Universal Music Group posted relatively small gains in the second quarter but stronger ones for the half year that ended June 30, with its publishing division seeing 11%-plus year-over-year gains in both categories.
Recorded music posted solid mid-year gains, although merchandise took a big dive that the company executives explained was an expected drop after the bounty from Taylor Swift’s 2023-24 “Eras” tours.
Top recorded-music sellers for the first half of the year included Lady Gaga, Morgan Wallen, Sabrina Carpenter, Kendrick Lamar and the Weeknd.
Overall for the quarter, UMG posted revenue of €2,980 million, up 1.6% year-over-year (4.5% in constant currency), while publishing revenue was up 11.5% year-over-year (14.5% in constant currency). Recorded music revenue was up 1.1% year-over-year, or 3.9% in constant currency, with merchandising and other revenue down 15.4% (12.7% in constant currency). Physical revenue decreased by 13.2% year-over-year, or 12.4% in constant currency, “due to a difficult comparison against last year’s strong release schedule,” which included new albums from Taylor Swift, Billie Eilish, Seventeen, Morgan Wallen and Ae! Group, the report states.
Recorded music subscription revenue grew 5.3% year-over-year (8.5% in constant currency), and streaming revenue increased 4.4% year-over-year (9.1% in constant currency). Adjusted EBITDA of €676 million increased 4.2% year-over-year, or 7.3% in constant currency.
For the first half of the year, revenue of €5,881 million increased 6.4% year-over-year, or 6.9% in constant currency, driven by growth in the Recorded Music and Music Publishing segments
Recorded music revenue grew 6.5% year-over-year, or 7.0% in constant currency. Music publishing grew 11.6% year-over-year, or 12.1% in constant currency, and merchandising and other revenue declined 10.6%, or 10.0%in constant currency. Recorded music subscription revenue grew 8.4% year-over-year, or 8.9% in constant currency, and streaming revenue grew 3.8% year-over-year, or 4.6% in constant currency
Adjusted EBITDA of €1,336 million increased 7.7% year-over-year, or 8.5% in constant currency.
UMG Chairman-CEO Lucian Grainge said, “It is the powerful combination of our artists’ and songwriters’ creative excellence with our strategic vision and execution that continues to deliver UMG’s strong results,” and spent the first 10 minutes of the earnings call extolling the company’s chart numbers in the U.S. and several European countries, along with its efforts in the health and wellness space.
In the report, the company noted that its cost of revenues, consisting of artist and product costs, increased by €228 million to €3,341 million in the first half of 2025, reflecting higher revenue and revenue mix.
Operating profit improved 25.3% year-over-year, or 27.5% in constant currency, to €947 million due to the increase in revenues, lower non-cash share-based compensation expense and the decrease in restructuring charges, which amounted to €49 million in H1 2025 compared to €113 million in H1 2024, the report states.
Cash paid for catalogue acquisitions was €149 million in H1 2025 compared to €96 million in H1 2024, while other strategic investments were lower year-over-year.
In line with UMG’s dividend policy to pay a dividend of at least 50% of adjusted net profit, its board declared an interim dividend for H1 2025 of €440 million, or €0.24 per share. The ex-dividend date will be on October 6, 2025, the record date will be on October 7, 2025 and the payment date will be on October 28, 2025.