Warner Music Losses Increase As Album Sales Decrease

May 8th, 2008 | By | Category: Digital Music

The Wall Street Journal reports that Warner Music Group losses increased in the fiscal second quarter as the company continues to struggle with a drop-off in sales of compact discs as consumers shift toward digital music.

The company remains “excited about the long-term prospects for our business”, according to Chairman and Chief Executive Edgar Bronfman Jr. said, despite the fact that “an uncertain economic backdrop and evolving recorded music industry make a conservative approach to our balance sheet a prudent strategy.”

For the quarter ended March 31, the recording company reported a net loss of $37 million, or 25 cents a share, compared with a net loss of $27 million, or 19 cents a share, a year earlier. The latest results include a two-cent loss from discontinued operations.

Revenue rose 2% to $800 million, although in constant currency it fell 3.6%. The mean estimates of analysts polled by Thomson Reuters were for a loss of 12 cents a share on revenue of $780 million. Gross profit margin climbed to 48.4% from 45.5%.

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