The Warner Music Group posted $1.34 billion in revenue for its fiscal third quarter ended June 30, the company announced today (Aug. 3). That represents a 32.7% revenue growth over the same period last year, fueled by 33.8% growth in recorded music revenues, up to $1.15 billion from 2020’s pandemic-hit $861 million.
That growth was driven largely by a big jump in digital revenues, which grew 28.9% in the third quarter to $928 million. As a share of total revenue, however, digital actually shrunk compared to the same period last year (69.3% vs. 71.3%), due to a 155% increase in physical revenue from recorded music, which ballooned from $51 million in 2020 to $130 million in 2021, as vinyl sales soared over the past year during the pandemic (up 109% overall in the first half of 2021, according to MRC Data). Meanwhile, music publishing revenue increased 27% to $189 million, while artist services and expanded rights (up 7.3% to $133 million) and licensing revenues (up 32% to $74 million) also grew.
Over the first nine months of the year, WMG posted $3.93 billion in revenue, up 18% over the $3.34 billion it had accrued over the first nine months of 2020. Of that, recorded music revenues ($3.37 billion) grew at the same 18% clip, while publishing revenue ($556 million) is up 14% over the prior year.
“We’re proud of everything we’ve accomplished during our first year as a publicly traded company,” WMG CEO Steve Cooper said in a statement. “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.”
In a press release announcing the results, WMG pointed to growth in streaming revenues — which increased 32.6% in Q3 — as well as the growth in streaming from platforms new to the music game like Facebook, Peloton and TikTok, while the artist services boost came from an increase in direct-to-consumer merch sales and licensing grew through higher broadcast fees and synch revenues. On the publishing side, part of the growth was attributed to increased revenues from films and commercials. For the quarter, the company counted Dua Lipa, Ed Sheeran, Cardi B, Ava Max and Masked Wolf among its “major sellers.”
“The third quarter was highlighted by impressive streaming numbers, recovery in several areas that had been negatively impacted by COVID, and strong operating leverage that drove margin expansion,” WMG CFO Eric Levin said in a statement. “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.”
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