(Reuters) -Universal Music Group, the label representing Taylor Swift, BTS and Drake, on Wednesday recorded higher than expected second quarter sales, driven by growth across all areas.
Second-quarter revenue totalled 2.93 billion euros, up 9.6% year-on-year in constant currency terms, beating the 2.89 billion euros expected by analysts, according to a Visible Alpha consensus.
WHY IT’S IMPORTANTUMG is benefiting from its leading position in the sector, with rights to around one third of the world’s repertoire. The $54 billion company has seen its profit driven by the success of pop sensation Taylor Swift. CONTEXT In the first quarter, Universal reported earnings above expectations, helped by the record-breaking success of its star act Taylor Swift. The commercial success of Swift has boosted the group’s earnings through royalties from streaming, album sales and concert tickets. In parallel, it signed a deal with TikTok, restoring the label’s songs and artists to the social media platform from the end of May. Swedish audio-streaming giant Spotify beat its premium subscriber guidance on Tuesday, recording a 12% growth year-on-year to 246 million subscribers. The group also forecast third quarter operating income , at 405 million euros, ahead of 301.7 million euros consensus. BY THE NUMBERS Adjusted EBITDA for the second quarter rose 10.0% year-on-year, to 649 million euros, ahead of analysts expectation of 645 million euros, according to Visible Alpha consensus. Streaming revenues came in below expectations, at 343 million euros, while analysts expected 387 million euros, according to Visible Value consensus quoted by ING.
Streaming revenue fell 4.2% year-over-year or 3.9% in constant currency, “due to a deceleration in growth at key advertising-based platform partners as well as shortfalls on certain platforms related to the timing of deal renewals,” the company said.
(Reporting by Alban Kacher. Editing by Jane Merriman)
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