Universal Music Group Adopts AI to Drive Revenue Growth

3 months ago

Khloe Mele

"Yeah, it reported revenue ahead of expectations for the third quarter and that's thanks to two things in particular. So, the omniresent Taylor Swift, uh with really strong sales of her latest album and then also a really strong performance of the soundtrack album for the hit next Netflix film, uh K-pop Demon Hunters, which I've not seen. Um but apparently it was really huge. And so that really boosted the shares this morning after quite an uneven performance over the last few months. Um, Universal is in quite an interesting position of having to adapt the disruption to the music industry created by AI, of course. So, instead of fighting against it, it's actually decided to, uh join forces with an AI music startup to collaborate on a new music creation and streaming service that automates the music making process. It's also signed a partnership with Spotify to develop what it has called responsible AI products that respect artists' copyright. So something definitely to watch going forward because all of that is really likely to reshape the music industry in quite significant ways and labels have to find a way to protect themselves against those AI songs taking that market share."

Universal Music Group delivered a better-than-expected third quarter with revenue gains driven by Taylor Swift's album sales and strong soundtrack performance. The company is strategically embracing AI by partnering with an AI music startup and Spotify to launch innovative, responsible AI products, suggesting a significant industry transformation and potential upside for the stock.

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