Taylor Swift helps Universal Music Group generate $2.9b in Q3
The huge success of Taylor’s Lover album is attributed to Universal Music Group’s healthy revenues in its financial third quarter.
Figures published by its French parent company Vivendi showed UMG had revenues of €1.8 billion (A$2.9 billion or US$2 billion) in the three months to the end of September from records publishing, licensing and merchandising.
Lover sold 3 million copies in its first week alone around the world.
The quarterly figures were an increase of 16% from the same period in 2018.
The company also got strong Q3 traction from Post Malone’s Hollywood’s Bleeding (biggest streaming week for an album in the United States in 2019, with over 365 million on-demand audio streams), Billie Eilish, Ariana Grande, Japanese band King & Prince, the A Star Is Born soundtrack and the Queen catalogue.
Vivendi noted that it performed particularly well in the world’s largest music market, the US.
It stated in its report, “UMG has had the five biggest United States debut sales weeks for albums this year with Taylor Swift, Post Malone, Jonas Brothers’ Happiness Begins, Ariana Grande’s Thank U, Next and Billie Eilish’s When We All Fall Asleep Where Do We Go?.
The buoyant performance is expected to continue in Q4 with releases from Kanye West, Lady Antebellum, Shawn Mendes, Sting, the Who, and Bocelli among others
Recorded music rose 13.3% (at constant currency) to €1.376 billion ($2.24 billion).
Breaking it down that was €945 million ($1.54 billion) from streaming and downloads (a rise of 21.5% from 3Q 2018 achievements).
Physical sales grew 18.6% to €230 million ($374.8 million), helped by the fact that Lover generated 700,000 vinyl format sales in the US alone.
As percentages of recorded music that breaks out to 68.7% digital, (60.8% is streaming and 7.8% is downloads;), 16.7% physical and 14.6% from licensing.
Publishing was particularly strong again, with a 8.3% rise to €293 million. It is heading for its first US$1 billion delivery in 2019.
Merchandising took a 82.4% jump to €136 million ($221.6 million).
Vivendi says its US$3.3 billion sale of a 10% stake in UMG to Tencent should be completed in a matter of weeks.
It values UMG at US$33 billion, and has the right to purchase another 10% down the track.
It adds that other companies have “expressed an interest in investing at a similar price level.”
Vivendi will sell up to 50% of its stake, it has announced.
In May Bloomberg cited unnamed sources that the sale was slow because potential suitors were baulking at the high price expected, but Vivendi responded at the time that the entire sale could be finalised by the end of January 2020.
Vivendi said this week it may use proceeds from the deal “for a significant share buyback program and bolt-on acquisitions”.