Warner Music Group Corp.

Previous wording

•Results of operations. This section provides an analysis of our results of operations for the three and six months ended March 31, 2025 and March 31, 2024. This analysis is presented on both a consolidated and segment basis.

Current wording

•Results of operations. This section provides an analysis of our results of operations for the three and nine months ended June 30, 2025 and June 30, 2024. This analysis is presented on both a consolidated and segment basis.

Previous wording

•Financial condition and liquidity. This section provides an analysis of our cash flows for the six months ended March 31, 2025 and March 31, 2024, as well as a discussion of our financial condition and liquidity as of March 31, 2025. The discussion of our financial condition and liquidity includes recent debt financings and a summary of the key debt covenant compliance measures under our debt agreements.

Current wording

•Financial condition and liquidity. This section provides an analysis of our cash flows for the nine months ended June 30, 2025 and June 30, 2024, as well as a discussion of our financial condition and liquidity as of June 30, 2025. The discussion of our financial condition and liquidity includes recent debt financings and a summary of the key debt covenant compliance measures under our debt agreements.

Previous wording

In 2024, the Company announced a strategic restructuring plan (the “Strategic Restructuring Plan”) designed to free up additional funds to invest in music and accelerate the Company’s growth for the next decade. The Company expects to incur total non-recurring restructuring charges of approximately $240 million or approximately $160 million of total non-recurring after tax charges. The expected pre-tax charges include approximately $158 million of severance and other contract termination costs, along with approximately $82 million of non-cash impairment charges. The majority of severance payments and other termination costs are expected to be paid by the end of fiscal year 2026.

Current wording

In 2024, the Company announced a strategic restructuring plan (the “2024 Strategic Restructuring Plan”) designed to free up additional funds to invest in music and accelerate the Company’s growth for the next decade. The 2024 Strategic Restructuring Plan is substantially complete and the remaining associated cash payments are expected to be made by the end of fiscal year 2026.

Previous wording

The cost savings under the Strategic Restructuring Plan will be achieved through a combination of the disposal or winding down of non-core operations, continuing to manage overhead, sharpening focus, expanding shared services, and implementing previously disclosed expected operational efficiencies made possible by the Company’s financial transformative initiative. The Company expects allocating a majority of the costs savings to increase investment in the Company’s core Recorded Music and Music Publishing businesses, new skill sets and tech capabilities.

Current wording

The cost savings under the 2024 Strategic Restructuring Plan will be achieved through a combination of the disposal or winding down of non-core operations, continuing to manage overhead, sharpening focus, expanding shared services, and implementing previously disclosed expected operational efficiencies made possible by the Company’s financial transformative initiative. The Company expects allocating a majority of the costs savings to increase investment in the Company’s core Recorded Music and Music Publishing businesses, new skill sets and tech capabilities.

Previous wording

For the three months ended March 31, 2025, total severance and other contract termination costs recorded in connection with the Strategic Restructuring Plan were $7 million, all of which was recognized in our Recorded Music segment. For the six months ended March 31, 2025, total severance and other contract termination costs recorded in connection with the Strategic Restructuring Plan were $8 million, of which $9 million of expense was recognized in our Recorded Music segment while there was a $1 million benefit recognized at Corporate due to a change in estimate. Additionally, for the three and six months ended March 31, 2025, the Company recognized $6 million and $32 million of impairment losses, respectively, all of which were recognized in our Recorded Music segment. Impairment charges recognized during the period primarily relate to the write-off of certain long-form audiovisual production assets and lease termination costs for office closures. The Company continues to review its operations for additional cost

Current wording

For the three months ended June 30, 2025, the Company recognized a $1 million benefit in our Recorded Music segment due a change in estimate of severance costs. For the nine months ended June 30, 2025, total severance and other contract termination costs recorded in connection with the 2024 Strategic Restructuring Plan were $7 million, of which $8 million of expense was recognized in our Recorded Music segment while there was a $1 million benefit recognized at Corporate due to a change in estimate. Additionally, for the nine months ended June 30, 2025, the Company recognized $32 million of impairment losses, all of which were recognized in our Recorded Music segment. Impairment charges recognized during the period primarily relate to the write-off of certain long-form audiovisual production assets and lease termination costs for office closures.

Previous wording

In September 2023, the Company terminated its distribution agreement with BMG as BMG began to bring digital distribution in-house and license directly with digital service partners in fiscal 2024 (the “BMG Termination”). Alternative Distribution Alliance (“ADA”), which is part of our Recorded Music business, had previously been distributing BMG’s recorded music catalog and revenues are reported within our Recorded Music segment. The shift to direct deals by BMG is a phased in-sourcing of distribution during the current fiscal year and we expect BMG to be rolled off by the end of the current fiscal year.

Current wording

In September 2023, the Company terminated its distribution agreement with BMG as BMG began to bring digital distribution in-house and license directly with digital service partners in fiscal 2024 while also licensing its physical distribution with a different provider (the “BMG Termination”). Alternative Distribution Alliance (“ADA”), which is part of our Recorded Music business, had previously been distributing BMG’s recorded music catalog and revenues are reported within our Recorded Music segment. The shift to digital direct deals by BMG is a phased in-sourcing of distribution during the current fiscal year and we expect BMG to be rolled off by the end of the current fiscal year.

Previous wording

Total revenues decreased by $10 million, or 1%, to $1,484 million for the three months ended March 31, 2025 from $1,494 million for the three months ended March 31, 2024. The decrease includes $27 million of unfavorable currency exchange fluctuations. Prior to intersegment eliminations, Recorded Music and Music Publishing revenues represented 79% and 21% of total revenue for the three months ended March 31, 2025, respectively, and 80% and 20% of total revenue for the three months ended March 31, 2024, respectively. Prior to intersegment eliminations, U.S. and international revenues represented 44% and 56% of total revenues for the three months ended March 31, 2025 and 45% and 55% of total revenues for the three months ended March 31, 2024.

Current wording

Total revenues increased by $135 million, or 9%, to $1,689 million for the three months ended June 30, 2025 from $1,554 million for the three months ended June 30, 2024. Revenue growth was favorably impacted by the settlement of certain copyright infringement cases (the “Copyright Settlement”), which resulted in $16 million higher Recorded Music revenue. The prior-year quarter included $22 million of incremental revenue recognized in Recorded Music from a Digital Service Provider (“DSP”) for performance obligations satisfied in previous periods (the “DSP True-Up Payments”). Recorded Music revenue growth was also unfavorably impacted by the BMG Termination, which resulted in $14 million less Recorded Music revenue compared to the prior-year quarter. The increase in total revenue includes $24 million of favorable currency exchange fluctuations. Prior to intersegment eliminations, Recorded Music and Music Publishing revenues represented 80% and 20% of total revenue for each of the three months ended June 30, 2025 and June 30, 2024, respectively. Prior to intersegment eliminations, U.S. and international revenues represented 43% and 57% of total revenues for the three months ended June 30, 2025, respectively, and 44% and 56% of total revenues for the three months ended June 30, 2024, respectively.

Previous wording

Total digital revenues after intersegment eliminations decreased by $8 million, or 1%, to $1,027 million for the three months ended March 31, 2025 from $1,035 million for the three months ended March 31, 2024. Total streaming revenue decreased by $3 million, primarily driven by Recorded Music, partially offset by growth in Music Publishing. Total streaming revenue includes $19 million of unfavorable currency exchange fluctuations. Prior to intersegment eliminations, total digital revenues for the three months ended March 31, 2025 were composed of U.S. revenues of $490 million and international revenues of $539 million, or 48% and 52% of total digital revenues, respectively. Prior to intersegment eliminations, total digital revenues for the three months ended March 31, 2024 were composed of U.S. revenues of $511 million and international revenues of $524 million, or 49% and 51% of total digital revenues, respectively.

Current wording

Total digital revenues after intersegment eliminations increased by $57 million, or 5%, to $1,132 million for the three months ended June 30, 2025 from $1,075 million for the three months ended June 30, 2024. Total streaming revenue increased by $42 million, driven by growth in Recorded Music and Music Publishing. Total streaming revenue includes $11 million of favorable currency exchange fluctuations. Prior to intersegment eliminations, total digital revenues for the three months ended June 30, 2025 were composed of U.S. revenues of $535 million and international revenues of $598 million, or 47% and 53% of total digital revenues, respectively. Prior to intersegment eliminations, total digital revenues for the three months ended June 30, 2024 were composed of U.S. revenues of $504 million and international revenues of $572 million, or 47% and 53% of total digital revenues, respectively.

Previous wording

The overall increase in Music Publishing revenue was driven by increases in digital, performance, synchronization, and mechanical revenues. Digital revenue increased by $1 million, or 1%, driven by an increase in downloads and other digital revenue of $1 million, while Music Publishing revenue from streaming services remained constant at $185 million for each of the three months ended March 31, 2025 and March 31, 2024, partially offset by an unfavorable impact of foreign currency exchange rates of $2 million. Performance revenue increased by $1 million, or 2%, driven by higher concert revenue, partially offset by an unfavorable impact of foreign currency exchange rates of $2 million. Mechanical revenue increased by $1 million, or 7%, driven by higher physical sales, partially offset by an unfavorable impact of foreign currency exchange rates of $1 million. Synchronization revenue increased by $1 million, or 2%, attributable to higher television and commercial licensing activity, partially offset by the timing of copyright infringement settlements.

Current wording

The overall increase in Music Publishing revenue was driven by increases in digital, performance, synchronization, and mechanical revenues. Digital revenue increased by $10 million, or 5%, driven by an increase in streaming revenue, which includes a favorable impact of foreign currency exchange rates of $1 million. Revenue from streaming services grew by $10 million, or 5%, to $202 million for the three months ended June 30, 2025 from $192 million for the three months ended June 30, 2024, driven by the impact of digital deal renewals, primarily in the U.S, and a favorable impact of foreign currency exchange rates of $1 million. Performance revenue increased by $6 million, or 12%, driven by growth from concerts, radio and live events primarily in Europe, and a favorable impact of foreign currency exchange rates of $1 million. Mechanical revenue increased by $3 million, or 23%, and includes a favorable impact of foreign currency exchange rates of $1 million. Synchronization revenue increased by $12 million, or 29%, attributable to timing of other copyright infringement settlements, higher television and commercial licensing activity, and the $3 million impact of our acquisition of Tempo.

Previous wording

U.S. revenue decreased by $20 million, or 3%, to $658 million for the three months ended March 31, 2025 from $678 million for the three months ended March 31, 2024. U.S. Recorded Music revenue decreased by $11 million, or 2%. U.S. Recorded Music digital revenue decreased by $12 million, or 3%, driven by lower streaming revenue of $12 million, or 3%, while download and other digital revenue was flat to the prior-year quarter. U.S. Recorded Music licensing revenue increased by $1 million, or 3%, driven by the timing of licensing settlements. U.S. Recorded Music physical revenue and artist services and expanded-rights revenues remained constant. U.S. Music Publishing revenue decreased by $9 million, or 5%, to $161 million for the three months ended March 31, 2025 from $170 million for the three months ended March 31, 2024. U.S. Music Publishing digital revenue decreased by $9 million, or 8%, attributable to lower streaming revenue of $10 million, or 9%, partially offset by an increase in download and other digital revenue of $1 million. U.S. Music Publishing streaming revenue reflects the impact of digital deal renewals compared to the prior-year quarter. U.S. Music Publishing performance revenue decreased by $1 million, or 5%. U.S. Music Publishing mechanical revenue increased by $2 million, or 67%, during the three months ended March 31, 2025 compared to the three months ended March 31, 2024, and U.S. Music Publishing synchronization revenue remained constant, driven by higher television and commercial licensing activity and the impact of acquisitions, partially offset by the timing of copyright infringement settlements.

Current wording

U.S. revenue increased by $44 million, or 6%, to $722 million for the three months ended June 30, 2025 from $678 million for the three months ended June 30, 2024. U.S. Recorded Music revenue increased by $19 million, or 4%. U.S. Recorded Music digital revenue increased by $20 million, or 5%, driven by higher download and other digital revenue of $15 million, or 150%, including the impact of the Copyright Settlement in the quarter, and higher streaming revenue of $5 million, or 1%. U.S. Recorded Music licensing revenue increased by $8 million, or 30%, driven by timing of other copyright infringement settlements. U.S. Recorded Music artist services and expanded-rights revenues decreased by $5 million, or 10%, driven by lower merchandising revenue, and physical revenue decreased by $4 million, or 8%. U.S. Music Publishing revenue increased by $25 million, or 16%, to $186 million for the three months ended June 30, 2025 from $161 million for the three months ended June 30, 2024. U.S. Music Publishing digital revenue increased by $11 million, or 10%, attributable to higher streaming revenue of $11 million, or 10%. U.S. Music Publishing streaming revenue reflects impact of digital deal renewals. U.S. Music Publishing performance and mechanical revenues remained constant during the three months ended June 30, 2025 compared to the three months ended June 30, 2024. U.S. Music Publishing synchronization revenue increased by $13 million, or 54%, driven by timing of other copyright infringement settlements, higher television and commercial licensing activity and the impact of acquisitions.

Previous wording

International revenue increased by $10 million, or 1%, to $827 million for the three months ended March 31, 2025 from $817 million for the three months ended March 31, 2024. Excluding the unfavorable impact of foreign currency exchange rates of $27 million, International revenue increased by $37 million, or 5%. International Recorded Music revenue decreased by $3 million, which includes an unfavorable impact of foreign currency exchange rates of $22 million, driven by lower artist services and expanded rights revenue, partially offset by growth across digital and physical revenues. International Recorded Music licensing revenue remained constant driven by licensing deals primarily in Japan, partially offset by the timing of copyright infringement settlements compared to the prior-year quarter. International Recorded Music artist services and expanded-rights revenue decreased by $9 million due to lower direct-to-consumer merchandising revenue at EMP, lower concert promotion revenue primarily in France, and the unfavorable impact of foreign currency exchange rates of $2 million. International Recorded Music digital revenue increased by $5 million, attributable to higher streaming revenue of $9 million, or 2%, which reflects an unfavorable impact of foreign currency exchange rates of $16 million, partially offset by lower download and other digital revenue of $4 million driven by the continued shift to streaming services. Physical revenue increased by $1 million driven by new releases primarily in Japan, partially offset by lower revenue resulting from the BMG Termination and an unfavorable impact of foreign currency exchange rates of $1 million. International Music Publishing revenue increased by $13 million, or 10%, to $149 million for the three months ended March 31, 2025 from $136 million for the three months ended March 31, 2024. International Music Publishing revenue growth was driven by increases in digital revenue of $10 million attributable to growth in streaming, performance revenue of $2 million due to growth from concerts, radio and live events, synchronization revenue of $1 million due to higher television and commercial licensing activity, and other revenue of $1 million. This was partially offset by a decrease in International Music Publishing mechanical revenue of $1 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.

Current wording

International revenue increased by $90 million, or 10%, to $968 million for the three months ended June 30, 2025 from $878 million for the three months ended June 30, 2024. Excluding the favorable impact of foreign currency exchange rates of $23 million, International revenue increased by $67 million, or 7%. International Recorded Music revenue increased by $84 million, which includes a favorable impact of foreign currency exchange rates of $21 million, driven by growth across digital, artist services and expanded rights, licensing and physical revenues. International Recorded Music licensing revenue increased by $13 million, or 21%, driven by licensing deals primarily in the U.K. and China, and timing of other copyright infringement settlements. International Recorded Music artist services and expanded-rights revenue increased by $41 million, or 37%, driven by higher concert promotion revenue primarily in France and Spain, and the favorable impact of foreign currency exchange rates of $4 million. International Recorded Music digital revenue increased by $27 million, attributable to higher streaming revenue of $27 million, or 6%, which includes the impact of the BMG Termination, and reflects a favorable impact of foreign currency exchange rates of $9 million. Physical revenue increased by $3 million driven by the favorable impact of foreign currency exchange rates of $4 million, partially offset by the impact of the BMG Termination. International Music Publishing revenue increased by $6 million, or 4%, to $150 million for the three months ended June 30, 2025 from $144 million for the three months ended June 30, 2024. International Music Publishing revenue growth was driven by increases in performance revenue of $6 million due to growth from concerts, radio and live events in Europe and mechanical revenue of $3 million. This was partially offset by decreases in digital revenue of $1 million, synchronization revenue of $1 million, and other revenue of $1 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024.

Previous wording

Artist and repertoire costs decreased by $8 million, to $531 million for the three months ended March 31, 2025 from $539 million for the three months ended March 31, 2024. Artist and repertoire costs as a percentage of revenue remained constant at 36% for each of the three months ended March 31, 2025 and March 31, 2024.

Current wording

Artist and repertoire costs increased by $36 million, to $584 million for the three months ended June 30, 2025 from $548 million for the three months ended June 30, 2024. Artist and repertoire costs as a percentage of revenue remained constant at 35% for each of the three months ended June 30, 2025 and June 30, 2024.

Previous wording

Product costs increased by $8 million, to $260 million for the three months ended March 31, 2025 from $252 million for the three months ended March 31, 2024. Product costs as a percentage of revenue increased to 18% for the three months ended March 31, 2025 from 17% for the three months ended March 31, 2024 due to revenue mix from lower artist services and expanded-rights revenue, partially offset by higher costs on third-party distributed label revenue and the impact of acquisitions.

Current wording

Product costs increased by $47 million, to $329 million for the three months ended June 30, 2025 from $282 million for the three months ended June 30, 2024. Product costs as a percentage of revenue increased to 19% for the three months ended June 30, 2025 from 18% for the three months ended June 30, 2024 due to revenue and deal mix.

Previous wording

Total selling, general and administrative expense increased by $2 million, to $924 million for the six months ended March 31, 2025 from $922 million for the six months ended March 31, 2024. Expressed as a percentage of revenue, total selling, general and administrative expense increased to 29% for the six months ended March 31, 2025 from 28% for the six months ended March 31, 2024 due to the factors noted below.

Current wording

Total selling, general and administrative expense increased by $9 million, to $471 million for the three months ended June 30, 2025 from $462 million for the three months ended June 30, 2024. Expressed as a percentage of revenue, total selling, general and administrative expense decreased to 28% for the three months ended June 30, 2025 from 30% for the three months ended June 30, 2024 due to the factors noted below.

Previous wording

General and administrative expense increased by $18 million to $276 million for the three months ended March 31, 2025 from $258 million for the three months ended March 31, 2024. The increase in general and administrative expense was largely due to higher non-cash stock-based compensation costs of $4 million, the impact of acquisitions of $3 million and higher depreciation expense driven by assets placed into service of $2 million, partially offset by savings from the Strategic Restructuring Plan, of which a portion has been reinvested in the Company’s business. Expressed as a percentage of revenue, general and administrative expense increased to 19% for the three months ended March 31, 2025 from 17% for the three months ended March 31, 2024.

Current wording

General and administrative expense increased by $18 million to $282 million for the three months ended June 30, 2025 from $264 million for the three months ended June 30, 2024. The increase in general and administrative expense was driven by incremental investment in technology of $7 million, higher non-cash stock-based compensation costs of $5 million due to the departure of our former Chief Financial Officer (“CFO”) in the current year, the impact of acquisitions of $4 million and higher depreciation expense of $4 million, primarily driven by the core financials component of our new technology platform being placed into service, partially offset by savings from the 2024 Strategic Restructuring Plan, of which a portion has been reinvested in the Company’s business. Expressed as a percentage of revenue, general and administrative expense remained constant at 17% for each of the three months ended June 30, 2025 and June 30, 2024.

Previous wording

Selling and marketing expense decreased by $12 million, or 7%, to $157 million for the three months ended March 31, 2025 from $169 million for the three months ended March 31, 2024. Expressed as a percentage of revenue, selling and marketing expense remained constant at 11% for each of the three months ended March 31, 2025 and March 31, 2024 due to savings from the Strategic Restructuring Plan, of which a portion has been reinvested in the Company’s business.

Current wording

Selling and marketing expense decreased by $6 million, or 3%, to $167 million for the three months ended June 30, 2025 from $173 million for the three months ended June 30, 2024. Expressed as a percentage of revenue, selling and marketing expense decreased to 10% for the three months ended June 30, 2025 from 11% for the three months ended June 30, 2024 due to savings from the 2024 Strategic Restructuring Plan, of which a portion has been reinvested in the Company’s business.

Previous wording

Distribution expense decreased by $2 million to $17 million for the three months ended March 31, 2025 from $19 million for the three months ended March 31, 2024. Expressed as a percentage of revenue, distribution expense remained constant at 1% for each of the three months ended March 31, 2025 and March 31, 2024.

Current wording

Distribution expense decreased by $3 million to $22 million for the three months ended June 30, 2025 from $25 million for the three months ended June 30, 2024. Expressed as a percentage of revenue, distribution expense decreased to 1% for the three months ended June 30, 2025 from 2% for the three months ended June 30, 2024.

Previous wording

Adjusted OIBDA decreased by $9 million to $303 million for the three months ended March 31, 2025 from $312 million for the three months ended March 31, 2024. Expressed as a percentage of total revenue, Adjusted OIBDA margin decreased to 20% for the three months ended March 31, 2025 from 21% for the three months ended March 31, 2024. The decreases in Adjusted OIBDA and Adjusted OIBDA margin are driven by revenue mix, partially offset by the impact of acquisitions and savings from the Strategic Restructuring Plan, a portion of which has been reinvested in the Company’s business.

Current wording

Adjusted OIBDA increased by $57 million to $373 million for the three months ended June 30, 2025 from $316 million for the three months ended June 30, 2024, driven by the impact of the Copyright Settlement of $9 million in Recorded Music in the current quarter and the $12 million impact of the DSP True-Up Payments in the prior-year quarter, as well as revenue mix, the impact of acquisitions, and savings from the 2024 Strategic Restructuring Plan, partially offset by the reinvestment of these savings in the Company’s business including $7 million of incremental investment in technology for the three months ended June 30, 2025. Expressed as a percentage of total revenue, Adjusted OIBDA margin increased to 22% for the three months ended June 30, 2025 from 20% for the three months ended June 30, 2024.

Previous wording

There was no net gain on divestitures during the three months ended March 31, 2025. Net gain on divestitures during the three months ended March 31, 2024 includes a pre-tax gain of $14 million in connection with the divestiture of certain publishing rights.

Current wording

There was no net gain on divestitures during the three months ended June 30, 2025. Net gain on divestitures during the three months ended June 30, 2024 includes a pre-tax gain of $1 million in connection with the divestiture of certain non-core owned and operated media properties.

Previous wording

Our transformation initiative costs which include costs associated with our finance transformation decreased by $1 million to $18 million for the three months ended March 31, 2025 from $19 million for the three months ended March 31, 2024.

Current wording

Our transformation initiative costs which include costs associated with our finance transformation increased by $1 million to $19 million for the three months ended June 30, 2025 from $18 million for the three months ended June 30, 2024.

Previous wording

Our restructuring and impairment charges decreased to $13 million for the three months ended March 31, 2025 from $95 million for the three months ended March 31, 2024. The three months ended March 31, 2025 includes severance costs and impairment charges related to the write-off of certain long-form audiovisual production assets recognized in connection with the Strategic Restructuring Plan.

Current wording

Our restructuring and impairment charges increased to $69 million for the three months ended June 30, 2025 from $1 million for the three months ended June 30, 2024. The three months ended June 30, 2025 includes an impairment charge of $70 million for long-lived assets associated with certain of the Company’s non-core e-tailer operations.

Previous wording

Our depreciation expense increased by $2 million to $28 million for the three months ended March 31, 2025 from $26 million for the three months ended March 31, 2024. The increase is primarily due to technology assets being placed into service.

Current wording

Our depreciation expense increased by $4 million to $29 million for the three months ended June 30, 2025 from $25 million for the three months ended June 30, 2024. The increase is primarily driven by the core financials component of our new technology platform being placed into service.

Previous wording

Our amortization expense increased by $5 million, to $62 million for the three months ended March 31, 2025 from $57 million for the three months ended March 31, 2024. The increase is driven by incremental amortization related to acquisitions of music-related assets, partially offset by certain intangible assets becoming fully amortized.

Current wording

Our amortization expense increased by $12 million, to $67 million for the three months ended June 30, 2025 from $55 million for the three months ended June 30, 2024. The increase is driven by incremental amortization related to acquisitions of music-related assets, partially offset by certain intangible assets becoming fully amortized.

Previous wording

Our operating income increased by $49 million to $168 million for the three months ended March 31, 2025 from $119 million for the three months ended March 31, 2024. In addition to the factors impacting Adjusted OIBDA described above, the increase in operating income was driven by a decrease in restructuring and impairment charges of $82 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 related to the Strategic Restructuring Plan, partially offset by a $14 million net gain on a divestiture in the prior-year quarter, higher amortization expenses of $5 million, and higher non-cash stock-based compensation and other related costs of $4 million.

Current wording

Our operating income decreased by $38 million to $169 million for the three months ended June 30, 2025 from $207 million for the three months ended June 30, 2024. In addition to the factors impacting Adjusted OIBDA described above, the decrease in operating income was driven by an increase in restructuring and impairment charges of $68 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, higher amortization expenses of $12 million, higher non-cash stock-based compensation and other related costs of $5 million, and the impact of a $1 million net gain on a divestiture in the prior-year quarter.

Previous wording

Other expense for the three months ended March 31, 2025 primarily includes foreign currency losses on our Euro-denominated debt of $34 million, currency exchange losses on our intercompany loans of $27 million, and realized and unrealized losses on hedging activity of $6 million. This compares to foreign currency gains on our Euro-denominated debt of $21 million, currency exchange gains on our intercompany loans of $7 million, and realized and unrealized gains on hedging activity of $5 million for the three months ended March 31, 2024.

Current wording

Other expense for the three months ended June 30, 2025 primarily includes foreign currency losses on our Euro-denominated debt of $70 million, currency exchange losses on our intercompany loans of $63 million, and realized and unrealized losses on hedging activity of $8 million. This compares to foreign currency gains on our Euro-denominated debt of $7 million, currency exchange losses on our intercompany loans of $5 million, and realized and unrealized gains on hedging activity of $1 million for the three months ended June 30, 2024.

Previous wording

Our income tax expense increased by $28 million to $118 million for the six months ended March 31, 2025 from $90 million for the six months ended March 31, 2024. The increase of $28 million in income tax expense is primarily due to the impact of higher pre-tax income in the current year and benefit from the winding down of the Company’s owned and operated media properties in the prior year.

Current wording

Our income tax expense decreased by $25 million to $5 million for the three months ended June 30, 2025 from $30 million for the three months ended June 30, 2024. The decrease of $25 million in income tax expense is primarily due to the impact of pre-tax loss in the current period and benefit for updated allowable costs for reported foreign derived intangible income in the prior period.

Previous wording

Net income decreased by $12 million to $277 million for the six months ended March 31, 2025 from $289 million for the six months ended March 31, 2024 as a result of the factors described above.

Current wording

Net (loss) income decreased by $157 million to net loss of $16 million for the three months ended June 30, 2025 from net income of $141 million for the three months ended June 30, 2024 as a result of the factors described above.

Previous wording

There was no income attributable to noncontrolling interest during the three months ended March 31, 2025 or the three months ended March 31, 2024.

Current wording

There was no income attributable to noncontrolling interest during the three months ended June 30, 2025 compared to a loss of $2 million for the three months ended June 30, 2024.

Previous wording

The overall decrease in Recorded Music revenue was driven by decreases in digital, licensing and artist services and expanded-rights revenues revenues, partially offset by an increase in physical revenue, as described in the “Total Revenues” and “Revenue by Geographical Location” sections above.

Current wording

The overall increase in Recorded Music revenue was driven by higher revenue across digital, artist services and expanded-rights and licensing, partially offset by a decrease in physical revenue, as described in the “Total Revenues” and “Revenue by Geographical Location” sections above.

Previous wording

Recorded Music cost of revenues increased by $1 million, to $599 million for the three months ended March 31, 2025 from $598 million for the three months ended March 31, 2024. Expressed as a percentage of Recorded Music revenue, Recorded Music artist and repertoire costs remained constant at 29% for each of the three months ended March 31, 2025 and March 31, 2024.

Current wording

Recorded Music cost of revenues increased by $70 million, to $706 million for the three months ended June 30, 2025 from $636 million for the three months ended June 30, 2024. Expressed as a percentage of Recorded Music revenue, Recorded Music artist and repertoire costs remained constant at 28% for each of the three months ended June 30, 2025 and June 30, 2024. Expressed as a percentage of Recorded Music revenue, Recorded Music product costs increased to 24% for the three months ended June 30, 2025 from 23% for the three months ended June 30, 2024, driven by revenue and deal mix.

Previous wording

Recorded Music selling, general and administrative expense decreased by $10 million, to $327 million for the three months ended March 31, 2025 from $337 million for the three months ended March 31, 2024. The increase in general and administrative expense was largely driven by higher non-cash stock-based compensation and other related costs of $3 million, and the impact of acquisitions of $3 million. The decrease in selling and marketing expense was driven by savings from the Strategic Restructuring Plan, a portion of which has been reinvested into the Company’s business. The decrease in distribution expense was primarily driven by revenue mix. Expressed as a percentage of Recorded Music revenue, Recorded Music selling, general and administrative expense remained constant at 28% for each of the three months ended March 31, 2025 and March 31, 2024.

Current wording

Recorded Music selling, general and administrative expense decreased by $8 million, to $345 million for the three months ended June 30, 2025 from $353 million for the three months ended June 30, 2024. The increase in general and administrative expense was largely driven by the impact of acquisitions of $4 million, partially offset by lower non-cash stock-based compensation and other related costs of $2 million. The decrease in selling and marketing expense was driven by savings from the 2024 Strategic Restructuring Plan, a portion of which has been reinvested into the Company’s business. The decrease in distribution expense was primarily driven by revenue mix. Expressed as a percentage of Recorded Music revenue, Recorded Music selling, general and administrative expense decreased to 25% for the three months ended June 30, 2025 from 28% for the three months ended June 30, 2024.

Previous wording

Recorded Music operating income increased by $69 million to $203 million for the three months ended March 31, 2025 from $134 million for the three months ended March 31, 2024. In addition to the factors impacting Adjusted OIBDA described below, the increase in operating income was driven by a decrease in restructuring and impairment charges of $75 million compared to the prior-year quarter which includes severance costs and impairment losses recorded in connection with the Strategic Restructuring Plan, partially offset by higher amortization expenses of $1 million related to acquisitions of music-related assets.

Current wording

Recorded Music operating income decreased by $29 million to $201 million for the three months ended June 30, 2025 from $230 million for the three months ended June 30, 2024. In addition to the factors impacting Adjusted OIBDA described below, the decrease in operating income was driven by an increase in restructuring and impairment charges of $67 million compared to the prior-year quarter, which includes an impairment charge of $70 million for long-lived assets associated with certain of the Company’s non-core e-tailer operations, and higher amortization expenses of $3 million related to acquisitions of music-related assets.

Previous wording

Music Publishing selling, general and administrative expense increased by $4 million, or 13%, to $35 million for the three months ended March 31, 2025 from $31 million for the three months ended March 31, 2024. Expressed as a percentage of Music Publishing revenue, Music Publishing selling, general and administrative expense increased to 11% for the three months ended March 31, 2025 from 10% for the three months ended March 31, 2024 driven by higher overhead and the impact of acquisitions.

Current wording

Music Publishing selling, general and administrative expense increased by $3 million, or 10%, to $34 million for the three months ended June 30, 2025 from $31 million for the three months ended June 30, 2024, driven by higher overhead and the impact of acquisitions. Expressed as a percentage of Music Publishing revenue, Music Publishing selling, general and administrative expense remained constant at 10% for the three months ended June 30, 2025 and June 30, 2024.

Previous wording

Music Publishing operating income decreased by $17 million to $52 million for the three months ended March 31, 2025 from $69 million for the three months ended March 31, 2024, driven by the same factors affecting Adjusted OIBDA discussed below, partially offset by the gain on divestiture of $14 million in the prior-year quarter, as well as an increase in depreciation and amortization expense of $5 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.

Current wording

Music Publishing operating income increased by $7 million to $60 million for the three months ended June 30, 2025 from $53 million for the three months ended June 30, 2024, driven by the same factors affecting Adjusted OIBDA discussed below, partially offset by an increase in depreciation and amortization expense of $10 million for the three months ended June 30, 2025 compared to the three months ended June 30, 2024.

Previous wording

Our operating loss from corporate expenses and eliminations increased by $3 million for the three months ended March 31, 2025 to $87 million from $84 million for the three months ended March 31, 2024, driven by incremental investment in technology and higher depreciation expense of $1 million, partially offset by restructuring and impairment charges of $7 million recorded in the prior-year quarter in connection with the Strategic Restructuring Plan, and lower expenses related to transformation initiatives of $1 million.

Current wording

Our operating loss from corporate expenses and eliminations increased by $17 million for the three months ended June 30, 2025 to $92 million from $75 million for the three months ended June 30, 2024, driven by incremental investment in technology and higher depreciation expense of $2 million driven by the core financials component of our new technology platform being placed into service.

Previous wording

Our Adjusted OIBDA loss from corporate expenses and eliminations increased by $10 million for the three months ended March 31, 2025 to $52 million from $42 million for the three months ended March 31, 2024, primarily due to the operating loss factors noted above.

Current wording

Our Adjusted OIBDA loss from corporate expenses and eliminations remained constant at $44 million for each of the three months ended June 30, 2025 and June 30, 2024, primarily due to the operating loss factors noted above.

Previous wording

Total revenues decreased by $92 million, or 3%, to $3,150 million for the six months ended March 31, 2025 from $3,242 million for the six months ended March 31, 2024. The prior year included $75 million from a licensing agreement extension for an artist’s catalog (the “Licensing Extension”) in Recorded Music licensing revenue and $30 million of Recorded Music streaming revenue from a deal with one of the Company’s digital partners (the “Digital License Renewal”), which resulted in upfront revenue recognition for the six months ended March 31, 2024. Revenue growth was also unfavorably impacted by the BMG Termination, which resulted in $32 million lower Recorded Music revenue compared to the six months ended March 31, 2024, of which $16 million was in streaming revenue and $16 million was in physical revenue. Adjusted for these items, total revenues increased 1%, which includes $46 million of unfavorable currency exchange fluctuations. Prior to intersegment eliminations, Recorded Music and Music Publishing revenues represented 80% and 20% of total revenues for the six months ended March 31, 2025, respectively, and 81% and 19% of total revenues for the six months ended March 31, 2024, respectively. Prior to intersegment eliminations, U.S. and international revenues represented 43% and 57% for the six months ended March 31, 2025, respectively, and 46% and 54% for the six months ended March 31, 2024, respectively.

Current wording

Total revenues increased by $43 million, or 1%, to $4,839 million for the nine months ended June 30, 2025 from $4,796 million for the nine months ended June 30, 2024. Revenue growth was favorably impacted by $16 million of higher Recorded Music digital revenue from the Copyright Settlement and $4 million of higher Recorded Music digital revenue from the DSP True-Up Payments. The prior year included $75 million in Recorded Music licensing revenue from a licensing agreement extension for an artist’s catalog (the “Licensing Extension”), $43 million of incremental Recorded Music streaming revenue recognized from the DSP True-Up Payments, and $30 million of Recorded Music streaming revenue from a deal with one of the Company’s digital partners (the “Digital License Renewal”), which resulted in upfront revenue recognition for the nine months ended June 30, 2024. Revenue growth was also unfavorably impacted by the BMG Termination, which resulted in $64 million lower Recorded Music revenue compared to the nine months ended June 30, 2024, of which $24 million was in streaming revenue and $40 million was in physical revenue. Prior to intersegment eliminations, Recorded Music and Music Publishing revenues represented 80% and 20% of total revenues for the nine months ended June 30, 2025, respectively, and 81% and 19% of total revenues for the nine months ended June 30, 2024, respectively. Prior to intersegment eliminations, U.S. and international revenues represented 43% and 57% for the nine months ended June 30, 2025, respectively, and 45% and 55% for the nine months ended June 30, 2024, respectively.

Previous wording

Total digital revenues after intersegment eliminations decreased by $30 million, or 1%, to $2,109 million for the six months ended March 31, 2025 from $2,139 million for the six months ended March 31, 2024. Excluding the BMG Termination and the Digital License Renewal, total digital revenues increased 1%. Total streaming revenue decreased 1% driven by Recorded Music, partially offset by growth in Music Publishing. Total digital revenues represented 67% of consolidated revenues for the six months ended March 31, 2025, from 66% for the six months ended March 31, 2024. Prior to intersegment eliminations, total digital revenues for the six months ended March 31, 2025 were composed of U.S. revenues of $998 million and international revenues of $1,111 million, or 47% and 53% of total digital revenues, respectively. Prior to intersegment eliminations, total digital revenues for the six months ended March 31, 2024 were composed of U.S. revenues of $1,047 million and international revenues of $1,092 million, or 49% and 51% of total digital revenues, respectively.

Current wording

Total digital revenues after intersegment eliminations increased by $27 million, or 1%, to $3,241 million for the nine months ended June 30, 2025 from $3,214 million for the nine months ended June 30, 2024. Total streaming revenue increased 1% primarily driven by an increase in streaming revenue at Music Publishing. Total digital revenues remained constant at 67% of consolidated revenues for each of the nine months ended June 30, 2025 and June 30, 2024. Prior to intersegment eliminations, total digital revenues for the nine months ended June 30, 2025 were composed of U.S. revenues of $1,533 million and international revenues of $1,709 million, or 47% and 53% of total digital revenues, respectively. Prior to intersegment eliminations, total digital revenues for the nine months ended June 30, 2024 were composed of U.S. revenues of $1,551 million and international revenues of $1,664 million, or 48% and 52% of total digital revenues, respectively.

Previous wording

The overall decrease in Recorded Music revenue was driven by decreases in digital, licensing, and artist services and expanded-rights revenues, partially offset by an increase in physical revenue. Digital revenue decreased by $42 million, or 2%, which includes an unfavorable impact of currency exchange fluctuations of $30 million. Revenue from streaming services fell by $36 million, or 2%, to $1,679 million for the six months ended March 31, 2025 from $1,715 million for the six months ended March 31, 2024. The decrease in streaming revenue reflects the unfavorable impact of the Digital License Renewal of $30 million, the BMG Termination of $16 million, and the unfavorable impact of foreign currency exchange rates of $29 million. Excluding the BMG Termination and the Digital License Renewal, streaming revenue increased 1%, driven by the impact of price increases in the prior year, the timing of deal renewals, and content delivery with certain emerging streaming platforms in the prior year. Download and other digital revenues decreased by $6 million, or 15%, to $35 million for the six months ended March 31, 2025 from $41 million for the six months ended March 31, 2024 primarily due to the continued shift to streaming services. Licensing revenue decreased by $68 million, or 24%, primarily driven by $75 million from the Licensing Extension in the prior year. Artist services and expanded-rights revenue decreased by $17 million attributable to lower concert promotion revenue, lower direct-to-consumer merchandising revenue at EMP, and a decrease in revenue related to the exit of the Company’s non-core owned and operated media properties in connection with the Strategic Restructuring Plan. Physical revenue increased by $13 million, or 5%, which includes the unfavorable impact of the BMG Termination of $16 million. Excluding the BMG Termination, physical revenue increased 12%, driven by releases from Linkin Park, Mariya Takeuchi, Hwang Young Woong, ROSÉ, and MISAMO, and includes an unfavorable impact of foreign currency exchange rates of $2 million.

Current wording

The overall decrease in Recorded Music revenue was driven by a decrease in licensing offset by increases in artist services and expanded-rights and physical revenues. Digital revenue increased by $5 million for the nine months ended June 30, 2025 compared to the nine months ended June 30, 2024, which includes an unfavorable impact of currency exchange fluctuations of $20 million, and reflects the impacts of the Copyright Settlement of $16 million and DSP True-Up Payments of $4 million in the current year and $43 million in the prior year, as well as the Digital License Renewal of $30 million and the BMG Termination of $24 million in the prior year. Revenue from streaming services decreased $4 million to $2,574 million for the nine months ended June 30, 2025 compared to $2,578 million for the nine months ended June 30, 2024, which includes the unfavorable impact of foreign currency exchange rates of $20 million, and reflects the impacts of the DSP True-Up Payments of $4 million in the current year and $43 million in the prior year, as well as the Digital License Renewal of $30 million and the BMG Termination of $24 million in the prior year. Download and other digital revenues increased by $9 million, or 15%, to $69 million for the nine months ended June 30, 2025 from $60 million for the nine months ended June 30, 2024 primarily due to the impact of the Copyright Settlement of $16 million, partially offset by the continued shift to streaming services. Licensing revenue decreased by $47 million, or 13%, primarily driven by $75 million from the Licensing Extension in the prior year. Artist services and expanded-rights revenue increased by $19 million, or 4%, attributable to higher concert promotion revenue in Europe. Physical revenue increased by $12 million, or 3%, driven by strong U.S. and international releases, including in Japan and Korea, and includes a favorable impact of foreign currency exchange rates of $2 million, partially offset by the unfavorable impact of the BMG Termination of $40 million. Top sellers for the nine months ended June 30, 2025 included ROSÉ, Bruno Mars, Teddy Swims, Linkin Park, Charli XCX, and Benson Boone.

Previous wording

The overall increase in Music Publishing revenue was attributable to increases in digital revenue of $12 million, or 3%, performance revenue of $6 million, or 6%, other publishing revenue of $4 million, and synchronization revenue of $1 million. Mechanical revenue remained constant. The increase in digital revenue was primarily driven by continued growth in streaming revenue. Revenue from streaming services grew by $12 million, or 3%, to $390 million for the six months ended March 31, 2025 from $378 million for the six months ended March 31, 2024, reflecting the continued market growth, partially offset by an unfavorable impact of foreign currency exchange rates of $4 million. The growth in performance revenue is attributable to growth from concerts, radio and live events, and the growth in synchronization revenue is attributable to the timing of copyright infringement settlements.

Current wording

The overall increase in Music Publishing revenue was attributable to increases in digital revenue of $22 million, or 4%, performance revenue of $12 million, or 8%, synchronization revenue of $13 million, or 8%, mechanical revenue of $3 million, or 7%, and other publishing revenue of $4 million. The increase in digital revenue was primarily driven by continued growth in streaming revenue. Revenue from streaming services grew by $22 million, or 4%, to $592 million for the nine months ended June 30, 2025 from $570 million for the nine months ended June 30, 2024, reflecting the impact of deal renewals, primarily in the U.S., partially offset by an unfavorable impact of foreign currency exchange rates of $2 million. The growth in performance revenue is attributable to growth from concerts, radio and live events in Europe, and the growth in synchronization revenue is attributable to the timing of other copyright infringement settlements, higher television and commercial licensing activity, and the $5 million impact of our acquisition of Tempo.