Universal Music Group N.V. Reports Financial Results for theThird Quarter and Nine Months Ended September 30, 2023
Summary Q3 2023 Results1
•

•
•

•

Revenue of €2,752 million increased 3.3% year-over-year, or 9.9% in constant currency, driven by healthy
constant currency growth in all segments. Excluding items affecting comparability detailed below, revenue
grew 4.1% year-over-year, or 10.6% in constant currency.
Recorded Music subscription revenue grew 6.7% year-over-year, or 13.0% in constant currency andstreaming revenue declined 1.4% year-over-year, but grew 5.0% in constant currency.
Adjusted EBITDA of €581 million increased 5.1% year-over-year, or 11.3% in constant currency, and Adjusted
EBITDA margin expanded 0.3 percentage points to 21.1%. Excluding items affecting comparability detailed
below, Adjusted EBITDA grew 13.8% year-over-year, or 20.0% in constant currency, and Adjusted EBITDA
margin expanded 1.8 percentage points to 21.1%.
Top sellers included Taylor Swift, SEVENTEEN, Morgan Wallen, Olivia Rodrigo and King & Prince.

Summary YTD Results1
•

•
•

•

Revenue of €7,901 million increased 6.8% year-over-year, or 9.4% in constant currency, driven by strong
growth in all segments. Excluding items affecting comparability detailed below, revenue grew 8.6% yearover-year, or 11.1% in constant currency.
Recorded Music subscription revenue grew 9.9% year-over-year, or 12.1% in constant currency andstreaming revenue grew 1.0% year-over-year, or 2.9% in constant currency.
Adjusted EBITDA of €1,692 million increased 11.7% year-over-year, or 14.4% in constant currency, andAdjusted EBITDA margin expanded 0.9 percentage points to 21.4%. Excluding items affecting comparability
detailed below, Adjusted EBITDA grew 16.3% year-over-year, or 18.8% in constant currency, and Adjusted
EBITDA margin expanded 1.4 percentage points to 21.4%.
Top sellers included King & Prince, Taylor Swift, Morgan Wallen, Karol G and Metro Boomin.

Hilversum, The Netherlands, October 26, 2023 – Universal Music Group N.V. (“UMG” or “the Company”) today
announced its financial results for the third quarter and nine months ended September 30, 2023.
"Our performance this quarter was marked not only by continued growth across our businesses but also bystrong progress on our long-term strategy," said UMG’s Chairman and CEO Sir Lucian Grainge. "We remain laserfocused on driving sustainable value creation for the company and its stakeholders: identifying and capitalizing
on new revenue streams for UMG and our artists, responsibly advancing new technology, and expanding ourglobal footprint."
Boyd Muir, UMG's EVP, CFO and President of Operations said, “For the ninth consecutive quarter as a stand-alone
public company, we once again reported strong growth in revenue and Adjusted EBITDA. Even as we delivercurrent results, we continue to execute on the growth prospects that lie ahead for UMG."

1

This press release includes certain alternative performance indicators which are not defined in the International Financial ReportingStandards (“IFRS”) issued by the International Accounting Standards Board as endorsed by the EU. The descriptions of these alternative
performance indicators and reconciliations of non-IFRS to IFRS measures are included in the Appendix to this press release.

1

UMG Results
Three Months Ended
September 30,(in millions of euros)

Revenue
EBITDA

2023

2022(unaudited)(unaudited)

2,752

478

2,664

YoY

const.

3.3%

9.9%(11.3%)(5.9%)

553

5.1%

11.3%

17.4%

20.2%

Adjusted
EBITDA margin

21.1%

20.8%

581

%

539

EBITDA margin

Adjusted EBITDA%(2.8pp)0.3pp

Nine Months Ended
September 30,

2023

2022

(unaudited)(unaudited)

7,901

1,244

7,398

%

YoY

const.

6.8%

9.4%

1,499

(17.0%)(15.0%)

1,515

11.7%

14.4%

15.7%

20.3%

21.4%

20.5%

1,692

%

(4.6pp)0.9pp

Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted forconstant currency. Constant currency is calculated by taking current year results and comparing against prioryear results restated at current year rates.
Q3 2023 Results
Revenue for the third quarter of 2023 was €2,752 million, an increase of 3.3% year-over-year, or 9.9% in constantcurrency, driven by healthy constant currency growth in all segments. Revenue in the third quarter of 2023
included a €53 million benefit in Music Publishing from the accrual for a catch-up payment from certain DSPs
related to the Copyright Royalty Board Phonorecords III ruling in 2023 (the “CRB Phonorecords III Accrual”) .
Revenue in the third quarter of 2022 included a previously disclosed €71 million benefit in Recorded Music fromthe settlement of a copyright infringement lawsuit with an internet service provider (the “Legal Settlement”).
Excluding both of these items, revenue grew 4.1% year-over-year, or 10.6% in constant currency.
UMG’s Recorded Music, Music Publishing and Merchandising and Other segments all contributed to the revenue
growth in the quarter, as discussed further below.
EBITDA for the quarter declined 11.3% year-over-year, or 5.9% in constant currency, to €478 million. EBITDA
margin was 17.4%, compared to 20.2% in the third quarter of 2022. EBITDA and EBITDA margin were impacted
by non-cash share-based compensation expenses of €103 million during the third quarter of 2023, comparedto €14 million during the third quarter of 2022. Excluding non-cash share-based compensation expenses,
Adjusted EBITDA for the quarter was €581 million, up 5.1% year-over-year, or 11.3% in constant currency,
driven by the revenue growth and cash compensation savings of €21 million associated with the equity planrollout. Adjusted EBITDA margin was 21.1%, compared to 20.8% in the third quarter of 2022.
EBITDA and Adjusted EBITDA in the third quarter of 2023 included a €11 million benefit in Music Publishing fromthe CRB Phonorecords III Accrual. EBITDA and Adjusted EBITDA in the third quarter of 2022 included a €52 million
benefit from the Legal Settlement. Excluding these items, Adjusted EBITDA was up 13.8% year-over-year, or
20.0% in constant currency, and Adjusted EBITDA margin improved 1.8 percentage points to 21.1%, compared to19.3% in the third quarter of 2022.
EBITDA and Adjusted EBITDA were also impacted by revenue mix, as revenues in the third quarter of 2023 weremore heavily weighted towards Merchandising and Other revenues, which carry a lower EBITDA margin than the
Company’s Recorded Music and Music Publishing revenues, and towards physical sales, which carry a lower
EBITDA margin than digital sales. This impact was partially offset by the timing of certain A&R expenses, whichwere elevated in the third quarter of 2022.
YTD 2023 Results
In the nine months ended September 30, 2023, UMG’s revenues of €7,901 million increased by 6.8% year-overyear, or 9.4% in constant currency, compared to the nine months ended September 30, 2022. This increase wasdriven by strong improvements across all segments, as discussed further below.
Revenue for the nine months ended September 30, 2023 included the €53 million benefit in Music Publishingfrom the CRB Phonorecords III Accrual and revenue for the nine months ended September 30, 2022 included the€71 million benefit from the Legal Settlement discussed above. Revenue for the nine months ended September230, 2022 also included a €98 million benefit from the Change in Society Accounting previously defined anddetailed in UMG's earnings press release for the second quarter and half year ended June 30, 2023. Excludingthese items, revenue increased 8.6% year-over-year, or 11.1% in constant currency.
For the nine months ended September 30, 2023, EBITDA of €1,244 million declined 17.0% year-over-year, or
15.0% in constant currency, and EBITDA margin was 15.7% compared to 20.3% in the prior year period. EBITDA
and EBITDA margin were impacted by non-cash share-based compensation expenses of €448 million during
the first nine months of 2023, compared to €16 million during the first nine months of 2022. Excluding theseamounts, Adjusted EBITDA for the first nine months of 2023 was €1,692 million, up 11.7% compared to the firstnine months of 2022, and up 14.4% in constant currency, driven by the revenue growth and cash compensation
savings of €55 million associated with the equity plan rollout. Adjusted EBITDA margin increased 0.9 percentage
points year-over-year to 21.4%.
EBITDA and Adjusted EBITDA for the nine months ended September 30, 2023 included the €11 million benefit
from the CRB Phonorecords III Accrual in Music Publishing. EBITDA and Adjusted EBITDA for the nine months
ended September 30, 2022 included the €52 million benefit from the Legal Settlement and a €17 million benefit
from the Change in Society Accounting. Excluding these items, Adjusted EBITDA grew 16.3% year-over-year, or
18.8% in constant currency, and Adjusted EBITDA margin improved to 1.4 percentage points to 21.4%, compared
to 20.0% for the nine months ended September 30, 2022.

Recorded Music
Three Months Ended
September 30,(in millions of euros)

Subscriptions
and streamingof which streamingof which subscription
Downloads andother digital
PhysicalLicense and other
RecordedMusic revenues

2023

2022

(unaudited)(unaudited)

1,414

1,353

%

%

YoY

const.

Nine Months Ended
September 30,

2023

2022

(unaudited)(unaudited)

%

%

YoY

const.

4.5%

10.9%

4,169

3,876

7.6%

9.7%

357

362 (1.4%)

5.0%

1,030

1,020

1.0%

2.9%

59

137 (56.9%) (53.2%)

174

275 (36.7%) (33.8%)294

264 11.4%

20.0%

933

803

16.2%

20.5%

2,037

2,060 (1.1%)

5.2%

6,040

5,703

5.9%

8.5%

1,057

270

991

6.7%

306 (11.8%)

13.0%(6.9%)

3,139

764

2,856

749

9.9%

2.0%

12.1%

5.1%

Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted forconstant currency.
Q3 2023
Recorded Music revenues for the third quarter of 2023 were €2,037 million, down 1.1% compared to the third
quarter of 2022, but up 5.2% in constant currency. Excluding the Legal Settlement in 2022, revenues grew by
2.5% year-over-year, or 8.9% in constant currency. Subscription revenue grew 6.7% year-over-year, or 13.0%
in constant currency, driven primarily by the growth in global subscribers. Streaming revenue declined 1.4%
year-over-year, but grew 5.0% in constant currency, as the broader advertising industry continued to slowly
recover. Physical revenue increased 11.4% year-over-year, or 20.0% in constant currency, driven by strong vinyl
sales, particularly in the US and Europe, as well as multi-format physical growth in Japan. Downloads and otherdigital revenue declined 56.9% year-over-year, or 53.2% in constant currency, attributable to the benefit fromthe Legal Settlement in the third quarter of 2022 as well as the continued format shift away from downloads.
License and other revenue declined 11.8% year-over-year, or 6.9% in constant currency, due to a difficultcomparison, as the third quarter of 2022 benefitted from the strong recovery in live touring, where the Company
participates with a limited number of artists in certain markets. Top sellers for the quarter included Taylor Swift,
SEVENTEEN, Morgan Wallen, Olivia Rodrigo and King & Prince, while top sellers in the prior-year quarter included
BTS, BLACKPINK, Ado, INI and Morgan Wallen.

3

YTD 2023 Results
In the nine months ended September 30, 2023, Recorded Music revenues were €6,040 million, up 5.9% yearover-year, or 8.5% in constant currency. Excluding the Legal Settlement in 2022, revenues grew by 7.2% yearover-year, or 9.8% in constant currency.
Subscription revenue of €3,139 million grew 9.9% year-over-year, or 12.1% in constant currency driven primarily
by the growth in global subscribers. Streaming revenue of €1,030 million grew 1.0% year-over-year, or 2.9% in
constant currency as the broader advertising market has seen mixed performance this year. Physical revenue
grew 16.2% year-over-year, or 20.5% in constant currency as vinyl and CD sales both grew. Downloads and otherdigital revenue decreased 36.7% year-over-year, or 33.8% in constant currency, attributable to the benefit fromthe Legal Settlement in the third quarter of 2022 as well as the continued format shift away from downloads.
License and other revenue improved 2.0% year-over-year, or 5.1% in constant currency. Top sellers included
King & Prince, Taylor Swift, Morgan Wallen, Karol G and Metro Boomin, while top sellers in the prior year included
BTS, the Encanto soundtrack, Olivia Rodrigo, Morgan Wallen and The Weeknd.

Music PublishingThree Months Ended
September 30,(in millions of euros)

Performance

Synchronisation

2023

%

%

YoY

const.

92

15.2%

21.8%

2022

(unaudited)

106
55(unaudited)

57(3.5%)

3.8%

Digital

294

234

25.6%

33.6%

Other

11

10

10.0%

22.2%

418

17.5%

24.6%

MechanicalMusic
Publishing revenues

25

491

25

0.0%

0.0%

Nine Months Ended
September 30,

2023

%

%

YoY

const.

219

33.8%

37.6%

771

2.3%

4.5%

2022

(unaudited)(unaudited)

183

177

293
789
77
38

1,380

3.4%

5.2%

31

22.6%

8.5%

10.0%

1,269

8.7%

11.1%

71

26.7%

Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted forconstant currency.
Q3 2023
Music Publishing revenue amounted to €491 million in the third quarter of 2023, up 17.5% year-over-year, or
24.6% in constant currency. Music Publishing revenue in the third quarter of 2023 included the €53 million
benefit from the CRB Phonorecords III Accrual. Excluding this item, Music Publishing revenue was up 4.8%
year-over-year, or 11.2% in constant currency.
Within Music Publishing, digital revenue grew 25.6% year-over-year, or 33.6% in constant currency, reflecting
the CRB Phonorecords III Accrual and continued growth of streaming and subscription. Performance revenue
grew 15.2% year-over-year, or 21.8% in constant currency. Synchronisation revenue declined 3.5% year-overyear, but grew 3.8% in constant currency. Mechanical revenue was stable year-over-year.
YTD 2023 Results
In the nine months ended September 30, 2023, Music Publishing revenue amounted to €1,380 million, up 8.7%
year-over-year, or 11.1% in constant currency. Music Publishing revenue in the nine months ended September
30, 2023 included the €53 million benefit from the CRB Phonorecords III Accrual while revenue in the ninemonths ended September 30, 2022 included the €98 million benefit from the Change in Society Accounting.
Excluding these items, Music Publishing revenue grew 13.3% year-over-year, or 16.0% in constant currency,
as a result of continued growth in streaming and subscription revenue and improvements in mechanical,
sychronization and performance revenue.
Within Music Publishing, digital revenue grew 2.3% year-over-year, or 4.5% in constant currency, driven by
growth in streaming and subscription revenue. Digital revenue benefitted from the CRB Phonorecords III Accrualin the first nine months of 2023 and from a portion of the Change in Society Accounting in the first nine monthsof 2022. Performance revenue grew 33.8% year-over-year, or 37.6% in constant currency, reflecting better than
expected receipts following the COVID recovery and due to the Change in Society Accounting which had a4negative impact on the prior year performance revenue. Synchronisation revenue grew 3.4% year-over-year, or
5.2% in constant currency. Mechanical revenue grew 8.5% year-over-year, or 10.0% in constant currency, as aresult of improvements in physical sales.

Merchandising and Other
Three Months Ended
September 30,(in millions of euros)

Merchandising andother revenues

2023

2022

(unaudited)(unaudited)

227

189

%

%

YoY

const.

20.1%

Nine Months Ended
September 30,

2023

2022

(unaudited)(unaudited)

491

437

27.5%

%

%

YoY

const.

12.4%

14.7%

Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted forconstant currency.
Q3 2023
Merchandising and other revenue in the third quarter of 2023 was €227 million, an increase of 20.1% yearover-year, or 27.5% in constant currency, driven by growth in direct-to-consumer sales and higher touring
merchandise sales.
YTD 2023 Results
Merchandising and other revenue of €491 million was up 12.4% year-over-year, or 14.7% in constant currency,
driven by the growth in direct-to-consumer sales, partially offset by lower retail sales.

Items Impacting Comparability of Results
TOTAL UMG
Three Months Ended

Nine Months Ended

September 30,(in millions of euros)

2023

Revenue

September 30,

2022

2023

2022

Legal Settlement

-

71

-

71

CRB Phonorecords III Accrual

53

-

53

-

Change in Society Accounting-

Adjusted EBITDA

-

-

98

Legal Settlement

-

52

-

52

CRB Phonorecords III Accrual

11

-

11

-

Change in Society Accounting

-

-

-

17

RECORDED MUSIC
Three Months Ended

Nine Months Ended

September 30,(in millions of euros)

Revenue

Legal Settlement
Adjusted EBITDA

Legal Settlement

2023

September 30,

2022

2023

2022

-

71

-

71

-

52

-

52

5

MUSIC PUBLISHING
Three Months Ended

Nine Months Ended

September 30,(in millions of euros)

Revenue

Change in Society Accounting
CRB Phonorecords III Accrual
Adjusted EBITDA

Change in Society Accounting
CRB Phonorecords III Accrual

2023

September 30,

2022

2023

-

-

-

-

53

11

-

-

2022

-

98

-

17

53

11

-

-

Change in Society Accounting
As disclosed in UMG’s Annual Consolidated Financial Statements for the year ended December 31, 2021, UMG
adjusted its accounting policy in relation to certain revenues that are collected through societies. In prioryears, these revenues were recognized when the relevant collection society notified UMG of the usage by theend customer and collectability was assured. Recognition of that revenue, in both 2022 and 2023, was based onan accrual for the best available estimate of when the usage occurs and the amount of consideration which
is probable to be collected. This has affected the timing of the recognition of certain revenues across financial
reporting quarters compared to periods before 2022 and also, notably in the second quarter of 2022, reflected
the receipt of higher income than was accrued at the end of 2021.
Legal Settlement
Revenue, EBITDA and Adjusted EBITDA in 2022 included a benefit from the settlement of a copyright
infringement lawsuit with an internet service provider previously disclosed and booked in Q3 2022.
CRB Phonorecords III Accrual
Revenue, EBITDA and Adjusted EBITDA in 2023 included the accrual for a catch-up payment from certain DSPs
related to the Copyright Royalty Board Phonorecords III ruling in 2023 disclosed and booked in Q3 2023.

6

Conference Call Details
The Company will host a conference call to discuss these results on Thursday, October 26, 2023, at 6:15pm CEST .
A link to the live audio webcast will be available on investors.universalmusic.com and a link to the replay will beavailable after the call.
While listeners may use the webcast, a dial-in telephone number is required for investors and analysts
to ask questions. Investors and analysts interested in asking questions can pre-register for a dial-in line
at investors.universalmusic.com under the "Financial Reports" tab.

Cautionary NoticeThis press release is published by Universal Music Group N.V. and contains inside information within themeaning of article 7(1) of Regulation (EU) No 596/2014 (Market Abuse Regulation).

Forward-Looking Statements
This press release may contain statements that constitute forward-looking statements with respect to UMG’sfinancial condition, results of operations, business, strategy and plans. Such forward-looking statements may
be identified by the use of words such as ‘profit forecast’, ‘expect’, ‘estimate’, ‘project’, ‘anticipate’, ‘should’,‘intend’, ‘plan’, ‘probability’, ‘risk’, ‘target’, ‘goal’, ‘objective’, ‘will’, ‘endeavour’, ‘optimistic’, ‘prospects’ andsimilar expressions or variations on such expressions. Although UMG believes that such forward-looking
statements are based on reasonable assumptions, they are not guarantees of future performance. Actual
results may differ materially from such forward-looking statements as a result of a number of risks anduncertainties, many of which are related to factors that are outside UMG’s control, including, but not limited
to, UMG’s inability to compete successfully and to identify, attract, sign and retain successful recording artists
and songwriters, failure of streaming and subscription adoption or revenue to grow or to grow less rapidly
than anticipated, UMG’s reliance on digital service providers, UMG’s inability to execute its business strategy,
the global nature of UMG’s operations, UMG’s inability to protect its intellectual property and against piracy,
UMG’s inability to attract and retain key personnel, changes in laws and regulations and the other risks thatare described in our 2022 Annual Report. Accordingly, UMG cautions readers against placing undue relianceon such forward-looking statements. Such forward-looking statements are made as of the date of this press
release. UMG disclaims any intention or obligation to provide, update or revise any such forward-looking
statements, whether as a result of new information, future events or otherwise.

Alternative Performance Indicators
This press release includes certain alternative performance indicators which are not defined in IFRS issued
by the International Accounting Standards Board as endorsed by the EU. The descriptions of these alternative
performance indicators and reconciliations of non-IFRS to IFRS measures are included in the Appendix to thispress release.

About Universal Music GroupAt Universal Music Group (EURONEXT: UMG), we exist to shape culture through the power of artistry. UMG is
the world leader in music-based entertainment, with a broad array of businesses engaged in recorded music,
music publishing, merchandising and audiovisual content. Featuring the most comprehensive catalogue ofrecordings and songs across every musical genre, UMG identifies and develops artists and produces anddistributes the most critically acclaimed and commercially successful music in the world. Committed toartistry, innovation and entrepreneurship, UMG fosters the development of services, platforms and businessmodels in order to broaden artistic and commercial opportunities for our artists and create new experiences forfans. For more information on Universal Music Group N.V. visit www.universalmusic.com.

Contacts
Media
James Murtagh-Hopkins - communicationsnl@umusic.com
Investors
Erika Begun - investorrelations@umusic.com
7Appendix

Non-IFRS Alternative Performance Indicators
and Reconciliations
Reconciliation of Adjusted EBITDA
Three Months Ended
September 30,(in millions of euros)

EBITDA
Non-cash share-based
compensation expenses
Adjusted EBITDA

2023

%

2022

YoY

Nine Months Ended
September 30,

%

2023

2022

YoY

(unaudited)(unaudited)

1,499(17.0%)(unaudited)(unaudited)539(11.3%)

10314

635.7%

448

16

2700.0%

581

553

5.1%

1,692

1,515

11.7%

478

1,244

Definitions
In this press release, UMG presents certain financial measures when discussing UMG’s performance that are
not measures of financial performance or liquidity under IFRS (“non-IFRS”). These non-IFRS measures (alsoknown as alternative performance indicators) are presented because management considers them important
supplemental measures of UMG’s performance and believes that they are widely used in the industry in which
UMG operates as a means of evaluating a company’s operating performance and liquidity. UMG believes that anunderstanding of its sales performance, profitability, financial strength and funding requirements is enhanced
by reporting the following non-IFRS measures. All non-IFRS measures should be considered in addition to, andnot as a substitute for, other IFRS measures of operating and financial performance as described in this press
release. In addition, it should be noted that other companies may have definitions and calculations for these
non-IFRS measures that differ from those used by UMG, thereby affecting comparability.
EBITDA and EBITDA margin
UMG considers EBITDA and EBITDA margin, non-IFRS measures, to be relevant measures to assess its operating
performance and the performance of its operating segments as reported in the segment data. It enables
UMG to compare the performance of operating segments regardless of whether their performance is driven
by the operating segment’s organic growth or by acquisitions. It excludes restructuring expenses, which may
impact period-to-period comparability. EBITDA margin is EBITDA divided by revenue. To calculate EBITDA, theaccounting impact of the following items is excluded from the Operating Profit:i.
amortization of intangible assets;ii.
impairment losses on goodwill and other intangibles;iii.
depreciation of tangible assets including right of use assets;iv.
(gains)/losses on the sale of tangible assets, included right of use assets and intangible assets; andv.
restructuring expenses.
Adjusted EBITDA and Adjusted EBITDA margin
The difference between EBITDA and Adjusted EBITDA consists of non-cash share-based compensation expenses
and, if applicable, certain one-time items that are deemed by management to be significant and incidental
to normal business activity. Adjusted EBITDA margin is Adjusted EBITDA divided by revenue. UMG considers
Adjusted EBITDA and Adjusted EBITDA margin, non-IFRS measures, to be relevant measures to assess
performance of its operating activities excluding items that may be incidental to normal business activity andexcluding non-cash share based compensation which may impact period-to-period comparability.

8