Streaming Revenue Jumps 29.4% in Warner Music Group's Q2 2019 Report

Warner Music Group has published the financial reports for the second quarter 2019 (Q2 2019).

For the three months ended March 31st, 2019, WMG reported $1.09 billion in revenue.  This figure represents a 13% jump over the same period last year.  In addition, for the six months ended March 31st, 2019 (Q1 and Q2 2019), the major label reported $2.3 billion in revenue, up 14% over the same period last year.

Recorded music revenue grew 18%, or $142 million, in Q2 2019.  In addition, WMG’s streaming revenue during this quarter jumped 29.4% to $537 million.

For Q2 2019, digital revenue – including streaming music and downloads – jumped 21% to $661 million.  In the label’s Q1 and Q2 2019, digital revenue grew 19% to $1.3 billion.  Growth in digital and artist services and expanded-rights revenue as well as growth in music publishing digital revenue were partially fset by a decline in physical and licensing revenue and music publishing mechanical, performance, and synchronization revenue.  Digital revenue represented 60.6% WMG’s total revenue in Q2 2019.

Operating income grew 47% to $122 million in Q2 2019, up from $83 million.  In its Q1 and Q2 2019, operating income skyrocketed 55% to $269 million, up from $173 million over the same period last year.

Adjusted operating income increased 16% to $130 million in Q2 2019.  For the six months ended March 31st, 2019, adjusted operating income totaled $284 million, up 32% year-over-year.

OIBDA (operating income before depreciation and amortization) jumped 26% over the prior-year quarter to $191 million in Q2 2019.  OIBDA also jumped 32% in Q1 and Q2 2019 to $406 million, up from $307 million year-over-year.

In Q2 2019, adjusted OIBDA slightly increased to $199 million, up 10% over the prior-year quarter.  For the six months ended March 31st, 2019, adjusted OIBDA rose 21% to $421 million.

Thanks to growth in digital revenue, net income also skyrocketed to $67 million in Q2 2019, up from a $1 million net loss last year.  In its Q1 and Q2 2019, WMG posted $153 million in net income, up from just $4 million year-over-year.

Adjusted net income totaled $75 million in Q2 2019, up from $28 million over the prior-year quarter.  For the six months ended March 31st, 2019, adjusted net income skyrocketed to $168 million, up from $46 million year-over-year.

The company’s net cash provided by operating activities totaled $7 million in Q2 2019.  In Q1 and Q2 2019, net cash plummeted 27% to $99 million, down from $136 million year-over-year.

As explained earlier, licensing and publishing revenue from mechanical, performance, and sync fell.  Warner/Chappell’s overall revenue declined 9.2% in Q2 2019.

Speaking about the financial report, Steve Cooper, WMG’s CEO, explained,

Our second-quarter results were strong.  Our sustained investment in our artists and songwriters, our artist services business, and our world-class operators are delivering great results.

Eric Levin, the company’s Executive Vice President and CFO, added,

Revenue and OIBDA were both up double-digits.  Our cash position remains strong, with $470 million on the balance sheet at quarter-end.

 


Featured image by Eva Rinaldi (CC by 2.0).