Warner Music's Q2 Revenue Surges On Ed Sheeran, Jack Harlow, Green Day Hits, Yet Shares Fall

Warner Music Group Corp WMG shares were trading lower on Thursday after the company reported fiscal second-quarter 2024 results.

GAAP EPS of $0.18 beat the analyst consensus estimate of $0.16. 

Revenue grew 7% year-on-year (Y/Y) to $1.49 billion, beating the analyst consensus estimate of $1.48 billion.

Recorded Music revenue grew by 4% Y/Y at $1.19 billion in the quarter. The major sellers included Zach Bryan, Ed Sheeran, Jack Harlow, and Green Day, the Hollywood Reporter reports.

Music Publishing revenue increased by 19% Y/Y to $306 million, and Digital increased by 10% Y/Y to $1.04 billion.

Adjusted OIBDA increased by 9% compared to the previous year, reaching $312 million, and the margin improved by 50 basis points to 20.9%

Warner Music held $587 million in cash and equivalents as of March 31. Operating cash flow used was $(31) million versus $(6) million in the prior-year quarter.

“Our performance in the quarter was driven by an acceleration in Recorded Music subscription streaming growth and continued momentum in Music Publishing,” said Bryan Castellani, CFO, Warner Music Group. 

During the fiscal first-quarter print, the company had shared plans to dispose of certain non-core owned and operated media properties, including the in-house ad sales function (the “O&O Media Properties”), and slash headcount by 600 to unlock shareholder value.

The company sold Uproxx, HipHopDX, and Dime Magazine to Jarret Myer, Rich Antoniello and will.i.am.

Price Action: WMG shares were down 6.1% to $33.46 at last check Thursday.

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