Q2 2026 Results Highlights(1)
-- Revenue of EUR3,294 million grew 10.5% year-over-year, or 13.3% in
constant currency, with the consolidation of Downtown Music Holdings
("Downtown"), pricing benefits of Streaming 2.0 agreements, strong
physical and licensing and other sales, and healthy performance revenue
amongst the key contributors to growth in Recorded Music and Music
Publishing.
-- Recorded Music subscription revenue grew 14.3% year-over-year, or 16.6%
in constant currency, benefitting from the consolidation of Downtown, as
well as from pricing benefits of Streaming 2.0 agreements.
-- Adjusted EBITDA of EUR674 million declined 0.3% year-over-year, but
increased 1.5% in constant currency driven by revenue growth, while
Adjusted EBITDA margin decreased 2.2pp to 20.5% due to the consolidation
of Downtown, pressure from revenue and repertoire mix in Recorded Music,
and a loss in Merchandising.
-- Top sellers included Noah Kahan, BTS, Olivia Rodrigo, Drake and Olivia
Dean.
H1 2026 Results Highlights(1)
-- Revenue of EUR6,194 million increased 5.3% year-over-year, or 10.8% in
constant currency, driven by the consolidation of Downtown, and
underlying growth in the Recorded Music and Music Publishing segments.
-- Recorded Music revenue grew 6.8% year-over-year, or 12.7% in constant
currency and Music Publishing grew 3.8% year-over-year, or 8.4% in
constant currency, both benefitting from the consolidation of Downtown,
while Merchandising and Other revenue declined 12.1%, or 7.6% in constant
currency.
-- Recorded Music subscription revenue grew 9.0% year-over-year, or 14.5% in
constant currency, and streaming revenue grew 2.4% year-over-year, or
8.3% in constant currency, helped by the consolidation of Downtown.
-- Adjusted EBITDA of EUR1,310 million decreased 1.9% year-over-year, but
increased 2.7% in constant currency, and Adjusted EBITDA margin
contracted 1.6pp to 21.1% largely due to the consolidation of Downtown.
-- EPS was EUR0.12 per share compared to EUR0.78 in the first half of 2025
with the decline largely due to variance in revaluation of investments in
listed and other companies. Adjusted diluted EPS of EUR0.47 per share
declined 1.7% year-over-year, but grew 4.3% in constant currency.
-- 2026 interim dividend of EUR0.24 per share, in line with the 2025 interim
dividend.
1 This press release includes certain alternative performance indicators which are not defined in the IFRS Accounting Standards ('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 Interim Financial Review and Unaudited Condensed Consolidated Interim Financial Statements which is available on our website at investors.universalmusic.com/reports.
Hilversum, The Netherlands, July 30, 2026 /PRNewswire/ -- Universal Music Group N.V. ("UMG" or "the Company") today announced its financial results for the second quarter and half year ended June 30, 2026.
Sir Lucian Grainge, Chairman and Chief Executive Officer of UMG, said, "We're delivering on our strategic plan, and working to further sharpen our execution, while capitalizing on the opportunities presented by new technologies and the ever-evolving music ecosystem. Our unique combination of global reach, local expertise, artist development, vast audio and visual IP and entrepreneurial culture positions UMG to deliver long-term growth, sustained value creation, and creative and commercial success for our artists and songwriters."
"This quarter demonstrated both the strong fundamentals of our business and the opportunities we see to improve," said Matt Ellis, UMG's CFO. "Our focus is on building our market leadership, while driving top and bottom-line growth, improving efficiency, and continuing to invest where we see the greatest returns."
UMG RESULTS
Three Months Six Months
Ended June Ended June
30, % % % 30, % % %
const. const.
excl. excl.
(millions of euros) 2026 2025 YoY const. DMG(1) 2026 2025 YoY const. DMG(1)
------ ------ ------- ------ ------- ------ ------ -------- -------- -------
(unaudited) (unaudited)
Revenue 3,294 2,980 10.5 % 13.3 % 6.4 % 6,194 5,881 5.3 % 10.8 % 5.7 %
EBITDA 610 611 (0.2 %) 1.5 % (0.2 %) 1,181 1,214 (2.7 %) 1.8 % 0.7 %
EBITDA margin 18.5 % 20.5 % (2.0pp) (1.3pp) 19.1 % 20.6 % (1.5pp) (1.0pp)
Adjusted EBITDA 674 676 (0.3 %) 1.5 % 0.0 % 1,310 1,336 (1.9 %) 2.7 % 1.6 %
Adjusted EBITDA
margin 20.5 % 22.7 % (2.2pp) (1.3pp) 21.1 % 22.7 % (1.6pp) (0.8pp)
Operating profit 901 947 (4.9 %) (0.6 %) (0.8 %)
Net profit attributable to equity holders of the parent 222 1,432 (84.5 %) (84.1 %)
Adjusted net profit 863 882 (2.2 %) 3.9 %
Net cash provided by operating activities before income tax
paid 408 488 (16.4 %)
Free cash flow(2) 24 163 (85.3 %)
Weighted average number of shares outstanding 1,831 1,831
EPS - basic 0.12 0.78 (84.5 %) (84.1 %)
EPS - diluted 0.12 0.77 (84.4 %) (84.1 %)
Adjusted EPS - basic 0.47 0.48 (2.2 %) 3.9 %
Adjusted EPS - diluted 0.47 0.48 (1.7 %) 4.3 %
(1 DMG = Downtown.2 During Q2 2026, UMG revised how it defines Free Cash Flow to better reflect the cash generated by its business that is available for strategic investments and capital return. Following this change in definition, the HY25 Free Cash Flow has been restated. See "New Definition of Free Cash Flow" for further details.)
Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted for constant currency. Constant currency is calculated by taking current year results and comparing against prior year results restated at current year rates.
Q2 2026 Results
Revenue for the second quarter of 2026 ("Q2 2026") grew 13.3% in constant currency, which included the consolidation of Downtown for the entire quarter. Excluding Downtown, revenue grew 6.4% in constant currency with improvement in Recorded Music and Music Publishing primarily driven by:
-- pricing benefits of Streaming 2.0 agreements;
-- outsized audiovisual and live and related income within "License and
other" revenue;
-- strong physical sales; and
-- healthy Music Publishing performance revenue.
Adjusted EBITDA increased 1.5% in constant currency. Excluding Downtown, Adjusted EBITDA was largely flat in constant currency and Adjusted EBITDA margin declined 1.3pp year-over-year due to:
-- revenue and repertoire mix in Recorded Music;
-- an increase in corporate overhead,
largely due to higher professional fees; and
-- a loss in Merchandising.
H1 2026 Results
In the half year ended June 30, 2026 ("H1 2026"), UMG's revenue was up 10.8% in constant currency, and up 5.7% in constant currency excluding Downtown, with improvements in Recorded Music and Music Publishing, partially offset by a decline in Merchandising, as discussed further below.
Cost of revenues, consisting of artist and product costs, increased by EUR281 million to EUR3,622 million in H1 2026. Cost of revenues as a percentage of revenue increased to 58.5% in H1 2026 from 56.8% in H1 2025. Excluding Downtown, cost of revenues was 57.1% of sales in H1 2026, driven by higher product costs.
-- Artist costs increased to EUR3,045 million, or 49.2% of sales in H1 2026
from EUR2,795 million, or 47.5% of sales in H1 2025, due to the
consolidation of Downtown. Excluding Downtown, artist costs declined to
47.3% of sales in H1 2026.
-- Product costs increased to EUR577 million in H1 2026 from EUR546 million
in H1 2025 while remaining consistent as a percentage of sales at 9.3%.
Excluding Downtown, product costs grew to 9.8% of sales in H1 2026 due to
a greater proportion of phycial sales as well as costs associated with
live and related revenues and audiovisual income.
Adjusted EBITDA was up 2.7% in constant currency. Excluding Downtown, Adjusted EBITDA grew 1.6% in constant currency and Adjusted EBITDA margin declined 0.8pp year-over-year due to:
-- higher contribution from artist and label services revenue within Recorde
d Music;
-- an increase in corporate overhead,
largely due to higher professional fees; and
-- a loss in Merchandising.
Operating profit declined 0.6% in constant currency, or 0.8% in constant currency excluding Downtown, to EUR901 million reflecting:
-- constant currency Adjusted EBITDA growth;
-- lower non-cash share based compensation expense; and
-- lower restructuring charges; more than offset by
-- an increase in software-related amortization and lease-related depreciati
on expense; and
-- higher integration and business transformation costs.
Adjusted net profit, which adjusts for the revaluation of investments in listed and other companies, non-cash share-based compensation expense, amortization of catalogues, and restructuring charges and other items, amounted to EUR863 million in H1 2026, up 3.9% in constant currency, resulting in Adjusted diluted EPS of EUR0.47, up 4.3% in constant currency, primarily reflecting:
-- a decline in operating profit; and -- increased interest expense; more than offset by -- income from equity affiliates.
For fiscal year 2026, UMG revised how it defines Free Cash Flow to better reflect the cash generated by its business that is available for strategic investments and capital return. Prior periods have been restated to conform with the new definition. See "New Definition of Free Cash Flow" for further details. Free cash flow decreased to EUR24 million in H1 2026 compared to EUR163 million in H1 2025 due to:
-- a decline in operating profit;
-- an increase in cash used for working capital;
-- higher interest costs; and
-- higher capital expenditures, largely related to previously disclosed
office build-outs at key locations; partially offset by
-- a decrease in royalty advance payments, net of recoupments,
which were EUR292 million in H1 2026 compared to EUR377 million in H1
2025, due to the timing of deals and higher recoupment; and
-- favorable non-cash adjustments.
In line with UMG's dividend policy to pay a dividend of at least 50% of adjusted net profit, UMG's Board of Directors declared an interim dividend for H1 2026 of EUR432 million, or EUR0.24 per share. The ex-dividend date will be on October 5, 2026, the record date will be on October 6, 2026 and the payment date will be on October 27, 2026.
As at %
June 30, December
(millions of euros) 2026 31, 2025 YoY
----------- --------- ------
(unaudited) (audited)
Financial Net Debt 4,131 2,390 72.8 %
Net debt at the end of H1 2026 was EUR4,131 million compared to EUR2,390 million at the end of 2025 due to:
-- cash used for investing activities of EUR806 million,
including the acquisition of Downtown;
-- stock repurchases amounting to EUR734 million between March 31, 2026 up t
o and including June 30, 2026; and
-- dividend payments of EUR514 million; partially offset by
-- proceeds of EUR379 million from the sale of Spotify shares.
Recorded Music
Three Months Six Months
Ended June Ended June
30, % % % 30, % % %
const. const.
excl. excl.
(millions of euros) 2026 2025 YoY const. DMG 2026 2025 YoY const. DMG
------ ------ -------- -------- -------- ------ ------ -------- -------- --------
(unaudited) (unaudited)
Subscriptions
and streaming 1,757 1,555 13.0 % 15.4 % 5.6 % 3,398 3,160 7.5 % 13.2 % 6.0 %
of which
subscription 1,368 1,197 14.3 % 16.6 % 6.7 % 2,670 2,449 9.0 % 14.5 % 7.3 %
of which
streaming 389 358 8.7 % 11.5 % 1.7 % 728 711 2.4 % 8.3 % 1.5 %
Downloads and
other digital 38 69 (44.9 %) (43.3 %) (50.7 %) 72 109 (33.9 %) (30.1 %) (36.9 %)
Physical 342 310 10.3 % 15.9 % 15.6 % 651 611 6.5 % 14.2 % 14.0 %
License and
other 379 290 30.7 % 34.9 % 32.7 % 648 584 11.0 % 16.3 % 14.5 %
Recorded
Music revenues 2,516 2,224 13.1 % 16.2 % 8.7 % 4,769 4,464 6.8 % 12.7 % 7.1 %
EBITDA 560 555 0.9 % 2.9 % 1.7 % 1,085 1,092 (0.6 %) 4.0 % 3.0 %
EBITDA margin 22.3 % 25.0 % (2.7pp) (1.6pp) 22.8 % 24.5 % (1.7pp) (0.9pp)
Adjusted
EBITDA 593 588 0.9 % 2.8 % 1.6 % 1,158 1,163 (0.4 %) 4.3 % 3.3 %
Adjusted
EBITDA margin 23.6 % 26.4 % (2.8pp) (1.8pp) 24.3 % 26.1 % (1.8pp) (0.9pp)
Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted for constant currency.
Q2 2026
Recorded Music revenue grew 16.2% in constant currency, and grew 8.7% in constant currency excluding Downtown:
-- Subscription revenue grew 16.6% in constant currency, and grew 6.7% in
constant currency excluding Downtown. Wholesale price increases
contributed 3.5pp to the growth rate, partially offset by a 1.5pp
negative impact of market share headwinds from Q1 2026 extending into Q2
2026. A stronger Q2 2026 release schedule resulted in market share
improvement over the course of the quarter.
-- Streaming revenue increased 11.5% in constant currency, and grew 1.7% in
constant currency excluding Downtown, as consumers continue to shift
consumption from better monetized video platforms to short-form
platforms.
-- Downloads and other digital revenue declined 43.3% in constant currency,
and declined 50.7% in constant currency excluding Downtown, due to a
previously disclosed settlement with an internet service provider in Q2
2025, and the ongoing industry-wide format shift.
-- Physical revenue increased 15.9% in constant currency, and grew 15.6% in
constant currency excluding Downtown, with particular strength in the
U.S. and Europe, partially offset by declines in Japan due to the timing
of releases.
-- License and other revenue increased 34.9% in constant currency, or 32.7%
in constant currency excluding Downtown, with outsized contributions from
audiovisual and live and related income, along with healthy licensing
revenue growth.
Recorded Music Adjusted EBITDA was up 2.8% in constant currency, or 1.6% in constant currency excluding Downtown. Recorded Music Adjusted EBITDA margin excluding Downtown declined 1.8pp in Q2 2026, reflecting:
-- a higher contribution of artist and label services revenue in Recorded Mu
sic due to strong growth in Virgin Music Group; and
-- a greater proportion of physical sales and lower-margin audiovisual and
live and related income.
Music Publishing
Three Months Six Months
Ended June Ended June
30, % % % 30, % % %
const. const.
excl. excl.
(millions of euros) 2026 2025 YoY const. DMG 2026 2025 YoY const. DMG
------ ------ -------- ------- -------- ------ ------ ------- ------ -------
(unaudited) (unaudited)
Digital 392 351 11.7 % 13.6 % 5.2 % 720 690 4.3 % 9.4 % 3.3 %
Performance 123 111 10.8 % 12.8 % 9.2 % 238 225 5.8 % 9.7 % 7.4 %
Synchronisation 58 66 (12.1 %) (9.4 %) (14.1 %) 126 130 (3.1 %) 2.4 % (0.8 %)
Mechanical 29 28 3.6 % 3.6 % (3.6 %) 58 54 7.4 % 9.4 % 3.8 %
Other 14 14 0.0 % (6.7 %) (20.0 %) 26 26 0.0 % 0.0 % (7.7 %)
Music Publishing
revenues 616 570 8.1 % 9.8 % 2.7 % 1,168 1,125 3.8 % 8.4 % 3.4 %
EBITDA 131 126 4.0 % 5.6 % 3.2 % 261 252 3.6 % 8.3 % 7.5 %
EBITDA margin 21.3 % 22.1 % (0.8pp) 0.1pp 22.3 % 22.4 % (0.1pp) 0.8pp
Adjusted EBITDA 133 130 2.3 % 3.9 % 1.6 % 268 259 3.5 % 7.6 % 6.8 %
Adjusted EBITDA
margin 21.6 % 22.8 % (1.2pp) (0.2pp) 22.9 % 23.0 % (0.1pp) 0.8pp
Note: % YoY indicates % change year-over-year; % const. indicates % change year-over-year adjusted for constant currency.
Q2 2026
Comments