Equity Snap: Universal Music Group (UMG NA): Q2 margins fall flat versus expectations

Research evidence excerpt

Equity Snap: Universal Music Group (UMG NA): Q2 margins fall flat versus expectations

31 July 2026

Equity Snap: Universal Music Equities Media

Group (UMG NA)

Q2 margins fall flat versus expectations Netherlands

◆ UMG Q2 results below expectations on lower-than-expected Charlie Rothbarth*

adj. EBITDA margins Global Tech Platforms Analyst HSBC Bank plc

charlie.rothbarth@hsbc.com

+44 203 2685284

Universal Music Group (UMG NA, EUR19.35, Hold, TP EUR18.50)

Joe Thomas*

(Priced as of 30 Jul 2026) Senior Analyst, Head of Equity Research Mexico

HSBC Mexico, S.A., Institucion de Banca Multiple, Grupo

Q2/H1 results – 2Q miss at adj. EBITDA level: Q2 revenues of EUR3,294m Financiero HSBC

(including a 2.8% FX headwind) were in-line versus the company compiled joe.thomas@hsbc.com.mx

+52 55 8551 5172

consensus of EUR3,294m. However, 2Q adjusted EBITDA of EUR674m was 5.1%

Paul Rossington*

below consensus of EUR710m. This implies an EBITDA margin of 20.5%, vs cons of Senior Global Tech Platforms Analyst

21.6%. The falling margin is due to the Downtown consolidation (which was already HSBC Bank plc

paul.rossington@hsbcib.com

included in consensus), pressure from the revenue and repertoire mix in Recorded +44 20 7991 6734

Music including an increase in artist and production costs equivalent to 1.7% of sales

(up to 49.2%) in H1 as whole, and loss in Merchandising. H1 adj. EPS was EUR0.47 * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

or -1.7% yoy, and was in-line consensus with the reduction in underlying operating

profit and higher net interest charges offset by income from equity affiliates. The delta

between adj. EPS and reported EPS of EUR0.12 is attributable to EUR47m of

corporate adjustments.