WMG Stock Forecast & Price Target

Warner Music Group has demonstrated robust financial performance, as evidenced by a 22.6% year-over-year increase in live entertainment revenue, indicating strong post-pandemic demand and strategic concert promotion efforts. Additionally, the company's adjusted OIBDA rose by 18% year-over-year to $373 million, with expanding margins of 22.1% driven by a successful restructuring plan and enhanced operational efficiencies. The overall net sales revenue grew from $6.38 billion to $6.47 billion, with Q3 2025 revenue reaching a record $1.69 billion, showcasing the strength of its recorded music segment, which includes notable artists and growing streaming revenue.

Warner Music Group's financial performance has exhibited signs of decline, with Net Operating Profit After Tax (NOPAT) experiencing a slight decrease year-over-year, falling from $815.9 million to $814.9 million. Additionally, the Core Adjusted OIBDA margin dropped by 50 basis points, reflecting a challenging revenue mix and necessitating a reduction in profit expectations consistent with the company's subscription revenue outlook. The decline in Economic Profit (EP) by 1.97% and the Return on Capital (ROC) dropping from 15.77% to 14.88% over the last twelve months further underscores the potential risks related to slower digital music growth, the absence of major artist releases, and various external challenges impacting profitability.