Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

Universal Music Q3 earnings beat expectations, streaming growth slows

Published 10/27/2022, 12:00 PM
Updated 10/27/2022, 04:36 PM
© Reuters. FILE PHOTO: Universal Music Group logo is seen displayed in this illustration taken, May 3, 2022. REUTERS/Dado Ruvic/Illustration

AMSTERDAM (Reuters) -Universal Music Group NV (UMG (AS:UMG)), the largest record label, on Thursday reported better than expected third-quarter core earnings due to a legal settlement, though streaming revenue growth slowed.

The company said top sellers in the quarter included Korean pop band BTS, BLACKPINK, Ado, INI and Morgan Wallen.

Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) were 539 million euros ($538 million), compared with 426 million euros in the third quarter of 2021.

Analysts had forecast EBITDA at 524 million euros, according to Refinitiv data.

Revenue rose 13.3% to 2.66 billion euros, with streaming and subscription revenue up 7.7%. The revenue figure included a 71 million euro benefit due to the settlement of a copyright infringement lawsuit, which also influenced EBITDA.

"Although still healthy, the slower revenue growth relative to the first half of this year was largely timing-related," Chief Financial Officer Boyd Muir said on a post-earnings call.

He noted the third quarter of 2021 had "included new releases from Billy Eilish and from Drake, as well as a significant Olivia Rodrigo carryover."

Ad-supported streaming revenues had slowed "consistent with worldwide advertising trends, which continue to impact this part of our business, "he said.

UMG, which competes against Warner Music Group and Sony (NYSE:SONY), was spun out of France's Vivendi (OTC:VIVHY) in 2021.

Shares closed down about 1% at 20.78 euros in Amsterdam, after surging more than 10% earlier this week on news Apple (NASDAQ:AAPL) had raised prices for its Apple Music streaming service.

© Reuters. FILE PHOTO: Universal Music Group logo is seen displayed in this illustration taken, May 3, 2022. REUTERS/Dado Ruvic/Illustration

Universal, whose artists include Taylor Swift and Justin Bieber, receives a cut of royalties when their music is streamed on Apple Music or other streaming platforms like Spotify (NYSE:SPOT).

($1 = 1.0020 euros)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.