WMG · Warner Music Group Corp.

Warner Music Group Corp. delivered strong Q2 fiscal 2026 results, with total revenue up 17% to $1,732 million (12% constant currency), driven by double-digit growth in both Recorded Music (17% to $1,380 million) and Music Publishing (14% to $353 million). Recorded Music streaming revenue accelerated to 16.5% growth (18.9% adjusted for prior-year DSP settlement and BMG termination impacts), fueled by per-subscriber minimum increases and market share gains, alongside robust artist services (up 40%) and physical sales (up 22%). Music Publishing digital streaming rose 20%, supported by new deals and market expansion. Adjusted OIBDA expanded 31% to $397 million (24% constant currency), with margin up 250 basis points to 22.9%, reflecting favorable revenue mix, restructuring savings (partially reinvested), despite $13 million foreign exchange headwinds. GAAP operating income surged 57% to $264 million, aided by lower restructuring charges. Net income jumped to $181 million from $36 million, boosted by $22 million Euro debt exchange gain and $12 million intercompany loan gain, offset by higher taxes. CEO Robert Kyncl highlighted strategic pillars driving share growth, music value, and efficiency, while CFO Armin Zerza noted sustained growth model with disciplined capital allocation. The company expects high end of 150-200 basis points full-year margin expansion guidance. Cash from operations rose 83% to $126 million, free cash flow to $99 million with capex down 25%. Balance sheet shows $741 million cash against $4.719 billion total debt (net $3.978 billion). Additionally, the Board declared a regular $0.19/share dividend, payable June 2 to May 26 record holders, signaling confidence in cash generation. A joint venture with Bain Capital acquired $650 million in catalogs, enhancing asset base.