WMG REVENUE UP 8%

Warner Music Group’s first quarter results are whistling the same song as every other major: Digital revenue is up enough to compensate for the decline in physical and licensing revenue. “Our formula for sustainable growth is clearly working,” says Eric Levin, Warner Music Group’s Executive Vice President and CFO.

Revenue was up 8% to $797m in the first quarter, which ended 12/31.While net income was down—$24m compared to $28m in the prior-year quarter— operating income was $94m compared to $62m in the prior-year quarter.

Recorded Music revenue grew 8.1% (or 10.5% in constant currency). The growth areas were in digital, artist services and expanded-rights revenue, the latter two due to higher merchandise revenue in the U.S.

Total recorded music digital revenue hit $402m in the three months ended 12/31, up from $322m a year earlier, a rise of 27.6% (or 30.2% in constant currency). Streaming generated $311m in the quarter vs. $212m the previous year; downloads were down to $91m from $110m.

Digital revenue grew and represented 48.4% of total revenue, compared to 41% in the prior-year quarter.

“Our strong momentum continues with excellent first-quarter results including 11% constant-currency revenue growth on top of 11% growth in the prior-year quarter,” said Warner Music Group CEO Steve Cooper. “While streaming continues to drive industry growth, we are outperforming the market thanks to extraordinary music from our artists coupled with first-class execution from our operators around the world.”

Music Publishing revenue rose 6.9% (or 10.7% in constant currency). Digital and synchronization revenue posted increases; mechanical and performance revenue were down, which the company attributed to timing.

Music Publishing’s operating loss was $2m compared with a loss of $13 million in the prior-year quarter, owing to revenue growth in the quarter and the absence of legal settlement costs.