Warner Music Group is earning around $2m a day from streaming activity of its recorded music catalogue.
MBW’s estimate is based on new figures released by the major label showing that its income from streaming jumped 59%, or $72m, in the three months to end of March.
That, combined with a typically quiet new year release slate, meant that streaming earned more for Warner in the quarter than physical or downloads – a first for any major label.
Although Warner didn’t give a specific income figure for streaming, we know that it must be higher than $164m, which equates to half of its $328m total digital revenue in the period.
Physical revenues stood at $151m in Q1.
Taking into account the 91 days of the first quarter, that means Warner definitely earned an average of more than $1.8m per day from streaming services.
However, considering the substantial 59% rise in streaming income, and the fact that download overtook streaming revenues at WMG a year ago, it’s a safe bet to suggest Warner’s daily earnings from streaming are nearer $2m – which would require its streaming cash to have hit $182m in Q1.
That’s especially true as download income decreased by $17m in the first three months of this year, a fall easily offset by streaming’s growth.
What makes these numbers particularly pleasing for Warner is the lack of overhead, with a much bigger margin percentage coming its way from streaming consumption than a resource-heavy physical release.
Stephen Cooper, Warner Music Group
Warner boss Stephen Cooper said on an earnings call on Friday (May 6) that Warner was “proud to be leading the industry’s transition to streaming”
He added: “Just five quarters ago, streaming was the third-largest revenue source in our Recorded Music business, behind both downloads and physical. Today, we are the first major music company to report that streaming is the largest source of revenue in our Recorded Music business.
“This rapid transformation is evidence of our ability to sign, develop and market artists that thrive in the streaming world. Reaching these achievements is made possible by healthy macro trends in the recorded music industry, as well as tireless execution by our global operators.”
As you can see below, Warner’s total revenues in the quarter grew 10%, or 13.4% on a constant-currency basis.
Digital revenue grew 21.2%, up 25.0% on a constant-currency basis.
Net income stood at $12 million versus $19 million in the prior-year quarter.
Revenue rose in every major region, with Asia up 17%, Latin America up 17% and Europe up 12%.