Universal Music Group generated nearly $1 billion from subscription streaming in Q3

Over the summer, Bill Ackman’s Pershing Square predicted that Universal Music Group “can grow revenues at an annual rate of 10% or so for more than a decade”.

Right now, Universal is meeting that challenge.

UMG published its financial results for the three months to end of September today (October 27). The company posted Q3 revenues of EUR €2.664 billion (USD $2.68bn) across all of its divisions (including recorded music, publishing and more).

That Q3 revenue figure was up 13.3% YoY at constant currency, driven by growth across all revenue segments.

Year-to-date, across the first nine months of 2022, Universal’s revenues grew 15.6% YoY at constant currency to €7.398 billion ($7.44bn).

Recorded Music

Universal’s overall recorded music revenues for Q3 2022 (including streaming plus physical etc.) were €2.06 billion ($2.07bn), up 10.1% YoY at constant currency (see below).

‘Subscription and streaming revenue’ (including ad-supported and subscription streaming revenues) grew 7.7% YoY at constant currency to €1.35 billion ($1.359bn).

Breaking that recorded music streaming figure down further reveals that Universal’s subscription streaming revenues specifically grew 8.7% YoY at constant currency to €991 million ($998m), driven, according to UMG, “by the continued healthy growth in music subscribers”.

Universal’s ad-supported recorded music streaming revenue, meanwhile, grew 5.2% YoY at constant currency (see below) to €362 million ($364.5m).

UMG said that this growth reflects “ongoing improvement in ad-based monetization, despite industry-wide ad-market pressure as a result of the uncertain macro-economic environment”.

UMG’s Q3 recorded music revenue haul included a €71 million ($71.5m) benefit from the settlement of a copyright infringement lawsuit with an internet service provider.

Within Universal’s recorded music business, physical revenues declined 9.6% YoY at constant currency to €264 million ($265.8m).

UMG said that this drop was “driven by the industry transition to digital consumption and a difficult comparison against strong physical sellers in the prior-year quarter”.

‘License and other revenue’ grew 30.2% YoY at constant currency to €306 million ($308.1m), driven, according to UMG, “by the strong recovery in live touring”.

Top sellers for the quarter included BTS, BLACKPINK, Ado, INI and Morgan Wallen, while top sellers in the prior-year quarter included Olivia Rodrigo, BTS, Billie Eilish, Drake and King & Prince.

‘Merchandising and Other’

Apart from streaming growth, the biggest highlight across Universal’s Q3 earnings results was the revenue it generated from its ‘Merchandising and Other’ segment.

Universal’s merch revenues grew by a whopping 101.1% YoY at constant currency to €189 million ($190.32m). This growth came, according to UMG, “as touring-related merchandising revenue rebounded following a COVID-related slow-down in live touring in the prior year period”.

Year-to-date (the nine months ended September 30), Universal’s ‘Merchandising and Other’ revenue segment 80.6% at constant currency to €437 million ($440m) (see below).

Music Publishing

Elsewhere, Universal’s Music Publishing division, Universal Music Publishing Group, generated revenues of €418 million ($420.9m) in Q3 2022.

That was up 6.9% YoY at constant currency, despite a €21 million negative impact in the quarter from a “previously announced change in accounting policy”

Excluding this Change in Society Accounting impact, Universal’s Music Publishing revenue was up 12.3% YoY in constant currency.

Within Music Publishing, digital revenue grew 17% YoY at constant currency to €234 million ($235.6m), “reflecting the continued growth of streaming and subscription, partially offset by the Change in Society Accounting,” according to UMG.

Synchronisation revenue grew 7.5% YoY at constant currency to €57 million ($57.4m). This came as a result of “increased income from advertising and film,” said UMG.

Mechanical revenue fell 21.9% YoY at constant currency to €25 million ($25.2m). The company said that was driven by “a decline in industry-wide physical sales, as well as the Change in Society Accounting”.

“More than ever, we are delivering a diverse and growing range of business and creative opportunities to our recording artists and songwriters.”

Sir Lucian Grainge

Sir Lucian Grainge, UMG´s Chairman and CEO, said: “More than ever, we are delivering a diverse and growing range of business and creative opportunities to our recording artists and songwriters.

“Through our innovation, global reach, and unique understanding of the evolution of the market, we are continually improving the monetization of music and music-related content, generating high-quality revenue and recurring income from more sources than ever before.”

Boyd Muir, UMG´s EVP, CFO and President of Operations, added: “Our vision of success is about maximizing the long-term value of the business.

“That requires not only growing revenues but also growing a broad diversity of revenue streams that help drive greater absolute EBITDA and greater value for shareholders.”


In Q3, UMG’s EBITDA (earnings before interest, taxes, and depreciation) grew 15.4% YoY at constant currency, to €539 million ($542.8m), driven by the revenue growth and the aforementioned legal settlement with a DSP.

All EUR-USD conversions in this report for Q3 2022 have been made as the average prevailing quarterly rate as identified by the European Central Bank.Music Business Worldwide

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