WMG changes
Pick any two versions below to diff them.
- Price
- $31.40 → $30.62(−2.5%)
- Next earnings
- Nov 5, 2026 → Nov 19, 2026
- Next earnings is estimate
- Yes → No
- Thesis
- The market prices Warner Music for the risk that streaming growth will slow and that AI-generated music will take listening time and lower the value of its catalog. The company also has net debt of $4.09 billion, and its CFO and COO left on July 31, 2026, with an acting CFO in his place. Results are strong now: in the quarter to June 30, 2026, revenue rose 10%, adjusted OIBDA rose 16% to $433 million and recorded music subscription streaming revenue rose 12%, helped by contractual increases in per-subscriber minimums with streaming services. For the gap to close, three things must be true. Subscription streaming revenue must keep double-digit growth as streaming services raise prices. The adjusted OIBDA margin must reach the high end of the target of 150 to 200 basis points of expansion for fiscal 2026 and keep growing in fiscal 2027. Free cash flow must keep growing, so that the company can pay its dividend and reduce net debt. The fiscal 2026 report, removed: estimated for about added: on November removed: 5, added: 19, 2026, gives the first test, and the appointment of a permanent CFO is another check. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is a slowdown in streaming subscriptions or a shift of listening to AI music.
- Checkpoints
- Nov removed: 5, 2026 (estimate): added: 19, 2026: Fiscal 2026 results and fiscal 2027 outlook. Pending. Watch: Adjusted OIBDA margin expansion at the high end of the 150 to 200 basis points target and continued double-digit subscription streaming growth pass; slower subscription growth or a smaller margin gain fails. Feb 2027 (estimate): Q1 fiscal 2027 results. Pending. Watch: Revenue and adjusted OIBDA growth with a permanent CFO in place pass; a fall in streaming growth or no permanent CFO fails.