Music Earnings Preview: We Like the Tune WMG Management Is Playing

Research evidence excerpt

Music Earnings Preview: We Like the Tune WMG Management Is Playing

TD SECURITIES (USA) LLC INDUSTRY UPDATE

July 10, 2026

■Media: Entertainment Music Earnings Preview: We Like the Tune

■Media: Music

WMG Management Is Playing

Doug Creutz, CFA THE TD COWEN INSIGHT

415 646 7225

We remain bullish on music content ownership, contributing to our Buy (1) ratings on

douglas.creutz@tdsecurities.com

WMG (now our top pick in music due to what we think is a very clear bull thesis laid out by

Mei Lun Quach, CFA management), UMG, and Sony. We are more cautious on digital music aggregation, with

415 646 7342 Spotify at a Hold (2) rating. We maintain our Buy (1) on LYV based on market leadership and

meilun.quach@tdsecurities.com

industry fundamentals.

WMG Now Our Top Idea in Music As Management Aggressively Prosecutes Attractive Thesis.

We have consistently liked both WMG and UMG, but historically had marginally favored UMG

due to (1) its market leadership, (2) its established and experienced management team, and (3)

its (relatively) cleaner corporate governance. However, we now favor WMG, as management

has worked to create a clear narrative for shareholders around revenue growth and margin

expansion, both in the near term and longer term, that we have confidence they can deliver

on. UMG will benefit from the same secular tailwinds as WMG, but the WMG story feels

cleaner at this point; UMG's margin structure is going to be weighed down by the Downtown

acquisition, and while that may turn out to be an attractive deal in the long term, it creates

noise in the near term that WMG doesn't have to contend with.

Content Ownership Appears To Be Structurally Undervalued vs Distribution. Our belief

remains that music content ownership is mispriced relative to streaming distribution. Spotify