Warner Music Group could also be getting ready to promote EMP Merchandising, the European rock and metallic merchandise e-retailer it acquired for USD $180 million in 2018.
That’s in keeping with clues in WMG’s newest earnings press launch and quarterly SEC submitting, noticed by MBW.
The quarterly submitting, masking the three months ended June 30, 2025, reveals a USD $70 million pre-tax impairment cost on “long-lived property related to sure of [WMG’s] non-core e-tailer operations” – following what Warner describes as a “triggering occasion”.
In earlier Warner annual filings, just one subsidiary is known as an “e-tailer”: EMP.
An impairment cost, basically a company write-down, happens when an organization determines that property on its steadiness sheet are value lower than their recorded guide worth.
So-called “triggering occasions” for firms to document impairments can embrace receiving market affords, commissioning impartial valuations forward of asset gross sales, or different causes.
Along with revealing particulars of the impairment cost, Warner’s Q3 submitting notes that the e-tailer now carries “recoverable honest worth primarily based on present market indicators”.
“Present market indicators” might clearly counsel sale discussions, or unsolicited affords.
Both manner, the $70 million write-down ($48 million after tax) confirms that EMP’s earlier guide worth considerably exceeded what Warner believes it may possibly get well, both by operations or a sale.
Given Warner paid roughly $180 million for EMP in 2018, this represents a considerable discount in market worth.
WMG confirming EMP’s standing as a “non-core” asset tells its personal story.
This doubtlessly suits inside WMG CEO Robert Kyncl‘s not too long ago introduced strategic cost-reduction plan, and his willpower to deal with “core” music property.
In July, Kyncl introduced plans to scale back WMG’s annual prices by $300 million.
That concentrate on was damaged down into $200 million from lay-offs ($170 million from redundancies and an extra $30 million in associated admin/actual property prices) plus an extra $100 million in “a lower in SG&A bills unrelated to headcount”.
Entire-asset gross sales are an apparent avenue to attain the latter a part of the plan.
In February 2024, as a part of a earlier restructuring program, Warner offered/shed its “owned and operated media properties” together with UPROXX and HipHopDX, with Kyncl telling employees these manufacturers “function exterior our core obligations to our roster.”
Warner’s determination to jot down off $70 million from EMP’s worth got here in the identical quarter as a change of management for the e-tailer.
In accordance with filings at Germany’s firms register, Dr. Jan Marc Fischer ended his tenure as EMP’s boss in April.
Fischer was named CEO of EMP in 2023 after 10 years as its Chief Monetary Officer and Chief Working Officer.
Succeeding him as EMP’s chief was Tom Kuper, who stepped up from his then-role as COO.
Writing on LinkedIn on the time, Kuper stated (translated): “Change brings alternatives – and I’m prepared to steer the EMP crew by this thrilling section of change with coronary heart and perspective.”
EMP, based in Germany in 1986, was acquired by Warner in September 2018 from non-public fairness agency Sycamore Companions.
At acquisition, Warner described it as providing merchandise from artists together with Twenty One Pilots, Panic! At The Disco, Metallica, Motörhead, Weapons N’ Roses, Nirvana, Pink Floyd, AC/DC, and The Doorways.
EMP additionally operates as an e-tailer past music merchandise, promoting merchandise from leisure manufacturers like Disney, Marvel, Star Wars, gaming manufacturers like Nintendo and PlayStation, and various trend manufacturers like Vans.
This diversification might now not align with Warner’s music-first technique below Kyncl, who final week emphasised “specializing in the artists, songwriters, and markets with the best potential”.
A Warner Music Group spokesperson declined to remark when contacted by MBW.Music Enterprise Worldwide
