Universal Music Group reports 12.3% revenue growth in Q3

Universal Music Group (UMG) reported third-quarter revenue of 3.394 billion euros, representing a 12.3% increase compared to the previous year. This growth was significantly bolstered by the acquisition of Downtown Music, which CEO Lucian Grainge described as the company’s most important acquisition since EMI.

Excluding the impact of Downtown, revenue grew by 5.3% at constant currency. A primary driver of the results was the recorded music subscription segment, which saw revenue increase by 19.2% at constant currency, or 9.5% excluding Downtown. This acceleration was attributed to rising subscriber numbers and wholesale price increases.

Other financial highlights include a 17.4% increase in physical revenue and a 4.7% rise in ad-supported streaming revenue (excluding Downtown). While the overall adjusted EBITDA margin saw a slight decrease due to the Downtown integration, the adjusted EBITDA margin excluding Downtown improved by 0.4 percentage points to 22.4%.

Top performing artists during this period included Olivia Rodrigo, Ariana Grande, The Beatles, Stray Kids, and Mrs. Green Apple. Despite the revenue growth, the company noted a slight decline in merchandise revenue, which fell approximately 4.6%.