Warner Music Group Corp

Latest Results (05.04.2026):

Warner Music Group Corp's first quarter of fiscal 2026 (three months ended December 31, 2025) showed broad-based revenue and margin strength: total revenue rose 10% (7% in constant currency) while operating performance and cost savings drove double-digit Adjusted OIBDA growth and higher operating cash flow, even as net income and EPS declined year‑over‑year. Management highlighted continued market-share gains, streaming acceleration and a 2026 plan targeting 150–200 basis points of margin improvement.

Top-line growth

Total revenue increased 10% (7% constant currency) to reflect gains across Recorded Music and Music Publishing; adjusted for certain one-time items the revenue increase was ~10.8% (7.4% cc).

Streaming and digital performance

Digital revenue rose 10% (7.1% cc) and streaming revenue increased 10.7% (7.6% cc). Recorded Music streaming grew 12.4% (9.1% cc), and Recorded Music subscription revenue showed double‑digit growth driven by market share and chart performance.

Profitability and margins

Operating income increased 35% to $288 million; Adjusted OIBDA rose 28% to $463 million and Adjusted OIBDA margin expanded to 25.2% (up 3.4 percentage points versus prior year), driven by revenue mix, restructuring savings and favorable FX movements (~$25 million).

Net income and EPS

Net income fell to $175 million from $241 million year‑over‑year and basic/diluted EPS were $0.33; the decline was largely due to adverse currency impacts on Euro‑denominated debt, reduced intercompany currency gains and weaker hedging results versus the prior year.

Cash flow and balance sheet

Cash provided by operating activities increased 33% to $440 million and Free Cash Flow rose to $420 million; cash on hand was $751 million, total debt $4.371 billion and net debt $3.620 billion (includes certain non‑recourse Tempo/Beethoven financing).

Recorded Music segment

Recorded Music revenue rose 10.0% (6.6% cc) with digital, artist services and licensing strength (physical declined); Recorded Music operating income grew to $329 million and Adjusted OIBDA to $403 million, with margin expansion to 27.2%.

Music Publishing segment

Music Publishing revenue increased 12.1% (9.4% cc) — and +18.3% excluding prior‑year MLC matched royalty items — with strong synchronization (+53.8%), performance and mechanical growth; Adjusted OIBDA was $102 million and margin expanded to 28.2%.

One‑time / timing items

Quarter results were affected by DSP settlement/true‑ups (~$12M in the quarter, $7M prior year), a $6M impact from a terminated BMG distribution agreement, and prior‑year MLC historical matched royalties (~$17M), which management separately discloses and adjusts for in constant comparisons.

Capital allocation and shareholder return

The Board declared a regular quarterly cash dividend of $0.19 per share, payable March 3, 2026 (record date Feb 18, 2026), reflecting continued focus on returning cash to shareholders.

Outlook and strategy

Management reiterated a 2026 strategic plan to accelerate growth via investments in core businesses, expanded monetization (including AI initiatives) and cost‑savings measures targeting 150–200 bps of margin improvement.