In a banner week for music shares, document labels and music publishers posted features after Common Music Group (UMG) signed a brand new licensing cope with Spotify and Amazon introduced additional worth will increase for its music streaming service.
UMG gained 11.2% to 26.94 euros ($27.91) after the corporate introduced it renewed its licensing deal with Spotify for its document labels and music publishing. In keeping with the corporate, the settlement will permit for “new paid subscription tiers,” comparable to Spotify’s anticipated high-priced superfan providing, and bundling of music and non-music content material. UMG additionally bought a lift from information that Amazon is elevating costs on its Amazon Music Limitless on-demand service within the U.S., U.Ok. and Canada. After the week’s acquire, UMG had recovered practically the entire 24% decline it suffered after its second-quarter earnings outcomes confirmed lower-than-expected streaming development.
Morgan Stanley analysts referred to as it “an necessary and constructive week” for traders in corporations that function within the music streaming house. Warner Music Group (WMG) rose 6.7% to $31.80 as traders probably assumed the corporate will observe UMG and negotiate a mutually useful licensing cope with Spotify later this 12 months. Each Consider and Reservoir Media rose 2%.
Spotify rose one other 7.5% to a brand new document closing worth of $548.55 after a number of analysts raised their worth targets and the streaming big emerged victorious in a U.S. court docket case over a tactic employed to decrease its royalty obligations. The streaming firm’s inventory reached as excessive as $560.36 on Friday (Jan. 31), valuing the corporate’s market capitalization at roughly $111 billion. Extra analysts hiked their worth targets forward of Spotify’s earnings name on Tuesday (Feb. 4). Deutsche Financial institution elevated its Spotify worth goal on Monday to $550 from $535, whereas Citi raised it to $540 from $500.
Music shares have produced robust features only one month into the brand new 12 months. This week, the 20-company Billboard International Music Index (BGMI) rose 6.4% to a document 2,447.97. Simply two of the index’s 20 shares misplaced floor whereas one was unchanged and 17 posted features. The index’s third-straight weekly acquire was the perfect of the 12 months and the perfect single-week efficiency because the BGMI gained 6.8% within the week ended July 21, 2023. Simply 31 days into 2025, the index is up 15.2% and is outpacing main indexes such because the Nasdaq composite (up 1.6%), S&P 500 (up 2.7%) and FTSE 100 (up 6.1%).
Other than Spotify, different streaming corporations posted giant features. LiveOne, the week’s best gainer, jumped 20.8% to $1.45 after CEO Robert Ellin introduced — from President Trump’s The Mar-a-Lago Membership — that LiveOne had surpassed 700,000 Tesla customers, half of that are free, ad-supported customers. Chinese language music streaming firm Cloud Music additionally improved, with its replenish 8.4% to 112.20 HKD ($14.40), after the corporate introduced it had reached a “preliminary” settlement with Ok-pop firm SM Leisure to maintain the Ok-pop firm’s catalog on the platform. Paris-based Deezer rose 9.6% to 1.26 euros ($1.31). Abu Dhabi-based Anghami improved 4.2% to $0.75.
SiriusXM rose 9.3% to $24.01 after the corporate’s fourth-quarter earnings on Thursday (Jan. 30) confirmed a drop in income and subscribers however gross margins and earnings earlier than curiosity, taxes, depreciation and amortization (EDITDA) that had been consistent with steering. For full-year 2025, SiriusXM expects slight declines in each income and adjusted EBITDA however a rise in free money circulate to $1.15 billion from $1.02 billion in 2024. Forward of the corporate’s earnings, Deutsche Financial institution lowered its worth goal to $25 from $28.
Sphere Leisure Co. shares rose 8.5% to $46.60, with Guggenheim elevating the corporate’s worth goal to $69 from $64 and sustaining its “purchase” score. Sister firm MSG Leisure, which is able to announce earnings on Thursday (Feb. 6), rose simply 0.1% to $36.34.
iHeartMedia had the week’s largest decline, dropping 8.3% to $2.22, after posting features in earlier weeks. iHeartMedia shares are up 12.1% 12 months so far.
