Warner Music Q3 revenue rises 10%, beats estimates
Warner Music Q3 revenue rises 10%, beats estimates
Overview
Music company reported fiscal Q3 revenue up 10%, beating analyst expectations
Adjusted EPS for fiscal Q3 rose to $0.51 from $0.42 yr/yr
Company attributes growth to strong streaming, improved DSP terms, and cost savings
Outlook
Company continues to expect high end of 150-200 basis points full-year margin expansion
Warner Music Group reiterates 50-60% operating cash flow conversion target for FY2026
Company sees positive industry trends and resilient global market share supporting outlook
Result Drivers
STREAMING GROWTH - Co said double-digit subscription streaming growth was driven by improved DSP terms, positive industry trends, and resilient global market share
REVENUE MIX AND COST SAVINGS - Margin expansion attributed to favorable revenue mix and savings from restructuring plans
ARTIST SERVICES AND PHYSICAL SALES - Higher artist services, expanded-rights, and physical revenue driven by strong releases and catalog success
Company press release: ID:nBw7n2J8Ka
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Beat | $1.86 bln | $1.81 bln (14 Analysts) |
Q3 Net Income |
| $200 mln |
|
Q3 Free Cash Flow |
| $114 mln |
|
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 15 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the entertainment production peer group is "buy"
Wall Street's median 12-month price target for Warner Music Group Corp. is $39.00, about 51.2% above its August 4 closing price of $25.80
The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 18 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)