Credit: McSleepy / Shutterstock.comReservoir's recent acquisitions include rights to the recorded music catalog of José Feliciano, who wrote and recorded 'Feliz Navidad' in 1970.
Reservoir Media has published its financial results for the three months ended September 30, 2026 – the company’s fiscal Q2 2027 (calendar Q3 2026).
The New York-headquartered music company generated USD $49.9 million in the quarter, up 10% YoY, or 4% organically excluding acquisitions.
Revenue growth was propelled by an 8% YoY rise in music publishing revenue and an 18% increase in recorded music revenue.
Reservoir also raised its full-year guidance for both revenue and Adjusted EBITDA on Wednesday (November 4).
Operating income was $12.3 million, up 15% YoY, while OIBDA (operating income before depreciation and amortization) rose 14% to $20.7 million.
Adjusted EBITDA grew 14% YoY to $22.1 million.
Music Publishing
Reservoir’s music publishing segment generated $33.2 million in calendar Q3, up 8% YoY, with OIBDA rising 9% YoY to $12.4 million.
Digital revenue climbed 10% YoY to $17.6 million, driven primarily by catalog acquisitions and streaming growth, according to Reservoir.
Synchronization revenue rose 13% YoY to $5.2 million, which the company attributed to “the timing of licenses.”
Performance revenue rose 1% YoY to $7.5 million, mechanical revenue declined 5% YoY to $1.6 million, and other revenue increased 24% YoY to $1.3 million.
The segment’s OIBDA margin held steady at 37%.
Recorded Music
Reservoir’s recorded music division generated $15.4 million in revenue, up 18% YoY, with segment OIBDA increasing 26% YoY to $8.3 million.
Digital revenue in the segment increased 33% YoY to $11.5 million, with catalog acquisitions and streaming growth again the main drivers.
Neighboring rights revenue grew 40% YoY to $1.5 million, which Reservoir credited to catalog acquisitions and “new affiliations.”
Physical revenue rose 6% YoY to $1.4 million, while synchronization revenue fell 54% YoY to $0.9 million, which the company put down to the timing of licenses.
In the prior quarter, the segment’s synchronization revenue rose to $1.4 million from $0.3 million.
Recorded music OIBDA margin expanded from 51% to 54%, which Reservoir said primarily reflected lower cost of revenue as a percentage of revenue.
Both acquisitions were announced in October, after the quarter closed.
The company also signed songwriter-producer Jake Sinclair to a publishing deal for his future works, and formed a joint venture with him to sign and develop emerging talent to publishing deals.
Other new publishing signings include songwriter-producer Fred Ball, singer-songwriter Orla Gartland, Scottish indie rock band The Snuts, songwriter Justin Dukes, singer-songwriters Ava Liv Mabry and Riley Biederer, and singer-songwriter duo The Reklaws.
“Our second quarter results marked the end of a strong first half of fiscal 2027, with growth across both our Publishing and Recorded Music segments reflecting the continued successful execution of our long-term strategy,” said Golnar Khosrowshahi, Founder and Chief Executive Officer of Reservoir Media. “Our recent investments span across established songwriters and catalogs with enduring cultural and commercial significance and the hitmakers of tomorrow.
“We continue to thoughtfully expand and diversify our portfolio, while deepening our established reputation as a trusted steward for exceptional music talents and catalogs. We remain confident in our ability to build on this momentum for the remainder of fiscal year 2027.”
Credit: Becky Yee
“Our recent investments span across established songwriters and catalogs with enduring cultural and commercial significance and the hitmakers of tomorrow.”
Golnar Khosrowshahi, Reservoir
Reservoir now expects revenue of $188 million to $192 million for its fiscal year ending March 31, 2027, implying 8% growth at the midpoint.
Adjusted EBITDA guidance now stands at $77 million to $80 million, implying 7% growth at the midpoint.
The company’s previous guidance ranges of $186 million to $191 million for revenue and $75 million to $79 million for Adjusted EBITDA implied midpoint growth of 7% and 5%, respectively.
Reservoir first issued those ranges in May, when it reported that its annual revenues grew 11% YoY to $175.7 million in fiscal 2026.
It reiterated them in August alongside its fiscal Q1 2027 results, which showed revenues up 12% YoY, or 6% organically.
“Our first-half results underscore our ability to generate consistent growth from a high-quality, diversified catalog while maintaining a disciplined approach to both future investments and cost management,” said Jim Heindlmeyer, Chief Financial Officer of Reservoir.
“Based on this performance, we have the confidence to raise our guidance ranges for both revenue and Adjusted EBITDA for fiscal year 2027.”
“Based on this performance, we have the confidence to raise our guidance ranges for both revenue and Adjusted EBITDA for fiscal year 2027.”
Jim Heindlmeyer, Reservoir
For the first half of fiscal 2027, Reservoir’s revenues rose 11% YoY to $91.4 million, while Adjusted EBITDA increased to $37.8 million from $33.3 million.
As of September 30, the company had total available liquidity of $113.9 million and net debt of $433.8 million, up from $429.8 million as of March 31, 2026.Music Business Worldwide
