📊 WMG Key Takeaways
Is Warner Music Group Corp. (WMG) a Good Investment?
WMG demonstrates strong free cash flow generation ($519M) and modest revenue growth (+4.4%), but is severely hampered by excessive leverage (6.39x debt-to-equity) and deteriorating profitability, with net income declining 16.1% YoY despite revenue growth. Critical liquidity stress (0.73x current ratio) combined with a thin equity base ($738M on $10.6B assets) creates material refinancing risk that offsets otherwise stable operational cash generation.
Warner Music Group Corp. Key Strengths (WMG)
- Strong free cash flow generation ($519M with 14.5% FCF margin)
- Positive revenue growth momentum (+4.4% YoY) in entertainment sector
- Robust operating margins (15.5%) demonstrating pricing power
- Low capital intensity (CapEx only $47M on $3.6B revenue base)
WMG Stock Risks: Warner Music Group Corp. Investment Risks
- Severe financial leverage with 6.39x debt-to-equity ratio and $4.7B long-term debt
- Acute liquidity crisis with current ratio of 0.73x and quick ratio of 0.71x (both below 1.0)
- Profit margin compression with net income declining 16.1% YoY despite flat-to-positive top-line growth
- Razor-thin equity cushion ($738M) vulnerable to operational or market shocks
- Refinancing risk given debt burden and constrained balance sheet flexibility
Key Metrics to Watch
- Debt-to-equity trajectory and refinancing activity
- Current ratio trend and working capital management
- Operating income growth sustainability against cost pressures
- Free cash flow consistency and covenant compliance
- Quarterly net income trends for stabilization signals
Warner Music Group Corp. (WMG) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The current ratio below 1.0x warrants monitoring of short-term liquidity.
WMG Profit Margin, ROE & Profitability Analysis
WMG vs Services Sector: How Warner Music Group Corp. Compares
How Warner Music Group Corp. compares to Services sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Warner Music Group Corp. Stock Overvalued? WMG Valuation Analysis 2026
Based on fundamental analysis, Warner Music Group Corp. has mixed fundamental signals relative to the Services sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Warner Music Group Corp. Balance Sheet: WMG Debt, Cash & Liquidity
WMG Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Warner Music Group Corp.'s revenue has grown significantly by 27% over the 5-year period, indicating strong business expansion.
WMG Revenue Growth, EPS Growth & YoY Performance
WMG Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q2 2026 | $1.5B | $36.0M | N/A |
| Q1 2026 | $1.7B | $176.0M | N/A |
| Q3 2025 | $1.6B | -$16.0M | N/A |
| Q2 2025 | $1.5B | $36.0M | N/A |
| Q1 2025 | $1.7B | $159.0M | N/A |
| Q3 2024 | $1.6B | $122.0M | N/A |
| Q2 2024 | $1.4B | $34.0M | N/A |
| Q1 2024 | $1.5B | $122.0M | N/A |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Warner Music Group Corp. Dividends, Buybacks & Capital Allocation
WMG SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Warner Music Group Corp. (CIK: 0001319161)
📋 Recent SEC Filings
❓ Frequently Asked Questions about WMG
What is the AI rating for WMG?
Warner Music Group Corp. (WMG) has an AI grade of B with 58% confidence, based on fundamental analysis of SEC EDGAR filings.
What are WMG's key strengths?
Claude: Strong free cash flow generation ($519M with 14.5% FCF margin). Positive revenue growth momentum (+4.4% YoY) in entertainment sector.
What are the risks of investing in WMG?
Claude: Severe financial leverage with 6.39x debt-to-equity ratio and $4.7B long-term debt. Acute liquidity crisis with current ratio of 0.73x and quick ratio of 0.71x (both below 1.0).
What is WMG's revenue and growth?
Warner Music Group Corp. reported revenue of $3.6B.
Does WMG pay dividends?
Warner Music Group Corp. pays dividends, with $200.0M distributed to shareholders in the trailing twelve months.
Where can I find WMG SEC filings?
Official SEC filings for Warner Music Group Corp. (CIK: 0001319161) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is WMG's EPS?
Warner Music Group Corp. has a diluted EPS of $-0.68.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is WMG's fundamental grade?
Based on our AI fundamental analysis in June 2026, Warner Music Group Corp. has a B grade with 58% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is WMG stock overvalued or undervalued?
Valuation metrics for WMG: ROE of 48.6% (sector avg: 16%), net margin of 10.1% (sector avg: 10%). Higher ROE suggests strong returns relative to peers.
What is WMG's AI grade for 2026?
Our dual AI analysis gives Warner Music Group Corp. a combined B grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is WMG's free cash flow?
Warner Music Group Corp.'s operating cash flow is $566.0M, with capital expenditures of $47.0M. FCF margin is 14.5%.
How does WMG compare to other Services stocks?
Vs Services sector averages: Net margin 10.1% (avg: 10%), ROE 48.6% (avg: 16%), current ratio 0.73 (avg: 1.5).
Is Warner Music Group Corp. carrying too much debt?
WMG has a debt-to-equity ratio of 6.39x, which is above the Services sector average of 0.7x. Combined with a current ratio below 1, this warrants careful monitoring of the balance sheet.
Why is WMG's return on equity (ROE) so high?
Warner Music Group Corp. has a return on equity of 48.6%, significantly above the Services sector average of 16%. A high ROE indicates the company is efficient at generating profits from shareholder equity. This is supported by a 10.1% net margin.