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Warner Music Group is the latest music company publishing its financial results for the second quarter of 2022 – its fiscal Q3. They revealed that its revenues grew by 7% year-on-year (or 12% at constant currency) to $1.43bn.

WMG’s 3% growth in recorded music revenues was well outstripped by a 30% rise in publishing revenues, even if the former is still the lion’s share of the business – $1.19bn and $245m respectively.

Among the trends bubbling underneath these figures: a 1% decline in streaming revenues for recorded music. While WMG said this was partly down to an $11m “catch-up payment” from a DSP in the year-ago quarter, it also acknowledged that its streaming royalties had been “affected by market-related slowdown in ad-supported revenue”.

The bumper publishing rise, meanwhile, was fuelled by “growth in digital, performance and synchronisation revenue, partially offset by a decline in mechanical revenue”.

In WMG’s earnings call with analysts, CEO Steve Cooper offered some more colour on the financials, including noting WMG’s growth in China: “where our revenue is seven times what it was in 2014”. He also talked up WMG’s web3 experiments, including Jason Derulo and 22Gz activations in virtual world Decentraland, and Warner Records’ line of Stickmen Toys NFTs.

He also said that WMG, like UMG, has “recently signed new deals with Meta that will deliver additional revenue in Q4”. Meanwhile, chief financial officer Eric Levin responded to a question about whether the advertising crunch and/or slowing streaming subscription growth might be a concern for WMG.

“Long term, we think subscription streaming growth has tremendous upside potential in front of it. Developed markets are roughly 30% penetrated in aggregate. We’ve seen both research studies, but also market forecasts that show that growing into the 50s or even 60s percent over time,” he said.

“Emerging markets are still penetrated in the mid-single digits and are starting to show real improved growth, and we see enormous opportunity for emerging markets coming online with subscription streaming… In the short term, we’re navigating tough macros, but still think the resilience of music and streaming gives us real opportunities to continue the growth factors.”

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