For Universal Music Group — and Sony Music and Warner Music Group — there’s no stopping revenue from music streaming. Yet, how much are artists really getting?
Under Vivendi ownership, Universal Music Group posted their best financial performance thus far. Across recorded music, publishing, and other activities, UMG’s overall revenues rose to $5.57 billion. This number is up 4.4% from 2015’s $5.41 billion.
Earnings before interest, taxes, and amortization (EBITDA) came to $681 million, up 9.1% from 2015 in constant global currency.
Streaming helped drive UMG’s revenues in 2016. The company’s revenues from streaming grew a whopping 58% in 2016.
All of which leads a fun fact about music streaming. Per the company’s numbers, 2016 streaming figures equated to $137 million a month. By week, the company makes $32 million, and per day, it earns $4.5 million.
This increase helped to offset steep declines in album and download sales.
Those formats have been avalanching. Album sales saw a 15% drop, while download sales also saw a 29% decline. Downloads include the iTunes-standard DRM-free AAC format as well as other formats like ringtones.
Let’s break down some other categories from the financial disclosure.
UMG’s operating income grew 10%. The mega-label attributed the rise in operating income to album popularity from artists like Drake, Rihanna, and Ariana Grande. Carryover sales from Justin Bieber also boosted sales.
Recorded music revenues also rose to $4.63 billion, up 1.8% over the previous year’s $4.55 billion. Of course, recorded music revenue from Spotify and Apple Music also saw a solid increase, from 2015’s $1.06 billion to $1.64 billion, a 55.5% jump.
Revenue in merchandising also saw strong growth. It grew 16.1% thanks to “stronger touring activity” from its artists. Income from music operations also jumped 10.7% from 2015, totaling $726.9 million.
Will the streaming surge continue?
While praising record revenue, chief executive of Vivendi, Arnaud de Puyfontaine, remained cautiously optimistic that streaming momentum would continue this year. Yet, UMG’s earnings weren’t enough to offset Vivendi’s losses. FT reports that Vivendi’s core operating profits fell 23%. Canal Plus, a French television channel, saw its weakest revenue in five years.