Universal Music Group (UMG) Posted Over $3 Billion in Streaming Revenue Last Year — And Vivendi Will Soon Set a Sale Price

Streaming continues to strengthen Universal Music Group’s bottom line.

Ahead of its proposed sale, Vivendi has posted a great profit from its subsidiary, Universal Music Group (UMG).  Now, the only question for would-be buyers is how long the soaring profits continue.

Across labels, record sales, publishing, merchandising, tours, and more, the company posted €6 billion ($7.2 billion) in revenue for the full year of 2018.  This represents a 10% increase over 2017 at constant currency.

Looking at the company’s 2018 EBITA (earnings before interest, taxes, and amortization), UMG posted €902 million ($1.1 billion).  This represents a 22.1% growth year-over-year at constant currency.

Breaking down key figures, the company’s record music revenue grew 9.8% to €4.8 billion ($5.5 billion).  Streaming and subscriptions accounted for the majority of this revenue, jumping 37.3% to €2.6 billion ($3.1 billion).

Other digital sales – mainly downloads – and physical sales plummeted 26.6% and 16.1% to €479 million ($541 million) and €949 million ($1.1 billion), respectively.  Licensing revenue rose 10.7% to €804 million ($908 million).

Music publishing revenue increased 14.5% to €941 million ($1.1 billion).  Revenue from merchandising and other decreased 1.5% year-over-year to €273 million ($303 million).

Vivendi also confirmed that it is working toward the sale of up to 50% of UMG.  At the start of 2019, the media conglomerate launched ‘due diligence’.  It will soon set a floor price.

Globally, UMG had every one of the top five tracks, the top four artists, and the top three albums on Spotify last year.  In addition, UMG artists occupied the top five positions and 14 of the top 20 positions on Apple Music’s Global Top 100 Songs 2018.

Drake, Post Malone, The Beatles, and XXXTentacion emerged as UMG’s top sellers last year.

Breaking down recorded music revenue, UMG brought in €2.2 billion ($2.5 billion) in North America, up 11.5% year-over-year.  The company brought in €1.6 billion ($1.8 billion) in Europe, up 5.5%.  UMG brought in €618 million ($698 million) from Asia and €153 million ($173 million) from Latin America, up 13% and 14.5%, respectively.  From the rest of the world, the company brought in €253 million ($286 million).

You can view the earnings release here.


Featured image by GFDL (CC by 2.0).