UMG Reports Strong Q1 Revenues, Resolves TikTok Dispute

Universal Music Group reports strong Q1 earnings with a 5.8% increase in revenues and resolves licensing dispute with TikTok, leading to a substantial improvement in their deal and potential for increased revenues from other social media platforms.

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Universal Music Group has reported a strong start to 2024, with a 5.8% increase in revenues in the first quarter. The company’s senior management was able to focus on this positive news after resolving a licensing dispute with a major social media platform earlier in the day.

UMG’s total revenues reached €2.59bn ($2.78bn) in the first quarter, with recorded music revenues growing by 3.4% to €1.99bn. Streaming revenues saw a significant increase of 10.3% to €1.47bn, while physical sales declined by 18.5% to €255m. This decrease was attributed to a tough comparison to the previous year, particularly in the Japanese market.

On the publishing side, UMPG saw a 16.7% increase in revenues to €496m, with digital revenues growing by 22.9% to €284m.

The highlight of the earnings call was the announcement of a new deal with TikTok, which UMG’s EVP and chief digital officer Michael Nash described as a “substantial improvement” from their previous agreement. This new deal is expected to significantly increase UMG’s revenues from the platform.

UMG’s CEO Sir Lucian Grainge also addressed the TikTok deal in a memo to staff, stating that it will benefit not only UMG’s artists and songwriters, but the entire music ecosystem. He emphasized that the goal of the dispute was to find common ground and make progress, and this new deal achieves just that.

Grainge also mentioned that UMG has been actively engaging with other monetized social platforms such as Snapchat, Instagram, and YouTube Shorts. This further highlights the label’s efforts to increase revenues from social media platforms.

Overall, UMG’s strong start to 2024 and successful resolution of the TikTok dispute demonstrate the company’s commitment to driving growth and maximizing revenues for its artists and songwriters.

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