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Warner Music Group's (WMG) Q1 Earnings and Revenues Increase Y/Y

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Warner Music Group’s (WMG - Free Report) first-quarter 2022 adjusted earnings of 36 cents per share increased 100% year over year.

The Zacks Consensus Estimate for earnings was pegged at 29 cents per share

Revenues of $1.61 billion beat the Zacks Consensus Estimate by 7.3% and increased 21% year over year.

Region-wise, revenues from the United States (44.8% of revenues) increased 26.4% year over year to $723 million. International revenues (55.3% of revenues) increased 16.8 % year over year to $892 million.

Warner Music Group Corp. Price, Consensus and EPS Surprise Warner Music Group Corp. Price, Consensus and EPS Surprise

Warner Music Group Corp. price-consensus-eps-surprise-chart | Warner Music Group Corp. Quote

Top-Line Details

Total streaming revenues increased 22.8% year over year (23.6% at constant currency) to $965 million, driven by growth across Recorded Music and Music Publishing, including revenues from emerging streaming platforms.

Recorded music revenues of $1.386 billion rose 19.4% year over year.

Music publishing revenues were up 30.9% year over year, amounting to $229 million.

Digital revenues (62.1% of revenues) logged $1.002 billion in the reported quarter, up 21.5% year over year.

Operating Details

In the first-quarter, adjusted OIBDA increased 25.9% year over year to $355 million. Adjusted OIBDA margin expanded 90 basis points (bps) on a year-over-year basis to 22% due to strong operating performance.

Adjusted EBITDA increased 31% year over year to $389 million. EBITDA margins expanded 190 bps to 24.1%.

Selling, general and administrative expenses increased 24% year over year to $497 million

Adjusted operating income increased 29.9% year over year to $274 million in the reported quarter.

Balance Sheet

As of Dec 31, 2021, Warner Music Group had cash and cash equivalents of $450 million compared with $499 million as of Sep 30, 2021.

Free cash flow in the reported quarter was $95 million against the free cash flow of $193 million in the previous quarter.

As of Dec 31, 2021, the company had total debt of $3.85 billion and net debt of $3.40 billion.

Zacks Rank & Other Stocks to Consider

Warner Music Group currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks from the Zacks Consumer Discretionary sector are Cedar Fair (FUN - Free Report) and Crocs (CROX - Free Report) , both sporting a Zacks Rank #1 (Strong Buy), and Gildan Activewear (GIL - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Cedar Fair is set to announce fourth-quarter 2021 results on Feb 16.

FUN is up 35.9% in the past year against the Zacks Leisure and Recreation Services industry’s decline of 3.3% and the Consumer Discretionary sector’s fall of 22.5%.

Crocs is set to announce fourth-quarter fiscal 2021 results on Feb 16.

CROX is up 31.3% in the past year against the Zacks Textile – Apparel industry’s decline of 7% and the Consumer Discretionary sector’s fall of 22.5% in the past year.

Gildan Activewear is set to announce fourth-quarter 2021 results on Feb 23.

GIL is up 48.4% in the past year against the Zacks Textile – Apparel industry’s decline of 7% and the Consumer Discretionary sector’s fall of 22.5%.

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