue growth from emerging streaming platforms such as Facebook, TikTok and Peloton.
Digital revenue represented 69.3% of total revenue in the quarter, compared to 71.3% in the prior-year quarter.
Major sellers included Dua Lipa, Cardi B, Ed Sheeran, Ava Max and Masked Wolf.
Recorded music licensing revenue and music publishing sync and mechanical revenue all had double-digit growth. Recorded music artist services and expanded-rights revenue increased 7.3% on an as-reported basis (or 0.8% in constant currency). Music publishing performance revenue was flat (down 3.6% in constant currency).
WMG operating income was $162 million compared to an operating loss of $433 million in the prior-year quarter.
“We’re proud of everything we’ve accomplished during our first year as a publicly traded company,” said Steve Cooper, CEO, Warner Music Group. “During a very challenging time, we’ve focused on investing in our core business and building an array of innovative growth opportunities. Outstanding releases from our artists and songwriters, coupled with imaginative execution by our operators, delivered excellent results in the third quarter. We’re looking forward to wrapping up our fiscal year with a slate of great new releases from established and emerging stars.”
“The third quarter was highlighted by impressive streaming numbers, recovery in several areas that had been negatively impacted by Covid, and strong operating leverage that drove margin expansion,” said Eric Levin, CFO, Warner Music Group. “We continue to create value through our wide-ranging services to artists and songwriters, to drive shareholder return through our disciplined allocation of capital, and to deliver long-term growth through our digital-first approach to business.”