By Mauro Orru
Universal Music Group is scheduled to report results for the third quarter on Thursday. Here is what you need to know:
REVENUE FORECAST: The music company behind the Weeknd, Billie Eilish and Taylor Swift is expected to post revenue of 2.68 billion euros ($2.84 billion) for the three months to the end of September, Citi analysts wrote in a note to clients. The forecast is higher than revenue of EUR2.66 billion that Universal reported for last year’s third quarter.
EARNINGS FORECAST: Adjusted earnings before interest, taxes, depreciation and amortization–a key profitability metric for Universal–should come in at EUR579 million with a 21.6% adjusted margin, Citi analysts estimate. Citi’s projections compare with adjusted Ebitda of EUR553 million and 20.8% adjusted margin that Universal posted last year.
WHAT TO WATCH:
-STREAMING: Revenue from streaming increased 5.3% at constant currency in the second quarter, and Universal’s third-quarter results are expected to show an acceleration in growth. Citi analysts are forecasting streaming revenue growth of 8% at constant currency in the quarter. Still, the forecast marks a departure from quarters of strong growth seen at the height of the pandemic, when streaming services boomed as listeners turned to digital after Covid-19 restrictions brought live concerts to a standstill.
Write to Mauro Orru at mauro.orru@wsj.com
