Sony Music streaming up in Q2 but pandemic sees revenues dip
Sony’s financial Q2 ending June 30 showed the snakes and ladders of the COVID-19 pandemic hitting its music division from start of April.
The major positive was that streaming was up nearly 6% for recorded music and music publishing to ¥68.9 billion (A$894.7 million) from the same period in 2019.
But streaming gains were not enough to offset the hits to recorded and publishing – revenue from the former fell by a 12.4% drop to ¥98.1 billion ($1.27 billion) while the latter’s fell 14.6% to ¥129.2 billion ($1.67 billion) after drops in sync and performance royalties.
The closure of physical stores around the world hit CD and vinyl sales by over 40% to ¥12.69 billion ($164.9 million).
Licensing, merchandising and concert staging, (collectively referred to as “other” in the Sony financials) had a 40% decline to ¥8.87 billion ($115.14 million).
Interestingly, consumers’ shift to online saw the decline of downloads slowing down, from 12.5% to the 20% rate of the last few years.
During the quarter, Sony said its best sellers included Harry Styles’ Fine Line, Future’s High Off Life, Doja Cat’s Hot Pink, Travis Scott’s Astroworld, Polo G’s The Goat, Khalid’s Free Spirit, Pwofu’s Death Bed, Luke Combs’ dual What You See Is What You Get and This One’s For You and from Japan, Ju Ju’s Your Story and Milet’s Eyes.
Sony said, “Around the world, the release of new music is being delayed primarily due to some artists being unable to record songs and music videos.
“The impact on profitability from the delays in new music is limited at this time in the U.S. and other countries where the proportion of music that is streamed is high.
“However, in countries like Japan where the proportion of music that is streamed is relatively low, CDs and other packaged media sales are decreasing due to restrictions on going outside.
“Ticket and merchandising revenues are also decreasing, as concerts and other events are being postponed and cancelled in Japan and other areas.
“Due to a global reduction in advertising spending, revenue from advertising-supported streaming services and revenue from the licensing of music in TV commercials is decreasing.
“Additionally, delays in the production of motion pictures and TV shows are causing a decline in music licensing revenue.”
Sony expects music operations to bring in ¥790 billion ($10.2 billion) with releases expected from Apache 207, Beyonce, Dominic Fike, Fantsy, G-Easy, Indochino, Jean-Baptiste Guegan, Julien Dore, Kang Daniel, Maluma, the Chicks, The Kid Laroi, and the Neighbourhood.