After Spotify and Google announced their quarterly results, it’s Universal’s turn, publishing its quarterly and half-year results yesterday, and the news is: big numbers going up again! Across all sectors, UMG generated €2.697 billion in revenue, up 6.4% year on year (or 8.8% YoY in constant currency, which translates last year’s figures to today’s exchange rates.) That’s more strong growth for UMG, and is built on equally strong revenue in the recorded music sector: subscription revenue grew 10.6% YoY to €1.068bn (or 13.0% const.) and total record music revenues grew by 8.2% YoY (or 10.9% const.) to €2.08bn, of which physical sales accounted for €326m.
UMG’s publishing division saw revenue drop slightly to €464 million, down 2.5% YoY (or 0.6% const.) – although there was a significant €98 million impact due to a change in accounting policy in Q2, which was to blame, the company said, for recording a drop in digital publishing revenues from €346m to €264m YoY. UMG merchandising also reported rosy figures, up 11.3% YoY to €157m.
So: in general, more growth, driven by streaming in particular. It’ll be interesting to see the impact of various DSPs’ price hikes in subsequent quarterly reports. In the earnings call that accompanied the announcement, UMG chairman and CEO Lucian Grange welcomed the recent subscription price increase from Spotify and YouTube music, but quickly moved thoughts back to the company’s main topic of discussion this year: “we must ensure that real artists with real fan bases are fairly compensated.” UMG’s goal is to “promote an environment where real music isn’t drowned out in a sea of noise,” Grainge said.
Also announcing its Q2 financial results was Snapchat’s parent company, Snap, which reported revenues dropping to $1.07 billion, down from $1.11bn in Q2 2022, 14 million new users (bringing its daily active user (DAU) number up to 397m) and a net loss of $377 million. Its subscription tier, Snapchat+, now has 4m subscribers. Snap’s share price dropped 14% to $10.73 at the news – which, like many tech companies, is a figure significantly lower than its highs of mid-2021, when it was priced at around $74.
CEO Evan Spiegel, perhaps anticipating that the market might want assuaging, said that the company would invest in its products to grow its community and encourage more engagement, invest in improving ROI for advertisers, as well as find new sources of revenue.