Digital formats now account for nearly one-third of Warner Music Group revenues.
But the improved ratio is being driven by a sinking story on physical, and losses continue to mount at the major.
In its fiscal third quarter review, Warner Music revealed a loss of $55 million, compared with a year-earlier drop of $37 million. That is the sixth-straight quarterly drop for Warner, and during the latest period, revenues slipped 16 percent to $652 million.
That actually beat analyst expectations, for what it’s worth. Yet losses over the past three quarters are nearly $100 million.
Meanwhile, the same old story on digital is getting worse. Digital formats only gained 2.3 percent during the quarter, and now account for 27 percent of the broader sales pie. Instead of replacing physical sales and forging a new business, digital seems to be flattening out prematurely.