Warner Music Group, home to the likes of Ed Sheeran, Cardi B and Bruno Mars, reported higher fiscal fourth-quarter revenue and net income Tuesday, with its music publishing unit growing revenue 23.9 percent.
The music major said that major sellers in its recorded music unit in the latest period included Sheeran, Jack Harlow, Dua Lipa and Lizzo.
Fiscal fourth-quarter revenue rose 8.8 percent, or 16.0 percent in constant currency terms, to $1.50 billion, driven by the music publishing gain and digital revenue growth of 6.8 percent, or 12.3 percent in constant currency, across recorded music and music publishing.
Net income for the latest quarter ending in September amounted to $150 million, compared with $30 million recorded in the year-ago period, the company said before the stock market opened. Adjusted net income rose from $69 million to $170 million. Quarterly operating income jumped 63 percent from $100 million to $163 million.
Quarterly operating income before depreciation and amortization (OIBDA), another profitability metric, jumped 37 percent from $179 million to $245 million percent, while adjusted OIBDA rose 22 percent to $265 million, the company said.
Music publishing unit revenue for the latest quarter increased 32.3 percent when assuming constant currencies. “The revenue increase was driven by growth in digital and performance revenue,” Warner Music said. Digital revenue jumped 32.5 percent, or 39.5 percent in constant currency. Music publishing operating income of $36 million compared with $28 million in the prior-year quarter.
Recorded music revenue in the quarter climbed 6.1 percent, or 13.1 percent in constant currency, “due to artist services and expanded-rights revenue growth of 21.4 percent, or 33.3 percent in constant currency, reflecting an increase in merchandising and concert promotion revenue.” Digital revenue grew 2.9 percent, or 8.1 percent in constant currency. Recorded music operating income hit $165 million, up from $129 million in the prior-year quarter.
“Our strong fourth-quarter and full-year results were driven by our talented artists, songwriters and teams, across a wide range of genres, geographies and generations,” outgoing Warner Music Group CEO Stephen Cooper said. “Against the backdrop of a challenging macro environment, we once again proved music’s resilience, with new commercial opportunities emerging all the time. We’re very well positioned for long-term creative success, and continued top and bottom-line growth. We’re excited to have Robert Kyncl joining next year as WMG’s new CEO, as we enter the next dynamic phase of our evolution.”
Kyncl, who will succeed Cooper on Jan. 1, knows Warner Music well, having spent years as the chief business officer of YouTube, one of the label’s biggest partners.
“The momentum in our business is strong, underpinned by global subscriber growth, subscription price increases, and the expansion of emerging platforms,” said Warner Music CFO Eric Levin on Tuesday. “As we look ahead, we’re excited to share amazing releases from the world’s hottest artists, as well as innovative tech collaborations that will strengthen our position at the intersection of music, film, TV, social media, fitness and gaming.”