Universal Music Group (UMG) stock continues to struggle, trading at $24.80 (€23.12) per share as of November 6th, 2024, down roughly 21% from its May valuation.

The initial decline began following UMG's Q2 2024 earnings report, triggered by concerns over streaming subscription growth slowdown. Despite the recent Q3 earnings report and an ambitious revenue forecast presented during the 2024 Capital Markets Day, the stock hasn't recovered.

Key Points:

• Q3 2024 recorded music subscription revenue grew 7.6% YoY to $1.22 billion
• Company projects 8-10% compound annual growth for subscription revenue through 2028
• UMG is implementing a "Streaming 2.0" initiative focusing on superfan monetization
• Approximately 20% of current streaming subscribers may be willing to pay for premium tiers
• Growth strategy combines expanding subscriber base while increasing revenue from existing users

The company's future stock performance largely depends on executing this dual-approach strategy: attracting new subscribers while successfully implementing premium tiers for existing users. CEO Lucian Grainge promises further updates on the Streaming 2.0 initiative in coming months, which could significantly impact investor confidence.

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