Universal Music Group N.V. Reports Financial Results for the Third Quarter and Nine Months Ended September 30, 2024
Announces Promotion of Boyd Muir to Chief Operating Officer, Plans for Chief Financial Officer Transition
Summary Q3 2024 Results1
Revenue of €2,870 million increased 4.3% year-over-year, or 4.9% in constant currency, with growth in all segments. Excluding a prior-year item affecting comparability, detailed below, revenue grew 6.3% year-over-year, or 7.0% in constant currency.
Recorded Music subscription revenue grew 7.6% year-over-year, or 8.2% in constant currency while streaming revenue declined 0.8% year-over-year, but grew 0.3% in constant currency.
Adjusted EBITDA of €621 million increased 6.9% year-over-year, or 8.2% in constant currency, and Adjusted EBITDA margin expanded 0.5 percentage points to 21.6%. Excluding a prior-year item affecting comparability, detailed below, Adjusted EBITDA grew 8.9% year-over-year, or 10.3% in constant currency.
Top sellers included Taylor Swift, Sabrina Carpenter, Billie Eilish, Chappell Roan and Post Malone.
Summary YTD Results1
Revenue of €8,396 million increased 6.3% year-over-year, or 7.4% in constant currency, driven by strong growth in all segments. Excluding a prior-year item affecting comparability, detailed below, revenue grew 7.0% year-over-year, or 8.2% in constant currency.
Recorded Music subscription revenue grew 8.2% year-over-year, or 9.2% in constant currency and streaming revenue grew 0.9% year-over-year, or 1.8% in constant currency.
Adjusted EBITDA of €1,862 million increased 10.0% year-over-year, or 11.7% in constant currency, and Adjusted EBITDA margin expanded 0.8 percentage points to 22.2%. Excluding a prior-year item affecting comparability, detailed below, Adjusted EBITDA grew 10.8% year-over-year, or 12.4% in constant currency.
Top sellers included Taylor Swift, Billie Eilish, Morgan Wallen, Sabrina Carpenter and Noah Kahan.
1 This press release includes certain alternative performance indicators which are not defined in the International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board as endorsed by the EU. The descriptions of these alternative performance indicators and reconciliations of non-IFRS to IFRS measures are included in the Appendix to this press release.
HILVERSUM, The Netherlands, Oct. 31, 2024 /PRNewswire/ -- Universal Music Group N.V. ("UMG" or "the Company") today announced its financial results for the third quarter and nine months ended September 30, 2024.
"Even as we continue to grow revenue and Adjusted EBITDA, we are already making progress on the strategic initiatives we outlined at our recent Capital Markets Day," said Sir Lucian Grainge, UMG's Chairman and CEO. "We continue to advance our Artist-Centric strategy, a key pillar of our work to evolve streaming's underlying business model, or what we call 'Streaming 2.0'. Through these initiatives, we are setting the stage for a new wave of streaming growth and new opportunities to UMG, its artists, songwriters and shareholders."
Boyd Muir, UMG's EVP, CFO and President of Operations, said, "Our focus remains on maximizing the long-term value of the business. The diversity of our revenue is not only driving attractive results in revenue and Adjusted EBITDA growth for UMG this quarter, but also positioning the company for strong continued growth in the coming years."
UMG Results
Three Months Ended
September 30,
%
%
Nine Months Ended
September 30,
%
%
(in millions of
euros)
2024
2023
YoY
const.
2024
2023
YoY
const.
(unaudited)
(unaudited)
(unaudited)
(unaudited)
Revenue
2,870
2,752
4.3 %
4.9 %
8,396
7,901
6.3 %
7.4 %
EBITDA
556
478
16.3 %
17.8 %
1,626
1,244
30.7 %
33.6 %
EBITDA margin
19.4 %
17.4 %
2.0pp
19.4 %
15.7 %
3.7pp
Adjusted EBITDA
621
581
6.9 %
8.2 %
1,862
1,692
10.0 %
11.7 %
Adjusted EBITDA margin
21.6 %
21.1 %
0.5pp
22.2 %
21.4 %
0.8pp
Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted for constant currency. Constant
currency is calculated by taking current year results and comparing against prior year results restated at current year rates.
Q3 2024 ResultsRevenue for the third quarter of 2024 was €2,870 million, an increase of 4.3% year-over-year, or 4.9% in constant currency. As previously disclosed, revenue in the third quarter of 2023 included a €53 million benefit in Music Publishing from the accrual for a catch-up payment from certain digital service providers related to the Copyright Royalty Board Phonorecords III ruling in 2023 (the "CRB Phonorecords III Accrual"). Excluding this item, revenue grew 6.3% year-over-year, or 7.0% in constant currency.
UMG's Recorded Music, Music Publishing and Merchandising and Other segments all contributed to the revenue growth in the quarter, as discussed further below.
EBITDA for the quarter increased 16.3% year-over-year, or 17.8% in constant currency, to €556 million and EBITDA margin was 19.4%, compared to 17.4% in the third quarter of 2023. EBITDA and EBITDA margin were impacted by non-cash share-based compensation expenses of €65 million during the third quarter of 2024, compared to €103 million during the third quarter of 2023. Excluding non-cash share-based compensation expenses, Adjusted EBITDA for the quarter was €621 million, up 6.9% year-over-year, or 8.2% in constant currency. Adjusted EBITDA margin increased 0.5 percentage points to 21.6%, compared to 21.1% in the third quarter of 2023, driven by operating leverage and cost savings.
EBITDA and Adjusted EBITDA in the third quarter of 2023 included an €11 million benefit in Music Publishing from the CRB Phonorecords III Accrual. Excluding this item, Adjusted EBITDA was up 8.9% year-over-year, or 10.3% in constant currency, as a result of revenue growth and cost savings. The CRB Phonorecords III Accrual did not impact Adjusted EBITDA margin or margin expansion.
YTD 2024 ResultsIn the nine months ended September 30, 2024, UMG's revenues of €8,396 million increased by 6.3% year-over-year, or 7.4% in constant currency, compared to the nine months ended September 30, 2023. This increase was driven by strong improvements across all segments, as discussed further below.
Revenue for the nine months ended September 30, 2023 included the €53 million benefit in Music Publishing from the CRB Phonorecords III Accrual discussed above. Excluding this item, revenue increased 7.0% year-over-year, or 8.2% in constant currency.
For the nine months ended September 30, 2024, EBITDA of €1,626 million increased 30.7% year-over-year, or 33.6% in constant currency, and EBITDA margin was 19.4% compared to 15.7% in the prior year period. EBITDA and EBITDA margin were impacted by non-cash share-based compensation expenses of €236 million during the first nine months of 2024, compared to €448 million during the first nine months of 2023. Excluding these amounts, Adjusted EBITDA for the first nine months of 2024 was €1,862 million, up 10.0% year-over-year, or 11.7% in constant currency. Adjusted EBITDA margin increased 0.8 percentage points year-over-year to 22.2%, driven by operating leverage and cost savings.
EBITDA and Adjusted EBITDA for the nine months ended September 30, 2023 included the €11 million benefit from the CRB Phonorecords III Accrual in Music Publishing. Excluding this item, Adjusted EBITDA grew 10.8% year-over-year, or 12.4% in constant currency, driven by revenue growth and cost savings. The CRB Phonorecords III Accrual did not impact Adjusted EBITDA margin or margin expansion.
Recorded Music
Three Months Ended
September 30,
%
%
Nine Months Ended
September 30,
%
%
(in millions of
euros)
2024
2023
YoY
const.
2024
2023
YoY
const.
(unaudited)
(unaudited)
(unaudited)
(unaudited)
