Warner Music in May had sold around 75% of its Spotify stock for $400 million in proceeds, and in its latest earnings call confirmed the sale of the rest of its stake.
Warner Music Group has declared on Tuesday that the company has sold its complete stake in Spotify for $504 million.
Warner Music Group CEO Steve Cooper told that the music label will share around $126 million in proceeds with its artists as part of the label’s latest royalty payments.
Cooper told specialists, the sale of the Spotify stock did not reduce his enthusiasm for the music streaming business as it continues to grow.
“While Apple and Spotify continue to grow their global subscriber numbers, Amazon and YouTube are both off to a great start with their premium services. This increased competition is good news for our business, and we’re happy to see other large tech companies, such as Facebook, begin to recognize the true value that music brings to their platforms,” he said.
Sony earlier realized a gain of $768 million from selling off most of its own stake in Spotify, which leaves Universal Music Group as the last remaining major label with a generous holding in the music streamer.
Warner Music Group has also shared their third quarter financial report for the period ended on June 30, 2018 according to which WMG’s revenue grew 4.5% (or 1.9% in constant currency). Revenue grew in the U.S., Asia and Latin America and declined in Europe due to a decrease in physical revenue and the impact of stronger releases in the prior-year quarter.
“Amazing new music from our artists and songwriters and great execution from our global operators have driven our year-to-date revenue up 12%, or 7% in constant currency. While streaming continues to fuel our growth, we are exploring a wide array of creative and commercial opportunities in order to position ourselves for long-term success.” said Warner Music Group, CEO, Steve Cooper.
Digital revenue increased 16.1% (or 14.1% in constant currency), and represented 60.1% of total revenue, compared to 54.1% in the prior-year quarter.
Warner Music Group’s Executive Vice President and CFO Eric Levin said,
“We are pleased with our revenue growth in the context of a very difficult prior-year comparison. The health of our business is evidenced by our very strong cash generation.”
Operating income was $28 million compared to $51 million in the prior-year quarter. OIBDA (Operating Income Before Depreciation and Amortization) declined 13.9% to $99 million from $115 million in the prior-year quarter and OIBDA margin declined 2.2 percentage points to 10.3% from 12.5% in the prior-year quarter.
Recorded Music revenue grew 4.2% (or 1.5% in constant currency). Growth in digital and licensing revenue was partially offset by a decline in physical and artist services and expanded-rights revenue.
Net income was $321 million compared to $143 million in the prior-year quarter and adjusted net income was $332 million compared to $149 million in the prior-year quarter according to the release by WMG.