Today, Warner Music Group Corp. (WMG) revealed that its revenue for the year ended September 30, 2023, increased by 4% year over year.
Also reported a 5% revenue gain and a 7% growth in digital revenue for the fourth quarter of the company’s fiscal year 2023.
WMG announces that its total sales climbed by 4% in constant currency to reach a record $6 billion for the year ended September 30, 2023. With “the impact in the prior year of $38 million in downloads and other digital revenue from the Copyright Settlement,” digital revenue increased by 5%.
After $555 million in net profits the previous year and $307 million in 2021, the corporation reports $439 million in net income annually.
The major label stated that there was a decrease in net income and adjusted net income, which was partially offset by higher operating income, a decrease in income tax expense, and higher realized and unrealized losses related to certain investments in the prior year. The unfavorable impact of exchange rates on the Company’s Euro-denominated debt, an increase in interest expense, and a loss on extinguishment of debt were the main causes of the net income loss. Warner Music Group describes the loss as complicated.
The rise in recorded music and music publishing revenue was the primary driver of the 6.7% overall increase in streaming revenue. Recorded music streaming revenue climbed 3.9%, while music publishing streaming revenue increased by 22.6% due to a reduced release schedule and the market-related decrease in ad-supported revenue in the first half of the year.
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WMG claims that growth in recorded music income ($4,955 million) and total music publishing performance ($1,088 million) contributed to the year’s revenue increases. Notably, $3,989 million was the total revenue generated by digital channels for the year that concluded on September 30, 2023.
“We delivered on our promise of second-half improvement, and reached over $6 billion ($6,037 million) in annual revenue for the first time in WMG’s history,” stated Robert Kyncl, CEO of WMG, in a statement announcing the Q4 and annual 2023 earnings.
The head of WMG continued, “Our industry is healthy and growing as the music ecosystem recognizes the value of premium content and emerging markets continue to gain traction.” We’ve been working hard to create a WMG that will succeed in the future music industry with these tailwinds behind us, and we can’t wait to share amazing music with you in 2024 from our fantastic artists and songwriters.
Warner Music Group’s CFO, Bryan Castellani, thinks that the company’s success in the fourth quarter was supported by a strong release schedule and strong growth in recorded music streaming. Castellani continued, “This drove our improvement in the second half, which, when paired with our strict cost control, produced strong Adjusted OIBDA growth and margin expansion for the entire year. We are enthusiastic about WMG’s upcoming prospects to take advantage of positive market trends, increase shareholder value through successful expansion, and maintain a strong cash flow conversion rate in 2024 and beyond.
WMG reported increase in music publishing for the third quarter of the firm, which concluded on June 30, 2023, supported by an acceleration of digital revenue.
Furthermore, compared to the current Q4’s 5% growth, the Big Three label’s revenue increased by 10% in Q3 thanks to a 10% increase in digital revenue. The company anticipated that its stronger Q3 streaming growth would continue into Q4.
The corporation’s Board of Directors also announced a customary quarterly cash dividend to investors in WMG’s Common Stock ahead of the earnings release; the payout was previously announced at $0.16 per share for the same quarter previous year, but it is now valued at $0.17 per share. To stockholders of record as of November 21, 2023, the close of business, the dividend is payable on December 1, 2023.
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