The three months ending in late September marked the fourth consecutive $ 1 billion quarter for Warner Music Group’s recorded music business.

Released today (November 15), WMG’s tax results for the three months to the end of September (its fiscal fourth quarter, but the third calendar quarter), show that the company’s quarterly recorded music revenues – including the streaming, digital and physical sales, as well as ancillary revenue – reached $ 1.172 billion, up 22.3% year-over-year (or up 21.1% at constant exchange rates). ).

Top sellers for the quarter were Iron Maiden, Dua Lipa, Ed Sheeran, Masked Wolf, and Ava Max.

In the previous quarter – Calendar Quarter 2 – WMG’s quarterly recorded music revenue from streaming, digital and physical sales, plus ancillary revenue, reached $ 1.152 billion, up 34% year-on-year (or 27.6% in constant currency).

And in the first calendar quarter (three months to the end of March), WMG generated recorded music revenue of $ 1.059 billion, up 16.8% (or 12.9% in constant currency).

In the fourth calendar quarter of 2020 (WMG’s fiscal Q1 2021), the company’s recorded music revenue increased 4.5% at constant exchange rate year-on-year to $ 1.16 billion.

The breakdown of WMG’s recorded music streaming revenue in the calendar’s third quarter 2021 reveals that $ 777 million came from streaming, a figure up 22% year-on-year (see below).

Digital revenue (including streaming and downloads) grew 19% (or 17.3% in constant currency), from $ 679 million in the previous year’s quarter to $ 807 million in the three month ended at the end of September of this year.

According to WMG, accelerated revenue growth from emerging streaming platforms like Facebook, TikTok and Peloton contributed to this increase.

The revenue growth in this area is not surprising, after WMG CEO Steve Cooper confirmed in September that the company’s recorded music operation currently has sales of $ 235 million. per year from “alternative” platforms such as Facebook, TikTok and Peloton.



Warner Music Group’s digital revenues represented 68.9% of the company’s total recorded music revenues, up from 70.9% in the previous year quarter.

WMG claims that the decrease in digital revenue as a percentage of total recorded music revenue is due to “the partial recovery of some revenue streams impacted by COVID during the quarter.”

Among those sources of income to see a “partial clawback” were artist services and extended rights income, as well as physical income.

WMG’s artist services and extended rights revenue grew 71.4% (or 69.7% in constant currency) to $ 168 million in the third calendar quarter, which the company said reflects an increase revenue from merchandising and concert promotion, both of which were disrupted by COVID in the previous quarter of the year.

Meanwhile, WMG’s physical revenue grew 21% (or 22.1% in constant currency) year-on-year to $ 127 million, mainly due to what the company says is “growing demand for products. vinyl and a continuous recovery after the COVID disruption ”.




Editing

WMG’s music publishing business – Warner Chappell Music (WCM) – saw revenue increase 21.3% year-on-year (or 19.2% at constant exchange rate) to $ 205 million in the third quarter calendar, compared to $ 169 million in the previous year quarter.

This increase was propelled by increases in all WCM revenue segments, including timing, mechanics and performance, but digital was the primary growth driver for the publishing company in the third calendar quarter.

Digital revenues grew 20% (or 18.8% at constant exchange rates) to $ 120 million, from $ 100 million generated in the previous year quarter. Digital revenue as a percentage of total Music Publishing revenue fell to 58.5% in the third calendar quarter, compared to 59.2% in the previous year quarter.

WMG says the drop is also due “to the partial recovery of some revenue streams impacted by COVID during the quarter.”

Among those revenue streams was sync revenue, which grew 44.4 year-on-year from $ 27 million in the third quarter of 2020 on the calendar to $ 39 million in the three months through the end of September. 2020.

Synchronization revenues increased “due to rising film and commercial revenues and a single license settlement,” according to WMG.

Elsewhere, Warner Chappell’s mechanical revenue rose from $ 10 million to $ 13 million (30% year-on-year) “as businesses continue to recover from COVID-related disruptions and an increase in physical sales,” explains WMG.

Performance revenue, meanwhile, rose 7.1% year-on-year to $ 30 million “as bars, restaurants, concerts and live events continued to recover from COVID-related disruptions. “.



“Music is essential for billions of people around the world,” said Steve Cooper, CEO of Warner Music Group.

He added: “But now, more than ever, great talent needs help to cut the noise. By bringing in new artists and songwriters, returning superstars and global legends, we also achieved exceptional results in 2021 ”,

Steve Cooper Warner Music

“Music is essential for billions of people around the world. “

Steve Cooper, Warner Music Group

“Turning to 2022, we’re excited to release incredible new music from the world’s hottest artists and most influential songwriters.

“We are also planning innovative initiatives and collaborations that will strengthen our leadership position in a vast universe of opportunities, both in the digital and physical worlds. “

“Our strong fourth quarter results put an exclamation mark on an exceptional year. “

Lou Dickler, Warner Music Group

Lou Dickler, Interim CFO, Warner Music Group, added, “Our strong fourth quarter results put an exclamation mark on an exceptional year.

“Even though some revenue has been impacted by COVID, the strength and resilience of our music has propelled us towards double-digit revenue growth and margin expansion in 2021.

{As the possibilities for music continue to evolve, we remain focused on creating shareholder value through our financially disciplined investment strategy and positioning ourselves for the next wave of growth. “Music trade around the world