Warner Music Group has reported a net loss of $470 million for the year ending in September 2020, against an income of $258 million, due to losses attributed to the COVID-19 pandemic. The company also posted a $32 million OIBDA against $625 million the previous year, although operating income, the company’s adjusted OIBDA and adjusted EBITDA both increased.
The company saw major losses in Artist Services and Expanded Rights revenue, which was down to $98 million compared to $171 million. Artist Services and Expanded Rights accounts for merchandising, touring, concert promotion, ticketing, sponsorship and fan clubs, which is down due to the pandemic. Publishing revenue was also down 2.3 percent year over year, or 3.4 percent at constant currency.
The company’s adjusted OIBDA increased 11 percent to $790 million versus $713 million the previous year, while its
adjusted EBITDA increased 14 percent to $837 million versus $737 million in the prior year. Operating income was $88 million compared to $29 million in the prior-year quarter. These increases were attributed to increases in streaming revenue, a lower non-cash stock-based compensation expense of $14 million, lower variable costs and cost-management efforts. The company also saw financial success from artists such as Dua Lipa, Roddy Ricch,Tones and I, Aimyon and Cardi B.
“We’re proud of everything we’ve accomplished in the past year, despite the challenging conditions that the world has faced. We’re essentially flat against a record-breaking prior year and, during the quarter, we grew 11% on an as-reported basis, excluding the revenue streams most impacted by COVID,” Steve Cooper, the CEO of Warner Music Group said in a press statement.
Due to the COVID-19 pandemic, Warner Music Group posted losses back in August and May, as shutdowns caused live music events and some physical releases to come to a temporary halt. This year was notable for the company as it went public back in June, with its stock going up by 20 percent in only its first day of trading. This move was also significant as the China-based company Tencent purchased a 10 percent stake in Warner Music Group soon after it went public.