Spotify has overtaken Universal Music Group (UMG) to become the largest music company by market capitalization in the second quarter of 2024, according to new analysis from Omdia.
Omdia’s Music Industry Sharewatch report for Q2 2024 highlights that Spotify’s market cap reached $62.5 billion by the end of June, compared to UMG’s $53.7 billion. This marks an 18.2% increase for Spotify from its Q1 value of $52.8 billion, while UMG saw a slight decline of 1.5% from $54.5 billion.
The quarter proved to be robust for music streaming services, with China’s Tencent Music Entertainment (TME) securing third place. TME’s market cap surged by 26.3%, rising to $24.1 billion from $19.1 billion. Consequently, Spotify’s share of the combined market cap of the 28 publicly listed music companies tracked by Omdia increased to 28.7% from 24.9%. UMG’s share dipped to 24.7% from 25.7%, while TME’s share climbed to 11.1% from 9%.
Out of the 28 companies tracked, only eight saw an increase in their share prices over the quarter. One company, Mdundo, experienced no change, while the remaining 19 recorded a decline.
Notably, Saregama emerged as the top performer. Its share price opened at INR 348.05 ($4.18) on April 1 and closed at INR 555.45 on June 28. This surge led to an increase in its market cap from $878 million to $1.28 billion. Conversely, Brazilian live music promoter, Time for Fun, witnessed the steepest decline, with its share price falling 50.7% to BRL 1.47 ($0.29) from BRL 2.98.
By the end of June, the combined market cap of the 28 companies stood at $217.5 billion, up from $212.4 billion at the beginning of April and $194.2 billion at the start of the year. Of this total, US-listed companies contributed 63.3%, Netherlands-listed companies 24.7%, and South Korean companies 4.3%. Streaming services accounted for 41.2% of the market cap, while record companies and music publishers made up 38.8%.
“Spotify’s impressive second-quarter performance is a continuation of its success from the first quarter of this year,” commented Simon Dyson, Senior Principal Analyst at Omdia. “The share price has risen almost 70% so far this year and has doubled since last October.”
This report underscores the evolving landscape of the music industry, with streaming services increasingly dominating the market and traditional players adapting to the new dynamics.
