Overview
- Universal reported subscription revenue of €1.37 billion for the quarter, a 16.6% rise in constant currency that fell short of analyst forecasts when the impact of its Downtown acquisition is removed.
- Excluding Downtown, subscription revenue rose 6.7% in constant currency and second-quarter EBITDA was €610 million versus analyst expectations near €643 million, a shortfall that hit investor confidence.
- The stock sold off sharply, dropping around one-fifth of its value in trading as investors reacted to the weaker metrics and to signs of slowing streaming momentum.
- Management pointed to "market share headwinds" and reiterated plans such as Streaming 2.0 to better monetise superfans, expanded buybacks and a planned sale of half its Spotify stake to shore up value.
- The miss has reignited debate over growth options for major labels — whether to push price rises, convert users in lower-penetration regions, pursue catalogue deals, or grapple with AI-related legal and commercial risks that could reshape revenue streams.