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Against the backdrop of the global pandemic, Warner Music Group, which has top artists like Ed Sheeran and Dua Lipa in its stable, posted record digital music revenues from emerging streaming platforms as part of its first-quarter financial performance posted on Monday.
The world’s biggest record company saw digital music revenues from social media and streaming platforms like Spotify and TikTok and its short dancing clips rise 17 percent to $825 million, which represented nearly 62 percent of total revenue.
Emerging music artists increasingly break out on social media platforms like TikTok before being signed by the major music labels like WMG, while other platforms like Facebook and Instagram are increasingly using music as content, offering additional revenues.
Physical music publishing revenue, by contrast, rose only 1 percent to $175 million, as overall revenue at WMG rose 6 percent to $1.33 billion. At the same time, net income for the music label giant fell 19 percent to $99 million due to the impact of unfavorable foreign exchange rates and a higher tax expense.
Steve Cooper, CEO of Warner Music Group, in a statement said of the accelerating streaming growth: “The strong double-digit growth in our digital revenue and direct-to-consumer business more than offset the continued disruption to our performance, merchandising, and physical revenue. We have some fantastic new music from amazing artists and songwriters on the way, and we continue to grow our investment in a new generation of talent, as well as inventing bold and memorable ways to impact global culture.”
Cooper during an analyst call said subscription and ad-supported streaming platforms revenue continue to grow for WMG, and the music label also saw future growth from fitness and online gaming platforms, especially after investing in kids gaming platform Roblox. “We see this as a growth area, even as we come out of COVID,” he argued, as new social media and streaming platforms continue to launch and grow.
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