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Warner Music Group has scheduled its Q1 FY 2021 earnings call (covering the three months ending on December 31st, 2020) for Monday, February 1st. Here’s a brief rundown of what to expect from the Big Three record label’s latest performance report.
Warner Music Group (WMG) announced yesterday, in a formal release, that it had scheduled the Q1 FY earnings call for the first day in February. (SiriusXM is set to post its own earnings breakdown, for the same three-month stretch, on Tuesday the 2nd, and Spotify will follow with a report on the 3rd.) WMG will make its fiscal analysis publicly available early on February 1st, while the conference call itself is slated to kick off at 4:30 PM EST, half an hour after the market closes.
Building upon the latter point, this will mark the first Q1 FY earnings report that Warner Music Group has delivered since returning to the stock market in June of 2020, in what was the largest IPO of the year. WMG shares briefly approached $40 each (from $25 apiece out of the gate) in late December, and the stock is currently hovering around a per-share worth of nearly $36. The upcoming performance analysis could determine whether Warner Music’s roughly eight-month-old stock cracks $40 per share in the near future.
Perhaps the most significant takeaway from WMG’s Q4 FY 2020 earnings report was the company’s continued uptick in digital earnings. Warner Music’s quarterly revenue was flat year over year ($1.126 billion in Q4 FY 2020 as opposed to $1.124 billion in Q4 FY 2019), but within the newer of the two totals, a strong showing from digital managed to offset declines attributable to the COVID-19 pandemic.
To be sure, overall Warner/Chappell earnings fell from $173 million to $169 million, across Q4 FY 2019 and 2020, respectively. But digital publishing revenue hiked $24 million year over year, as part of an overarching 15.4 percent digital-earnings jump from the identical period in 2019. In total, digital accounted for nearly 70 percent of Warner Music Group revenue in Q4 FY 2020 – up from 60 percent during the same window in 2019.
Accordingly, logic suggests that investors could zero in on WMG’s digital performance in the coming earnings report. More broadly, with concerts and music festivals still on hold, these revenues will once again have to supplement clear-cut income falloffs in certain categories. (In Q4 FY 2020, “artist services and expanded rights” dipped $73 million year over year, whereas publishing revenue attributable to performances declined by $20 million.)
Earlier this month, Warner Music Group participated in Roblox’s $520 million Series H funding round, and several WMG execs received shares from their company’s “long-term incentive plan.”