Universal Music stock price falls due to weak profit margins and concerns over earnings guidance

2026-03-06 16:21:48

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Universal Music Group N.V. (AMS:UMG) announced its Q4 revenue of €3.605 billion, up 4.8% year-over-year, and up 10.6% at constant exchange rates. The results fell short of analyst expectations, causing the stock to decline after the earnings release.

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The company reported an adjusted EPS of €1.03 for fiscal 2025, compared to €0.96 in 2024. Q4 adjusted EBITDA was €810 million, up 1.4% year-over-year, and up 6.4% at constant exchange rates. However, the adjusted EBITDA margin decreased by 0.7 percentage points to 22.5%.

Excluding one-time items, adjusted EBITDA grew by 8.6% at constant exchange rates, with the margin decreasing by 0.4 percentage points to 22.0%.

As of 11:55 a.m. GMT on Friday, Universal Music’s stock fell 5.5%.

Music subscription revenue increased by 2.4% year-over-year, and 7.7% at constant exchange rates. Excluding last year’s catch-up payments, subscription revenue grew by 9.6% at constant exchange rates.

The company’s Q4 revenue included €45 million in legal settlement income, compared to €60 million in legal settlement income and digital streaming platform catch-up payments in the same period last year.

Chairman and CEO Sir Lucian Grainge stated, “2025 has been another outstanding year for Universal Music Group; we performed exceptionally across creative, commercial, and strategic areas. We made substantial, measurable progress across our initiatives: advancing Streaming 2.0, expanding artist and label services, accelerating the Super Fan program, expanding into high-growth markets, and leading the industry in responsible AI applications.”

Full-year revenue for fiscal 2025 reached €12.507 billion, up 5.7% year-over-year, and up 8.7% at constant exchange rates. Full-year adjusted EBITDA was €2.81 billion, up 5.6%, with the margin remaining steady at 22.5%. The company proposed a final dividend of €0.28 per share, bringing the total dividend for 2025 to €0.52 per share.

Universal Music announced it will delay its plans to go public in the U.S. due to market uncertainty and valuation concerns.

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