Warner posts another $1bn in recorded music revenues

The figure, which includes streaming, digital and physical sales, and ancillary income, represents a 34% jump year-on-year or 27.6% in constant currency. It also makes it the third consecutive quarter that Warner has posted more than $1bn. In calendar Q1, the major music rights holder generated $1.06bn, up 16.8% and $1.16bn from the preceding quarter.

Streaming contributed $781m to total recorded music revenue, a whopping $192m spike, or a 32.6% increase from the $589m generated in calendar Q2 last year. Warner said the impressive growth was driven by new and carryover releases as well as more revenue from emerging streaming platforms including Facebook, TikTok and Peloton.

An increasing demand for vinyl products boosted Warner’s recorded music physical revenues, which jumped 154.9% to reach $130m, compared to the $51m earned in the same quarter last year. Growing retail sales also contributed to the figure with the gradual recovery of businesses from the negative impact of COVID-19.

Meanwhile, Warner’s artist services and expanded-rights revenue increased by 7.3% year-on-year to $133m.The company attributed the growth to improved direct-to-consumer merchandising returns, even though they were stifled by the global pandemic’s disruption of concert touring and live events.

Warner’s best sellers in the reporting period included Cardi B, Dua Lipa, Ed Sheeran, Ava Max and Masked Wolf.

With regard to the company’s publishing arm, Warner Chappell Music, revenues peaked at $189m in calendar Q2 – a 26.8% uptick or 21.2% increase in constant currency. The increase was mainly due to a 25.6% rise in digital revenues, which hit $113m in Q2. In the same period, digital revenue contributed 59.8% to total publishing business, slightly less than the 60.4% it contributed in Q2 of 2020.

Warner says growth in motion picture and commercial income boosted its sync business, which climbed from $22m in calendar Q2 last year to $34m in calendar Q2 of 2021, to become the publisher’s second-biggest earner. Performance revenue, meanwhile, was constant at $27m due to the ongoing pandemic’s impact on bars, restaurants, concerts and live events.

“We’re proud of everything we’ve accomplished during our first year as a publicly traded company,” Warner CEO Music Group Steve Cooper CEO said. “During a very challenging time, we’ve focused on investing in our core business and building an array of innovative growth opportunities. Outstanding releases from our artists and songwriters, coupled with imaginative execution by our operators, delivered excellent results in the third quarter. We’re looking forward to wrapping up our fiscal year with a slate of great new releases from established and emerging stars.”

Warner Music Group chief financial officer Eric Levin added: “We continue to create value through our wide-ranging services to artists and songwriters, to drive shareholder return through our disciplined allocation of capital, and to deliver long-term growth through our digital-first approach to business.”

View the full report here.