Warner Music Group posted a wider quarter loss as recorded music sales declined more than expected.
The world’s third largest music company posted a net loss of $68 million on Thursday (May 7), or 45 cents a share in its fiscal second quarter ended March 31 compared with a year-earlier loss of $37 million, or 25 cents a share.
The company booked $33 million in charges for items such as the declining value of investments in digital music start-up companies Lala and Imeem.
Excluding the charges, Reuters Estimates calculates that the company posted a loss of 23 cents, compared with an average Wall Street estimate of a loss of 25 cents.
Revenue fell by 17% to $668 million, compared with the average Wall Street forecast of $730.2 million.
Like other music companies, Warner Music is struggling with shrinking sales of recorded music as fewer fans buy albums in physical CD format.
The transition to downloaded music has led to a decline in revenue throughout the industry as fans increasingly buy lower-priced individual songs from Web retailers like Apple Inc’s iTunes Music Store.
Digital music sales rose 6% to $173 million, or 26% of total revenue in quarter.
Warner Music also blamed the weak sales on a light record release schedule and the turbulent global economy.
It said that fiscal 2009 results would be “back-end weighted” due to the timing of its music releases.
Warner Music’s biggest sellers for the quarter included albums from Seal, Jason Mraz, Peter Fox and rock band Nickelback’s as well as the “Twilight” movie soundtrack.