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Photo Credit: Universal Music Group
Universal Music has reported a 5.3% year-over-year (YoY) revenue improvement for Q3 2025, when recorded music streaming revenue turned in a modest 1.6% YoY increase.
The major label posted its financials for July, August, and September today, having evidently timed up the disclosure of Udio and Stability AI deals to coincide with the earnings report.
Diving directly into Universal Music’s Q3 showing, then, overall revenue came in at €3.02 billion (currently $3.49 billion), up the aforementioned 5.3% or 10.2% in constant currency YoY. Additionally, UMG pointed to Q3 2025 EBITDA of $687 million/€594 million (up 6.8% YoY).
Beyond these top-level performance particulars, perhaps the most interesting component of the core report – more on execs’ conference call remarks in a moment – is the initially highlighted $1.75 billion/€1.52 billion in recorded streaming revenue.
Behind the sum, which jumped 1.6% and 6.6% in constant currency YoY, Universal Music acknowledged a 4.8% YoY slip in ad-supported recorded revenue (chalked up mainly to short-form monetization challenges) to $390 million/€337 million. The streaming sub-category’s remaining $1.36 billion/€1.18 billion derived from paid subscriptions, reflecting 3.6% YoY growth.
Despite technically missing the early October release of Taylor Swift’s new album, the quarter benefited from “initial shipments” of The Life of a Showgirl en route to delivering $394 million/€341 million (up 18.4% YoY) in recorded revenue from physical formats like vinyl and CDs.
“Physical revenue was better than anticipated, up 23%, driven by strength in Japan, led by Mrs. Green Apple and Fujii Kaze as well as initial shipments of Taylor Swift’s latest album,” added UMG CFO Matt Ellis.
“While physical revenue performance may be less predictable and have more seasonality than subscription revenue, it’s important to note that over a longer-time horizon, this is a growing business that reflects increasing demand by fans to own physical products, connecting them with the artists they love,” Ellis proceeded.
Rounding out the recorded side, UMG identified $379 million/€328 million in licensing revenue (up nearly 1% YoY) and $45 million/€39 million in permanent downloads revenue (down 7.1% YoY).
Universal Music’s results were a bit stronger on the publishing front, with $682 million/€543 million in revenue (up 8.6% YoY) and, therein, double-digit boosts for both performance ($133 million/€115 million, up 13.9% YoY) and digital ($378 million/€327 million, up 10.8% YoY).
“Growth in both digital and performance revenue benefited from the inclusion of Chord and a major television studio business win in this year’s results,” elaborated Ellis.
Also in publishing, UMG confirmed Q3 dips in sync (down 1.6% YoY to $73 million/€63 million) and mechanical (down 7.1% YoY to $30 million/€26 million), with other revenue flat YoY at $14 million/€12 million.
Meanwhile, tours from The Weeknd, Morgan Wallen, and different artists fueled a 9.3% YoY merchandising revenue increase to $300 million/€259 million.
Shifting to the conference call, Universal Music head Lucian Grainge confirmed that his company had inked a fresh “Streaming 2.0” licensing deal with YouTube – including “really important guardrails” concerning gen AI.
“I’m pleased to report that we’ve successfully concluded our third major Streaming 2.0 agreement, this one with YouTube, covering both recorded music and music publishing,” Grainge said.
“The agreement includes all aspects of YouTube’s various music services and platforms, embodies our artist centric principles, and drives greater monetization for artists and songwriters. And as part of our new YouTube deal, we’ve secured really important guardrails and protections for our artists and writers around gen AI content,” he continued.
Elsewhere during the call, higher-ups touted the perceived global appeal and monetization potential of Japanese artists and rather unsurprisingly declined to provide more concrete details about the above-noted Udio and Stability AI deals.
