Warner Music Group Reports 9% Revenue Growth but $16 Million Net Loss in Q3

Warner Music Group Corp. (WMG) reported its financial results for the third quarter and nine months ended June 30, 2025, revealing a revenue increase of 9% to $1.689 billion compared to $1.554 billion in the same period last year. The growth was driven by a rise in digital revenues, which reached $929 million, up from $882 million, and a notable increase in artist services and expanded rights revenue, which grew by 23% to $195 million. However, the company experienced a net loss of $16 million for the quarter, a significant decline from the net income of $141 million reported in the prior year, primarily due to increased restructuring and impairment charges.

For the nine-month period, total revenues increased slightly by 1% to $4.839 billion, compared to $4.796 billion in the previous year. The Recorded Music segment saw a decrease in revenue, down 0.3% to $3.874 billion, while Music Publishing revenues increased by 6% to $969 million. The decline in Recorded Music revenue was attributed to a drop in licensing income, which was partially offset by growth in digital and physical sales. The company also noted a $64 million revenue loss due to the termination of its distribution agreement with BMG.

WMG's operational metrics showed a mixed performance. The company reported a total of $2.678 billion in current assets, with cash and equivalents decreasing to $527 million from $694 million at the end of the previous fiscal year. The total liabilities increased to $8.965 billion, up from $8.480 billion, largely due to higher accrued royalties and long-term debt. The company’s employee headcount remained stable, and it continues to focus on strategic initiatives, including the acquisition of Tempo Music Holdings, which contributed to an increase in intangible assets.

Looking ahead, WMG is implementing a new strategic restructuring plan aimed at generating annualized cost savings of approximately $300 million by the end of fiscal year 2027. The company anticipates that these savings will be reinvested into its core operations to support growth. Despite the challenges faced in the current fiscal year, including the impact of foreign currency fluctuations and the BMG termination, WMG remains optimistic about its long-term growth prospects, particularly in the digital music space. The company is also committed to maintaining its dividend payments, having declared a cash dividend of $0.18 per share for the quarter, with plans for future dividends contingent on financial performance and liquidity.