Universal
Music Group
Annual report
2025
Universal
Music Group
Annual report
2025
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
CONTENTS
About UMG
3
We are Universal
4
Profile
7
Mission & Vision
8
Our Values
9
UMG is a category of one
10
UMG is consistently home to the world's best-selling recording artists
11
2025 Chart Highlights
12
We are driving the next era of streaming growth
16
Our growth strategies are founded on creativity, innovation
and entrepreneurship
17
Emerging AI partnerships and products will reshape the way fans engage
with music
18
Expanding artist brands & superfan business
19
Music powers engagement across a vast ecosystem
20
Key Figures 2025
21
Financial Data For The Last Three Years
22
Global Impact Highlights
23
How UMG Adds Value
24
Year in Review
25
Board Report
26
Introduction
27
Strategy
37
Organizational and Reporting Structure
48
Financial Review
52
Corporate Governance
60
Shareholder Information
80
Risk and Risk Management
85
Sustainability Statement
111
Non-Executive Directors' Report
161
Non-Executive Directors' Report
162
Remuneration Report
171
Financial Statements
189
Consolidated Statements
190
Company Statements
248
Other Information
266
Distribution of Profits
267
Independent Auditor's Report
268
Limited assurance report of the independent auditor on the
sustainability statement
278
Appendix
281
Biographies of the Corporate Executives
282
Biographies of the Board of Directors
286
Definitions
290
Cautionary Notice
294
MUSIC IS UNIVERSAL
Annual Report 2025 |
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About UMG
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
FOREWORD
WE ARE UNIVERSAL
Dear Fellow Shareholders:
It is my distinct pleasure to report to you about our company’s performance over the last year – not
only because of the results we delivered but also for the work we accomplished to assure we remain
best-positioned to capitalize on tomorrow’s business opportunities.
These are exciting times. We see significant future market opportunities for those who prepare and
position themselves properly. This is why we continue to execute on our long-term strategy with
focus and discipline.
To give you some context, I’ll describe for you some of our accomplishments for the year past and
then discuss the major opportunities we will pursue under our long-term strategy. Some of 2025’s
highlights include: our artists’ and songwriters’ incredible music; significant strategic advances we
made in Artificial Intelligence (or AI); our continuing progress on Streaming 2.0; providing best-in
class services to independent labels, artists and entrepreneurs; serving Superfans; expanding our
global footprint; and strengthening our efforts in sustainability.
Artists’ and Songwriters’ Music
As ever, we begin with our core role: supporting our artists and songwriters and helping them
achieve their greatest potential, creatively and commercially.
This is the heart of our business. Our single greatest investment every year is our investment –
including both employee talent and financial – into artists and their careers and the infrastructure
we build to support them and amplify their creativity.
By combining the expertise, and long-term vision of our employees with those of our artists, our
foundation of artist development consistently delivers success. To be clear, this investment is
separate and distinct from artist compensation; it is investment into artists’ career development.
In 2025, once again, that success was on full display.
There is far too much to detail those successes here, though you can read about many of them
throughout this report. For example, on Spotify, the largest digital service provider (DSP), we had four
of the top five artists globally in 2025, as well as six of the top ten albums and six of the top 10
songs. And the results on other distribution platforms – whether it was Apple Music, Amazon Music,
YouTube Music, TikTok, Deezer and more – also reflected our incredible performance.
In short, no other company – in music or any other sector of entertainment – has ever achieved such
a level of success and done so with such consistency.
Importantly, this success is also the foundation of our future successes. The enduring strength of
our artists’ music and their “brands”, as part of the world’s leading roster, and catalog best positions
us to capitalize on new opportunities in areas such as AI.
AI
UMG is playing a pioneering role in fostering AI’s enormous potential and boosting a healthy
commercial AI ecosystem in which artists, songwriters, music companies and technology
companies can all flourish together.
As I’ve said before, AI will never replace human creativity because it will always lack the essential
spark that drives the most talented artists to do their best work, which is intention. And while I firmly
believe that responsible AI can be a hugely beneficial commercial and creative driver for UMG and
our artists, we cannot ignore the fact that AI also creates challenges. This is why we have worked to
keep the interests of artists and music companies front and center in all discussions about AI and
will continue to do so.
One thing we’ve learned over the years is that trying to smother emerging technology is futile and
often counterproductive. The link between music and technology has been a growth driver of our
industry for more than a century – from the player-piano to today’s premium subscription.
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That’s why, when it comes to new technology, we engage, adapt and innovate. Whether that’s being
the first music company to embrace streaming or striking the first deals to monetize music on social
platforms, we must lean in and take the reins in best shaping our future.
As part of our proactive strategic approach on AI, UMG became the first media company to enter into
AI-related agreements last year both with established platforms (such as YouTube, Meta, TikTok, and
KDDI) as well as with emerging AI entrepreneurs (such as Udio, BandLab, Soundlabs, KLAY Vision,
Splice and Stability AI).
With all of our agreements, we have simultaneously protected artists and songwriters and human
creativity, spawned a new wave of creative innovation in music and developed new revenue streams
and commercial opportunities.
Streaming 2.0
I’m particularly proud of our continued progress in reaching “Streaming 2.0” agreements with
our DSP partners. These agreements encourage smarter customer segmentation, create greater
consumer value and drive ARPU growth. In late 2024 and in 2025 we implemented Streaming 2.0
deals with Amazon, Spotify and YouTube, and we expect to enter into more such agreements in 2026.
When we first announced our Artist-Centric initiative three years ago, we accurately predicted the
fact that the dramatic increase in the volume of irrelevant uploads, including the rise of AI “slop”,
could overwhelm DSPs. This ability to see around corners enabled us to anticipate this trend and
protect our artists and songwriters by preemptively placing provisions in our agreements with DSPs
that prevent AI slop from being counted in the same royalty pools as our artists and songwriters
(among other Artist-Centric components we’ve implemented to advance the interests of artists and
reward the value they bring to these platforms).
Fueled by our Streaming 2.0 initiatives, we have delivered on the vision and commitments, with
growth performance metrics that demonstrate our capability to effectively develop, harness and
adapt strategies to the benefit of the entire music ecosystem.
Services to Independent Labels
We’ll be developing different models, structures and competencies to service and grow an
increasingly vibrant diversity in music. It’s no secret that much of our company’s success is
powered by our entrepreneurial culture and decentralized structure, so identifying and partnering
with like-minded leaders and entrepreneurs will only help ensure our continued future success
while supporting the health of the entire music ecosystem.
With the closing of Virgin Music’s acquisition of Downtown Music in February 2026, and by
continuing to broaden our independent partner portfolio, we want to accelerate our efforts in
providing best-in-class services to both independent entrepreneurs and labels.
The Superfan
One key part of our strategy is further serving so-called “superfans” and bringing them closer to our
artists.
To do so, we complement our growing D2C business by working both with our established
DSP partners on the launch of enhanced premium tiers for superfans, as well as with emerging
platforms that are focused on special events and products for superfans – both virtually and in the
physical world.
Other superfan initiatives include the expansion of our experiential hospitality and retail strategy
and seamless integrations between virtual and in real life events – demonstrating how UMG’s
identity is expanding and our direct connection with music consumers is growing.
Global Footprint
We continue to broaden our presence in fast-growing markets around the world, both through
organic A&R within our growing network of local labels, as well as through partnerships and
acquisitions of dynamic music companies in Africa, China, India and Southeast Asia. Identifying the
best entrepreneurs and independent labels that will provide access to some of the best artists and
music in those regions, as well as the ability to grow the influence of those artists and their music
in markets around the world. One early example is Universal Music India’s investment in Excel
Entertainment, a leading Indian film and digital content studio. The deal will expand opportunities
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5
FOREWORD
ABOUT UMG
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APPENDIX
for Indian artists and strengthen our position in original soundtracks, which remain at the heart of
India’s high-potential music market.
Community Leadership and Recognition
UMG and its employees work on a wide range of sustainability and community issues. Whether
that’s actively working to foster the next generation of industry leaders through things like music
education, mentoring and scholarships, or providing critical support to those affected by the Los
Angeles wildfires, our sustainability initiatives have been recognized as effective and impressive.
Newsweek
named us as one of the “World’s Greenest Companies” and we won the “ESG Transparency
Award”, recognizing our clarity and openness in sustainability reporting. We were also named by
Forbes
as one of America’s Dream Employers.
Finally, I was so pleased that
Time
magazine honored UMG as one of the world’s most influential
companies, the first recognition of a major music company in the list’s history.
Time
cited our
commitment to defending artists’ rights, championing an Artist-Centric streaming landscape for
artists and songwriters, and shaping culture through the power of artistry.
I close with where it all begins – our unique role investing in, partnering with and fighting for the
interests of artists and songwriters. Our work has an impact that far exceeds our imagination and we
take it as a great honor. Music is an extraordinarily meaningful part of humanity, touching the lives
of billions of people around the globe. I am proud of the work of our team at Universal Music Group
and pleased to present this report to you.
Sincerely,
SIR LUCIAN GRAINGE, CHAIRMAN AND CEO,
UNIVERSAL MUSIC GROUP
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Annual Report 2025 |
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FOREWORD
#
1
#
2
WE HAVE A RICH HISTORY AND HAVE BUILT AN UNPARALLELED
CATALOG OF SONGS AND RECORDINGS
MILLION
RECORDINGS
GLOBAL LEADER IN
RECORDED MUSIC
RECORDED MUSIC
~
3.6
~
5.4
ARTIST/BRANDS
220
LEADING
MUSIC
MERCHANDISING
BUSINESS
MUSIC
MERCHANDISING
>
MILLION
OWNED &
ADMINISTERED TITLES
GLOBALLY IN
MUSIC PUBLISHING
MUSIC PUBLISHING
TITLES
3,500
OF LONG-FORM
MUSIC-BASED
AUDIOVISUAL
CONTENT
RAPIDLY GROWING
LIBRARY OF MORE THAN
MUSIC-BASED VISUAL
ENTERTAINMENT
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PROFILE
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ABOUT UMG
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MISSION & VISION
Mission
More music to more people in more ways
We are Universal Music Group, the world’s leading music company.
We exist to shape culture through the power of artistry.
We are a community of entrepreneurs committed to creativity and innovation.
We own and operate a broad array of businesses engaged in recorded music, music publishing,
merchandising, and audiovisual content in nearly 60 territories around the world.
We identify and develop recording artists and songwriters, and we produce, distribute and promote
the most critically acclaimed and commercially successful music to inspire and entertain fans
around the world.
Our vast catalog of recordings and songs stretches back over a century and comprises the largest,
most diverse and culturally rich collection of music ever assembled.
As technology refashions the world, our unmatched commitment to lead in developing new services,
platforms and business models for the delivery of music and related content empowers innovators
and allows new commercial and artistic opportunities to flourish.
Knowing that music, a powerful force for good in the world, is unique in its ability to inspire people
and bring them together, we work with our artists and employees to serve our communities.
We are the home to music’s greatest artists, innovators and entrepreneurs.
TOGETHER, WE ARE UNIVERSAL MUSIC GROUP
Vision
Putting artists and songwriters first
Artists and songwriters are at the heart of everything we do at Universal Music Group. Focused on
their long-term development, our company is built to serve their unique needs throughout their
careers. Successfully producing and marketing music requires a significant upfront investment and
an ongoing collaboration. UMG invests more in developing talent, and does so with greater expertise,
than any other music company. This investment, combined with our excellence in marketing and
promoting artists globally, means we consistently lead the industry in breaking new artists.
Putting artists first sets us apart. We turn art into hits and hits into careers. By building a continuum
of services and resources for artists, we've designed UMG so we can partner with artists at each
stage of their careers to provide them with all the services and resources they need. We start
by identifying the artists with whom we want to partner and presenting them with a world of
opportunities to accelerate their careers. We remain by their side with customized campaigns and
promotion, platform-integrated targeted marketing, top-tier data and insights, and global reach with
local activation.
We work side-by-side with them over the long-term to build and sustain their careers
through continuous engagement, improving lifetime fan value, and enabling unique access
to synchronization, brand partnerships, licensing opportunities and eCommerce capabilities to
monetize fandom.
Our artist-centric approach gives us an unrivalled track record in artist development and
commercial success.
MUSIC IS UNIVERSAL
Annual Report 2025 |
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DRIVE
INSIGHT
AUTHENTICITY
CONNECTION
BOLDNESS
CREATIVITY
ALWAYS PUSH FOR THE NEXT LEVEL OF GREATNESS
SEE WHAT OTHERS DON’T SEE
EXPRESS WHO YOU TRULY ARE AND WHAT YOU BELIEVE
DRAW STRENGTH FROM DIVERSE AND MEANINGFUL RELATIONSHIPS
ACT DECISIVELY WITH OWNERSHIP AND CONVICTION
MEET A CHALLENGE IN NEW AND UNEXPECTED WAYS
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OUR VALUES
MUSIC IS UNIVERSAL
Annual Report 2025 |
9
Note: 1. Based on historical results from Luminate, Billboard, IFPI, and Spotify
Leading labels, industry
talent and demonstrated
operational excellence
World’s top
artists and
songwriters
Continued
outsized
success
1
The next generation
of creative and
industry talent
INDUSTRY’S LEADING LABELS, ARTISTS AND SONGWRITERS PERPETUATE INCREASING SUCCESS
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UMG IS A CATEGORY OF ONE
MUSIC IS UNIVERSAL
Annual Report 2025 |
10
TOP 10 GLOBAL ARTISTS
8/10
9/10
2019
2025
9/10
2020
9/10
2024
8/10
2021
7/10
2022
9/10
2023
Source: IFPI Global Charts (2019-2025)
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UMG IS CONSISTENTLY HOME TO THE WORLD'S BEST-SELLING
RECORDING ARTISTS
MUSIC IS UNIVERSAL
Annual Report 2025 |
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GLOBAL
Spotify
Amazon Music
7 of the TOP 10
ARTISTS
and
ALL of the TOP 3
ALL of the Top 5
ALBUMS
with
KPop Demon Hunters
Soundtrack
at
No. 1
#
1
4 of the TOP 5
ARTISTS
6 of the TOP 10
ALBUMS
6 of the TOP 10
SONGS
with Lady Gaga
& Bruno Mars “Die With A Smile” at
No. 1
#
1
UMPG
On Spotify,
7 of the TOP 10
ARTISTS
were UMPG Songwriters, and UMPG had
an interest in
7 of the Top 10
ALBUMS
and
7 of the Top 10
SONGS
On Apple Music, UMPG had an interest in
8 of the TOP 10
SONGS
, including “APT.”
from ROSÉ & Bruno Mars at
No. 1
The
TOP 4
ARTISTS
9 of the TOP 10
ALBUMS
6 of the TOP 10
SONGS
and
The
MOST-SHARED
SONG
was Lola Young’s “Messy”
Deezer
#
1
ARTIST
of the
Year
was KATSEYE
TRACK
of the Year
was “Pretty Little Baby”
by Connie Francis
The
MOST-SAVED ARTIST
was Taylor Swift
The
MUSIC TREND
of the year was
“Anxiety” by Doechii
TikTok
#
1
9 of the TOP 10
SONGS
with Kendrick Lamar
and SZA’s “luther”
at
No. 1
#
1
U.S.
7 of the TOP 10
ARTISTS
and
ALL of the TOP 4
8 of the
TOP 10
ALBUMS
with Taylor Swift’s
The Life of a Showgirl
at
No. 1
3 of the TOP 5
SONGS
with Lady Gaga & Bruno Mars
“Die With A Smile” at
No. 1
The
TOP 3
LABELS
were REPUBLIC
Collective, Interscope Capitol, and
Universal Music Enterprises
Billboard
C
O
L
L
E
C
T
I
V
E
#
1
ALL of the TOP 4
ARTISTS
7 of the TOP 10
ALBUMS
with Morgan Wallen’s
I’m The Problem
at
No. 1
4 of the TOP 5
SONGS
Spotify
#
1
4 of the TOP 5
SONGS
with Lady Gaga & Bruno Mars
“Die With A Smile” at
No. 1
YouTube
On Billboard, UMPG
held
3 of the TOP 5
on the
HOT 100
SONGWRITERS
CHART
with Kendrick
Lamar at
No. 1
On Apple Music, UMPG had an
interest in
7 of the TOP 10
SONGS
UMPG
#
1
7 of the TOP 10
SONGS
The
TOP
ARTIST
was Drake
The
TOP
ALBUM
was Morgan
Wallen’s
I’m The Problem
Apple Music
#
1
Apple Music
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2025 CHART HIGHLIGHTS
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Annual Report 2025 |
12
REGIONAL
YouTube Music:
2 OF THE TOP 3
MOST
STREAMED NIGERIAN
ARTISTS
globally were
Mavin’s Rema
(No. 1)
and Ayra Starr
(
No. 3)
Nigeria
Official Charts Company:
ALL of the TOP 3
ALBUMS
Spotify:
8 of the TOP 10
ARTISTS
and
ALL of the TOP 5
4 of the TOP 5
SONGS
7 of the TOP 10
ALBUMS
with
Sabrina Carpenter’s
Short n’ Sweet
at
No. 1
YouTube:
7 of the TOP 10
SONGS
UK
#
1
#
1
ARIA:
8 of the TOP 10
ALBUMS
6 of the TOP 10
SONGS
Australia
#
1
Spotify:
3 of the TOP 5
ALBUMS
The
TOP
ARTIST
was
Henrique & Juliano
Brazil
GfK:
The
TOP 2
MOST
STREAMED ARTISTS
were Taylor Swift
and Pashanim
The
TOP
ALBUM
was
Taylor Swift’s
The Life of a Showgirl
The
TOP
SINGLE
was
“Wackelkontakt” by Oimara
Germany
#
1
Spotify:
The TOP
ARTIST
was So’n Tùng M-TP
2 of the Top 5
SONGS
with “Exit Sign” by
HIEUTHUHAI at
No. 1
3 of the Top 5
ALBUMS
Vietnam
#
1
France
The
TOP 2
DOMESTIC
BREAKING
ARTISTS
were Theodora and L2B
Thailand
The Top
DOMESTIC ALBUM
from PUN
Luminate:
7 of the TOP 10
ALBUMS
and
ALL of the TOP 4
Canada
Japan
Billboard Japan:
The
TOP 2
ARTISTS
were
Mrs. GREEN APPLE
(No. 1)
and back number
(No. 2)
Mrs. GREEN APPLE had
3 of the TOP 5
ALBUMS
and
5 of the TOP 10
SINGLES
with “Lilac” at
No. 1
Spotify:
5 of the TOP 10
ARTISTS
with Mrs. GREEN
APPLE at
No. 1
for the third straight year
Mrs. GREEN APPLE had
7 of the TOP 10
SONGS
#
1
Italy
Spotify:
5 of the Top 10
ARTISTS
including Sfera Ebbasta
at
No. 1
#
1
Weibo Music Awards:
The
MOST INFLUENTIAL SINGER
was David Tao
The
MOST POPULAR SINGER
was Nana Ouyang
The
BEST NEW ARTIST
was LBI
China
#
1
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MUSIC IS UNIVERSAL
Annual Report 2025 |
13
2025 TOP 10 MARKETS
1.
USA
+3.3%
US$11.6bn
2.
JAPAN
+8.9%
US$2.8bn
3.
UK
+4.8%
US$2.2bn
4.
CHINA
+20.1%
US$1.9bn
5.
GERMANY
+1.7%
US$1.8bn
6.
FRANCE
+3.7%
US$1.4bn
7.
SOUTH KOREA
+1.7%
US$736m
8.
BRAZIL
+14.1%
US$708m
9.
CANADA
+5.6%
US$685m
10.
MEXICO
+13.3%
US$590m
* All reporting is translated at average CY 2025 exchange rates. Russia has been excluded from all years. Source: IFPI Global Music Report 2026
10
8
7
2
5
3
6
4
1
9
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RECORDED MUSIC INDUSTRY 2025 TOP 10 MARKETS
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14
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
22.3
20.9
22.1
20.7
19.2
19.2
18.7
18.0
16.9
15.5
14.6
13.8
13.7
13.7
13.5
13.1
13.5
14.8
15.9
17.4
18.7
20.0
23.7
25.8
28.4
29.7
2025
31.7
Synchronization
Performance Rights
Downloads and Other Digital
Streaming
Physical
CD era
Digital download era
Streaming era
GLOBAL RECORDED MUSIC BY REVENUE STREAM ($B, NOMINAL)
* All reporting is translated at average CY 2025 exchange rates. Russia has been excluded from all years. Source: IFPI Global Music Report 2026
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THE MUSIC INDUSTRY HAS EXPERIENCED A RETURN TO GROWTH,
PRIMARILY DRIVEN BY STREAMING
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15
STREAMING 2.0
Maximizing customer value
Achieving scale
STREAMING 1.0
FOCUS ON SUBSCRIPTION GROWTH
FOCUS ON SUBSCRIPTION AND ARPU GROWTH
(Including Streaming 2.0 deals
with Spotify, Amazon and YouTube)
Segmented customer propositions
Artist-centric principles
Broader and deeper monetization
Global focus
Single compelling proposition
Volume over value
Scale digital monetization
Established markets focus
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WE ARE DRIVING THE NEXT ERA OF STREAMING GROWTH
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LEADING RECORDED MUSIC LABELS AND MUSIC PUBLISHING BUSINESS - EXPANDING ICONIC CATALOG
STRONG FREE CASH FLOW WITH IMPROVING OPERATING LEVERAGE
WORLD-CLASS MANAGEMENT TEAM
Powering the
next era of sustainable
streaming growth
(Streaming 2.0)
Unlocking superfan
monetization
through innovative
new products and
experiences
Fueling an expanding
ecosystem of music
driven businesses
Attractive opportunities
for expansion:
high-potential markets,
independent label services
DRIVING INNOVATION AND EXPANDING TOTAL ADDRESSABLE MARKET
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OUR GROWTH STRATEGIES ARE FOUNDED ON CREATIVITY,
INNOVATION AND ENTREPRENEURSHIP
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EMERGING AI PARTNERSHIPS AND PRODUCTS WILL
RESHAPE THE WAY FANS ENGAGE WITH MUSIC
LICENSED GEN AI
SUBSCRIPTION
STREAMING PLATFORM
IMMERSIVE
AI-POWERED
MUSIC EXPERIENCES
ARTIST-FIRST
AI MUSIC PRODUCTS
COLLABORATION ON
AI POWERED MUSIC
DISCOVERY, CREATION,
AND ENGAGEMENT
• UMG-led strategic agreement
with Udio to build a licensed AI
music platform launching in 2026
• Focused on hyper-personalized,
superfan experiences and
discovery
• Built on authorized, opt-in content
enabling fans to customize,
stream, and share music
responsibly on-platform
• Commercial license follows
UMG-first strategic agreement
with Klay to launch AI-powered,
interactive music service
• Employs generative AI to create
new personalized listening and
immersive engagement for fans,
that will enhance connection
with artists
• Joint initiative between Spotify
and major labels to develop
responsible AI tools and products
• Creates new revenue streams
for rightsholders, artists, and
songwriters who choose
to participate
• Protects artist creativity while
offering new ways to connect
with fans
• Responsible AI to elevate
discovery, engagement and
consumption beyond current
constructs of search and
personalization
• Leverage AI to protect artists’
work and ensure proper
attribution
• Shared objectives of advancing
human music creation and
rightsholder compensation
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CAPTURED THROUGH INNOVATIVE PRODUCTS AND EXPERIENCES
PHYSICAL
COLLECTIBLES
PREMIUM
MERCHANDISE
LIVE
EXPERIENCES
DIGITAL
AUDIO VISUAL
PARTNERSHIPS
& PLATFORMS
LICENSING
ABOUT UMG
BOARD REPORT
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FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
EXPANDING ARTIST BRANDS & SUPERFAN BUSINESS
MUSIC IS UNIVERSAL
Annual Report 2025 |
19
BRANDS &
SPONSORS
VIDEO
STREAMING
RADIO,
TV & CABLE
NETWORKS
MUSIC
STREAMING
FITNESS
AI-DRIVEN
PRODUCTS
AND
PLATFORMS
HEALTH &
WELLNESS
TOURING
FILM & TV
PRODUCTION
VIDEO
GAMING
SOCIAL
MEDIA
RETAIL &
ECOMMERCE
ABOUT UMG
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APPENDIX
MUSIC POWERS ENGAGEMENT ACROSS A VAST ECOSYSTEM
MUSIC IS UNIVERSAL
Annual Report 2025 |
20
Note:
% YoY indicates % change year-over-year
% constant indicates % change year-over-year adjusted for constant currency
1
as defined in the Appendix to the Annual Report
Segment revenue is stated prior to elimination of intersegment transactions
EBITDA
1
2025
2024
2,538
2,332
YoY
+8.8%
+29.0%
constant
+12.2%
+31.3%
ADJUSTED EBITDA
1
2025
2024
2,810
2,661
YoY
+5.6%
+12.3%
constant
+8.6%
+13.8%
REVENUE
2025
2024
12,507
11,834
YoY
+5.7%
+6.5%
constant
+8.7%
+7.6%
EBITDA MARGIN
1
2025
2024
20.3%
19.7%
YoY
+0.6pp
+3.4pp
ADJUSTED EBITDA
MARGIN
1
2025
2024
22.5%
22.5%
YoY
0.0pp
+1.2pp
OPERATING PROFIT
2025
2024
1,998
1,775
YoY
+12.6%
+25.2%
constant
+16.6%
+28.0%
UMG RESULTS
(in € millions)
YEAR ENDED DECEMBER 31
Results per business segment
(in € millions)
Year Ended December 31
REVENUE
2025
2024
9,456
8,901
YoY
+6.2%
+5.2%
constant
+9.3%
+6.4%
YoY growth in constant currency
Subscription and Streaming Revenue
+7.6%
+6.8%
Downloads and Other Digital Revenue
+34.5%
-11.8%
Physical Revenue
+11.4%
+1.1%
License and Other Revenue
+11.0%
+13.5%
RECORDED MUSIC
REVENUE
2025
2024
811
842
YoY
-3.7%
+19.3%
constant
0.0%
+19.3%
REVENUE
2025
2024
2,260
2,121
YoY
+6.6%
+8.4%
constant
+9.3%
+9.0%
MUSIC PUBLISHING
MERCHANDISING AND OTHER
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APPENDIX
KEY FIGURES 2025
MUSIC IS UNIVERSAL
Annual Report 2025 |
21
Note: In millions of euros, number of shares in millions, data per share in euros.
ABOUT UMG
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OTHER INFORMATION
APPENDIX
FINANCIAL DATA FOR THE LAST THREE YEARS
Year ended December 31,
2025
2024
2023
Consolidated data
Revenues
12,507
11,834
11,108
EBITDA
1
2,538
2,332
1,808
Adjusted EBITDA
1
2,810
2,661
2,369
Operating profit
1,998
1,775
1,418
Net profit attributable to equity holders of the parent
1,533
2,086
1,259
Adjusted net profit
1
1,907
1,782
1,626
Net Cash Position/(Financial Net Debt)
1
(2,390)
(2,098)
(1,689)
Net cash provided by operating activities before income tax paid
2,142
2,104
2,278
Free Cash Flow
1
702
523
1,082
Dividends paid by UMG N.V. to its shareholders
(953)
(933)
(929)
Per share data
Weighted average number of shares outstanding
1,833
1,827
1,819
Earnings attributable to UMG N.V. shareowners per share - basic
0.84
1.14
0.69
Earnings attributable to UMG N.V. shareowners per share - diluted
0.83
1.13
0.68
Adjusted net profit per share - basic
1
1.04
0.98
0.89
Adjusted net profit per share - diluted
1
1.03
0.96
0.88
1
Non-IFRS measures as defined in the Appendix to the Annual Report.
MUSIC IS UNIVERSAL
Annual Report 2025 |
22
IN 2025, UMG’S GLOBAL IMPACT TEAM FOCUSED ON DRIVING POSITIVE CHANGE ACROSS
ITS FOUR MAJOR FOCUS AREAS, INCLUDING THE FOLLOWING INITIATIVES:
MENTAL
HEALTH
In 2025, UMG’s Global Impact Team
focused on driving positive change across
its four major focus areas, including the
following initiatives:
• In partnership with
Mental Health
Coalition, Project Healthy Minds, and
Music Health Alliance,
directed funding to
organizations focused on creating and
expanding mental health services to help
individuals in communities across the
music industry and around the world
• Launched
Sound Therapy
with Apple
Music, combining music from our more
than 250 participating artists using
Sollos, our proprietary audio technology
initiative, to help fans focus, relax and sleep
ENVIRONMENT &
SUSTAINABILITY
• Partnered with
innovative suppliers,
reimagining manufacturing processes,
and collaborating across the industry
• Continued to reduce our share of global
climate pollution, reducing our
scope 1 and
2 (market-based) emissions by 34% from
2019,
our base year.
1
Additionally, we have
reduced our
scope 3 emissions intensity
by 44% from 2019.
See “Climate Change
(E1)” section for our targets progress,
GHG emissions data, and methodology.
2
•
Joined as founding donors to EarthPercent
,
which mobilizes artists and the music
industry to channel funding and raise
awareness for high-impact climate and
nature solutions around the world
MUSIC
EDUCATION
• Collaborated with
educational institutions,
public school systems and
nonprofit partnerships
to
mobilize our artists, labels,
employees and fans
around programs and
initiatives that foster the
next generation of
industry leaders
•
Launched career pathway
programs and major
scholarships
to bolster
and support global access
to free music education
for young people around
the world
SOCIAL
CONNECTION
• Provided
critical
support to employees
and community
members
including
those impacted by the
2025 L.A. wildfires
• Supported a
vast
network of nonprofits
working every day to
meet the immediate
needs of communities
around the world
1 Our 2019 base year calculations are outside the scope of third-party assurance. For more information on our progress in meeting our science-based targets, see “Climate Change (E1)” section.
2 Our scope 3 target covers the following emissions categories: purchased goods and services, capital goods, fuel- and energy-related activities, upstream transportation and distribution, waste generated in operations, business travel, and employee commuting.
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APPENDIX
GLOBAL IMPACT HIGHLIGHTS
MUSIC IS UNIVERSAL
Annual Report 2025 |
23
OUTPUT
INPUT
ADDED VALUE
HUMAN
•
Employee headcount:
10,595
INTELLECTUAL
Intellectual Property
•
World class Record Labels and Brands
•
Recorded Music: ~3.6 million recordings
•
Music Publishing: ~5.4 million owned &
administrated titles
•
>3,500 titles of long-form music-based
audiovisual content
Personal Intellect
•
Industry advocacy
•
Partnerships and JVs with independent
labels and entrepreneurs
•
State-of-the art technology solutions
for streaming
SOCIAL & RELATIONSHIP
•
Stakeholder engagement: artists, fans,
employees, shareholders, distribution
partners, government and elected officials
•
Offices in nearly 60 countries
•
Covering nearly 200 markets
FINANCIAL
•
Royalty advance payments,
net of recoupments:
€402 million
•
Net cash used for investing activities:
€854 million
FINANCIAL
•
Revenue growth:
8.7%
(constant currency)
•
Adjusted EBITDA growth: 8.6
%
(constant currency)
ARTISTS
•
Artist costs paid:
€5,836 million
•
Protect intellectual property and rights
EMPLOYEES
•
Salaries & benefits paid:
€1,704 million
FANS
•
Connecting fans with artists they love
SHAREHOLDERS
•
Adjusted EPS growth:
6.1%
VISION
PUTTING
ARTISTS FIRST
MISSION
MORE MUSIC
TO MORE
PEOPLE
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ABOUT UMG
BOARD REPORT
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FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
HOW UMG ADDS VALUE
MUSIC IS UNIVERSAL
Annual Report 2025 |
24
Universal Music Japan (UMJ) acquired a majority stake in
A-Sketch, a leading Japanese music company that operates
as both an artist management business and record label. In
October 2025, UMJ acquired the remaining shares of A-Sketch
Inc. from KDDI.
Universal Music Greater China signed an exclusive global agreement with Liu Huan,
known as the “King of Chinese Pop”.
Launched the Music Industry Mental Health Fund with Music Health Alliance to
provide comprehensive, high-quality outpatient mental health resources for
music industry professionals nationwide.
At the 67th Annual Grammy Awards, Kendrick Lamar was
the top winner, taking home five awards including Record
of the Year, Song of the Year, Best Rap Song, Best Rap
Performance and Best Music Video. In other major
categories, Chappell Roan was named Best New Artist,
Doechii won Best Rap Album, and Sabrina Carpenter won Best Pop Vocal Album.
FEBRUARY
Morgan Wallen reached a U.S. chart milestone when
his album
One Thing at a Time
collected its 100th
nonconsecutive week in the top 10 on the U.S.
Billboard Album chart. His previous studio album,
Dangerous: The Double Album
, surpassed 100 weeks
back in late December 2022.
Chappell Roan won International Artist of the Year
and International Song of the Year at the 2025 Brit
Awards. Other UMG winners included The Last
Dinner Party with Best New Artist, Sam Fender with
Alternative/Rock Act, Stormzy for Hip-Hop/Grime/Rap
Act, and Sabrina Carpenter with the Global Success Award.
MARCH
Introduced Sound Therapy with Apple
Music, an innovative audio wellness
collection designed to help listeners
attain clearer focus, deeper relaxation,
and better sleep.
Launch of Deutsche
Grammophon China
and Blue Note
Records China,
marking a major expansion into
China’s burgeoning classical and
jazz music sectors.
MAY
UMG’s
Nashville
operations
reorganized and rebranded as
Music Corporation of America
(MCA), a brand with a storied
history which recognizes the
Nashville creative community
as a cornerstone of global
music innovation.
Relaunched iconic Nashville-
based label Lost Highway
Records in partnership with
Interscope Geffen A&M.
APRIL
JULY
Strategic partnership with IP asset
management, investment and
advisory firm Liquidax Capital to
accelerate the development of UMG’s
music-related AI patents.
Republic Records joint
venture with Visva
Records, a label
founded and run by Grammy and
Oscar-nominated songwriter Savan
Kotecha, which includes the
soundtrack to
KPop Demon Hunters
.
Universal Music
Greater China partner-
ship with Mandopop
artist David Tao the
“godfather of
Mandarin R&B” and
his company
GREAT Entertainment.
Collaboration with
SoundPatrol Inc. to protect
artists from copyright
infringement activity
coming from AI music
generators. Sound-Patrol’s
patent-pending “forensic
AI model for audio-video
fingerprinting” employs
neural embeddings that
capture and analyze
musical semantics in
order to identify the
influence of original
human-created music
in fully or partly
AI-generated music
content.
SEPTEMBER
Licensing agreement
with KLAY Vision to
further evolve music
experiences for fans,
leveraging the
potential of AI, while
fully respecting the
rights of artists,
songwriters, and
rightsholders.
NOVEMBER
Universal Music
India’s (UMI)
strategic partnership
with Maddock Films,
one of India’s most
prolific Hindi film
production studios,
and its newly formed
music label Mad For
Mussic. UMI
becomes the label’s
global strategic
partner for future
film soundtracks and
other businesses
and product
offerings.
AUGUST
New, multi-year
“Streaming 2.0”
agreements with
Spotify for Recorded
Music and Music
Publishing focused
on growth, innovation
and the advancement
of artists’ and
songwriters’ success.
JANUARY
Taylor Swift’s 12th studio album,
The Life of a Showgirl,
earned the biggest first week ever in
music history with over 4 million U.S. and 5.5 million global album-equivalent units.
Industry-first strategic agreement with Udio, an AI-powered music creation platform, under
which the companies settled copyright infringement litigation and will collaborate on an
innovative, new commercial music creation, consumption and streaming experience.
Strategic alliance with Stability AI to develop next-generation professional music
creation tools powered by responsibly trained generative AI and built to support the
creative process of artists, producers and songwriters globally.
Strategic partnership with KDDI Corporation to foster new engagement opportunities
between artists and fans. The companies will collaborate on and develop new services
that deliver innovative entertainment experiences leveraging cutting-edge technologies,
such as generative AI.
Universal Music Publishing Group signed The Marías to an exclusive, worldwide music
publishing agreement. Known for their fusion of alternative, psychedelic rock, jazz and
Latin, the band was nominated for Best New Artist at the 2026 Grammy Awards.
OCTOBER
Named to
the “World’s
Greenest
Companies” list by
Newsweek
,
one of 750 companies selected
from 8,000+ public companies with
more than a thousand employees
across 26 countries.
Named one of
Time Magazine’s
“100 Most Influential Companies
2025”, UMG was recognized for
defending artists rights and
protecting the creative and
commercial value of music.
JUNE
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YEAR IN REVIEW
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Annual Report 2025 |
25
Board Report
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INTRODUCTION
A world leader in music-based entertainment
UNIVERSAL MUSIC GROUP
is a world leader in music-based entertainment, with a broad array of
businesses engaged in recorded music, music publishing, merchandising and audiovisual content.
We have a broad global reach with a local presence in nearly 60 territories covering nearly
200 markets. Everything we do revolves around supporting artists and songwriters, promoting
innovation, entrepreneurship and bringing fans the world’s most loved music. Our three core
business segments work seamlessly to lead the dynamic and ever-changing global music market:
OUR RECORDED MUSIC BUSINESS
is dedicated to discovering and developing recording
artists at all stages of their careers and marketing, promoting, distributing, selling and
licensing the music they create. Showcasing an impressive roster of recording artists, a
diverse range of labels and a catalog of timeless performers with a combined total of more
than three million recordings, our Recorded music business is the partner of choice for
artists, innovators and entrepreneurs around the globe. This business also incorporates
our commercial activity in film and TV, as well as independent artist and label services
and distribution.
UNIVERSAL MUSIC PUBLISHING GROUP (UMPG)
, our global music publishing business, is
committed to signing, administering and acquiring rights to musical compositions and
licensing them for use in multiple formats. UMPG works closely with their songwriters at all
stages in their careers from early development to the stage where their songs are played
for millions. As one of the world’s largest music publishing companies, UMPG has a catalog
with more than five million-owned and administered titles and enjoys partnerships with
many of the world’s top songwriters.
Bravado, our
MERCHANDISING BUSINESS
, represents the merchandising rights of artists
and entertainment brands and properties. Providing an end-to-end merchandising
ecosystem, Bravado offers services including direct to consumer and retail sales, licensing,
branding, marketing, eCommerce, and creative resources for clients and innovative
experiences and products for fans and superfans worldwide.
Recorded music
Our recorded music business discovers and develops artists; supports the creation of audio and
audiovisual content by recording artists; and markets, distributes, sells, and licenses this content
across a broad range of formats and platforms. We own and administer copyrights to the audio and
audiovisual recordings created by recording artists signed to our iconic labels. We generate revenue
through the sales of this content in formats such as vinyl records, CDs and digital downloads, as
well as from our distribution to music subscription and streaming platforms. Our recorded music
content is also distributed to customers through multiple other platforms and formats, including via
social media, health and wellness, theatrical films, home entertainment, television productions and
video games.
Home to a diverse set of labels, brands and content
We are a leading recorded music company. We are home to many of the world’s premier record
labels and groups. Our roster of recording artists features a diverse portfolio of both global superstars
and leading local artists from around the world. Artists signed to us as part of our recorded music
business spanning musical genres and generations and include the greatest recording artists of
all time. Our renowned label brands include Capitol Records, Def Jam Recordings, EMI Records,
Interscope Geffen A&M, Island Records, Mercury Records, Motown Records, Music Corporation of
America (MCA), Polydor Records, Republic Records and Universal Music Latin Entertainment; as well
as many of the world’s leading classical and jazz labels such as Blue Note Records, Decca Records,
Deutsche Grammophon, Hyperion Records, Impulse! and Verve Records; and the [PIAS] Label Group
and its associated record labels. We continue to launch new labels in certain key markets where we
believe there to be significant untapped opportunity, such as expanding our classical and jazz labels
MUSIC IS UNIVERSAL
Annual Report 2025 |
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ABOUT UMG
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APPENDIX
in Asia with the launch of Deutsche Grammophon China and Blue Note Records China in 2025. We
are also home to many of the world’s premier recording studios, including the legendary Abbey Road
Studios in London, Capitol Studios in Los Angeles and East Iris Studios in Nashville.
Through Virgin Music Group (VMG), we offer a diverse range of premium and flexible independent
label and artist services to entrepreneurs and artists. These services range from global distribution,
insights, data and marketing tools, to fully staffed artist development teams at both the regional
and global levels. This flexibility enables us to foster long-term partnerships, and forges paths to
global success for entrepreneurs, independent labels and artists. In 2025, [Integral], the independent
distribution and services division of [PIAS] was merged with VMG. In addition, on February 20, 2026,
Virgin Music closed on its acquisition of Downtown Music, bringing together two industry-leading
providers of client services and music technology, enhancing their offerings and capabilities to
serve the independent music community.
In addition to recorded music content, we develop a wide spectrum of audiovisual content for
distribution across the globe. Our more than 4,300 hours of audiovisual content spans a diverse
mix of genres and eras and features legendary artists represented within our rich and storied catalog
of content and intellectual property. We have two content divisions at the heart of our audiovisual
operations: Mercury Studios, a multi-faceted content studio, distributor and administrator of our
audiovisual catalog, and Polygram Entertainment, a premium production company. Beyond these,
we also have content operations within our individual labels and other business units. Some of our
key film and TV projects in 2025 included: Ozzy Osbourne & Black Sabbath –
Back To The Beginning
(Mercury Studios), Metallica –
Saved My Life
(Mercury Studios),
Just Sing
(Mercury Studios), and
The Greatest
(Polygram). Other artist driven projects that have been announced include scripted
features from KISS and The Osbournes. Documentaries on the Red Hot Chili Peppers (Polygram) and
Merle Haggard (Mercury Studios) and scripted series including James Brown:
Say It Loud
(Polygram)
and
STAX: Hitsville U.S.A.
Mercury Studio’s Oscar nominated Jon Batiste documentary -
American
Symphony
- won two Grammy awards in 2025 for Best Music Film and Best Song Written For
Visual Media.
Selena y Los Dinos
, Polygram Entertainment’s documentary on legendary Mexican Tejano singer
Selena had its world premiere at the Sundance Film Festival on January 26, 2025, where the film won
the U.S. Documentary Special Jury Award for Archival Storytelling. The film was acquired by Netflix for
global distribution and was released globally on November 17, 2025.
Man on the Run
, a documentary film directed by Morgan Neville explores the post-Beatles era of
Paul McCartney, from his formation of Wings through the 1970s. The film, produced by MPL, Polygram
Entertainment and Tremolo Productions, premiered August 30, 2025 at the Telluride Film Festival in
Colorado. Amazon MGM acquired distribution rights, and it was released globally on February 25, 2026
on Amazon Prime Video as well as theatrically in cinemas.
Mercury Studios also operates two fast channels which launched in 2024—GIGS with partner
Samsung TV Plus in the U.K./EU, and a Def Jam channel with Tubi in the U.S. The fast channels are
exclusive, free, ad-supported streaming channels featuring live performances and documentaries
from across our audiovisual catalog. Mercury Studios also produced an 8-Part podcast series
Ali
In Me
in association with Audible/Amazon, delving into Muhammad Ali’s lasting impact beyond the
boxing ring through his own words in never-before-heard audio and explore his commitment to
fighting injustice.
All corners of the globe
Our recorded music business is both artistically and geographically diverse. We have offices in
nearly 60 territories, covering nearly 200 markets. Our wide geographical presence enables us to
create diversified revenue streams. In 2025, North America accounted for 49% of our recorded music
revenue, while EMEA, Asia, Latin America and the rest of the world represented 29%, 14%, 4% and
4% of our recorded music revenue, respectively. Our extraordinarily diverse roster of artists in turn
means that our business’ success is not reliant on one artist or even a small number of artists.
The top 50 artists accounted for 22% of our recorded music revenue for the year ended December
31, 2025.
MUSIC IS UNIVERSAL
Annual Report 2025 |
28
INTRODUCTION
ABOUT UMG
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APPENDIX
Multi-label structure enables entrepreneurs and encourages artistic diversity
We are home to many of the world’s most iconic record labels. We believe that operating multiple
major frontline labels in markets around the world yields significant benefits. This is why we
continue to develop, revitalize and invest in our label brands. Our multi-label structure empowers
entrepreneurialism, artistry and diversity.
We encompass a collection of iconic and world-class labels, spanning nearly every genre of music,
created and led by visionary entrepreneurs. Our shared passion for discovering recording artists
with the talent and potential to break through an increasingly competitive environment for audience
attention is at the core of who we are and what we do. Each one of these dynamic labels has a
common belief: that an artist they discover and develop will change and drive culture across their
domestic market, their region and around the world.
This approach produces many benefits. Our collection of dynamic enterprises enables us to
effectively cover the music market across all genres and styles, with each label having its own
unique culture and history. Decentralized talent-spotting across UMG, employing each label’s
distinctive identity and creative vision, means we can attract the widest variety of top talent.
Our multiple label structure creates a degree of competition even between and among our labels.
This healthy competition drives innovation and creativity and keeps our labels continuously
evolving to stay at the forefront of industry trends. This structure also alleviates short-term
performance pressure on any individual label. The fact that the different UMG labels will collectively
have a continuous flow of new content means each individual label can take a more long-term
approach to artist development.
Benefitting from UMG’s networks and expertise
While our multi-label structure gives each label the freedom to create and innovate, our labels still
benefit from the reach and expertise that comes with being part of UMG. This is because at UMG,
we negotiate with platform partners, provide in depth data and analytics, share best practices and
centralize many back-office functions at a company-wide level. This lets us benefit from our scale
and drive efficiency, while maintaining the spirit of a quick-moving, innovative and entrepreneurial
company. In 2024, we realigned our U.S. and U.K. frontline label operations to supercharge our
efficiency efforts, and in 2025, our Nashville operations were reorganized and rebranded as MCA.
Expanding touchpoints with artists and entrepreneurs through distribution
We enjoy longstanding relationships as the distribution partner for Big Loud, Concord, HYBE and
Disney, among others, to give our partners’ artists global reach and best-in-class services. We
distribute BMG’s recorded music in physical formats, including vinyl records and CDs. These types
of agreements often lead to further collaborations with these partners, such as BMG partnering with
Republic Records to amplify releases from singer songwriter Jelly Roll, increasing his impact across
genres and territories, and the global breakthrough success of KATSEYE, released as a JV between
HYBE and Geffen Records.
Diversified revenue streams
Our recorded music business has diversified revenue streams derived from three main
sources, including:
DIGITAL:
We generate subscription and streaming revenues through partnerships that
enable our content to be distributed by global, regional and local DSPs, including Spotify,
Apple, YouTube, Amazon, Deezer, Tencent Music and NetEase Cloud Music, among an
increasingly important number of other partners. Our music is streamed on an ad-
supported and paid subscription basis through these streaming services. Fans are also
able to purchase downloads of our music by album or individual tracks through download
services. We also generate subscription and streaming revenues from social media and
short-form video platform partners ranging from Meta, YouTube and TikTok to digital
fitness partners such as Peloton and Apple Fitness+ and gaming platforms, among other
emerging digital platforms. We partner with both established and emerging digital music
services to provide ever-greater access to fans, who are engaging with our music in
multiple ways.
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PHYSICAL:
Our physical recorded music products, including vinyl records, CDs, cassette
tapes, and DVDs, are sold through retailers and wholesalers both in-store and online. We
also sell our products directly to customers via our UMG websites and artist channels.
These D2C channels have shown strong growth and are an increasingly important area of
focus for us. In 2025, D2C sales represented 23% of our physical music sales, with UMG now
operating over 1,600 D2C artist and label stores.
LICENSING AND OTHER:
We enter into agreements to license the use of sound recordings
in combination with visual images, such as in films, broadcast television or subscription
video on demand streaming series, television commercials and video games. As a
rightsholder, consistent with local law, we receive royalties when sound recordings are
performed publicly through broadcast of music on television, radio and cable, and in
public spaces such as shops, workplaces, restaurants, bars and clubs. We also partner
with artists to develop their activities outside the traditional recorded music business, and
generate revenue through participation in these expanded rights, including sponsorship,
fan clubs, artist websites, touring, concert promotion, ticketing and artist and brand
management. We also develop and produce music-based audiovisual content, such
as music documentaries, feature films, theatrical musical productions, music-based
television series and reality shows, which are then licensed for distribution.
Ongoing healthy results across all major recorded music revenue streams
For the year ended December 31, 2025, we achieved growth across all our recorded music revenue
streams. Recorded music revenue in 2025 was €9,456 million, up 6.2% year-on-year compared to
2024, or 9.3% in constant currency.
We have played a prominent role in driving the recorded music industry’s transition to recurring
and more predictable paid subscription streaming models from a model based solely on physical
and digital purchases. Subscription and streaming revenues grew 4.7% year-over-year, or 7.6%
on a constant currency basis, and accounted for 67% of our recorded music revenues in 2025.
Subscription revenue saw growth of 5.6% year-over-year, or 8.6% on a constant currency basis,
largely driven by the growth in global subscribers. Streaming revenues grew 1.5% year-over-year or
4.7% on a constant currency basis.
Physical revenue grew 8.6% year-over-year, or 11.4% on a constant currency basis in 2025.
Downloads and other digital revenue increased by 30.0% year-over-year, or 34.5% on a constant
currency basis, due to a legal resolution. License and other revenue improved 7.8% or 11.0% in
constant currency, as a result of improved live and other related income, as well as a compensatory
payment as part of a strategic licensing agreement with an AI music platform, whilst the prior year
benefitted from certain legal settlements.
Importantly, we also prioritize developing new and diverse revenue sources, partnering with
local and global entrepreneurs to derive income from as many new places as possible. Driving
groundbreaking formats for music consumption has not only benefited our songwriters, artists, fans
and shareholders, it has solidified our role as an industry leader. It has also supercharged marketing
and revenue development via highly bespoke partnerships, such as
ABBA Voyage
, a live, life-like
performance of ABBA's music using avatars in London, and our joint venture with Patrick Whitesell's
WTSL that aims to extend music’s value across film, television, fashion, consumer products, branded
experiences, and other emerging growth areas.
Culture-defining global, regional and domestic superstars
We believe that the breadth and depth of our artist roster is unrivaled and that we are the destination
of choice for the world’s most successful stars and up-and-coming artists. We help local artists
succeed in their home market and grow their global fan base. With a roster featuring legends,
global hitmakers, regional stars and breakthrough artists, our artists span generations, genres,
languages, continents and cultures. Our best-selling artists include global superstars such as J
Balvin, Jon Batiste, Justin Bieber, Luke Bryan, BTS, Lewis Capaldi, Sabrina Carpenter, J. Cole, The Cure,
Lana Del Rey, Doechii, Drake, Billie Eilish, Eminem, Cynthia Erivo, Karol G, Glass Animals, Selena
Gomez, Ariana Grande, Imagine Dragons, Jelly Roll, Lady Gaga, Miranda Lambert, Lorde, Maroon 5,
Noah Kahan, Kendrick Lamar, Lil Baby, Post Malone, Shawn Mendes, Metro Boomin, Nicki Minaj, Katy
Perry, Rihanna, Chappell Roan, Olivia Rodrigo, Sam Smith, Chris Stapleton, Taylor Swift, Shania Twain,
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Morgan Wallen and The Weeknd. Our roster of artists also includes hugely successful local artists
such as Olivia Dean, Sam Fender, The Last Dinner Party, Stormzy, and Lola Young in the U.K., Angele,
Zaho de Sagazan, and SDM in France, Shirin David, Helene Fischer, Herbert Grönemeyer, and Luciano
in Germany, Ado, back number, Fujii Kaze, King & Prince, and Mrs. GREEN APPLE in Japan, Eason Chan,
Jay Chou, Liu Huan, and David Tao in China, AP Dhillon and Hanumankind in India, and Anitta, Feid,
Luis Fonsi, Carin León, and Sebastian Yatra in Latin America.
Our recorded music artists once again topped the global charts in 2025. UMG had:
•
From
IFPI
: Nine of the Top 10 Global Artists for the third consecutive year, including Taylor Swift at
No. 1;
•
On
Spotify
: Four of the Top 5 Artists (Taylor Swift, The Weeknd, Drake and Billie Eilish); six of the
Top 10 Albums and three of the Top 5 (
KPop Demon Hunters Soundtrack
, Billie Eilish
HIT ME HARD
AND SOFT
, and Sabrina Carpenter
Short n’ Sweet
); and six of the Top 10 Songs (with Lady Gaga &
Bruno Mars “Die With A Smile” at No. 1 and Billie Eilish “BIRDS OF A FEATHER” at No. 2);
•
On
Apple Music
: Our artists had seven of the Top 10 Songs globally, including four of the
Top 5 (Kendrick Lamar & SZA "luther"; Lady Gaga & Bruno Mars "Die With A Smile"; Kendrick
Lamar "Not Like Us"; and Billie Eilish "BIRDS OF A FEATHER").Drake was the most streamed
artist worldwide
,
while Morgan Wallen’s
I’m The Problem
was the most streamed album. UMPG’s
songwriters were represented across 15 of the Top 20 Songs globally, including “APT.” from ROSÉ &
Bruno Mars at No. 1, and contributions to four of the Top 5;
•
On
YouTube
: Seven of the Top 10 Songs in the U.S., including Lady Gaga & Bruno Mars “Die With A
Smile” at No. 1;
•
On
Amazon Music
: UMG had all of the Top 5 Albums (
KPop Demon Hunters
, Morgan Wallen
I’m
the Problem
and
One Thing At A Time
, Sabrina Carpenter
Short n’ Sweet
,
and Taylor Swift
The Life
of a Showgirl
); seven of the Top 10 Artists, including the Top 3 (Taylor Swift, Morgan Wallen and
Mrs. GREEN APPLE); seven of the Top 10 Most Requested Artists on Alexa (Taylor Swift,
KPop Demon
Hunters
cast, Morgan Wallen, Lady Gaga, KAROL G, Billie Eilish and Eminem); seven of the Top
10 Vinyl Albums (Taylor Swift
The Life of a Showgirl
, Kendrick Lamar
GNX
, Taylor Swift
reputation
,
Gracie Abrams
The Secret of Us
,
Wicked: The Soundtrack
, The Beatles
Abbey Road
and The Beatles
Anthology Collection(2025 Remaster);
•
On
TikTok
: Global Artist of the Year (KATSEYE) and seven of the Top 10; Track of the Year (“Pretty
Little Baby” recorded by Connie Francis in 1962) and four of the Top 5; Most-Saved Artist of the
Year (Taylor Swift); and Music Trend of the Year (“Anxiety” by Doechii);
•
On
Deezer:
UMG had the four Most-Streamed Artists (Lady Gaga, Taylor Swift, Billie Eilish and
The Weeknd); nine of the Top 10 Albums; six of the Top 10 Songs; and the Most-Shared Song
Worldwide (Lola Young’s “Messy”).
Industry-leading catalog of timeless recordings
Our track record in identifying and partnering with the world’s best artists has given us the
industry-leading catalog of recordings and songs. These include timeless performers such as ABBA,
Aerosmith, Louis Armstrong, The Beatles, The Beach Boys, The Bee Gees, Andrea Bocelli, Bon Jovi,
James Brown, Nat King Cole, Neil Diamond, Marvin Gaye, Guns N’ Roses, Elton John, KISS, Bob Marley,
Paul McCartney, Nirvana, Luciano Pavarotti, Lionel Richie, The Rolling Stones, Frank Sinatra, Sting,
U2, The Who, Amy Winehouse and Stevie Wonder. This diverse catalog gives us strong and reliable
revenue from sales of prior years’ releases. Catalog sales (defined as content older than three years)
accounted for 66% of recorded music digital and physical revenue in 2025, while frontline product
(content less than three years old) accounted for 34%.
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Music publishing
Universal Music Publishing Group (UMPG) is UMG’s global music publishing business and is home
to many of the world’s greatest songwriters and a leading song catalog. We are recognized as one of
the leading music publishing companies globally. Our core activities include discovering, identifying,
and developing some of the best songwriters in the world; publishing and acquiring rights to musical
compositions; and licensing them for use in different formats.
With a global roster of talent spanning genres and geographies, UMPG’s team works closely
alongside our songwriters to amplify their careers and build worldwide success. We license musical
compositions for use in sound recordings, films, television shows, advertisements, video games,
concerts, and other public performances and for use in printed sheet music and song folios. Our
vast catalog of original music and arrangements has incredible breadth and diversity. We enjoy
longstanding relationships with most major film and television studios, global brands and DSPs who
use our music and arrangements in their content and products.
Creating best-in-class service for both global and local songwriters
Songwriters are at the heart of everything we do at UMPG. We are dedicated to giving them best-in-
class service and maximizing their royalty streams. To achieve this, we deploy both the hands-on
expertise of the industry’s best people and cutting-edge technology to maximize opportunity and
value for our songwriters both commercially and creatively. We combine global reach and a local
presence, with over 850 employees operating at 48 offices in 40 countries. These teams focus on
discovering, signing and developing talent and creating unique opportunities for success on a local,
regional or global scale. This physical presence is vital in maintaining relationships with collection
societies worldwide to ensure all generated income is accounted for and collected on behalf of
songwriters and copyright holders. As part of the world’s largest music company, we are uniquely
positioned to develop collaborative strategies between publishing and recorded music. All with one
aim: to bring value to our songwriters.
Embracing technology responsibly to benefit songwriters
We deploy cutting-edge technology and expert administration services to benefit our songwriters.
Through our highly advanced technology platform, UMPG Window, we provide our songwriters and
clients with real-time information on earnings, royalty and copyright data. This advanced system
reflects UMPG’s longstanding commitment to transparency, integrity and trust. UMPG Window uses
the latest in cloud-indexing technology to provide comprehensive views of where, when and how
songs are consumed around the world. UMPG Window also features: one-click, no-fee advances;
international royalty “pipeline” income views; society registration information, status, and full
copyright details on all works; comprehensive film and TV information for works used and royalties
earned; and numerous other powerful tools to help our songwriters and clients.
Partnering with top film and TV content studios
We are a leading publisher in the film and television business. UMPG partners with most major film
and TV content studios including Amazon, Banijay, CBS, Disney, HBO, Lionsgate, MGM, NBCUniversal,
Paramount, Univision and Warner Bros., among others. This leading position means we represent the
world’s most iconic film and TV theme songs.
Multiple revenue streams
Our music publishing business derives revenue from five main sources, including:
PERFORMANCE:
The rightsholder receives revenues when the musical composition is
performed publicly through broadcasting of music on television or radio, and during a
live performance at a concert or other venues such as nightclubs, bars, restaurants, hotels
and retailers.
DIGITAL:
The rightsholder receives revenues when musical compositions are distributed
through audio and visual streaming services, download services, social networks and
other digital music services.
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MECHANICAL:
The rightsholder receives revenues for musical compositions embodied
in recordings sold in any physical format or configuration such as CDs, vinyl records
and DVDs.
SYNCHRONIZATION:
The rightsholder receives revenues for the right to use the musical
composition in combination with visual images such as in films or television programs,
television commercials and video games as well as from other uses such as in toys or
novelty items and other merchandise.
OTHER:
The rightsholder receives revenues for use of the musical composition in sheet
music, song folios and other uses.
Music publishing is a recurring growth business
Music publishing revenue amounted to €2,260 million for the year ended December 31, 2025, up
6.6% year-over-year, or 9.3% on a constant currency basis. Revenues benefited from the continued
growth in subscription and streaming and new business wins, as well as well as improvements in
synchronisation, performance and mechanical revenue.
Another chart-topping year
Our songwriters continued to top the charts around the world in 2025:
•
On
Spotify,
seven of the of the Top 10 Global Artists are UMPG songwriters: Bad Bunny (No. 1),
Taylor Swift (No. 2), The Weeknd (No. 3), Drake (No. 4), Billie Eilish (No. 5), Kendrick Lamar (No. 6), and
Ariana Grande (No. 8). UMPG had an interest in seven of the Top 10 albums, including all of the top
five (Bad Bunny,
KPop Demon Hunters,
Billie Eilish, SZA, Sabrina Carpenter); and seven of the Top
10 songs;
•
On
Apple Music
, UMPG’s songwriters were represented across 15 of the Top 20
Songs globally, including “APT.” from ROSÉ & Bruno Mars at No. 1, and contributions to four of
the Top 5;
•
On
Billboard
’s Hot 100 Songwriters chart in the U.S., UMPG held three of the Top 5 spots with
Kendrick Lamar (No. 1), Sabrina Carpenter (No. 3), and Billie Eilish & FINNEAS (No. 5).
Unparalleled collection of songs in every genre
We are home to many of the greatest songwriters in history. We have a global catalog containing
more than five million-owned and administered copyrights. Our world-class catalog is a rich mosaic
of songs spanning myriad eras, generations, genres and languages. We take a portfolio approach to
growing and managing our catalog. As a result, we have a mix of songwriters from around the world,
with works in our catalog inclusive of every genre —from country to Latin to pop to urban to K-pop
and J-pop. Our catalog is filled with classic songs spanning generations from “Like a Rolling Stone” to
“Every Breath You Take” and from “All I Want for Christmas” to “Stayin’ Alive”. This combines to create
an ever-evolving portfolio that is unmatched in terms of our richness and diversity.
Our music publishing catalog includes some of the world’s most popular songs from major
songwriters and artists such as ABBA, Gracie Abrams, Adele, Mark Ambor, Jack Antonoff, Bad Bunny, J
Balvin, Beach Boys, Beastie Boys, Bee Gees, Louis Bell, Matraca Berg, Irving Berlin, Leonard Bernstein,
Jeff Bhasker, Justin Bieber, Benny Blanco, Andrea Bocelli, Nicholas Britell, Chris Brown, Tommy Brown,
Geovani Cabrera, Mariah Carey, Brandi Carlile, Sabrina Carpenter, Michael Chabon, Nija Charles,
Kenny Chesney, Desmond Child, Cirkut, The Clash, Dave Cobb, Coldplay, Luke Combs, Iván Cornejo,
Lucy Dacus, Lana Del Rey, Alexandre Desplat, Aaron Dessner, Neil Diamond, Álvaro Díaz, Disclosure,
Doechii, Drake, Bob Dylan, Billie Eilish, Idris Elba, Danny Elfman, Eminem, Gloria and Emilio Estefan,
Zac Farro, Omer Fedi, Feid, Jerskin Fendrix, FINNEAS, Florence + the Machine, Fred again.., Future,
Martin Garrix, Selena Gomez, Ariana Grande, Al Green, Josh Groban, Danny L Harle, Kid Harpoon,
Emile Haynie, Jimi Hendrix, Don Henley, H.E.R., Hit-Boy, Audrey Hobert, Sam Hunt, Ice Spice, Carly
Rae Jepsen, Rodney Jerkins, Tobias Jesso Jr., Billy Joel, Elton John/Bernie Taupin, Alicia Keys, Savan
Kotecha, David Kushner, Steve Lacy, Kendrick Lamar, Carin León, Lil Baby, Lil Yachty, Linkin Park, Lorde,
Lord Huron, Demi Lovato, the Mamas & the Papas, Steve Mac, Maroon 5, Dave Matthews, Megan Thee
Stallion, Shawn Mendes, Metallica, Metro Boomin, Julia Michaels, Miguel, Maren Morris, Mumford &
Sons, Nas, Randy Newman, New Order, Pearl Jam, Post Malone, Elvis Presley, Prince, Quavo, Reneé
Rapp, Otis Redding, R.E.M., Red Hot Chili Peppers, Rex Orange County, Lionel Richie, Maggie Rogers,
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Mark Ronson, Rosalla, Carole Bayer Sager, Stephen Sanchez, Gustavo Santaolalla, Schoolboy Q, Carly
Simon, Blake Slatkin, Britney Spears, Stax (East Memphis Music), Sting, Harry Styles, Swedish House
Mafia, Taylor Swift, SZA, Take a Daytrip, Justin Timberlake, Brad Tursi, Shania Twain, U2, Keith Urban,
Michael Uzowuru, The Weeknd, Jack White, Hayley Williams, Dan Wilson, Yahritza, Sebastian Yatra,
Yusuf/Cat Stevens, Frank Zappa and Zedd.
In late 2024, we began global administration of catalogs owned by Chord Music Partners. Key UMPG
signings included The Marías, Geese, Ellie Goulding, Hayley Williams, Zac Farro, Mariah the Scientist,
Miles Clinton Jones, Jessica Agombar, Daniel Lopatin, Bambie Thug, Zikai and Joel Little.
Merchandising
Developing innovative cultural and retail experiences for fans
Bravado is our global, full-service merchandise business. With a portfolio spanning over 220
artists and labels, Bravado is one of the leading music and merchandising companies worldwide.
Through Bravado, we develop high-quality licensed consumer products that reflect and reinforce
an artist's brand and identity and present them to a worldwide audience. Our artists, labels and
brands have access to a unique end-to-end merchandising ecosystem that brings together creative
design, production and distribution. We work closely with new and established clients to create
innovative products that are carefully tailored to the brand or artist. Our products include apparel
and accessories, home goods, toys, games, luxury goods, food and other retail merchandise. They
are sold through selected retail outlets and web-based stores, both directly and through third
parties, and on live tours. By tapping into our global network, we can offer a comprehensive
range of merchandising services, including sales, licensing, branding, marketing, eCommerce and
creative resources.
Sparking connections with fans
With a focus on building connections between artists and their fans, our in-house creative
development team at Bravado works closely with new and established artist-clients to create
innovative products carefully tailored to the brand or artist. Our creative team operates at the
intersection of art, music and fashion — identifying key trends in all three areas and creating
compelling products and experiences that are in tune with today’s culture. As part of a world-leading
music-based entertainment company, we are uniquely positioned to create fresh and exciting
products that match an artist’s brand and identity. For example, for her 2025 Hit Me Hard And
Soft World Tour, Billie Eilish collaborated with Bravado to create exclusive sustainable merchandise
products for her fans around the world. All merchandise was made from a variety of 100% recycled
cotton, organic cotton or recycled polyester, while Posters were made from 100% recycled paper.
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Building our D2C business
We are excited about scaling our D2C capabilities and monetizing superfans. We are building our
“owned” audience and reinforcing our labels’ core artist brand building capabilities in consumer
products and live experiences. Our “owned” audience, which refers to the segment of customers
registered to receive marketing materials from our owned and operated websites, has grown
to over 200 million fans, as we have expanded into additional territories. Our D2C business
continues to be driven by our expanding global footprint of 1,600 owned and operated online artist
stores, our developing supply chain infrastructure and our increasingly sophisticated customer
data capabilities.
Global retail
We have developed an extensive global distribution network. Our strong direct relationships in the
retail sector and ability to curate a mix of products and experiences hold the key to our success.
Our global and in-market local teams work in close collaboration to manage our brands consistently
and effectively across all markets and countries. Thanks to this localized approach, our activities are
tailored to each individual market to achieve maximum reach and results.
Licensing
Our licensing services extend the scale and scope of our brands into categories beyond apparel and
traditional consumer products. We leverage dynamic partnerships across a range of platforms and
categories from footwear and accessories to gaming and spirits. Working closely within an extensive
global network of best-in-class licensees, we develop dynamic brand partnerships to reach new and
diverse audience segments without diluting the artist’s brand.
Compelling fan experiences
Through pop-ups and unique experiential events, Bravado connects artists with fans around
the world, creating unforgettable moments that maximize fan engagement. Recent examples
of compelling fan experiences engineered by Bravado included the exclusive Black Sabbath
“Homecoming” experience at Selfridges in Birmingham, UK to celebrate their final show, Queen “The
Greatest” pop-up store in London’s Carnaby Street to celebrate five decades of Music; Mrs. GREEN
APPLE “MGA Magical Ten Years” pop-up at UMusic Shop Tokyo; Lil Wayne's immersive “Tha Carter VI
Experience” exclusively at Selfridges in London; and Billie Eilish’s Hit Me Hard And Soft pop-up stores
around the world, along with so much more.
Multiple revenue streams
Our merchandising revenues are derived from four main sources:
TOURING INCOME:
Sales of physical merchandise products directly to consumers at
venues during tours. This also includes concession income, which is the sale of physical
merchandise products directly to consumers at concessions within venues. The right to
sell at concession is not limited to specific tours, Bravado signed artists or music events,
but can also encompass other events within venues.
RETAIL:
Sales of physical merchandise products to wholesalers and retailers.
LICENSING:
Fees received from third party licensees to use our merchandising rights in
products sold by or sub-licensed by the licensee.
ECOMMERCE/D2C:
Sales of physical merchandise product through our network of over
1,600 owned and operated artist and other branded online stores. This also includes VIP
events and fan clubs, which is the sale of premium experiences and exclusive access
through a D2C channel.
Bravado signs agreements with clients that provide for usage rights of the client's name, image and
likeness across product categories and distribution channels. For the year ended December 31, 2025,
merchandising and other revenues were €811 million, down 3.7% year-over-year, but in line with the
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prior year on a constant currency basis, as a decline in D2C sales was offset by growth in touring
merchandise sales.
Roster of clients with the greatest names in music
Our merchandising roster of clients includes some of the biggest names in music. We provide
merchandising services for leading artists including 21 Savage, Gracie Abrams, Aerosmith, Anitta,
The Beatles, Justin Bieber, Blink-182, DMX, Bob Dylan, Billie Eilish, Karol G, Selena Gomez, Ariana
Grande, Guns N’ Roses, Elton John, KISS, Lady Gaga, Kendrick Lamar, Bob Marley, Paul McCartney,
Reba McEntire, Tim McGraw, Shawn Mendes, Metro Boomin, Nine Inch Nails, Paramore, Post Malone,
Olivia Rodrigo, The Rolling Stones, Sex Pistols, Slipknot, Britney Spears, Taylor Swift, Shania Twain, Kali
Uchis, Morgan Wallen, The Weeknd and The Who.
A number of Bravado artists are also signed across our other businesses, allowing for synergies and
increased opportunities for artists. And for those Bravado clients who are not in the UMG-family, our
work holds potential to ultimately expand those relationships and bring them into our family.
Commitment to sustainability
Bravado seeks to advance climate action across the industry and drive progress toward our Science-
Based Targets. We have created, produced and hosted UMG x Bravado Sustainability Summits in
LA, London, Nashville and New York, the first music industry sustainability summits. The summit
series brought together industry leaders and innovators in sustainable solutions to share ideas and
drive change.
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STRATEGY
Creativity, Innovation, Entrepreneurship
As a world leader in music, we are guided by our key principles of creativity, innovation and
entrepreneurship, and are driven by a commitment to help songwriters and artists thrive and
connect with their fans all over the globe.
Our creative and commercial foundation has a proven track record of building sustainable long-term
value for our stakeholders and is built on a set of key pillars, most notably:
•
Continuing to discover and break new artists and songwriters and supporting them at every stage
of their career to help them achieve their greatest creative and commercial potential;
•
Maximizing and protecting the value of our extraordinary catalog, both now and in the future;
•
Driving growth in our subscription and ad-supported streaming revenue around the world and
expanding our capabilities and repertoire in high-growth markets;
•
Building winning partnerships with tech innovators to create innovative commercial opportunities
and explore how technology can be used to benefit our artists in creating product, driving
engagement and discovery, further fueling fandom and consumption;
•
Working to maximize the power, influence and impact of music to drive social conversation;
•
Progressing thought leadership on key industry issues and public policies to help maintain a
vibrant and growing music ecosystem;
•
Advancing data and insights, to help fuel discovery, furthering our ability to connect our artists
with their fans anywhere in the world and to identify superfans;
•
Enhancing our capabilities to comprehensively serve and maximize the value of superfans
through D2C/eCommerce/product development, increasing monetization.
With each of these areas creating expansive opportunities, our artists and songwriters remain the
cornerstone for our labels, businesses and brands. In addition, we are committed to sustainability
in our business and across our industry, working to reduce our environmental footprint and
generating a positive cultural handprint. For detailed sustainability-related information, see our
Sustainability Statement
.
Throughout 2025, we continued to make progress in all of these strategic areas — redefining
the model for streaming growth, protecting artist and songwriter rights through Artist-Centric
principles, building winning partnerships with tech innovators, seizing upon the opportunities of new
technologies like Al, boosting our presence and capabilities in high-growth markets, discovering new
ways to build audience using our data, leveraging our expansive catalog even further; and leaning
into consumer, commerce and superfan monetization.
And, of course, we continue to break new artists, time and again, in all genres and categories and in
markets around the world. We are proud of the breadth and success of these strategic initiatives and
investments, as we remain well positioned to realize the extraordinary potential that lies ahead for
the industry.
Deepening our local-global approach
We are a global company built on expertise and relationships with local music communities around
the world. We believe local repertoire is historically the most successful repertoire in music markets
spanning the globe. We are committed to expanding our presence and accelerating our growth in
both high-growth potential markets and far-reaching regions to discover exciting new music and
artists globally, expand our catalog and repertoire, create opportunities to connect with local music
fans, help introduce new music to global audiences and further benefit from the growth to come in
these markets.
Why it matters:
Our diverse and long track record of worldwide successes helps us continually
attract new talent to our roster. New talent will always be integral to our future success. The more
those artists reflect the local culture for the consumers and communities we serve, the more those
fans will connect to their music, including in high-potential markets like India, the Middle East, West
and Sub-Saharan Africa and Greater China.
Expansion strategy:
We continue to expand our global reach by investing in local markets. We are
doing that in three ways: local artist investment; local label partnerships; and acquisitions.
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Local artist investment:
Through our multi-label structure, we sign and develop local artists, while
building a roster of the best talent each region has to offer, just as we do in more established
music markets.
Partnerships:
We partner strategically with leading local labels, artist managers and entrepreneurial
companies to support and boost them with global promotion, distribution and a full suite of
artist services.
Through Virgin Music Group, we partner with regional independent labels to help their artists achieve
critical and commercial success outside of their local markets. For example in
Latin America
, Socios
Music, the record label of influential rising global artist Carin León, formed a unique partnership with
VMG and Island Records to release new music. An award-winning artist from Mexico, León has a
discography of globally charting songs that have amassed millions of streams globally, including the
Latin Grammy winning song “Como Lo Hice Yo”.
In
Asia
, VMG teamed up with Tokyo-based Bushiroad Music to distribute its gaming and anime music
globally. A subsidiary of gaming and anime producer Bushiroad Inc., the label manages several
music properties, including content from BanG Dream! Girls Band Party!, the parent company’s
smartphone game with over 20 million users globally. VMG also formed a strategic long-term
agreement with Hungama Digital Media, a digital entertainment company across South Asia. The
partnership will expand the reach of Hungama’s extensive music catalog while VMG will gain
regional expertise and deepen its presence in India’s regional music scene.
In
Africa
, VMG struck a partnership with RainLabs, a distribution and label services company
headquartered in Ghana. The collaboration will provide digital distribution, marketing, creative
production and brand partnership services to Africa-based artists, allowing them to reach global
audiences and achieve lasting success. Founded in 2020, RainLabs’s roster includes Joey B, Cina
Soul, Baaba J, Kofee Bean and Ess thee Legend.
And in
India
, we have continued to deepen our presence and capabilities through a series of
strategic initiatives. Notably, Universal Music India (UMI) entered a strategic partnership with
Maddock Films, a leading film production company, to further integrate music and film and expand
our reach in the Indian entertainment ecosystem. This collaboration enhances UMI’s ability to
identify, develop, and promote local talent, while deepening its presence in India’s largest music
category – domestic film music – by leveraging Maddock Films’ strong market presence and
content pipeline.
Acquisitions:
Through M&A, we acquire local labels, catalogs and artist services businesses.
In
Latin America
, VMG acquired Saban Music Latin, including the catalog and future releases from
its roster of artists including German Montero, Fuerza De Tijuana, Reykon, Jon Z, Almighty, Jesus
Mendoza, Banda Cruz De Oro, Michael Stuart, and Abel Zazueta Y Los De Culiacan.
In
Africa
, we acquired a majority stake in one of the world’s most dynamic and exciting independent
record labels, Mavin Global (Mavin) in 2024. The Lagos, Nigeria-based label is the driving force behind
many of the continent's most successful Afrobeats artists. Founded in 2012 by renowned artist,
producer, music executive and entrepreneur, Michael Collins Ajereh (aka Don Jazzy), Mavin has
played a pioneering role in breaking Afrobeats artists within Africa and beyond. Mavin is home to
a number of accomplished artists including Ayra Starr, Lifesize Teddy and Rema, whose hit single
“Calm Down” featuring Selena Gomez is the biggest Afrobeats song of all time and holds the record
for the most viewed video of all time by an African artist on YouTube, as well as being the first African
artist-led track to surpass 1 billion Spotify streams and views on YouTube. Founder and CEO Don
Jazzy and COO, Tega Oghenejobo continue to lead the company, which gives us the opportunity to
partner with proven local executives and experienced A&R professionals further strengthening our
position in Africa.
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In
Asia
, we have made a number of acquisitions related to our expansion strategy.
In 2024 we completed the full acquisition of RS Group in Thailand, a key music market in the
region. The acquisition includes Thailand’s second largest music catalog with over 10,000 master
recordings, 6,000 copyright ownerships, publishing rights, and licenses spanning four decades, as
well as a leading Thai music distributor and a management company. This acquisition and the
integration of local talent and repertoire helped us increase our market share in Thailand by over
50% since 2018.
We also purchased the catalog of iconic U.K.-based South Asian record label Oriental Star Agencies
(“OSA”) in 2024, including all of the label’s recordings and publishing rights. A slice of over 50 years
of South Asian culture and heritage, the catalog comprises approximately 18,000 song, concert and
video recordings, featuring legendary and genre-defining Pakistani and Indian artists.
In 2025, Universal Music Japan acquired a majority stake in A-Sketch, a leading Japanese music
company founded in 2008. A-Sketch has successfully signed and developed artists across rock,
J-pop and Anime-music, with a roster of popular Japanese artists including Saucy Dog, Flumpool and
Ayumu Imazu, and a catalog of classic releases from ONE OK ROCK, among others. A-Sketch’s MASH
A&R is one of Japan’s leading rock management companies, with a roster of artists including The
Oral Cigarettes, FREDERIC, and Saucy Dog.
In 2025, Universal Music Turkiye acquired the recorded music catalog of Sezen Aksu, known as
the “Queen of Turkish Pop”. Aksu is one of the most successful Turkish singers, songwriters and
producers and has been the most-streamed female artist in Turkey for the last seven years. Her
career spans over five decades, during which she has released 30 albums and 21 singles and sold
more than 40 million physical albums worldwide.
Spotlight on China
Under the leadership of Timothy Xu, Chairman & CEO for Universal Music Greater China (UMGC),
we have strengthened and grown our business operations across Greater China, one of the world’s
fastest growing and most dynamic music markets. We launched a new strategic division, Universal
Music China Greater Bay Area, covering China’s Greater Bay Area including Hong Kong and Macau.
With our new headquarters in Shenzhen, UMGC is the first major music company to establish a
division in China’s Greater Bay Area, the world’s largest and most economically vibrant urban cluster.
In addition to Shenzhen, UMGC has offices in Beijing, Hong Kong, Shanghai and Taipei to support the
next phase of growth across the region.
New partnerships and strategic developments in Greater China include:
Our landmark strategic distribution agreement with Modern Sky, China’s prestigious independent
music label that will provide Modern Sky’s extensive catalog and roster of artists with access
to our worldwide distribution network. It also opens doors for expanded collaboration between
the two companies to elevate and introduce China’s original music and vibrant youth culture to
international audiences. Founded in 1997, Modern Sky has been instrumental in shaping China’s
indie music movement, producing over 500 albums and working with some of the country’s most
influential bands and artists. The label is home to over 150 acts, including emerging talents with
a diverse range of musical genres and an increasingly global perspective. The company launched
China’s first large-scale outdoor music festival, the Strawberry Music Festival in 2009, and organizes
over 30 music festivals annually and more than 1,000 performances across China.
UMGC partnered with iQIYI, China’s leading online entertainment platform, to exclusively distribute
worldwide the new releases from contestants of “The Rap of China 2024”, while providing them with
an integrated support network.
The Rap of China
series produced by iQIYI is the first Chinese reality
program to adopt a narrative-driven episodic format, focusing on young Chinese rap talent. Since
its debut in 2018, the show has become a cultural phenomenon in China, sparking a nationwide rap
craze. As one of China’s most successful youth culture brands in recent years, “The Rap of China”
series has successfully launched the careers of numerous outstanding rap artists.
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We entered a strategic agreement with TF Entertainment, the driving force behind China’s premier
idol sensations TFBOYS and Teens In Times. UMGC will provide global digital distribution for TF
Entertainment’s roster of talent, targeting markets outside Mainland China to further elevate C-pop’s
prominence on a global stage.
UMGC signed an exclusive global agreement with Liu Huan, known as the “King of Chinese Pop”.
Huan has been a household name in China since the 1980s, after defining the voice of the era. A
prolific songwriter and music educator, he has made significant contributions to the evolution of
Chinese pop. The multi-year agreement with UMGC marks the first time that Liu Huan’s majority
body of work —both recording and publishing rights— will be united.
UMGC signed a new partnership with Mandopop artist David Tao and his company GREAT
Entertainment, further expanding its presence in the Greater China region. As part of the deal, UMG
will provide the Taiwanese singer-songwriter and GREAT Entertainment access to the music giant’s
global infrastructure and creative network. The partnership kicked off with the release of Tao’s eighth
studio album,
STUPID POP SONGS
, his first full-length project since 2012.
UMGC signed multi-faceted young artist Nana Ouyang — a renowned cellist, singer-songwriter,
and actress, returning the acclaimed artist to UMG, where she began her career. The collaboration
encompasses music development, global distribution, artist representation for music-focused
activities and brand partnerships.
UMGC announced the launch of Deutsche Grammophon China (“DG China”) and Blue Note Records
China, marking a major expansion into China’s burgeoning classical and jazz music sectors. As
two of the most iconic labels in global classical and jazz history, Deutsche Grammophon and Blue
Note will now operate dedicated China imprints through collaboration with UMGC, bringing their
artistic excellence and storied legacy into closer dialogue with China’s music community. Both new
labels will focus on identifying and supporting rising Chinese talent, fostering creativity, and building
pathways for Chinese musicians to connect with global audiences.
Enhancing our capabilities to maximize the value of superfans
The deep and passionate connection between artists and their fans —”super-fandom”— is a core
component of music industry economics. Unlocking the power and maximizing the value of the
superfan has been at the heart of our growth strategy for many years, utilizing our cutting-edge data
and technology to expand our direct fan audiences and better understand fan behavior. Superfans,
a growing and influential category of music enthusiasts, spend 75% more each month on live
music events and physical music purchases than the average music listener, based on data from
Luminate’s 2024 Year-End Music Report.
These fans drive increased activity both on platforms, but also through our rapidly growing D2C,
eCommerce and merchandising businesses, which represent a significant opportunity for us to grow
authentic engagement between fans and the artists they love.
We are also engaging superfans with new products and experiences that unlock their spending
potential, and we are seeing dramatic growth in revenues that are complementary to streaming.
These include premium music and merchandise collectibles and innovative superfan experiences.
We see an especially exciting opportunity to serve superfans through D2C channels and we are
expanding our capabilities to do so. We will identify and serve superfans across multiple channels
but more and more of this business, particularly in physical formats, will continue to be D2C.
In recent years, the launch of our own dynamic global eCommerce platform has enabled its D2C,
digital goods, merchandise divisions to accelerate and amplify artists’ ability to create experiential,
commerce and content offerings for their fans. The platform is already supporting more than 1,600
owned and operated artist and other branded online stores globally, helping to rapidly grow our D2C
revenues and enabling us to build our owned audience of more than 200 million fans as we have
expanded into additional territories. We are leaning further into eCommerce and focusing efforts
towards building an enhanced and holistic fan-centric ecosystem for our artists, providing them with
a robust network of tools and services to build comprehensive global campaigns that will help them
reach fans around the world.
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We are actively increasing our global audience and customer footprint, connecting with music fans
and superfans around the world in order to retain and deliver subscribers and fans access to the
experiences and products they want the most.
The superfan D2C opportunity is not just a complementary, high growth revenue opportunity; it’s also
an important competitive advantage that we believe is increasing our appeal to artists and giving us
the capability to do more for them than our competitors.
We are actively growing our global superfan business, introducing and developing more products
and experiences for our most passionate and engaged fans. Examples of these include physical
product collectibles, high-end merchandise collaborations such as Nike x Billie, Billie Eilish’s
ongoing collaboration with Nike, and Olivia Rodrigo’s House Party on Roblox.
We made a strategic investment in NTWRK, a premium live-video shopping platform and curated
marketplace serving buyers and sellers. As part of this investment, NTWRK then acquired publisher
Complex to create a new destination for superfan culture that will define the future of commerce,
digital media and music. The acquisition marks the next generation of Complex’s leadership as a
publication reaching young audiences about the trends, products and styles they love. By marrying
an eCommerce platform anchored in sneakers, streetwear, and collectibles with content and music,
the company operates a digital hub at the forefront of convergence culture. The deal allows Complex
to leverage NTWRK’s marketplace and culture-obsessed consumers to create a one-of-a-kind
experience for a highly engaged audience. This provides our artists a dynamic network to deepen
connections with superfans through unique collaborations and cultural moments.
UMusic Hospitality & Lifestyle (UMHL) extends UMG's ecosystem into physical spaces where
music, culture, and commerce converge. Building on the success of UMusic Hotels Madrid, UMHL
has expanded to encompass standalone retail, food and beverage, creative hubs, and venue
concepts.
In 2025, the first UMusic Shop opened in Madrid, followed by New York and London later in
the year. Separately, UMG operates a fourth UMusic Store in Tokyo’s Harajuku district.
Continuing to drive the music industry forward
Music as an industry is constantly evolving. We strongly believe we have the right formula to stay in
front of that evolution.
As part of our industry leadership, we are focused on helping to maintain a thriving and sustainable
global music ecosystem; continuing to redefine the streaming model in order to create greater
value for artists, fans, music companies and platforms, while protecting and reinforcing the value of
human artistry and creativity.
We have once again distinguished ourselves with our thought leadership and action, which we
believe sets out a clear path for both us and the broader industry in the coming years:
•
Ushering in the next era of streaming growth with “Streaming 2.0” and further advancing our
“Artist-Centric approach” to streaming model innovation;
•
Continuing our industry-leading push to define and establish responsible Al for the benefit of all
artists; and
•
Exploring new creative and commercial avenues for monetizing music well into the future.
Advancing Artist-Centric and Introducing Streaming 2.0
The Artist-Centric principles first spearheaded by UMG continue to make progress in the industry as
they became more broadly embraced by DSPs. Initially, we focused on:
•
Ensuring that real artists with real fan bases are better recognized and rewarded for the platform
engagement they drive and value they create;
•
Protecting an artist’s music and royalties from systematic streaming fraud, manipulation
and misattribution;
•
Better differentiating music from the flood of noise that has accelerated in recent years,
all of which undermines the user experience, diminishing discovery and diluting authentic
fan engagement.
We began in 2023 with several streaming DSPs’ adopting and exploring Artist-Centric principles.
The engagement here included Deezer and Spotify, as well as Tidal and SoundCloud, as platforms
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looked to better reward real engagement by creating a bespoke model that better reflects our own
fan-driven consumption and listening experience.
We continued to lead the industry forward in our groundbreaking deals and collaborations with
Amazon, Meta, TikTok, Snap, YouTube and others that helped apply Artist-Centric principles into
social listening and other categories.
Throughout 2025, we actively advanced our Artist-Centric principles with a number of key partners
to meet what we believe will be opportunities to increase our and our artists’ revenue by
building innovative superfan focused product offerings. This will create new revenue streams, and
opportunities for artists to engage with their biggest fans.
We are working closely with partners on the development of a compelling set of new features
that could form a super-premium subscription tier to help elevate the listener experience and
further deepen artist-fan engagement. In the future, we expect super-premium tiers to be deployed
by most streaming platforms—enhancing the user experience, bringing fans closer to the artists
they love and increasing subscription revenue for artists. The best way to characterize our vision
for streaming’s transformation through innovation is to frame the evolution of the market from
“Streaming 1.0” to “Streaming 2.0”.
Charting the transformation of our business over the past decade, it was essential to encourage
the market’s evolution by focusing on a simple and appealing value proposition for subscription
streaming, with services effectively marketing this clear and compelling product. We refer to this
period as Streaming 1.0, when market adoption scaled dramatically. However, the simplicity of this
model —with all streams being equal— has precipitated problems with volume prioritized over value.
We believe that the streaming models must adapt to embrace change.
Under Streaming 2.0, we elevate our focus on maximizing customer value, while also continuing
to grow the subscriber base. We believe that customer segmentation driven by product innovation
will be an important contributor to the next stage of subscription market growth. We are focused on
how best to drive customer acquisition via free tiers while also improving their economics, as we
realign the subscription model around the core value driver of authentic artist-fan relationships and
ultimately endeavor to capture higher customer value through super-premium tiers of service.
Subscriptions and ad-funded streaming have been primary growth drivers of our business over the
last ten years and are expected to continue to be engines of growth going forward — but we believe
growth in the years ahead will also be driven by targeting the superfan opportunity and through our
partnerships with a broad array of businesses fueled by music. This is how we further address our
goal of broadening and deepening monetization in the era of Streaming 2.0.
We executed our first major Streaming 2.0 deal in late 2024 when we expanded our global partnership
with Amazon, implementing artist centric initiatives, advancing Al and fraud protections and
promoting revenue growth. In 2025, we signed new multi-year agreements with Spotify and YouTube
platforms covering recorded music and music publishing that also embrace our Streaming 2.0
framework. These agreements provide for new paid-subscription tiers, the bundling of music and
non-music content, and a richer audio and visual content catalog that we believe will benefit artists,
songwriters, platforms and consumers alike.
We are extremely encouraged by this initial implementation of Streaming 2.0. Aligning our goals with
those of our platform partners is an initiative that we believe will benefit the entire music ecosystem.
The big picture:
The economics of streaming is a vastly more complex subject than it was at the
infancy of the format nearly two decades ago. Artist-Centric and Streaming 2.0 address many aspects
of the traditional streaming model that have come to need revision in order to create better equity
for the artists who drive value for DSPs. Over the past two years, UMG has spearheaded the Artist-
Centric approach, which has gained significant momentum as the driver for that change.
Why it matters:
The work and value of artists have become increasingly diluted on digital platforms
by an oversupply of content, much of it merely noise and increasingly more of it associated
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with fraud. This situation has become even more pronounced with the increased availability of
unlicensed, generative Al technology.
This has served to drown out the real music that fans actually want to hear. The principles of
an Artist-Centric approach to streaming were conceived by us to better reward music artists and
songwriters that inspire audiences and drive the most engagement, not the bots and white noise
diluting that experience.
The details:
While there is a significant degree of consensus about core objectives and guiding
principles, each platform will decide how they implement their version of the Artist-Centric model.
Some examples of how platforms are approaching this include: rewarding songs or artists that
reach a certain threshold of listeners or streams; rewarding streams that reflect more active fan
engagement; limiting the impact of non-artist noise content on platforms; protecting the royalty
pool from generative Al dilution; improving fraud detection and attribution; cleaning up zero-value
content already on platforms; and removing incentives for bad actors. Artists at every stage of their
career will benefit from these moves since they are prioritizing authentic artist-fan engagement.
What’s ahead:
We continue to work with every DSP to embrace Phase 1 and 2 Artist-Centric
approaches that will support all artists regardless of the scale at which they are operating and
regardless of the stage of their careers. Adoption of these core principles will enhance artist
discovery and will also significantly benefit the streaming services themselves by returning them
to their core mission of bringing great music to fans. As part of that process, it promotes subscriber
acquisition and retention.
Embracing AI for good
History has taught us that the emergence of new technologies comes with both transformative
opportunities and inherent risks to traditional business models. We believe that Al is no exception.
Our use of Al in the context of our business is wide ranging, and includes expert systems,
machine-learning based systems and generative systems. In order to address and harness the
rapid acceleration of developments in Al, we have developed a strategy that carefully choreographs
offense and defense while placing artists’ interests at the center of the conversation.
Based on what we’ve done with our AI partners to date, and what we see on the horizon, we believe
that AI has the potential to enable us to connect our artists with their fans in new and innovative
ways—and with advanced capability on a scale we’ve never encountered. Already, with AI we see the
advancements in these three categories which we will describe in greater detail below: 1) creative
tools that artist can use in the production of their music 2) new ways for fans to interact with our
artists’ music 3) advancements in the detection of copyright infringement. Because we believe that
Al can be used to enhance human creativity in music, enriching aspects of what we do for our artists
and their fans. We have been exploring the opportunities emerging from this technology for years.
This includes applying Al for advances in data analytics, marketing tools, enhanced studio and audio
production, while working to protect the long-term value of artistic content. We use a combination of
in-house developed Al tools, as well as a variety of third-party Al tools. In-house developed Al tools
include, for example, those for audio quality assurance testing and content tagging, and they operate
on our own catalog or on our distributed catalog. The quality assurance tool analyzes audio to
either identify common problems like pops or hiss, and the tagging tool analyzes audio to generate
metadata information, such as beats-per-minute or musical key. We also hold Al marketing patents
that generally cover automation of marketing campaigns and audience optimization, for example by
predicting audience behavior or identifying possible audience segments of interest.
Why it matters:
Placed in a context where artists’ rights and interests are embraced and advanced, Al
has the potential to amplify human imagination and enrich musical creativity in extraordinary new
ways. We see great potential in Al to inspire and empower a new generation of talent.
An example of this approach is our collaboration with YouTube in 2023 to launch their first Al-related
music experiment —Dream Track for Shorts and Music Al tools— built in collaboration with Google
DeepMind. The experiment was designed to help explore how the technology could be used to create
deeper connections between artists and creators, and ultimately, their fans. The experiment brought
together a working group of artists, songwriters and producers - including UMG’s Demi Lovato, John
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Legend, Troye Sivan, and others – to collaborate in YouTube’s AI Music Incubator to help shape the
potential creative and commercial future for Al in music. With this initiative, we established a shared
set of principles and best practices with YouTube around the use of Al in the creation of music.
Central to this collective vision is building a safe, responsible and profitable ecosystem for music
and video as technology advances — one where artists and songwriters can maintain their creative
integrity and be compensated fairly.
We also joined with Roland Corporation, the electronic musical instruments maker, to publish
Principles for Music Creation with Al, a series of clarifying statements relating to the responsible
use of Al in music creation and advocating for their adoption across the music industry and creative
community. The principles highlight the opportunity for innovation with Al in music production,
composition, and songwriting while underscoring the need for transparency, equity, and community
involvement. Today, more than 90 prominent music companies, associations, and institutions
globally added their support to the Principles, underscoring our influence as an industry leader in
this space.
As our Al strategy has progressed, we have seen many more companies committed to
exploring responsible Al development, working with us on solutions that respect artists’ right
and interests, unlock creativity, explore new commercial opportunities for us and compensate
artists appropriately.
In late 2025, we made major strides toward establishing new AI revenue streams by signing an
industry-first strategic licensing agreement with Udio for a new licensed AI music creation platform.
We agreed to settle our copyright infringement litigation, and will collaborate on a new music
creation, consumption and streaming experience. The license agreement covers recorded music and
music publishing and provides for new revenue opportunities for UMG artists and songwriters. The
new platform will launch in 2026 powered by cutting edge generative AI technology trained on
authorized and licenses music. Subscribers will be able to customize, stream and share music in
a protected environment on the Udio platform.
Other notable strategic developments we have made around Ethical AI include:
Universal Music Japan and KDDI Corporation entered a strategic partnership in music and
entertainment, aiming to foster new engagement opportunities between artists and fans. The two
companies will collaborate on and develop new services that deliver innovative entertainment
experiences leveraging cutting-edge technologies, such as generative AI. The partnership will aim
to balance the opportunities AI offers for personalization and creativity with the need to protect the
established value of music and intellectual property.
We are in collaboration with KLAY Vision Inc. on a pioneering commercial ethical foundational model
for Al generated music that works in collaboration with the music industry and our creators. KLAY
aims to be the backbone for a new era of innovation, powering new products and experiences,
committed to the premise that Al can bolster and grow musical creativity and human artistry. At
the core of this shared vision is the conviction that state-of-the-art foundational Al models are best
built and scaled responsibly through constructive dialogue and consensus with those responsible
for the artistry.
We partnered with SoundPatrol Inc., a research lab for large music models on a first-of-
a-kind collaboration to protect artists from the unchecked copyright infringement activity
coming from AI music generators. This groundbreaking development is made possible through
SoundPatrol’s patent-pending “forensic AI model for audio-video fingerprinting”, which employs
neural embeddings that capture and analyze musical semantics in order to identify the influence
of original human-created music in fully or partly AI-generated music content. The technology
represents a step change in copyright detection and responsible music creation and is tailored
specifically to capture the evolving complexities of the music landscape.
We formed a strategic collaboration with Idealab Studio, a leading technology incubator behind
ProRata.ai, a company founded to enable generative Al platforms to fractionally attribute and
compensate content owners. ProRata’s technology is designed to enable generative Al platforms —for
the first time — to help accurately attribute and share revenues on a per-use basis with content
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owners. The company’s attribution technology will help protect and reward creators while preventing
unreliable content from driving Al query responses.
And we are helping to develop the next generation of creative tools to apply AI technology in the
production studio:
With Splice, the world’s most popular music creation platform, we are collaborating on joint
exploration of the next generation of AI-powered music creation tools for musical artists. UMG and
Splice are building a roadmap for development of commercial AI tools rooted in creative control and
sonic excellence. The artist-centric agreement builds on Splice’s suite of AI-enabled creator tools,
which continue to respect intellectual property, and combine high-quality creative ingredients.
We partnered with Stability AI to develop professional AI music creation tools powered by responsibly
trained generative AI. Through this alliance, Stability AI’s research and product teams will work
with UMG and its artists to determine the needs and technical approaches for the next generation
of music creation tools. Together, they will explore new recording and composition concepts,
gather insights into artists’ needs, and better understand how artists adopt and engage with these
technologies. The collaboration will prioritize feedback from the creative community to guide the
creation of fully licensed, commercially safe AI music tools, advancing responsible innovation that
supports the creative process of artists, producers and songwriters globally.
Guarding against AI’s risks:
Rapid technological advancements have enabled digital manipulation,
misappropriation and misattribution of an artists name, image, likeness, voice and style—the
very characteristics that differentiate them as performers with unique vision and expression. Our
challenge and opportunity as an industry is to establish effective tools, incentives and rewards—
as well as rules of the road —that enable us to limit Al’s potential downside while promoting our
promising upside.
We have articulated the importance of establishing the perimeters of copyright, to help ensure
that artists’ creative output continues to be respected for generations to come. We support the
Human Artistry Campaign (HAC) and our principles —the HAC is a global initiative formed in early
2023 to protect creators’ rights in the age of Al, with more than 170 supporting organizations from
40+ countries.
In addition to responsible and ethical Al industry collaborations and thought leadership, we are
pursuing the establishment of legislative and regulatory “guardrails” for Al, including backing
legislation that would establish a federal right of publicity in the United States protecting all
Americans’ image, likeness and voice—and helping to prevent deepfakes. We are vigorously
advocating for public policies furthering responsible Al with governments around the globe,
including through multi-stakeholder coalitions and trade bodies, as well as on our own.
We are also protecting creators’ rights in the Al environment through litigation. For example, UMPG,
alongside two other music publishers, filed a copyright infringement lawsuit against Anthropic for
their large-scale, wholesale copying of copyrighted lyrics and we are part of the RIAA's action against
unlicensed generative Al platform Suno.
The bottom line:
We believe that Al will never replace human creativity because it will always lack
the essential spark that drives the most talented artists to do their best work. Forging a path on
behalf of and in collaboration with the entire music community will help enable us to empower this
breathtaking technology responsibly to the benefit of the entire creative ecosystem.
Embracing entrepreneurs to accelerate the next wave of transformation
With a view to our industry’s future, we continue to advance our role as an industry leader in
promoting entrepreneurship. We do this through a wide range of digital innovation programs,
including Abbey Road REDD. The Abbey Road REDD Incubator exists to seek out and nurture the
best innovation in music technology. It partners with startups across the world that are trying
to improve the way music makers create, capture or connect their work. In addition, we drive
innovation through a broadly deployed Accelerator Engagement Network. Since 2017, our UMG Digital
Innovation outreach has enabled us to monitor more than 2100 startups in the music technology
space, engaging meaningfully with a subset and turning several into value adding partners for UMG.
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In turn we have engaged an innovation network of 18 partners made up of internal acceleration and
incubation programs, external mentoring programs, and accelerator partnerships. This network has
passed through more than 250 startups in the music and media sectors which have raised funding
of more than $330m combined over their lifecycles.
Our core music DNA—conveyed through incubation, connectivity, mentorship and the strategic
partner network that we can provide startups and entrepreneurs — is the greatest asset we can
provide early-stage companies. Our online hub UMusicLift, is dedicated to supporting startups with
learning resources, news, spotlights and pathways to connect with our Digital Innovation team.
Our company values are deeply embedded in supporting creators of all kinds, including those
focused on digital technology. We are the home for many of music’s greatest artists, innovators
and entrepreneurs.
Since the inception of the Digital Innovation program in 2017, we have been at the forefront of
nurturing the music-tech ecosystem globally, developing partnerships with key networks, embracing
and mentoring startups, and creating programs and collaboration opportunities to support these
emerging businesses. Some examples of companies backed by us, and our accelerator program
include innovators like Audoo, Medimusic, MEDRhythms, soundBrilliance and Xone among others.
By advancing entrepreneurial innovation, these initiatives also drive significant value for us and,
by extension, our artists. As technology continues to transform the media landscape, our ongoing
commitment to bolstering this vital ecosystem is central to our mission and we look forward to
supporting the entrepreneurs of tomorrow.
Innovation and R&D
Innovation is a key element of how we continue to lead. We are not only maximizing existing
commercial opportunities for our labels and artists, but also evolving our broad range of businesses
to identify future opportunities, fan behaviors and consumption trends. We drive innovation through
ongoing investment in R&D, focusing on new products, services, and business models that enhance
music creation, distribution, and monetization. Our R&D is embedded across recorded music,
publishing, merchandising, and digital platforms, with a strong emphasis on technology integration,
especially data analytics and AI.
UMG’s Global Insights Team leads one of the most extensive research programs in the music
industry, providing research, analytics and strategy to support our operations around the world.
Our research tracks consumer behavior in 25 markets across five continents, or approximately
90% of the streaming market. We speak to nearly 100,000 online consumers annually to better
understand audience behaviors across markets, genres and platforms. We believe this gives us
a unique understanding of how consumers engage with each platform in the ecosystem and
anticipate their future actions. The Global Insights Team has been central to the development of
our artist-centric strategy.
We hold a small portfolio of patents in the areas of AI and digital music technologies to protect
our innovations, promote marketplace development and support our competitive position. We
currently hold five patents related to Al-driven content creation, analytics, music distribution,
content protection and rights management. In 2025, UMG formed a strategic partnership with IP
asset management, investment and advisory firm Liquidax Capital to accelerate the development
of UMG's music-related AI patents. Liquidax assists with the development, filing, and licensing
work related to these patents. In connection with the partnership, Music IP Holdings, Inc. (MIH)
has been formed to hold and license the AI patents and other technologies developed into the
global marketplace. To date, MIH has filed over 50 patents – 2 of which have been issued, 7 with
a notice of allowance, and the rest pending - in the fields of musical collaboration, multi-media
content and campaign creation, music & health, AI threat protection, music administration, and
rights management.
We harness technological innovation to drive market growth. Our unmatched commitment to lead
in collaborative development of new services, platforms and business models for the delivery
of music and related content-empowers innovators and promotes new commercial and artistic
opportunities. We collaborate with startups and tech partners through programs like Abbey Road
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REDD and our Accelerator Engagement Network, mentoring, incubating and directly supporting over
250 music-tech startups since 2017.
Through our expansive alliances and groundbreaking partnerships across the industry, we enable
our artists to better monetize their work and build deeper engagement with their fans. For
example, we partnered with Apple to introduce a new category of streaming music called “Sound
Therapy” supported by a team of scientists, engineers and producers at Sollos, Universal Music’s
groundbreaking music-wellness venture. Sound Therapy is an audio wellness initiative was
advanced by years of proprietary research and development by UMG to help listeners attain clearer
focus, deeper relaxation and better sleep, which launched exclusively on Apple Music in 2025.
Innovation is central to our mission to bring more music to more people around the world.
Advancing data and insights
A crucial aspect of our focus on innovation is the high priority we place on operationalizing data and
analytics at an industry-leading scale to promote the interests of our artists. Over the past several
years, we have made sustained strategic investments in our data architecture and underlying data
assets, expanding the range and impact of data-driven applications across our organization.
Our data organizations include teams of analysts, data scientists, machine learning scientists, and
engineers across our global markets and business units. Together, they bring deep domain expertise
across a wide range of disciplines and use cases, developing and deploying advanced models
and AI-driven applications to support our operations worldwide. These teams leverage diverse
data sources, techniques, and technologies to enhance talent identification, strengthen audience
development and marketing effectiveness, and deepen understanding of our artists’ fans — enabling
more meaningful and enduring connections.
We are also leveraging AI to broaden access to data and insights across our company, equipping
teams globally with intelligent tools that surface relevant information more quickly and at greater
scale. By accelerating the flow of insights across functions and markets, we enable faster, more
informed decision-making in support of our artists and our business.
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ORGANIZATIONAL AND REPORTING STRUCTURE
Corporate executives
The following structure chart illustrates the simplified structure of UMG as at December 31st, 2025
SOUTH KOREA
LATIN AMERICA
CANADA
AUSTRALIA
CHINA
ROW
JAPAN
UK
GERMANY
FRANCE
UNIVERSAL MUSIC
GROUP N.V.
The Netherlands
UNIVERSAL
MUSIC GROUP, INC.
US
UNIVERSAL INTERNATIONAL
MUSIC B.V.
The Netherlands
100%
100%
UMG is managed by corporate executives (the Corporate Executives).
The current Corporate Executives consists of nine key members, each of whom oversees a
specific aspect of the business. The persons set forth below are the current members of the
Corporate Executives.
Name
Age
Position
Sir Lucian Grainge
66
Chairman & Chief Executive Officer
Vincent Vallejo
65
Deputy Chief Executive Officer, Corporate
Matt Ellis
54
Chief Financial Officer
Philippe Flageul
61
Executive Vice President, Controller
Jody Gerson
65
Chairman & CEO for Universal Music Publishing Group
Jeffrey Harleston
65
General Counsel and Executive Vice President of Business & Legal Affairs
Eric Hutcherson
56
Executive Vice President, Chief People and Inclusion Officer
Boyd Muir
66
Chief Operating Officer
Michael Nash
68
Executive Vice President, Chief Digital Officer
Will Tanous
55
Executive Vice President, Chief Administrative Officer
Set out below are brief summaries of the biographies of the members of the Corporate Executives:
Sir Lucian Grainge (Chairman and Chief Executive Officer)
Sir Lucian has transformed Universal Music Group (UMG) into the most successful company in the
history of the music industry by pioneering new approaches to signing and developing the most
successful recording artists and songwriters and championing innovative business models with a
wide range of media and technology partners. For more than two decades, UMG has been the No.
1 music company in the world. Over the span of four decades at UMG, Sir Lucian has signed and
worked with many worldwide stars including ABBA, Andrea Bocelli, Sabrina Carpenter, Eminem, Elton
John, Lady Gaga, Kendrick Lamar, The Rolling Stones, Taylor Swift, U2 and Amy Winehouse, among
many others. In 2011, he led UMG’s successful acquisition of the recorded music assets of the
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legendary British music company EMI, revitalizing its iconic Capitol Records, and, in the process,
further strengthening UMG’s position as the global leader in music.
Billboard
magazine has listed
Sir Lucian a record eight times at No. 1 on the publication’s annual Power 100 list of the most
influential music executives and Variety magazine has ranked him among the Top 10 most powerful
executives in the global entertainment industry. A native of London, Sir Lucian was bestowed with a
knighthood in 2016 by Her Majesty Queen Elizabeth II in the Queen’s 90th Birthday Honours list for
accomplishments in the music industry and leadership through its challenging times, contributions
to British business and inward investment, as well as his development of innovative business
models, technology and media partnerships that have expanded UMG’s global presence. In 2020,
Sir Lucian received a star on the Hollywood Walk of Fame. Sir Lucian lives in Los Angeles with his wife
and has three children. He serves on the board of Northeastern University in Boston, Massachusetts.
Vincent Vallejo (Deputy Chief Executive Officer, Corporate)
Based at the Company’s corporate headquarters in Hilversum, The Netherlands, Vincent Vallejo is
in the lead of a number of corporate initiatives related to the Company’s listing on the Euronext NV
in Amsterdam. Vallejo joined UMG in 2021 and has worked closely across UMG matters ever since
he joined Vivendi in 1998, where he served most recently as SVP, Audit & Special Projects. Prior to
joining Vivendi, Vallejo held positions at AGF-ALLIANZ in France (where he was Deputy CFO) and Ernst
& Young in Paris and Madrid. He received an MBA from Montpellier University and a Master of Science
from Cornell-Essec, CergyPontoise, France.
Matt Ellis (Chief Financial Officer)
Matt Ellis is Chief Financial Officer (CFO) of Universal Music Group (UMG). As CFO, Ellis is responsible
for leading global financial operations across UMG and its subsidiaries. He is based in Santa
Monica and reports to UMG Chairman and CEO, Sir Lucian Grainge. Ellis joined UMG following
a 10-year tenure at Verizon Communications where he most recently served as Executive Vice
President and Chief Financial Officer (CFO). In this role, he led all finance activities, including
Controllership, Treasury, Tax, Investor Relations, FP&A, Internal Audit, Corporate Development, and
Business Transformation. Prior to Verizon, Ellis held multiple senior finance positions at global food
company Tyson Foods Inc., where he served as Vice President and Treasurer from 2010-2013.
Ellis was born in the U.S. and raised in the UK. Prior to moving back to the U.S. in 1997, Ellis held
early career roles as a Commercial Accountant at Dixons Stores Group and as an Audit Supervisor at
Coopers & Lybrand (now PwC). He is a member of the Institute of Chartered Accountants in England
and Wales and earned a BCom (Accounting) from the University of Birmingham in the UK.
Philippe Flageul (Executive Vice President, Controller)
Philippe Flageul is Executive Vice President, Controller for Universal Music Group. He is responsible
for overseeing many aspects of UMG’s finance operations, including accounting, tax, treasury, risk
management and IT and supply chain finance. He also oversees UMG’s global procurement. Flageul
joined UMG in 2015 from Bolloré Group, where he worked for more than two decades as CFO of the
industrial division and Chairman of IER. Flageul holds an MBA from EDHEC.
Jody Gerson (Chairman & CEO for Universal Music Publishing Group)
Jody Gerson is Chairman and CEO of Universal Music Publishing Group (UMPG) and a member of
Universal Music Group’s Executive Management Board. One of the industry’s most respected and
accomplished executives, Gerson leads a global company with 48 offices in 41 countries and more
than 850 employees. She made history as the first female chairman of a global music company and
the first woman to be named CEO of a major music publisher. Since joining UMPG in 2015, Gerson has
transformed the company into a global powerhouse that owns and administers more than 5 million
copyrights and is the industry’s best global home for songwriters. A highly respected creative
authority and thought leader in our culture, Gerson has signed and works with the world’s biggest
superstars, including Adele, Bee Gees, Bad Bunny, Justin Bieber, Sabrina Carpenter, Lana Del Rey,
Ariana Grande, Coldplay, Drake, Billie Eilish, H.E.R., Elton John, Alicia Keys, Steve Lacy, Kendrick Lamar,
Post Malone, Maren Morris, the Prince estate, Rosalia, Harry Styles, Taylor Swift, SZA, The Weeknd,
and more. She also led UMPG’s historic and highly competitive acquisitions of the iconic catalogs
of Bob Dylan, Neil Diamond, Sting, and others. As a champion for women in music and advocate for
education, Gerson cofounded the global nonprofit She Is The Music. She also serves on Boards for
the USC Annenberg Inclusion Initiative, The Rock & Roll Hall of Fame, the National Music Publishers
Association, Gap Inc., Ancestry.com, New Roads School, and Project Healthy Minds. In January
2020, Gerson made history as the first woman and first music publishing executive to be named
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Billboard
’s ‘Executive of the Year’ for that outlet’s most coveted Power 100 list, and annually ranks
within that list’s Top Ten. She is the recipient of numerous other prestigious honors, including the
Recording Academy’s 2025 Grammy Salute to Industry Icons award;
Billboard
Power Players’ Choice
Award;
Variety
’s Hitmakers Executive of the Year;
Billboard
's 2015 Executive of the Year for their
Women In Music issue;
Rolling Stone
’s ‘Future 25’;
Variety
’s Power of Women L.A.; The 2016 March
of Dimes Inspiring Woman of the Year; and more. Gerson oversees Polygram Entertainment, a film
and television development and production division of UMG which produces award-winning feature-
length films and music-centric series. In 2024 alone, she served as Executive Producer on a broad
array of projects, including
Music Box: Yacht Rock: A DOCKumentary
;
The Beach Boys
;
STAX: Soulsville,
U.S.A.
; and
Billy Preston: That’s The Way God Planned It
. Other recent projects that Gerson Executive
Produced include
The Bee Gees: How to Mend a Broken Heart
and HBO’s
Music Box
series. Among her
and Polygram’s many projects in development are documentaries on Bernie Taupin and Prince.
Jeffrey Harleston (General Counsel and Executive Vice President, Business &
Legal Affairs)
Jeffrey Harleston is responsible for the global oversight of all business transactions, contracts
and litigation. He is additionally responsible for the development of corporate policies to ensure a
unified strategy across the Company’s divisions, including the coordination of UMG’s government
relations, trade and anti-piracy activities. Harleston joined the Company in 1993 at MCA Records,
after serving as Associate Independent Counsel for the IranContra Investigation and prior to that as a
Litigation Associate at Covington & Burling LLP. Throughout his career, Harleston has been recognized
for his many achievements including receiving The Recording Academy’s 2020 Entertainment Law
Initiative Service Award, Billboard’s 2018 “Lawyer of the Year”, the 2018 Diversity Award from the
Association of Corporate Counsel for Southern California. In 2017, Harleston was named one of
Ebony
magazine’s
“Power 100” and he is annually recognized by
Billboard
on the magazine’s “Power 100”
list of the most powerful executives in the music industry. Harleston is a Member of the Board of
Trustees of Williams College and the Board of Harvard-Westlake School. He also serves on the boards
of the Recording Industry Association of America the TJ Martell Foundation, MusiCares and the
Motown Museum. Harleston is proud to be a Founder of the Universal/Motown Fund, an endowment
dedicated to providing financial assistance for artists from the 50’s, 60’s and 70’s. He received a B.A.
in Political Science from Williams College and a J.D. from the University of California, Berkeley School
of Law.
Eric Hutcherson (Executive Vice President, Chief People and Inclusion Officer)
With a focus on people, culture and inclusion, Eric Hutcherson leads a global team across UMG’s
record labels, publishing division and operating companies to align talent functions, amplify the
Company’s entrepreneurial-based culture, accelerate diversity and inclusion across all levels and
territories, attract, retain and develop talent, accelerate the Company’s social justice initiatives and
build on UMG’s successful track-record of driving innovation by recruiting employees who bring new
ideas, perspectives and skillsets. Prior to joining UMG, he was EVP, Chief Human Resources Officer
of the National Basketball Association (NBA) where he managed a team that drove the NBA’s global
workforce strategy. Hutcherson currently serves as Vice-Chair of Covenant House International and
Chair of the Human Capital Committee, and on the Board of Councilors for the USC Annenberg
School of Communication and Journalism. Additionally, he serves as strategic advisor to the Board
of Directors for the Young Peoples Chorus; a multicultural youth chorus whose mission is to provide
children of all economic and cultural backgrounds with a unique program of music education and
choral performance. Hutcherson earned a bachelor’s degree in political science from New York
University and a master’s degree in Sports Management and Administration from the University
of Massachusetts-Amherst.
Boyd Muir (Chief Operating Officer)
Boyd Muir is Chief Operating Officer (COO) of Universal Music Group (UMG). As COO, Muir is responsible
for driving strategic growth across the company’s worldwide operations. Muir formerly served as
UMG’s EVP, Chief Financial Officer (CFO) and President of Operations, and was appointed COO in
October 2024. As UMG’s CFO, Muir played a key role in the company’s successful listing on the
Euronext stock exchange in 2021. He has also been involved in a number of significant acquisitions,
including Sanctuary Group and V2 Music Group, as well as leading the company’s successful
acquisitions of EMI, Ingrooves, [PIAS] and UMG’s minority investment in the Chord Music Fund. He
was appointed as UMG’s EVP, CFO and President of Operations in 2010, having previously served
as CFO for Universal Music Group International, the division which manages UMG’s businesses in
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more than 50 countries for more than a decade. From 1984 to 1991, Muir worked for Ernst & Young,
including at its entertainment media division in London, and for EMI from 1991 to 1994. At the latter
group, he was head of internal audit, spending considerable time working in Los Angeles and New
York. He was also closely involved in EMI’s acquisition of Virgin Music and Chrysalis Records.
Michael Nash (Executive Vice President, Chief Digital Officer)
Michael Nash is Executive Vice President, Chief Digital Officer and oversees UMG’s digital business
development activities around the world. Nash has worked at the forefront of media and technology
convergence for his entire career as an executive, entrepreneur and producer. Most recently, Nash
served as a strategic advisor to Warner Music Group (WMG), as well as several digital media startups
and new technology companies. Prior to that, he served as an executive at WMG from 2000 to 2011,
rising to the role of Executive Vice President of Digital Strategy and Business Development where
he oversaw WMG’s worldwide new media projects, strategic relationships and business development
activities. Before joining WMG, Nash was the Executive Director of the Madison Project, the music
industry’s first digital distribution trial. From 1994 to 1997, Nash was founding CEO of Inscape, an
interactive entertainment and games publishing joint venture between WMG and HBO that produced
titles with artists such as William S. Burroughs, DEVO, Thomas Dolby and The Residents. Prior to that,
Nash served as Director of The Criterion Collection, working closely with directors and artists such as
Robert Altman, David Bowie, Terry Gilliam and Louis Malle.
Will Tanous (Executive Vice President, Chief Administrative Officer)
Will Tanous plays a key role in the development of the company’s business strategy, overseeing
several major strategic and corporate endeavors, as well as managing worldwide external and
internal communications, global public policy, investor and government relations, event functions
and global impact. Prior to joining UMG in 2013, Tanous served as Executive Vice President of
Communications & Marketing for Warner Music Group where he was central in all of the company’s
major corporate initiatives, including: the sale of WMG to Access Industries, Inc.; WMG’s initial public
offering on the New York Stock Exchange in 2005; and the sale of WMG by Time Warner Inc. to a
private equity consortium. In 2019, he was awarded the prestigious Ellis Island Medal of Honor,
which is presented annually to U.S. citizens “who have distinguished themselves within their own
ethnic groups while exemplifying the values of the American way of life”. Tanous is a graduate
of Georgetown University in Washington D.C. and serves on the board of the Recording Industry
Association of America.
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FINANCIAL REVIEW
Earnings analysis: group and business segments
Consolidated Statement of Profit or Loss
Year ended December 31,
(millions of euros)
2025
2024
Revenues
12,507
11,834
Cost of revenues
(7,196)
(6,746)
Selling, general and administrative expenses
(2,982)
(3,015)
Amortisation and impairment losses on intangible assets
(331)
(298)
Operating profit
1,998
1,775
Financial income
339
1,279
Financial expenses
(233)
(187)
106
1,092
Income/(loss) from equity affiliates
(18)
4
Profit before income taxes
2,086
2,871
Income taxes
(546)
(778)
Net profit
1,540
2,093
Of which:
Net profit attributable to equity holders of the parent
1,533
2,086
Net profit attributable to non-controlling interests
7
7
Earnings per share (in euros)
Earnings for the period attributable to equity holders of the parent - basic
0.84
1.14
Earnings for the period attributable to equity holders of the parent - diluted
0.83
1.13
Adjusted net profit
1
1,907
1,782
Adjusted net profit per share (in euros) - basic
1
1.04
0.98
Adjusted net profit per share (in euros) - diluted
1
1.03
0.96
1
Non-IFRS measures as defined in the Appendix to the Annual Report.
Reconciliation of Operating Profit to EBITDA and Adjusted EBITDA
Year ended December 31,
(millions of euros)
2025
2024
Operating Profit
1,998
1,775
Adjustments
Amortisation and depreciation expense
446
409
Restructuring expenses
95
169
(Gain)/loss on sale of assets
(4)
(23)
Impairment on intangible assets
3
2
EBITDA
1
2,538
2,332
Non-cash share-based compensation expense
227
329
Certain one-time items
2
45
-
Adjusted EBITDA
1
2,810
2,661
1
As defined in the Appendix to the annual report
2
Certain one-time items consists of US listing preparation costs and certain M&A advisory costs.
Analysis of the Consolidated Statement of Profit or Loss
Revenues
In 2025, UMG’s revenues of €12,507 million were up 5.7% compared to 2024 and up 8.7% at
constant currency. This increase was driven by improvements across the Recorded Music and
Music Publishing divisions. Recorded Music grew 6.2% year-over-year and 9.3% at constant currency
compared to 2024 and Music Publishing was up 6.6% or 9.3% in constant currency.
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For a detailed analysis of revenues by business segment, please refer to the Analysis of revenues
and operating results by business segment section below and to Note
3
to the Consolidated Financial
Statements for the year ended December 31, 2025.
Operating results
Analysis of cost of revenues:
Year ended December 31,
(millions of euros)
2025
2024
Artist costs
5,836
5,464
Product costs
1,360
1,282
Cost of Revenues
7,196
6,746
Cost of Revenues
grew by €450 million to €7,196 million in 2025 from €6,746 million in 2024, reflecting
the increase in revenues. Cost of revenues as a percentage of revenues increased to 57.5% from
57.0% driven by higher relative artist and product costs.
Artist costs
increased by €372 million to €5,836 million in 2025 from €5,464 million in 2024 driven
by the increase in sales. As a percentage of revenues, artists costs increased to 46.7% in 2025 from
46.2% in 2024 due to repertoire mix in both Recorded Music and Music Publishing.
Product costs
increased by €78 million to €1,360 million in 2025 from €1,282 million in 2024 reflecting
the growth in revenues. Product costs as a percentage of revenues increased to 10.9% from 10.8%
due primarily to higher manufacturing and distribution costs in Merchandising and Other.
Selling, general and administrative expenses
decreased by €33 million to €2,982 million in 2025 from
€3,015 million in 2024 and decreased as a percentage of revenues to 23.8% in 2025 from 25.5% in
2024 due largely to lower non-cash share-based compensation expenses and restructuring charges.
Non-cash share-based compensation expenses decreased to €227 million in 2025 from €329 million
in 2024, down by €102m. Restructuring charges were €95 million in 2025 compared to €169 million in
2024 as a result of the previously announced strategic organizational redesign. This was partly offset
by U.S. listing preparation costs and certain M&A advisory costs of €45 million in 2025.
Operating profit
was €1,998 million in 2025, compared to €1,775 million for 2024, an increase of
€223 million, 12.6% or 16.6% at constant currency, driven by the higher revenues and lower non-cash
share based compensation expenses and restructuring charges (discussed above). As a percentage
of revenues, operating profit increased to 16.0% in 2025 from 15.0% in 2024.
EBITDA
increased by €206 million, 8.8% or 12.2% at constant currency to €2,538 million in 2025
compared to €2,332 million in 2024 driven by the increase in revenues and lower non-cash share
based compensation expenses (discussed above). EBITDA margin increased by 0.6pp to 20.3% in
2025 compared to 19.7% in 2024 also due to operating leverage and cost savings from the strategic
organizational redesign, partially offset by the higher cost of revenues discussed above.
Adjusted EBITDA
was €2,810 million in 2025 up €149 million, 5.6% or 8.6% at constant currency
compared to €2,661 million in 2024. Adjusted EBITDA margin remained constant at 22.5% in 2025
and 2024.
For a detailed analysis of EBITDA and Adjusted EBITDA by business segment, please refer to the
Analysis of revenues and operating results by business segment section below.
Financial results
Financial income and Financial expenses were a net income of €106 million in 2025, compared to
a net income of €1,092 million for 2024, a decrease of €986 million. For 2025, the revaluation of
the investments in listed companies including Spotify and Tencent Music Entertainment was a net
income amount of €283 million, compared to a net income of €1,163 million for 2024, a decline of
€880 million.
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FINANCIAL REVIEW
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Income taxes
For 2025, income taxes were a net expense of €546 million, compared to a net expense of
€778 million for 2024. This decrease notably reflected the decrease in the deferred tax charge relating
to the revaluation of the investments in listed companies including Spotify and Tencent Music
Entertainment (€67 million expense in 2025, compared to €301 million expense in 2024).
Non-controlling interests
For 2025, earnings attributable to non-controlling interests were €7 million which has remained
constant from 2024.
Net profit attributable to equity holders of the parent
For 2025, net profit attributable to equity holders of the parent amounted to a profit of €1,533 million
(or €0.84 per share - basic), compared to €2,086 million for 2024 (or €1.14 per share - basic),
a decrease of €553 million. Net profit attributable to equity holders of the parent decreased by
€553 million, reflecting:
•
the variance in financial results (-€986 million) driven by the revaluation of the investments in
Spotify, Tencent Music Entertainment and other listed investments (-€880 million);
partially offset by:
•
the increase in operating profit (+€223 million); and
•
the decrease in income taxes reported to net income (+€232 million), on lower taxable income
including the decrease in the deferred tax charge relating to the revaluation of the investments in
Spotify, Tencent Music Entertainment and other listed investments.
Adjusted net profit
Adjusted net profit in 2025 amounted to a profit of €1,907 million (or €1.04 per share - basic),
compared to €1,782 million for 2024 (or €0.98 per share - basic), an increase of €125 million. Adjusted
net profit increased by €125 million, including:
•
the growth in Adjusted EBITDA (+€149 million);
partially offset by:
•
the increase in income taxes reported to Adjusted net profit (-€37 million).
Analysis of revenues and operating results by business segment
Year ended December 31,
(millions of euros)
2025
2024
% Change
% Change at
constant currency
Revenues
Recorded Music
9,456
8,901
6.2%
9.3%
Music Publishing
2,260
2,121
6.6%
9.3%
Merchandising & Other
811
842
(3.7%)
0.0%
Corporate Centre
-
-
0.0%
0.0%
Elimination of inter-segment transactions
(20)
(30)
Total UMG
12,507
11,834
5.7%
8.7%
Adjusted EBITDA
1
Recorded Music
2,423
2,275
6.5%
9.6%
Music Publishing
549
511
7.4%
10.0%
Merchandising & Other
16
43
(62.8%)
(61.0%)
Corporate Centre
(178)
(168)
6.0%
8.5%
Total UMG
2,810
2,661
5.6%
8.6%
1
As defined in the Appendix to the Annual Report
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NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Recorded Music
Year ended December 31,
(millions of euros)
2025
2024
% Change
% Change at
constant currency
Subscriptions and streaming revenue
6,319
6,038
4.7%
7.6%
of which streaming
1,435
1,414
1.5%
4.7%
of which subscription
4,884
4,624
5.6%
8.6%
Downloads and other digital revenue
234
180
30.0%
34.5%
Physical revenue
1,475
1,358
8.6%
11.4%
License and other revenue
1,428
1,325
7.8%
11.0%
Recorded Music Revenues
9,456
8,901
6.2%
9.3%
Adjusted EBITDA
1
2,423
2,275
6.5%
9.6%
Adjusted EBITDA margin
1
25.6%
25.6%
0.0pp
1
As defined in the Appendix to the Annual Report
In 2025, Recorded Music revenues were €9,456 million, up 6.2% compared to 2024, and up 9.3%
in constant currency. Subscription revenues grew by 5.6% or 8.6% in constant currency driven
primarily by the growth in global subscribers. Streaming revenue increased 1.5% or 4.7% in constant
currency as the consumption grows but continues to shift from better monetized video platforms
to short-form platforms, which are not yet as well monetized. Physical revenue grew by 8.6% or
11.4% in constant currency driven by strong CD sales in Japan and vinyl sales in the U.S. and
Europe. Downloads and other digital revenue improved by 30.0%, and 34.5% in constant currency,
due to €45 million recognised in relation to a legal resolution in the year. License and other revenue
improved 7.8% or 11.0% in constant currency, as a result of improved live and other related income,
as well as a compensatory payment as part of a strategic licensing agreement with an AI music
platform, whilst Q4 2024 included €32 million from certain legal settlements. Top sellers for the year
included albums from Taylor Swift, KPop Demon Hunters Soundtrack, Morgan Wallen, Lady Gaga and
Sabrina Carpenter. Top sellers in the prior year included multiple albums from Taylor Swift, and
albums from Billie Eilish, Sabrina Carpenter, Morgan Wallen and Chappell Roan.
Adjusted EBITDA for Recorded Music increased by €148 million to €2,423 million in 2025 from
€2,275 million in 2024 due to the revenue growth. Adjusted EBITDA margin remained constant at
25.6% of revenues as the benefit of cost savings and operating leverage offset margin headwinds
from repertoire mix, outsized growth in lower-margin physical sales and incremental overheads
from business combinations.
Music Publishing
Year ended December 31,
(millions of euros)
2025
2024
% Change
% Change at
constant currency
Performance revenue
456
442
3.2%
5.1%
Synchronisation revenue
272
253
7.5%
10.6%
Digital revenue
1,371
1,268
8.1%
11.4%
Mechanical revenue
107
103
3.9%
4.9%
Other revenue
54
55
(1.8%)
0.0%
Music Publishing Revenues
2,260
2,121
6.6%
9.3%
Adjusted EBITDA
1
549
511
7.4%
10.0%
Adjusted EBITDA margin
1
24.3%
24.1%
0.2pp
1
As defined in the Appendix to the Annual Report
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FINANCIAL REVIEW
ABOUT UMG
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NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Music Publishing revenue amounted to €2,260 million in 2025, up 6.6% year-over-year and 9.3% in
constant currency. Revenues benefited from the continued growth in subscription and streaming
and new business wins as well as improvements in synchronisation, performance and mechanical
revenue. Revenues in 2024 benefited from €8 million from certain legal settlements reported in
Q4 2024.
Music Publishing Adjusted EBITDA increased by €38 million to €549 million in 2025 compared to
€511 million in 2024 as a result of the revenue growth. Adjusted EBITDA margin increased by 0.2pp to
24.3% from 24.1% of revenues in 2024.
Merchandising & Other
Year ended December 31,
(millions of euros)
2025
2024
% Change
% Change at
constant currency
Merchandising and Other Revenues
811
842
(3.7%)
0.0%
Adjusted EBITDA
1
16
43
(62.8%)
(61.0%)
Adjusted EBITDA margin
1
2.0%
5.1%
(3.1pp)
1
As defined in the Appendix to the Annual Report
Merchandising and Other revenue decreased to €811 million, down 3.7% year-on-year but in line
with 2024 in constant currency. Merchandising touring revenues were up year-on year but this was
offset by lower direct-to-consumer sales which were very strong last year in connection with the
timing of artist tours.
Merchandising and Other Adjusted EBITDA decreased by €27 million to €16 million in 2025 compared
to €43 million in 2024. Adjusted EBITDA margins decreased by 3.1pp to 2.0% of revenues from 5.1% of
revenues in 2024 driven by higher manufacturing and distribution costs, driven both by product mix
and broader cost pressures.
Corporate
Year ended December 31,
(millions of euros)
2025
2024
% Change
% Change at
constant currency
Adjusted EBITDA
1
(178)
(168)
6.0%
8.5%
Adjusted EBITDA margin
1
-
-
1
As defined in the Appendix to the Annual Report
Corporate Adjusted EBITDA was a net expense of €178 million in 2025, a €10 million increase in
expense from the Adjusted EBITDA expense in 2024 of €168 million.
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FINANCIAL REVIEW
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Liquidity and capital resources
Financial Net Debt
Year ended December 31,
(millions of euros)
2025
2024
Cash and cash equivalents
451
553
Derivative financial assets
5
-
Drawn revolving credit facilities
(8)
-
Bank overdrafts
(74)
(8)
Bonds
(2,293)
(1,810)
Commercial papers
(384)
(746)
Other
(87)
(87)
Borrowings at amortized cost
(2,846)
(2,651)
Financial Net Debt
1
(2,390)
(2,098)
1
As defined in the Appendix to the Annual Report
Changes in the Financial Net Debt
As of December 31, 2025, UMG’s Financial Net Debt amounted to -€2,390 million compared to
Financial Net Debt of -€2,098 million as of December 31, 2024, i.e., an increase in net debt of
€292 million. This change was mainly attributable to the following:
•
Net cash provided by operating activities of €1,739 million;
offset by:
•
in June and July, UMG paid the final dividend with respect to fiscal year 2024 of €513 million;
•
in October and November 2025, UMG paid an interim dividend with respect to fiscal year 2025 of
€440 million;
•
Net cash used for investing activities of -€854 million primarily due to the €412 million purchase
of consolidated companies, equity affiliates and financial assets relating to several strategic
investments in the year. Net cash used for investing activities also included the €345 million
investment in Music Publishing and Recorded Music catalogues and €195 million investment in
other intangibles and capital expenditure. This was partly offset by proceeds from divestitures of
€78 million; and
•
repayment of €93 million in relation to lease liabilities and related interest and €90 million in
other interest and financing related payments.
UMG believes that the cash flow generated by its operating activities, its cash surpluses, net of
amounts used to reduce UMG’s debt, as well as funds available through undrawn bank credit
facilities and additional funding opportunities will be sufficient to cover expenses and investments
necessary for its operations, its debt service, the payment of income taxes, the distribution of
dividends, as well as its investment projects, if any, for the next 12 months.
Equity portfolio
As of December 31, 2025, UMG held a portfolio of listed non-controlling equity interests (including
Spotify) with an aggregate market value of approximately €3,404 million (before taxes), compared
to €2,945 million as of December 31, 2024. The increase in market value during 2025 was due to
the fluctuation in share price of our listed investments most notably of Spotify. As at February
28, 2026, the aggregate market value of these listed investments had decreased to approximately
€2,992 million (before taxes).
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ABOUT UMG
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FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Cash flow analysis
Year ended December 31,
(millions of euros)
2025
2024
Operating activities
Operating profit
1,998
1,775
Adjustments
508
520
Royalty advances payments, net of recoupments
(402)
(186)
Gross cash provided by/(used for) operating activities before income tax paid
2,104
2,109
Other changes in net working capital
38
(5)
Net cash provided by/(used for) operating activities before income tax paid
2,142
2,104
Income tax paid
(403)
(349)
Net cash provided by/(used for) operating activities
1,739
1,755
Investing activities
Catalogue investments
(345)
(266)
Other intangible assets investments
(125)
(92)
Capital expenditures
(70)
(91)
Purchases of consolidated companies, after acquired cash
(62)
(163)
Investments in equity affiliates
(198)
(390)
Purchase of financial assets
(152)
(145)
Investments
(952)
(1,147)
Proceeds from sales of property, plant, equipment and intangible assets
65
2
Proceeds from sale of financial assets
13
79
Divestitures
78
81
Dividends received from equity affiliates
18
12
Dividends received from investments
2
3
Net cash provided by/(used for) investing activities
(854)
(1,051)
Year ended December 31,
(millions of euros)
2025
2024
Financing activities
Distributions to shareowners
(953)
(933)
Dividends paid by consolidated companies to their non-controlling interests
(6)
(4)
Transactions with shareowners
(959)
(937)
Proceeds from borrowings
4,523
4,321
Repayments of borrowings
(4,369)
(3,755)
Interest, net
(81)
(81)
Other cash items related to financing activities
(9)
2
Transactions on borrowings and other financial liabilities
64
487
Repayment of lease liabilities
(72)
(81)
Payment of interest of lease liabilities
(21)
(21)
Net cash provided by/(used for) financing activities
(988)
(552)
Net change in cash and cash equivalents
(103)
152
Foreign currency translation adjustments
(65)
6
Change in cash and cash equivalents
(168)
158
Cash and cash equivalents
At beginning of the period
545
387
At end of the period
377
545
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OTHER INFORMATION
APPENDIX
Reconciliation of cash provided by operating activities to Free Cash Flow
Year ended December 31,
(millions of euros)
2025
2024
Net cash provided by/(used for) operating activities
1,739
1,755
Net cash provided by/(used for) investing activities
(854)
(1,051)
Repayment of lease liabilities and related interest expenses
(93)
(102)
Interest, net
(81)
(81)
Other cash items related to financing activities
(9)
2
Free Cash Flow
1
702
523
1
As defined in the Appendix to the Annual Report
Net cash provided by operating activities before income tax
For 2025, Net cash provided by operating activities before income tax amounted to an inflow of
€2,142 million compared to an inflow of €2,104 million for 2024, an increase of €38 million. This
increase was mainly attributable to the following items:
•
the increase in Operating profit (+€223 million); and
•
the favourable variance in Other changes in net working capital (+€43 million);
partially offset by:
•
the increase in Royalty advances payments net of recoupments (-€216 million) due to the timing
of major artist renewals and extensions.
Net cash provided by operating activities
Net cash provided by operating activities in 2025 amounted to an inflow of €1,739 million compared
to an inflow €1,755 million for 2024, a decrease of €16 million. Net cash provided by operating
activities before income tax in 2025 was €38 million higher than in 2024 but income tax paid in
2025 was €54 million higher than in 2024.
Net cash used for investing activities
Net cash used for investing activities in 2025 was a €854 million net outflow compared to a
€1,051 million net outflow for 2024, a decreased outflow of €197 million. The purchase of consolidated
companies, equity affiliates and financial assets was €286 million lower than in 2024 that included
investments in Chord Music Partners, NTWRK, Mavin Global and [PIAS]. Catalogue investments in 2025
were higher than in 2024 (-€79 million) due to the timing of deals and investment in other intangible
assets and capital expenditure was also slightly higher (-€12 million). Divestitures of €78 million
included proceeds on transfer of catalogues to Chord. Divestitures in 2024 included the release of
funds, previously paid into escrow, to complete a catalogue acquisition during the period.
Net cash used for financing activities
Net cash used for financing activities in 2025 was a €988 million net outflow compared to a
€552 million net outflow for 2024, an increased outflow of €436 million. This was mainly attributable
to a net proceed of borrowing in 2025 of €154 million compared to a net proceed of borrowing of
€566 million in 2024 (-€412 million). Dividend payments in 2025 were slightly higher than in 2024,
whilst interest and lease repayments were broadly in line with payments in 2024.
Free Cash Flow
Free Cash Flow in 2025 was a €702 million net inflow compared to a €523 million net inflow for
2024, an increase of €179 million. This is the result of lower net cash used for investing activities
(+€197 million) due to greater strategic investments in the previous year.
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FINANCIAL REVIEW
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
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OTHER INFORMATION
APPENDIX
CORPORATE GOVERNANCE
The Governance structure
Universal Music Group N.V. (UMG or the Company) is a public limited liability company (
naamloze
vennootschap
) incorporated under the laws of the Netherlands. The Shares (as defined in the
Shareholder Information section under "Share capital") were first admitted to listing and trading on
Euronext Amsterdam (the Listing), the regulated market of Euronext Amsterdam N.V., on September
21, 2021. The Company has a one-tier board (the Board), which currently consists of two executive
directors (the Executive Directors) and nine non-executive directors (the Non-Executive Directors
and, together with the Executive Directors, the Directors). The Executive Directors are primarily
responsible for all day-to-day operations of the Company. The Non-Executive Directors supervise the
Executive Directors’ policy and performance of duties and the Company’s general course of affairs
and business, and render advice and direction to the Executive Directors. The Directors furthermore
perform any duties allocated to them under or pursuant to the law or the Company’s articles of
association (the Articles). Each Director has a duty to the Company to properly perform the duties
allocated to him or her and to act in the Company’s corporate interests. Under Dutch law, the
Company’s corporate interests extend to the interests of all of the Company’s stakeholders, including
the Company’s shareholders (the Shareholders), creditors, customers and employees.
The Company acknowledges the importance of good corporate governance and complies with most
of the principles and best practice provisions of the Dutch Corporate Governance Code of March
20, 2025 (the
Code
), the full text of which can be found on
www.mccg.nl
. Deviations from any of the
principles and best practice provisions of the Code are explained under "Compliance with the Code--
Deviations" in accordance with the Code’s ‘comply or explain’ principle. Substantial changes in the
Company’s corporate governance structure and in the Company’s compliance with the Code, if any,
will be dealt with at the annual General Meeting (as defined under "The Board") as a separate item.
The Annual Report also includes the information that the Company is required to disclose pursuant
to the Dutch Decree on Article 10 of the Takeover Directive (
Besluit artikel 10 overnamerichtlijn
) and
the Dutch Decree on the Content of the Board Report (
Besluit inhoud bestuursverslag
).
The Board
The Board is the executive and supervisory body of the Company. It is entrusted with the
management of the Company, it supervises the Company's general course of affairs and business
and is responsible for the continuity of the Company. The Board is accountable for these matters to
the Company’s general meeting of shareholders (the General Meeting, being the corporate body or,
where the context so requires, the physical meeting).
The Board’s responsibilities include, among others, developing a view on sustainable long-term
value creation by the Company and formulating a strategy as well as specific objectives in line
with this view, identifying and managing the risks associated with the Company’s strategy and
activities, appointing and dismissing the Chief Audit Executive, annually assessing the way in which
the internal audit function fulfills its responsibility and ensuring that such assessment is performed
by an independent third party at least every five years, approving the internal audit plan, giving
account of the effectiveness of the design and operation of the internal risk management and
control systems, ensuring compliance with all applicable laws and regulations and the Company’s
corporate governance structure and preparing, approving and signing the (semi-annual) financial
statements and Board report and approving the annual budget and major capital expenditures in
excess thereof.
The Board may perform all acts necessary or useful for achieving the Company’s objectives, with
the exception of those acts that are prohibited pursuant to the law or the Articles. Pursuant to the
Articles, the Board may allocate its duties and powers among the Directors pursuant to the Board
Regulations (as defined under "The Board––Board Regulations") or otherwise in writing, provided that
the following duties and powers may not be allocated to the Executive Directors: (i) supervising the
performance of the Executive Directors, (ii) making a nomination for the appointment of Directors,
(iii) determining an Executive Director’s remuneration and (iv) instructing the external auditor(s) to
audit the financial statements. Regardless of an allocation of duties and powers, all Directors remain
collectively responsible for the proper management and strategy of the Company (including the
supervision thereof in the case of the Non-Executive Directors).
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ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Board Regulations
The Board has drawn up regulations dealing with its internal organization and setting out, among
others, the role and responsibilities of the Board, its composition and size and the manner in which
its meetings should be held (the Board Regulations). The Board Regulations are available on the
investor relations part of the UMG website.
Composition
The Articles provide that the Board shall consist of one or more Executive Directors and one or
more Non-Executive Directors. The number of Executive Directors and the number of Non-Executive
Directors shall be determined by the Board. The Board currently consists of two Executive Directors
and nine Non-Executive Directors:
Name
Function
Sir Lucian Grainge
Executive Director, Chairman and Chief Executive Officer
Vincent Vallejo
Executive Director, Deputy Chief Executive Officer, Corporate
Sherry Lansing
Non-Executive Director, Chairman of the Board
Margaret Frerejean-Taittinger
Non-Executive Director, Vice-Chairman of the Board
Cathia Lawson-Hall
Non-Executive Director
Eric Sprunk
Non-Executive Director
Haim Saban
Non-Executive Director
James Mitchell
Non-Executive Director
Luc van Os
Non-Executive Director
Mandy Ginsberg
Non-Executive Director
Nicole Avant
Non-Executive Director
None of the Non-Executive Directors represents the Company's employees and other workers.
Appointment and appointment term
The Executive Directors and Non-Executive Directors shall be appointed as such by the General
Meeting at the non-binding nomination of the Board. A nomination by the Board shall state whether
a person is nominated for appointment as Executive Director or Non-Executive Director. The person
so nominated shall be appointed by a resolution adopted by the General Meeting with a simple
majority of the votes cast. A Director shall be appointed for a maximum period of two years, provided,
however, that his or her term of office shall lapse at the close of the annual General Meeting held
in the second year after his or her appointment. A Director may be reappointed with observance of
the preceding sentences. At the proposal of the Board, the General Meeting may resolve to deviate
from the maximum period of two years. The Articles provide that each Non-Executive Director may
be in office for a maximum period of twelve years, unless, at the proposal of the Board, the General
Meeting resolves otherwise. A Non-Executive Director’s term of office shall lapse in accordance with
a retirement schedule drawn up by the Board to avoid, as much as possible, reappointments and
retirements of Non-Executive Directors occurring all at the same time so as to ensure continued
experience on the Board. Currently, the terms of office of six (out of nine) Non-Executive Directors
lapse at the close of the annual General Meeting to be held in 2026, and it is the intention that the
use of the retirement schedule will result in a more staggered replacement of the Non-Executive
Directors over time.
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CORPORATE GOVERNANCE
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
The appointment dates of the Executive Directors and Non-Executive Directors and the end of their
current terms are as follows:
Name
Initial appointment date
Reappointment date
Term
End of current term
Sir Lucian Grainge
February 26, 2021
May 11, 2023
Second term
May 1, 2028
Vincent Vallejo
February 26, 2021
May 14, 2025
Third term
Until the close of the annual General Meeting to be held in 2026
Sherry Lansing
May 12, 2022
May 14, 2025
Third term
Until the close of the annual General Meeting to be held in 2027
Margaret Frerejean-Taittinger
September 20, 2021
May 16, 2024
Second term
Until the close of the annual General Meeting to be held in 2026
Cathia Lawson-Hall
September 20, 2021
May 16, 2024
Second term
Until the close of the annual General Meeting to be held in 2026
Haim Saban
May 11, 2023
May 14, 2025
Second term
Until the close of the annual General Meeting to be held in 2027
Eric Sprunk
May 16, 2024
-
First term
Until the close of the annual General Meeting to be held in 2026
James Mitchell
September 20, 2021
May 16, 2024
Second term
Until the close of the annual General Meeting to be held in 2026
Luc van Os
September 20, 2021
May 14, 2025
Third term
Until the close of the annual General Meeting to be held in 2027
Mandy Ginsberg
May 16, 2024
-
First term
Until the close of the annual General Meeting to be held in 2026
Nicole Avant
May 12, 2022
May 16, 2024
Second term
Until the close of the annual General Meeting to be held in 2026
Suspension and dismissal
The General Meeting may at all times suspend or dismiss any Director. The Board may at all times
suspend an Executive Director. A suspension may be extended one or more times but may not last
longer than three months in aggregate. If at the end of that period, no decision has been taken on the
termination of the suspension or on a dismissal, the suspension shall terminate. A suspension can
be terminated by the General Meeting at any time.
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CORPORATE GOVERNANCE
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Independence
As per best practice provision 2.1.8 of the Code, a Non-Executive Director shall not be considered
independent from the Company if such Non-Executive Director or his or her spouse, registered
partner or life companion, (foster) child or relative by blood or marriage up to the second degree:
•
has been an employee of the Company or Executive Director or an employee or member of the
management (or executive) board of an associated issuing institution in the five years prior to his
or her appointment;
•
receives personal financial compensation from the Company or an associated company, other
than the compensation received for the work performed as a Non-Executive Director and in so far
as this is not in the normal course of business;
•
has had an important business relationship with the Company or an associated company in the
year prior to the appointment;
•
is a member of the management (or executive) board of a company in which an Executive Director
is a member of the supervisory (or non-executive) board;
•
has temporarily performed management (or executive) duties during the previous twelve months
in the absence or incapacity of Executive Directors;
•
has a shareholding of at least 10% in the issued share capital of the Company, taking into account
the shareholding of natural persons or legal entities cooperating with him or her on the basis of
an express or tacit verbal or written agreement; or
•
is a member of the management (or executive) board or supervisory (or non-executive) board – or
is a representative in some other way – of a legal entity which holds at least 10% of the issued
share capital of the Company, unless the legal entity is a subsidiary.
The independency of Non-Executive Directors is in any case assessed prior to each nomination for
(re)appointment to the Board.
Limitations on supervisory or non-executive positions
The number of an Executive Director’s supervisory (or non-executive) positions of large Dutch
companies or foundations shall be limited to a maximum of two. An Executive Director may not
be the chairperson of a supervisory board (or of a one-tier board) of another large Dutch company
or foundation. The number of a Non-Executive Director’s supervisory (or non-executive) positions
of large Dutch companies or foundations shall be limited to a maximum of five, for which purpose
the chairmanship of a supervisory board (or of a one-tier board) of another large Dutch company
or foundation counts twice. Executive Directors shall not pursue the candidacy for a supervisory (or
non-executive) or similar position in companies other than subsidiaries of the Company without the
Board’s prior approval. Such position may not conflict with the Company's interests. Other important
positions held by a Director shall be notified to the Board.
Diversity and inclusion
For the workforce as a whole, anti-discrimination and anti-harassment is dealt with in the Code
of Conduct, which encourages an inclusive environment that promotes individual expression,
creativity, innovation and achievement and emphasizes that within UMG diverse backgrounds and
skills are valued as well as other individual differences.
Specifically for the Board and senior management
1
, the Board has also adopted a separate diversity
and inclusion policy (the D&I Policy) as per articles 2:142b and 2:166 of the Dutch Civil Code and
best practice provision 2.1.5 of the Code, laying down the elements of a diverse and inclusive
composition of the Board and senior management as well as appropriate and ambitious aspirations
in this respect.
As set out in the D&I Policy, the Company acknowledges the benefits of greater diversity, including
with regards to gender or gender identity, age, nationality, ethnicity and cultural or other background,
and remains committed to ensuring that the Directors and senior managers bring a wide range of
expertise, experience, competencies, other personal qualities and perspectives. All (nominations for)
1
For purposes of the D&I Policy, senior management consists of: (i) the Executive Directors, including the Chairman and Chief Executive Officer (the Chairman and CEO), (ii) the Chairman and CEO’s direct reports who lead a label or business or with a primary function, (iii)
for other key labels or businesses, their leaders and in some instances, certain of their direct reports, and (iv) key large function leaders.
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appointments to the Board and senior management will be made based on merit against objective
criteria, in the context of the overall balance of expertise, experience, competencies, other personal
qualities and perspectives that are needed for the Company to remain effective.
The Board
With respect to the Board, the Company is committed to promoting diversity and inclusion in the
boardroom and to ensuring that all Directors are able to contribute to Board discussions and has
the aspiration:
•
to improve or safeguard gender diversity among the Non-Executive Directors, such that at least
one third of the Non-Executive Directors is female and at least one third of the Non-Executive
Directors is male, thereby at all times taking into account the Dutch statutory gender diversity
requirement with regards to the Non-Executive Directors;
•
to improve gender diversity among the Executive Directors, such that at least one Executive
Director is female and at least one Executive Director is male in the event that there are three
(or more) Executive Directors; and
•
to improve or safeguard diversity with regards to age, nationality, ethnicity and cultural or other
background as well as to create and maintain a variation in expertise, experience, competencies,
other personal qualities and perspectives within the Board.
The Company is further committed to considering candidates for Non-Executive Director positions
from a wide pool, including candidates with no prior publicly listed company board level experience.
The Nomination Committee (as defined under "The Board––Board committees") is responsible for
supporting the Board in applying the D&I Policy with respect to the composition of the Board by
annually assessing the Board’s size and composition and, as part thereof, for considering (i) with
respect to the Directors in general, the level of diversity with regards to expertise, experience,
competencies, other personal qualities, perspectives, gender or gender identity, age, nationality,
ethnicity and cultural or other background and (ii) with respect to the Non-Executive Directors
in particular, the level of independence, ahead of making recommendations to the Board for any
proposed changes. In addition, the Nomination Committee is required to consider the benefits of
all aspects of diversity, without compromises as to the caliber of the candidate Directors, when
identifying candidate Directors to be nominated for appointment to the Board.
The senior management
With respect to the senior management, the Company is committed to promoting diversity and
inclusion among the senior managers and has the aspiration:
•
to improve gender diversity among the senior managers, such that by December 31, 2026, at least
20% of the senior managers is female, which would reflect a 2.5% increase compared to December
31, 2023, i.e., the date on which the D&I Policy became effective, and at least 20% of the senior
managers is male; and
•
to improve or safeguard diversity with regards to age, nationality, ethnicity and cultural or other
background as well as to create and maintain a variation in expertise, experience, competencies,
other personal qualities and perspectives within the senior management.
For purposes of the D&I Policy and the aspirations laid down therein, as at December 31, 2025, the
senior management consisted of 73 senior managers.
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Overview
The following table provides an overview of the composition of the Executive Directors, Non-
Executive Directors and senior managers by gender as at December 31, 2025:
Directors
Executive Directors
Non-Executive Directors
Senior Managers
Female
5
0
5
16
Male
6
2
4
57
Total female and male
11
2
9
73
% Female
45
0
56
21.9
% Male
55
100
44
78.1
The composition of the Board as at December 31, 2025 was considered to be diverse. With
women representing 45% of all Directors and 56% of the Non-Executive Directors, the composition
of the Board and the Non-Executive Directors as at December 31, 2025 was in line with the
Company's gender diversity aspiration included in the D&I Policy as well as with the gender diversity
requirement included in Dutch law. With no recent changes to the composition, and with women
representing 0%, of the Executive Directors, the composition of the Executive Directors as at
December 31, 2025 was not in line with the Company's gender diversity aspiration included in the
D&I Policy. To monitor and address these factors, when assessing the Board’s composition - which is
done on an annual basis - and whilst recruiting to the Board, the D&I Policy (including the aspirations
included therein) and the Profile for Non-Executive Directors will be taken into consideration.
As set out in the D&I Policy, effective as from December 31, 2023, in efforts to continually improve on
diversity and inclusion among the senior management, especially gender diversity, the Company set
the aspiration that at least 20% of the senior managers be female by December 31, 2026. Due to those
continued efforts, such aspiration was reached one year ahead of schedule. Women represented
21.9% of all senior managers as at December 31, 2025 compared to 18.8% and 17.5% of all senior
managers as at December 31, 2024 and December 31, 2023, respectively. Gender diversity improved
by 3.1% compared to December 31, 2024 and by 4.4% compared to December 31, 2023.
The Company recognizes that there continues to be room for improvement. To keep the Company's
aspirations ambitious and appropriate, new such aspirations will be considered and, where
necessary, set in the course of 2026.
Actions to improve diversity and inclusion
The Company believes that the best way to foster an environment where original ideas are generated
and creativity can flourish is to build an inclusive workplace that attracts and promotes talent from
diverse backgrounds and cultures. Key actions to foster, and further enhance, such an environment
are set out in "S1: Own Workforce" of the Sustainability Statement and include:
Embracing cultural differences and raising awareness
•
The Company recognizes many cultural milestones and historically significant events.
•
The Company’s employee resource groups (ERGs) provide a platform for underrepresented
employees to network, share experiences and help shape employee programming, and play a
crucial role in supporting the Company’s commitment to fostering inclusion and belonging.
Attracting and retaining talent
•
To attract the next generation of talent, the Company hosts internship programs, allowing a
diverse group of students to take part in such programs.
•
The Company provides inclusive interviewing training to further support its goal of championing
inclusion and belonging throughout the employee lifecycle.
•
The Company strives to present a diverse slate of candidates to its hiring managers.
•
The Company advertises its jobs on a broad variety of platforms in order to attract a wide range
of candidates.
•
The Company is putting in place a workforce data insights initiative, which includes
the implementation of a global job architecture and a quarterly review of workforce
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changes, including turnover, to allow it to improve and prioritize its talent attraction and
retention programs.
Enhancing employee experience and development
•
To obtain feedback on the employee experience, the Company uses engagement surveys and a
series of employee lifecycle surveys, including new hire and exit surveys. The insights obtained
are turned into actions to further enhance the employee experience.
•
To cultivate leadership, the Company offers multiple programs specifically developed to drive
leadership preparedness.
•
The Company offers a broad range of employee development opportunities tailored to employees
at different career stages, including such programs centered on team development, cross-
functional collaboration, communication and productivity.
Fostering equitable pay practices
•
The Company supports equitable pay practices by conducting pay equity studies and through the
implementation of a global job architecture, in which individual pay reflects experience, skillset,
performance against goals and scope of responsibilities but does not differentiate on the basis of
protected characteristics.
•
The Company is focused on increasing transparency, such as publishing gender pay metrics.
Supporting employee wellbeing
•
As the Company is committed to enhancing its appeal as an employer and creating a positive
and healthy workplace, it provides programming and support for a Company-wide culture of
physical health, mental health and overall wellbeing. The Company has in place regionally-
specific employee assistance programs, which, among others, include counseling sessions,
in-the-moment support for emotional wellness, self-guided mindfulness, cognitive behavioral
therapy programs and work-life assistance.
Mitigating measures
•
As the Company promotes a respectful workplace, where harassment and discrimination have no
place, the Company offers multiple options for employees to seek guidance and report potential
instances of misconduct, including concerns related to harassment and discrimination, without
fear for retaliation.
Conflicts of interest and related party transactions
A Director may not take part in the discussions and/or decision-making process of the Board where
it concerns (i) a transaction in respect of which he or she has a direct or indirect personal conflict
of interest with the Company or one of its subsidiaries (a conflict of interest) or (ii) a related party
transaction in which he or she is involved. If the Board is unable to take a decision as a result of all
Directors being unable to take part in the discussions and/or decision-making process of the Board
due to a conflict of interest or due to all Directors being involved in a related party transaction, the
decision shall nevertheless be taken by the Board.
The Board has drawn up a related party transactions policy (the RPT Policy) for the purpose of
providing a procedure that prevents related parties from taking advantage of their position as well
as adequate protection for the interests of the Company and its stakeholders. In accordance with the
RPT Policy, any of the following transactions must be approved by the Board:
•
any transaction between the Company or one of its subsidiaries and (a) a shareholder holding at
least 10% of the issued share capital of the Company, or (b) a Director, a close family member of a
Director or a company in respect of which a Director personally has a material financial interest,
provided that the transaction is of material significance to the Company and/or the shareholder
concerned and/or the Director, close family member or company concerned (a Code RPT), or
•
any transaction between the Company or one of its subsidiaries and a related party within
the meaning of the standards adopted by the International Accounting Standards Board and
approved by the European Commission (International Accounting Standards 24 – Related Party
Disclosures (IAS24)), provided that the information concerning the transaction is considered
‘inside information’ as set out in Article 7(1) of Regulation (EU) No 596/2014 on market abuse,
as amended (a DCC RPT, and together with a Code RPT, a Related Party Transaction).
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In accordance with the RPT Policy, a Director shall promptly notify any (potential) Related Party
Transaction in respect of him or her or that he or she is otherwise aware of to the Chairman of the
Board; the Chairman of the Board shall promptly notify any (potential) Related Party Transaction in
respect to him or her or that he or she is otherwise aware of to the Vice-Chairman of the Board. In so
notifying the Chairman of the Board or the Vice-Chairman of the Board, the Director concerned must
provide all relevant information.
In accordance with best practice provisions 2.7.3, 2.7.4 and 2.7.5 of the Code, any Code RPT must be
approved by the Board, entered into on terms which are customary in the market, and published in
the Board report together with a declaration that best practice provisions 2.7.3 and 2.7.4 or 2.7.5 of the
Code have been complied with.
In the financial year 2025, there was one Code RPT in respect of which a Non-Executive Director had
a (potential) conflict of interest (within the meaning of the Code) that was considered to be of material
significance to the Company. In March 2020, as part of the Tencent-led consortium’s acquisition
of its stake in UMG, Tencent Music Entertainment was granted a call option to acquire up to 25%
(but no less than 20%) of the share capital of the holding company which controls UMG’s Greater
China operations (the Greater China option agreement). As previously disclosed, on June 16, 2022,
the Greater China option agreement was amended as follows: (i) the counterparty was changed to
Tencent Holdings, (ii) Tencent Holdings was granted a call option to acquire up to 12.5% (but no
less than 10%) of the share capital of the holding company which controls UMG’s Greater China
operations and (iii) Tencent Holdings could, within 24 months from the date of the amended Greater
China option agreement, deliver a written notice stating that it intends to exercise its rights under
the Greater China option agreement (the Initial Notice). Should Tencent Holdings deliver the Initial
Notice, both parties were required to use reasonable best efforts to complete certain actions set
forth in the Greater China option agreement, including, among others, due diligence, negotiation of
a purchase price and the terms of the definitive agreements and governance arrangements. As also
previously disclosed, in 2024, the Greater China option agreement was further amended to extend
Tencent Holdings’ right to deliver the Initial Notice until June 16, 2025, which Tencent Holdings
did in June 2025. Tencent Holdings’ actual exercise of the call option and any consummation
of the acquisition is subject to certain factors, including the parties reaching agreement on the
terms of the definitive agreements and governance arrangements, and receipt of any necessary
governmental approvals. Accordingly, there is no guarantee that UMG and Tencent Holdings will
reach such agreement or that the acquisition will be completed.
In
Note 25
‘Related parties’ to the consolidated financial statements, details of all related party
transactions (including DCC RPTs, if any) are set out.
Resolutions subject to approval of the Board
In addition to Related Party Transactions, which require the approval of the Board as set out under
"The Board––Conflicts of interest and related party transactions", in accordance with the Board
Regulations, the Company does not enter into any transaction with a value in excess of €300,000,000
that relates to (i) a disposal, sale or acquisition of all or a portion of investments in any company,
business or group created or to be created, whatever its legal form, (ii) a proposal or approach to
a third party concerning a significant transaction involving the Company or any of its subsidiaries
and (iii) a financing activity (including a bank loan, overdraft, vendor financing, asset securitization
program, pension fund or transaction involving a joint venture or minority interest) and the granting
of a guarantee or security right, without the approval of the Board.
Remuneration
The remuneration of the individual Executive Directors and Non-Executive Directors shall be
determined by the Board with observance of the remuneration policies for the Executive Directors
and Non-Executive Directors, respectively. The Executive Directors shall not participate in the
discussions and/or decision-making process regarding the determination of the remuneration of the
Executive Directors. The remuneration policies as well as the main elements of the agreements with
Sir Lucian Grainge and Vincent Vallejo are available on the investor relations part of the UMG website.
In the Remuneration Report, details of the individual remuneration of the Executive Directors and
Non-Executive Directors are set out.
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As per the remuneration policy for the Executive Directors, part of the remuneration of the Executive
Directors can consist of short-term and long-term incentives. The short-term and long-term
incentive plans for the Executive Directors (as described in detail in the Remuneration Report) do
not currently incorporate key performance indicators linked to sustainability matters. The Board
may explore the inclusion thereof in the short-term and/or long-term incentive plans for the
Executive Directors in future years. As per the remuneration policy for the Non-Executive Directors,
the remuneration of the Non-Executive Directors, which consists of a cash retainer and an annual
grant of restricted share units (RSUs), is fixed and not dependent on the Company’s results or the
attainment of key performance indicators, whether or not linked to sustainability matters.
Severance
Under his employment agreement, Sir Lucian Grainge is entitled to severance payments as set out
in the Remuneration Report under "Severance payments and termination provisions--Sir Lucian
Grainge" in the event of (i) termination of his employment agreement by Sir Lucian Grainge
for good reason, which includes a change in control (as defined in the Remuneration Report
under "Severance payments and termination provisions--Sir Lucian Grainge"), (ii) termination of
his employment agreement by Universal Music Group, Inc. (i.e., the formal employer of Sir Lucian
Grainge) without cause or (iii) non-renewal of his employment agreement by Universal Music
Group, Inc.
Under his management services agreement, Vincent Vallejo is not entitled to any severance
payments in the event of termination or non-renewal of his management services agreement; he
may, however, be entitled to severance payments in accordance with Dutch law.
Directors’ and officers’ liability insurance policy and indemnity
The Executive Directors and Non-Executive Directors as well as certain officers are insured under
a directors’ and officers’ liability insurance policy taken out by the Company against damages
resulting from their conduct when acting in their capacities as Directors or officers with coverage
and terms customary for a publicly listed company of the size of the Company. Although the policy
provides for broad coverage, the Executive Directors, Non-Executive Directors and officers may
become subject to uninsured liabilities.
In addition, pursuant to the Articles, the Company has agreed to indemnify each Executive Director
and each Non-Executive Director for any claim against him or her that he or she may derive from
exercising his or her duties as an Executive Director or Non-Executive Director, provided that he or
she acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to,
the best interests of the Company or out of his or her mandate and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.
Board committees
The Board has appointed from among its Non-Executive Directors three Board committees
to assist it in discharging its responsibilities: an audit committee (the Audit Committee),
a remuneration committee (the Remuneration Committee) and a nomination committee (the
Nomination Committee). Without prejudice to the collegiate responsibility of the Board, the duty of
these Board committees is to prepare the decision-making of the Board.
The Board has drawn up regulations for each Board committee, setting out the role and
responsibilities of the Board committee concerned, its composition and size and the manner in
which its meetings should be held. These regulations are available on the investor relations part of
the UMG website.
The Non-Executive Directors’ Report states the composition of the Board committees, the number of
meetings held and the main items discussed at such meetings.
The Audit Committee
According to the regulations of the Audit Committee, the Audit Committee shall advise the Board
in relation to its responsibilities, shall undertake preparatory work for the Board’s decision-making
regarding the supervision of the integrity and quality of the Company’s financial and sustainability
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reporting and the effectiveness of the Company’s internal risk management and control systems
and shall prepare resolutions of the Board in relation thereto.
In addition to the foregoing, the Audit Committee’s main responsibilities include: (i) supervising and
monitoring, and discussing with and advising the Board on, the effectiveness of the design and
operation of the internal risk management and control systems, (ii) supervising the enforcement of
all applicable laws and regulations and supervising the effect of the Code of Conduct, (iii) supervising
the preparation and submission of financial and sustainability information by the Company, (iv)
supervising the compliance with recommendations, comments and observations of the internal
auditor, the external auditor(s) and any other external party involved in providing assurance on
the sustainability reporting, (v) instructing the external auditor(s) and the internal audit function
to inform the Executive Directors and the chair of the Audit Committee without delay if it or they
discover(s) or suspect(s) an instance of misconduct or irregularity, (vi) supervising the functioning of
the internal audit function, (vii) ensuring that the way in which the internal audit function fulfills its
responsibility is assessed by an independent third party at least every five years, (viii) supervising
the policy of the Company on tax planning, (ix) supervising the financing of the Company, (x)
supervising the applications of information and communication technology, including risks relating
to cybersecurity and data protection and risks relating to new technologies, (xi) maintaining
frequent contact and supervising the relationship with the internal auditor, the external auditor(s)
and any other external party involved in providing assurance on the sustainability reporting,
(xii) implementing the procedure for the selection of the external auditor(s) and submitting a
recommendation to the Non-Executive Directors for the (re)appointment or dismissal of the external
auditor(s) by the General Meeting, (xiii) informing the Board of the outcome of the statutory audit
and explaining how the statutory audit contributed to the integrity of the financial reporting and
what the role of the Audit Committee was in that process, (xiv) monitoring the financial reporting and
submitting recommendations or proposals to ensure its integrity, (xv) determining whether, and if so,
how the external auditor(s) shall be involved in the content and publication of financial reports other
than the financial statements, (xvi) issuing a recommendation on the appointment and dismissal of
the Chief Audit Officer, (xvii) submitting a proposal to the Board for the engagement of the external
auditor(s) to audit the financial statements and (xviii) considering and, where appropriate, approving
for recommendation to the Board the (semi-annual) financial statements, the annual budget and
major capital expenditures of the Company.
The Audit Committee is also responsible for reporting to the Board on its deliberations and findings,
which report addresses, among others: (i) the methods used to assess the effectiveness of the design
and operation of the internal risk management and control systems, (ii) the methods used to assess
the effectiveness of the internal and external audit processes, (iii) material considerations regarding
the financial and sustainability reporting and (iv) the way in which material risks and uncertainties
have been analysed and discussed and the manner in which the Board's risk management
statement can be substantiated.
The Audit Committee shall consist of at least three members appointed by the Board from among
its Non-Executive Directors. More than half of the members of the Audit Committee, including the
chair of the Audit Committee, shall be independent within the meaning of best practice provision
2.1.8 of the Code. The Audit Committee may not be chaired by the Chairman of the Board or by
a former Executive Director. At least one member of the Audit Committee shall have competence
in accounting and/or auditing and the members of the Audit Committee as a whole shall have
competence relevant to the sector in which the Company operates.
The Audit Committee shall hold at least four meetings per year and whenever one or more of its
members have requested a meeting. The quorum of any meeting shall be a majority of the members
of the Audit Committee. The Audit Committee shall meet with the external auditor(s) as often as it
considers necessary, but at least once a year, outside the presence of the Executive Directors. The
Chief Financial Officer, the Chief Audit Executive and the external auditor(s) shall in principle attend
the meetings of the Audit Committee, unless the Audit Committee determines otherwise. The Audit
Committee shall decide whether and, if so, when the Chairman of the Board shall attend its meetings.
The Remuneration Committee
According to the regulations of the Remuneration Committee, the Remuneration Committee shall
advise the Board in relation to its responsibilities, shall undertake preparatory work for the Board’s
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decision-making regarding the determination of the remuneration of the individual Executive
Directors and Non-Executive Directors, with observance of the remuneration policies for the
Executive Directors and Non-Executive Directors, respectively, and shall prepare resolutions of the
Board in relation thereto.
In addition to the foregoing, the Remuneration Committee’s main responsibilities include: (i) at least
every four years, submitting a proposal to the Board for the remuneration policies for the Executive
Directors and Non-Executive Directors, to be submitted to the General Meeting for adoption and
(ii) annually preparing the Remuneration Report, to be submitted to the General Meeting for a non-
binding advisory vote.
The Remuneration Committee is also responsible for reporting to the Board on its deliberations
and findings.
The Remuneration Committee shall consist of at least three members appointed by the Board
from among its Non-Executive Directors. More than half of the members of the Remuneration
Committee shall be independent within the meaning of best practice provision 2.1.8 of the Code.
The Remuneration Committee may not be chaired by the Chairman of the Board or by a former
Executive Director.
The Remuneration Committee shall hold at least two meetings per year and whenever one or more
of its members have requested a meeting. The quorum of any meeting shall be a majority of the
members of the Remuneration Committee.
The Nomination Committee
According to the regulations of the Nomination Committee, the Nomination Committee shall advise
the Board in relation to its responsibilities, shall undertake preparatory work for the Board’s
decision-making and shall prepare resolutions of the Board in relation thereto.
In addition to the foregoing, the Nomination Committee’s main responsibilities include: (i) drawing
up selection criteria and appointment procedures for Directors, (ii) annually assessing the size and
composition of the Board, and making a proposal for the profile for Non-Executive Directors, (iii)
annually evaluating the functioning of the Board as a whole, the individual Directors and the various
Board committees, ensuring that such evaluation periodically takes place under the supervision of
an external expert and reporting on this to the Board, (iv) formulating succession plans for Directors
and drawing up a retirement schedule, (v) making recommendations for the (re)appointment of
Directors and (vi) supervising the policy of the Board on the selection criteria and appointment
procedures for senior management.
The Nomination Committee is also responsible for reporting to the Board on its deliberations
and findings.
The Nomination Committee shall consist of at least three members appointed by the Board from
among its Non-Executive Directors. More than half of the members of the Nomination Committee
shall be independent within the meaning of best practice provision 2.1.8 of the Code.
The Nomination Committee shall hold at least two meetings per year and whenever one or more
of its members have requested a meeting. The quorum of any meeting shall be a majority of the
members of the Nomination Committee.
The Market Disclosure Committee
The Board has also appointed a market disclosure committee (the Market Disclosure Committee),
consisting of seven members, which is responsible for the timely and accurate disclosure of all
information that is required to be so disclosed to the market in order to meet the applicable legal
and regulatory obligations and requirements arising from the Listing.
The Market Disclosure Committee shall meet whenever necessary to fulfill its responsibilities and
meetings can be called by and at the request of any of the members of the Market Disclosure
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Committee. The Market Disclosure Committee is not a committee of the Board although its members
are appointed by the Board.
Sustainability management
The Board is responsible for developing a view on sustainable long-term value creation by the
Company and for formulating a strategy as well as specific objectives in line with this view, which
includes overseeing the Company’s sustainability impacts, risks and opportunities, as well as the
integrity of the Company’s sustainability reporting. The Audit Committee supports and advises the
Board in relation to these responsibilities, as enshrined in the regulations of the Audit Committee,
and covers environmental, social, and governance (ESG) topics on its agenda.
The Company’s ESG team, led by the Head of Sustainability, is responsible for developing and
updating the Company’s sustainability strategy, measuring performance, driving compliance with
sustainability-related regulations and briefing the Board and, as applicable, Board committees, on
these activities.
At management level, executive leaders within each business unit are responsible for the day-to-
day oversight and management of applicable impacts, risks and opportunities, including for setting
and measuring key progress indicators and implementing and maintaining applicable policies.
These functions are discussed in greater detail within the relevant sections of the Annual Report.
The Board and Board committees are also regularly briefed on the Company’s material topics, both
in writing and during meetings, and have spent significant time discussing several of these topics,
including UMG’s relationships with its artists, content protection in general, and in particular in the
context of risks posed by (generative) artificial intelligence and employee attraction and retention,
including through the implementation of the 2022 UMG Global Equity Plan.
In 2023, a cross-functional steering committee (the SteerCo) was formed, which reviewed, approved
and advised on each phase of the process to identify the Company’s material impacts, risks
and opportunities, including the validation and reporting of the results of the double materiality
assessment process (the DMA). The ESG team regularly briefs the SteerCo on relevant sustainability
matters, and the SteerCo receives briefings and trainings from external subject matter experts
as needed.
The SteerCo is composed of senior leaders across UMG’s business units, including the:
•
Executive Vice President Communications and Chief Impact Officer
•
Senior Vice President, Head of Sustainability
•
Vice President, ESG
•
Executive Vice President and Chief Compliance Officer
•
Senior Vice President of Business and Legal Affairs
•
Senior Vice President and Head of M&A and Business Integration
•
Head of People Operations and Systems
•
Senior Vice President of Business Affairs and Compliance
•
Vice President of Investor Relations
•
Senior Vice President and Chief Audit Executive
•
Senior Vice President, Chief Future of Work Architect and People Business Partner
•
Senior Vice President of Information Technology Strategy
•
Senior Vice President of Global Financial Reporting and Analysis
•
Senior Vice President of Public Affairs, Europe
•
Vice President of Internal Audit and Control Assurance
The ESG team integrates sustainable business practices across the Company by executing a
comprehensive ESG management system. Among other efforts, the ESG team conducts all day-to-
day operations associated with developing and deploying the Company’s sustainability strategy,
measurement and reporting, including the execution of the DMA. The ESG team also mobilizes cross-
functional ESG working groups to operationalize sustainability commitments within each group’s
sphere of influence, through key performance indicator monitoring, target setting and program
implementation. Key ESG working groups include Universal Manufacturing and Logistics (UML),
Bravado and Global Travel.
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The General Meeting
Annual and extraordinary General Meetings
The Shareholders exercise their rights through annual and extraordinary General Meetings.
Annual General Meetings
The annual General Meeting shall be held within six months after the end of the financial year. The
agenda of the annual General Meeting typically includes the following (discussion or voting) items:
(i) the discussion of the Annual Report, (ii) the consideration of the Remuneration Report, (iii) the
adoption of the financial statements, (iv) the discussion of the dividend policy and the proposal
to distribute dividends, (v) the discharge of the Directors for the performance of their duties, (vi)
the (re)appointment of Directors, (vii) the adoption of the remuneration policies for the Executive
Directors and Non-Executive Directors insofar as any adjustments to the remuneration policies so
require or four years after their former adoption, (viii) the appointment of the external auditor(s) to
audit the financial statements, and (ix) any other items brought forward by the Board.
Extraordinary General Meetings
Extraordinary General Meetings shall be held as often as the Board deems necessary. In addition,
one or more of the Shareholders representing individually or jointly at least 10% of the issued
share capital of the Company are entitled to request the Board in writing that a General Meeting is
convened, the request setting out in detail the items to be discussed. If the Board has not taken the
steps necessary to ensure that a General Meeting can be held within eight weeks of the request, the
relevant Shareholder or Shareholders may at its or their request be authorized by a Dutch court in
summary proceedings to convene a General Meeting. In any event, a General Meeting shall be held
to discuss any requisite measures within three months of it becoming apparent to the Board that the
shareholders’ equity of the Company has decreased to an amount equal to or lower than 50% of the
paid-up and called-up part of the share capital of the Company.
Place
According to the Articles, General Meetings shall be held in Amsterdam, Rotterdam, Hilversum or
Haarlemmermeer (including Schiphol Airport).
Convocation
A General Meeting is convened by the Board by means of a convocation notice, which must be given
at least forty-two days before the day of the General Meeting.
Right to include items on the agenda
One or more of the Shareholders representing individually or jointly at least 3% of the issued share
capital of the Company are entitled to request the Company in writing that an item is included on
the agenda of the General Meeting. The request must be sufficiently motivated and received by the
Company at least sixty days before the day of the General Meeting. The Company cannot be forced
to include a voting item on the agenda of the General Meeting where the voting item concerns a
matter which does not lie within the powers of the General Meeting. In accordance with best practice
provision 4.1.6 of the Code, the Shareholders are expected to only exercise the right of including an
item on the agenda of the General Meeting after having consulted the Board in that respect.
Response time
If one or more of the Shareholders intend(s) to request that an item is included on the agenda
of the General Meeting as set out under "The General Meeting––Annual and extraordinary General
Meetings––Right to include items on the agenda" that may result in a change in the Company’s
strategy (via, for example, a change in the composition of the Board), the Board may, pursuant to best
practice provisions 4.1.6 and 4.1.7 of the Code, invoke a response time of a maximum of 180 days. The
possibility to invoke a response time also applies to a request of such Shareholder or Shareholders
to be authorized to convene a General Meeting as set out under "The General Meeting––Annual and
extraordinary General Meetings––Extraordinary General Meetings". The Board must use the response
time for further deliberation and constructive consultation with (in any event) such Shareholder or
Shareholders and for exploring alternatives, and must report on the process to the General Meeting.
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Furthermore, pursuant to article 2:114b of the Dutch Civil Code, the Board may invoke a response
time of a maximum of 250 days, if the Shareholder’s or Shareholders’ request entails a proposal
for a change to the composition of the Board or of the corresponding provisions in the Articles.
During the response time, the General Meeting cannot vote on the requested proposal, unless the
Board nonetheless includes the proposal on the agenda of a General Meeting as a voting item.
The Board must use the response time to collect the information it needs in order to come to a
prudent decision regarding the request, and must prepare a report on the policy and course of
action pursued during the response time, which report must be placed on the Company’s website
as well as on the agenda of the first General Meeting held after the response time has ended as a
discussion item.
Chairperson of the General Meeting
The General Meeting shall be presided over by the Chairman of the Board or another Director
designated for that purpose by the Board. If the Chairman of the Board is not present at the General
Meeting and no other Director has been designated by the Board to preside over the General Meeting,
the General Meeting itself shall appoint a chairperson of the General Meeting. The chairperson
has all powers necessary to ensure the orderly and efficient conduct of the General Meeting. The
chairperson decides on all matters relating to admission to the General Meeting and may admit
third parties to the General Meeting. The Directors are in any event authorized to attend the General
Meeting, in which they have an advisory vote. The external auditor(s) is (or are) also authorized to
attend the General Meeting.
Participation
Each Shareholder is entitled, in person or represented by a proxy authorized in writing, to attend and
address the General Meeting and to exercise its voting rights. Each Shareholder may exercise such
rights if it is a Shareholder on the record date, which is the twenty-eighth day before the day of the
General Meeting, and it has notified the Company in writing of its intention to do so in the manner
and by the date specified in the convocation notice. The Board may determine that a Shareholder
entitled to exercise its voting rights may cast its vote prior to the General Meeting by means of
electronic communication or letter. Votes cast in accordance with the previous sentence rank equal
to votes cast at the General Meeting.
Each Share confers the right on the holder thereof to cast one vote at the General Meeting. All
resolutions of the General Meeting shall be adopted by a simple majority of the votes cast, unless
Dutch law or the Articles require a qualified majority. Some resolutions require a qualified majority
if less than half of the issued share capital of the Company is present or represented at the General
Meeting. No special control rights are attached to the Shares. There are no restrictions on the
exercise of voting rights under Dutch law or the Articles nor, as far as the Company is aware, under
the Relationship Agreement.
The General Meeting has authority to adopt resolutions concerning, among others, the
following matters:
•
the issuance of Shares or the granting of rights to subscribe for Shares (and to designate the Board
as the competent body to issue Shares or to grant rights to subscribe for Shares);
•
the limitation or exclusion of the pre-emptive right in relation to Shares or rights to subscribe for
Shares (and to designate the Board as the competent body to limit or exclude the pre-emptive
right in relation to Shares or rights to subscribe for Shares);
•
the authorization of the Board to acquire Shares on behalf of the Company;
•
the reduction of the issued share capital of the Company;
•
the (re)appointment of Executive Directors and Non-Executive Directors;
•
the suspension and dismissal of Executive Directors and Non-Executive Directors;
•
the adoption of the remuneration policies for the Executive Directors and Non-Executive Directors;
•
the adoption of the financial statements;
•
the appointment of the external auditor(s) to audit the financial statements;
•
the distribution of dividends;
•
the amendment of the Articles;
•
the dissolution of the Company.
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No resolutions may be adopted on items other than those that have been included on the agenda of
the General Meeting (unless the resolution would be adopted unanimously during a General Meeting
where the entire issued share capital of the Company is present or represented).
Resolutions of the Board regarding a significant change in the identity or character of the Company
or its business are subject to the approval of the General Meeting. Such changes include in
any event:
•
the transfer of the business or practically the entire business to a third party;
•
the entering into or termination of any long-lasting cooperation of the Company or a subsidiary
with any other legal person or company or as a fully-liable general partner in a (limited or general)
partnership, provided that the entering into or termination of such cooperation is of material
significance to the Company;
•
the acquisition or disposal by the Company or a subsidiary of a participation in the issued share
capital of a company with a value of at least one third of the assets, as shown in the consolidated
balance sheet with explanatory notes according to the most recently adopted consolidated
financial statements.
Minutes
Minutes of the proceedings at the General Meeting shall be kept by a secretary who shall be
designated by the chairperson of the General Meeting. Within three months after the close of the
General Meeting, the minutes shall be made available to the Shareholders, which then have the
opportunity to provide their comments in the three months thereafter. The minutes shall then be
adopted by the chairperson and the secretary and signed by them as evidence thereof.
Issuance of Shares and limitation or exclusion of pre-emptive right
The General Meeting is authorized to issue Shares. The General Meeting may designate the Board as
the competent body to issue Shares and to determine the issue price and other conditions of the
issuance for a specified period not exceeding five years (which period can be extended from time
to time for further periods not exceeding five years). Such designation must state the number of
Shares that may be so issued. The General Meeting shall, in addition to the Board, remain authorized
to issue Shares if such is specifically stipulated in the resolution of the General Meeting designating
the Board as the competent body to issue Shares. A resolution of the General Meeting to issue Shares
and a resolution of the General Meeting designating the Board as the competent body to issue
Shares can only be adopted at the proposal of the Board. The foregoing applies by analogy to the
granting of rights to subscribe for Shares but does not apply to the issuance of Shares to a person
exercising a previously granted right to subscribe for Shares.
Each Shareholder has a pre-emptive right in proportion to the aggregate number of Shares held
by it upon an issuance of Shares. The pre-emptive right does not apply to: (i) Shares issued to
employees of the Company or of a group company, (ii) Shares issued against payment other than
in cash and (iii) Shares issued to a person exercising a previously granted right to subscribe for
Shares. The pre-emptive right may be limited or excluded by a resolution of the General Meeting.
The pre-emptive right may also be limited or excluded by a resolution of the Board if the Board has
been designated as the competent body to limit or exclude the pre-emptive right by the General
Meeting for a specified period not exceeding five years (which period can be extended from time to
time for further periods not exceeding five years), and the Board has also been designated as the
competent body to issue Shares by the General Meeting. A resolution of the General Meeting to limit
or exclude the pre-emptive right and a resolution of the General Meeting designating the Board as
the competent body to limit or exclude the pre-emptive right can only be adopted at the proposal of
the Board and requires a qualified majority of at least two thirds of the votes cast if less than half
of the issued share capital of the Company is present or represented at the General Meeting. The
foregoing applies by analogy to the granting of rights to subscribe for Shares.
On May 12, 2022, the General Meeting approved the 2022 Universal Music Group Global Equity Plan
(the 2022 UMG Global Equity Plan) as well as the issuance of Shares or the granting of rights to
subscribe for Shares in order to give effect to awards granted under the 2022 UMG Global Equity Plan
to employees of the Company and its subsidiaries and to Executive Directors up to a total amount of
5% of the issued share capital of the Company as at May 12, 2022 (the Share Pool) and, to the extent
necessary, the exclusion of the pre-emptive right with respect to such Shares or rights to subscribe
for Shares. On May 16, 2024, the General Meeting further approved the issuance of Shares or the
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granting of rights to subscribe for Shares in order to give effect to the granting of a fixed Euro amount
of awards to Non-Executive Directors under the remuneration policy for the Non-Executive Directors
from the same Share Pool and for the same five-year period calculated as from May 12, 2022, and to
the extent necessary, the exclusion of the statutory pre-emptive right with respect to such Shares
or rights to subscribe for Shares. The actual number of Shares to be issued or rights to subscribe for
Shares to be granted in order to give effect to awards granted under the 2022 UMG Global Equity Plan
is determinable by the Board (or a committee of the Board designated for such purpose).
Acquisition of Shares
The Company cannot subscribe for Shares. The Company may, however, acquire fully paid-up Shares
for no consideration or under universal title of succession. In addition, the Company may acquire
fully paid-up Shares against consideration if (i) the shareholders’ equity of the Company less the
acquisition price of the Shares does not fall below the sum of the paid-up and called-up part of
the issued share capital of the Company and any reserves that must be maintained pursuant to
Dutch law, (ii) the aggregate nominal value of the Shares which the Company acquires, holds or on
which it holds a right of pledge or which are held by a subsidiary does not exceed 50% of the issued
share capital of the Company and (iii) the Board has been authorized to acquire Shares on behalf of
the Company by the General Meeting. Such authorization is valid for a maximum period of eighteen
months and as part of the authorization, the General Meeting must specify the number of Shares that
may be acquired as well as the manner in which and the price range within which the Shares may
be acquired. Such authorization is not required if the Company acquires fully paid-up Shares for the
purpose of transferring such Shares to employees of the Company or of a group company under an
equity compensation plan. Any acquisition of Shares that are not fully paid-up shall be null and void.
In calculating the amount of any dividend distribution on the Shares, Shares held by the Company
shall be disregarded, unless such Shares are encumbered with a right of pledge or usufruct.
Furthermore, the Company or a subsidiary may not cast votes in respect of Shares held by it or
on which it holds a right of pledge or usufruct. However, a holder of a right of pledge or usufruct on
Shares held by the Company or a subsidiary may cast votes in respect of such Shares, if the right
of pledge or usufruct was created before the Shares were acquired by the Company or a subsidiary.
In determining how many votes can be cast, how many Shareholders are present or represented
or which part of the issued share capital of the Company is present or represented at the General
Meeting, no account shall be taken of Shares in respect of which no votes can be cast.
On May 14, 2025, the General Meeting resolved to grant the Board the authority to cause the Company
to acquire Shares in an amount of up to and including 10% of the issued share capital of the
Company as at May 14, 2025, through acquisitions effected on the exchange or in any other manner,
provided that following the acquisition, the Company, together with its subsidiaries, does not hold
more than 10% of the issued share capital of the Company. The minimum price which the Company
may pay for a Share will be an amount equal to the nominal value of such Share. The maximum
price which the Company may pay for a Share will be an amount equal to 110% of the market price
of the Shares. The authorization so granted is valid for a period of eighteen months as from May
14, 2025.
Reduction of the issued share capital of the Company
At the proposal of the Board, the General Meeting may resolve to reduce the issued share capital of
the Company by (i) cancelling Shares held by the Company or (ii) reducing the nominal value of the
Shares by way of an amendment of the Articles. A resolution of the General Meeting to reduce the
issued share capital of the Company requires a qualified majority of at least two thirds of the votes
cast if less than half of the issued share capital of the Company is present or represented at the
General Meeting.
On May 14, 2025, the General meeting resolved to grant the Board the authority to cancel any or all
Shares held by it in one or more tranches. The number of Shares that may be so cancelled (whether
or not in one tranche) may be determined by the Board but may in aggregate not exceed 10% of the
issued share capital of the Company as at May 14, 2025. The purpose of such cancellation would be
to optimize the Company’s capital structure.
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Appointment of the external auditor(s)
The General Meeting shall appoint the external auditor(s) to audit the financial statements. The Non-
Executive Directors shall submit a nomination for the appointment of the external auditor(s) to the
General Meeting, upon the recommendation of the Audit Committee. Unless it concerns the renewal
of an audit engagement, the recommendation of the Audit Committee shall be prepared following a
selection procedure organized by the Company under the responsibility of the Audit Committee in
accordance with Regulation (EU) No 537/2014 of the European Parliament and of the Council of April
16, 2014 on specific requirements regarding statutory audit of public-interest entities.
On May 11, 2023, the General Meeting appointed Ernst & Young Accountants LLP as the external
auditor to audit the financial statements for the financial years 2023 up to and including 2025.
Amendment of the Articles
At the proposal of the Board, the General Meeting may resolve to amend the Articles. If a proposal
to amend the Articles is to be submitted to the General Meeting, the convocation notice must state
so and a copy of the proposal, including the verbatim text thereof, must be made available at the
Company’s office for inspection by, and must be made available free of charge to, the Shareholders
until after the close of the General Meeting. An amendment of the Articles requires a notarial deed.
Dutch Decree on Article 10 of the Takeover Directive
Pursuant to the Dutch Decree on Article 10 of the Takeover Directive, the Board report needs to
include information on, among others, the Company’s share capital structure, any restrictions on
voting rights and the transfer of Shares, substantial shareholdings in the Company, any special
control rights attached to the Shares, any system of control of any equity compensation plans
where the control rights are not exercised directly by the employees, the rules governing the
appointment and dismissal of Executive Directors and Non-Executive Directors and the amendment
of the Articles, the powers of the Board (in particular the power to issue Shares and to cause
the Company to acquire Shares), any material agreement to which the Company is a party and
which comes into force or is amended or terminated upon a change in control over the Company
following a takeover offer, and any agreement between the Company and a Director or employee
providing for compensation if his or her employment is terminated because of a takeover offer. The
information that needs to be included in the Board report pursuant to the Dutch Decree on Article
10 of the Takeover Directive is included in this Corporate Governance section and in the Shareholder
Information section.
Compliance with the Code
The Company acknowledges the importance of good corporate governance and complies with most
of the principles and best practice provisions of the Code, the full text of which can be found on
www.mccg.nl
. Deviations from any of the principles and best practice provisions of the Code are
explained below in accordance with the Code’s ‘comply or explain’ principle. Substantial changes in
the Company’s corporate governance structure and in the Company’s compliance with the Code, if
any, will be dealt with at the annual General Meeting as a separate item.
Deviations
Best practice provision 2.2.1 of the Code
The Company does not comply with (the second sentence of) best practice provision 2.2.1 of the Code,
which recommends that an Executive Director may be reappointed for a term of not more than four
years at a time, now that the General Meeting, on May 11, 2023, reappointed Sir Lucian Grainge as
an Executive Director for a period ending on May 1, 2028. At the recommendation of the Nomination
Committee, the Board made its (non-binding) nomination for the reappointment of Sir Lucian Grainge
for such an extended period in order to align the term of his appointment as an Executive Director
with the term of his employment agreement.
Best practice provision 2.2.2 of the Code
The Company does not comply with (the first sentence of) best practice provision 2.2.2 of the Code,
which recommends that a Non-Executive Director is appointed for a period of four years and may
then be reappointed once for another four-year period, now that all Non-Executive Directors have
been appointed or reappointed by the General Meeting for a period of two years in order to comply
with the base scenario under the Articles.
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Best practice provision 3.1.2 item (vi) of the Code
The Company does not comply with best practice provision 3.1.2 item (vi) of the Code, which
recommends that if shares are being granted, they should be held for at least five years after
the grant date. Although the awards granted to the Executive Directors under the 2022 UMG Global
Equity Plan are (and will be) subject to (multiple-year) time-based and/or performance-based vesting
requirements as set out in
Note 24
‘Share-based compensation plans’ to the consolidated financial
statements, there is no requirement that Shares should continue to be held once vested. Considering
that the Company operates in a highly competitive environment, requiring the Executive Directors
to hold the Shares for at least five years after the grant date could meaningfully reduce the
perceived value of the awards for motivational and retention purposes, without reducing the cost
to the Shareholders in terms of dilution, while the minimum ownership guidelines included in the
Executive Director stock ownership policy and the vesting requirements attached to the awards are
already efficacious at aligning the Executive Directors’ and Shareholders’ interests.
Best practice provision 3.1.2 item (vii) of the Code
The Company does not comply with best practice provision 3.1.2 item (vii) of the Code, which
recommends that if share options are being granted, they should not be exercisable during the first
three years after they are granted. Although the performance stock options (the PSOs) granted under
the 2022 UMG Global Equity Plan to Sir Lucian Grainge are subject to (multiple-year) time-based and
performance-based vesting requirements, part of the PSOs could become exercisable within the first
three years after they were granted. On each of the first four anniversaries of the grant date, one
fourth of the PSOs will vest; in addition, one third of the PSOs will become eligible for exercise if the
first share price hurdle of €26.50 is met, one third of the PSOs will become eligible for exercise if the
second share price hurdle of €30.00 is met, and one third of the PSOs will become eligible for exercise
if the third share price hurdle of €38.00 is met. Only those PSOs that have vested due to the passage
of time and have become eligible for exercise due to a share price hurdle having been met become
exercisable. One twelfth of the PSOs became exercisable during the financial year 2024 and another
one twelfth of the PSOs became exercisable during the financial year 2025 as those PSOs had vested
due to the passage of time and had become eligible for exercise due to the first share price hurdle
having been met.
Best practice provision 3.2.3 of the Code
Sir Lucian Grainge is entitled to severance payments as set out in the Remuneration Report
under "Severance payments and termination provisions--Sir Lucian Grainge" in the event of (i)
termination of his employment agreement by Sir Lucian Grainge for good reason, (ii) termination
of his employment agreement by Universal Music Group, Inc. (i.e., the formal employer of Sir Lucian
Grainge) without cause or (iii) non-renewal of his employment agreement by Universal Music Group,
Inc., which severance payments are in excess of (the fixed remuneration component of) one year's
salary. Accordingly, the Company does not comply with best practice provision 3.2.3 of the Code,
which recommends that any severance payments in the event of dismissal should not exceed (the
fixed remuneration component of) one year’s salary or be awarded in the event that the employment
agreement is terminated by the Executive Director. However, as the recommended severance
payments are inconsistent with industry practices in the primary fields in which the Company
competes for talent, i.e., the fields of United States media, entertainment and tech, complying with
best practice provision 3.2.3 of the Code could be detrimental to Executive Director recruitment and
retention. Accordingly, at the time of renewal of Sir Lucian Grainge’s employment agreement, it was
decided to agree to a severance arrangement, which is in deviation of best practice provision 3.2.3 of
the Code.
Best practice provision 3.3.2 of the Code
The Company does not comply with best practice provision 3.3.2 of the Code, which recommends
that Non-Executive Directors should not be awarded any remuneration in the form of shares and/or
rights to shares, now that pursuant to the revised remuneration policy for the Non-Executive
Directors, as adopted by the General Meeting on May 16, 2024, the Non-Executive Directors are
entitled to receive part of their remuneration in the form of RSUs. A revision of the remuneration
policy for the Non-Executive Directors was considered necessary to align the remuneration of the
Non-Executive Directors more closely with sector market peers and to enhance the Company’s
ability to attract, motivate and retain highly qualified individuals.
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Corporate governance statement
Pursuant to the Dutch Decree on the Content of the Board Report, the Company is required to publish
a statement concerning its approach to corporate governance and compliance with the Code. The
information required to be included in this statement can be found in the following sections of the
Annual Report:
•
The information concerning compliance with the Code is set out under "Compliance with
the Code";
•
The information concerning the Company’s internal risk management and control systems
relating to the financial reporting process is set out in the Risk and Risk Management section;
•
The information concerning the functioning and powers of the General Meeting and the rights of
the Shareholders and how such rights can be exercised is set out under "The General Meeting";
•
The information concerning the composition and functioning of the Board and its Board
committees is set out under "The Board" and in the Non-Executive Directors' Report under
"Composition" and "Board committees";
•
The information concerning the D&I Policy is set out under "The Board––Diversity and inclusion"
and in the Non-Executive Directors' Report under "Diversity and inclusion";
•
The information concerning the inclusion of the information required by the Dutch Decree
on Article 10 of the Takeover Directive is set out under "Dutch Decree on Article 10 of the
Takeover Directive".
Statements of the Board
Risk management statement
Introduction
The Board is responsible for oversight and ensuring that senior management has established
and maintains adequate internal risk management and control systems, and for monitoring the
effectiveness of their design and operation. During the financial year, senior management has had
discussions with the Audit Committee and the external auditor about the effectiveness of the design
and operation of the internal risk management and control systems, and the Audit Committee has in
turn rendered account of this to the Board.
The Board recognizes the inherent limitations of internal risk management and control systems.
Whilst the Company continuously works towards improving its processes and procedures, the
internal risk management and control systems cannot provide assurance or comfort that all risks
have been identified or are effectively managed.
The level of assurance or comfort that can be provided is influenced by, among others, inherent
limitations to risk management, business considerations, such as the Company’s risk appetite, the
complexity of the Company’s operations and the dynamic nature of the business environment in
which the Company operates, and other disclosures on the internal risk management and control
systems as described in the Risk and Risk Management section.
Certain risks remain outside the Company’s direct control as they depend on third parties or external
circumstances beyond the Company’s influence.
The material risks the Company faces as well as the Company’s risk management framework and
risk appetite are described in the Risk and Risk Management section.
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NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Statement
Based on its assessment, and with reference to best practice provision 1.4.3 of the Code, the Board
confirms, to the best of its knowledge, that:
•
the Board report provides sufficient insights into major failings in the effectiveness of the internal
risk management and control systems;
•
the internal risk management and control systems provide reasonable assurance that the
financial reporting does not contain any material inaccuracies;
•
the internal risk management and control systems provide limited assurance that
the sustainability reporting included in the Sustainability Statement does not contain
material inaccuracies;
•
it is not aware that the internal risk management and control systems as at the balance sheet
date do not provide comfort* that the operational and compliance risks identified in the Risk and
Risk Management section are effectively managed considering the Company’s risk appetite;
•
based on the current state of affairs, it is justified that the financial reporting is prepared on a
going concern basis; and
•
the Board report states the material risks associated with the strategy and activities of the
Company and its affiliated enterprise and uncertainties, to the extent that they are relevant to
the expectation of the Company’s continuity for a period of twelve months after the preparation of
the Board report.
*Comfort is to be read as: comfort considering the Company’s risk appetite, the complexity of the
Company’s operations, the dynamic nature of the business environment in which the Company
operates, the inherent limitations to internal risk management and control systems, and other
disclosures on the internal risk management and control systems as described in the Risk and Risk
Management section.
Due to, among others, inherent limitations to internal risk management and control systems, the
above does not imply that the internal risk management and control systems and all processes and
procedures provide assurance or comfort as to the realization of strategic, operational, compliance
and reporting objectives, nor that they can prevent all misstatements, inaccuracies, errors, fraud,
operational issues and/or non-compliance with applicable laws and regulations.
Responsibility statement
In accordance with article 5:25c(2)(c) of the Dutch Financial Supervision Act
(Wet op het financieel
toezicht),
the Board confirms that, to the best of its knowledge:
•
the financial statements 2025 give a true and fair view of the assets, liabilities, financial position
and profit or loss of the Company and the undertakings included in the consolidation as a whole;
•
the Board report provides a true and fair view of the position as at December 31, 2025 and of the
performance of the business during the financial year 2025 of the Company and the undertakings,
details of which have been included in the financial statements 2025; and
•
the Board report includes a description of the material risks that the Company faces.
The Board,
Hilversum, March 26, 2026
Sir Lucian Grainge
Vincent Vallejo
Sherry Lansing
Margaret Frerejean-Taittinger
Cathia Lawson-Hall
Eric Sprunk
Haim Saban
James Mitchell
Luc van Os
Mandy Ginsberg
Nicole Avant
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ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
SHAREHOLDER INFORMATION
Share capital
The authorized share capital of the Company amounts to €27,000,000,000 and is divided into
2,700,000,000 ordinary shares with a nominal value of €10 per Share (the Shares). All Shares are
registered and numbered consecutively from one onwards.
As at December 31, 2025, the issued share capital of the Company amounted to €18,341,817,720
and was divided into 1,834,181,772 Shares, the Company held 214,235 Shares in treasury and no
depositary receipts for Shares were issued with the cooperation of the Company.
All Shares rank
pari passu
with each other. There are no restrictions on the transferability of
the Shares under Dutch law or the Articles nor, as far as the Company is aware, under the
Relationship Agreement.
Relationship Agreement
On September 8, 2021, Vivendi SE, Concerto Investment B.V. (which distributed the Shares held by it
to the investors of the Tencent-led consortium, including affiliates of Tencent Holdings Limited, on
March 26, 2025), Scherzo Investment B.V. (which distributed the Shares held by it to the investors
of the Tencent-led consortium, including affiliates of Tencent Holdings Limited, on March 26, 2025),
Compagnie de l’Odet and Compagnie de Cornouaille (which merged into Bolloré SE on July 17, 2024)
entered into a relationship agreement (the Relationship Agreement), which was co-signed by the
Company for agreement and acknowledgement.
Further details on the Relationship Agreement are set out in the Corporate Governance section under
"The General Meeting––Annual and extraordinary General Meetings––Participation", above under
"Share capital" and below under "Substantial shareholdings" and "Dividend policy".
Substantial shareholdings
Pursuant to the Dutch Financial Supervision Act, Shareholders are required to notify the Dutch
Authority for the Financial Markets (
Autoriteit Financiële Markten
) (the AFM) in the event that they
acquire or lose the disposal of a capital interest and/or voting rights in the Company as a result of
which their percentage of capital interest and/or voting rights in the Company reaches, exceeds or
falls below one of the following thresholds: 3%, 5%, 10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75%
and 95%. The requirement to notify the AFM also applies in the event that their percentage of capital
interest and/or voting rights in the Company passively reaches, exceeds or falls below one of the
thresholds due to a change in the issued share capital of and/or voting rights in the Company.
According to the AFM register, as at December 31, 2025, the following Shareholders had notified the
AFM of a capital interest and/or voting rights in the Company of 3% or more:
Shareholder
Notification date
Capital interest
Voting rights
BlackRock Inc.
December 8, 2025
2.91%
3.35%
GIC Private Limited
May 23, 2025
4.70%
4.70%
Vivendi SE
1
May 21, 2025
13.43%
2
43.38%
2,
3
V. Bolloré
May 21, 2025
18.51%
4
39.90%
3,
4
Tencent Holdings Limited
May 21, 2025
11.45%
5
39.90%
3,
5
W.A. Ackman
March 13, 2025
4.74%
6
4.74%
6
1
Vivendi SE also notified a short position of 3.49%.
2
Of which 3.49% represents a potential capital interest and potential voting rights in the Company as a result of Vivendi SE's entry
into an equity swap.
3
Each of Tencent Holdings Limited, Vivendi SE and V. Bolloré has notified an aggregated percentage of voting rights in the Company
based on a voting agreement included in the Relationship Agreement.
4
Held (in large part) via Compagnie de l'Odet and Bolloré SE.
5
Held via Tencent Mobility Limited and Tencent Music Entertainment Hong Kong Limited.
6
Held (in large part) via various Pershing Square funds.
It is possible that the stated percentages of capital interest and/or voting rights in the Company
differ from the actual percentages of capital interest and/or voting rights in the Company as the
Shareholders may only be required to notify the AFM in the event that their percentage of capital
interest and/or voting rights in the Company reaches, exceeds or falls below one of the thresholds.
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OTHER INFORMATION
APPENDIX
In the Relationship Agreement, the parties have agreed to, among others, consult with one another
prior to each General Meeting in order to form and exercise, to the extent possible, a common view
and vote in respect of the various items on the agenda of the General Meeting related to the dividend
policy as set out under "Dividend policy". Accordingly, the parties are considered to have concluded
a voting agreement and have therefore aggregated their voting rights in the Company as set out in
note 3 to the table above.
Change in control
Each of the Company’s €2 billion revolving credit facility agreement and €1 billion (bridge) term loan
facility agreement and Universal Music Group, Inc.'s €500 million bilateral revolving credit facility
agreement (potentially) entitles each bank to claim early repayment of the amounts borrowed by it
to the Company in the event of a change in control over the Company (as defined in the relevant
revolving credit facility agreement).
In addition, (i) the final terms of the ¥7 billion 2.25% senior notes due September 25, 2035, (ii) the final
terms of the ¥7 billion 1.61% senior notes due July 5, 2038, (iii) the final terms of the €850 million
4.00% senior notes due June 13, 2031, (iv) the final terms of the €800 million 3.75% senior notes due
June 30, 2032, and (v) the final terms of the €500 million 3.00% senior notes due June 30, 2027, each
entitle a holder of a note to require the Company to redeem or, at the Company’s option, purchase
such note at such note’s nominal amount together with (an amount equal to) accrued interest in the
event of a change in control over the Company (as defined in the terms and conditions of the notes).
As set out in the Remuneration Report under ”Severance payments and termination provisions--Sir
Lucian Grainge”, Sir Lucian Grainge is entitled to severance payments in the event of termination
of his employment agreement by Sir Lucian Grainge for good reason, which includes a change
in control (as defined in the Remuneration Report under ”Severance payments and termination
provisions--Sir Lucian Grainge”).
2022 UMG Global Equity Plan
On May 12, 2022, the General Meeting approved the 2022 Universal Music Group Global Equity Plan
(the 2022 UMG Global Equity Plan) as well as the issuance of Shares or the granting of rights to
subscribe for Shares in order to give effect to awards granted under the 2022 UMG Global Equity Plan
to employees of the Company and its subsidiaries and to Executive Directors up to a total amount
of 5% of the issued share capital of the Company as at May 12, 2022 (the Share Pool) and, to the
extent necessary, the exclusion of the statutory pre-emptive right with respect to such Shares or
rights to subscribe for Shares. On May 16, 2024, the General Meeting further approved the issuance
of Shares or the granting of rights to subscribe for Shares in order to give effect to the granting of
a fixed Euro amount of awards to Non-Executive Directors under the remuneration policy for the
Non-Executive Directors from the same Share Pool and for the same five-year period calculated as
from May 12, 2022, and to the extent necessary, the exclusion of the statutory pre-emptive right with
respect to such Shares or rights to subscribe for Shares. The actual number of Shares to be issued
or rights to subscribe for Shares to be granted in order to give effect to awards granted under the
2022 UMG Global Equity Plan is determinable by the Board (or a committee of the Board designated
for such purpose). The 2022 UMG Global Equity Plan is available on the investor relations part of the
UMG website.
The purpose of the 2022 UMG Global Equity Plan is to provide long-term incentives to employees
of the Company and its subsidiaries and to Directors which are linked to value creation for
Shareholders and, where appropriate, the achievement of certain long-term strategic and financial
goals through a variety of awards designed to attract, retain and motivate the best possible
workforce. In addition, the 2022 UMG Global Equity Plan aims to afford employees of the
Company and its subsidiaries and Directors the opportunity to acquire and maintain ownership
of Shares, thereby strengthening and aligning their concern for the interests of the Company and
its stakeholders.
In
Note 24
‘Share-based compensation plans’ to the consolidated financial statements, details of the
various awards are set out.
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FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Dividend policy
The distribution of profits shall be made after the adoption of the financial statements by the
General Meeting from which it appears that the distribution is allowed. The Company may only make
distributions to the extent the shareholders’ equity of the Company exceeds the sum of the paid-up
and called-up part of the share capital of the Company and any reserves that must be maintained
pursuant to Dutch law.
In accordance with the Relationship Agreement, and subject to all applicable laws, the Company
intends to, on an annual basis, pay dividends to all Shareholders, on a
pro rata
basis in two semi-
annual instalments, in the aggregate amount of no less than 50% of the Company’s net profits,
subject to agreed non-cash items, calculated as follows:
•
consolidated net profits of the most recent audited consolidated financial statements as of
December 31 prepared in accordance with EU IFRS;
plus
•
(a) any loss arising on any change in fair value of any intangible assets, tangible assets
or financial assets, (b) any amortization or impairment of intangible assets, (c) share-based
compensation expenses, (d) net losses related to non-consolidated companies consolidated
under the equity method, (e) net losses related to minority interests, (f) net provisions for
inventories and (g) any unrealized loss related to derivative financial instruments;
minus
•
(h) any gain arising on any change in fair value of any intangible assets, tangible assets or
financial assets, (i) any unrealized gain related to derivative financial instruments, (j) income
or reversal related to share-based compensation, (k) net profits related to non-consolidated
companies consolidated under the equity method and (l) net profits related to minority interests.
The Company intends to pay an interim dividend in the fourth quarter of each financial year after
the publication of the semi-annual report, and a final dividend in the second quarter of the following
financial year following adoption of the financial statements by the General Meeting.
On June 13, 2025, the Company paid a final dividend of €0.28 per Share, bringing the total dividend for
the financial year 2024 to €0.52 per Share.
On October 28, 2025, the Company paid an interim dividend of €0.24 per Share, and the Board now
proposes that on June 12, 2026, the Company pays a final dividend of €0.28 per Share, such proposal
to be approved at the annual General Meeting to be held on May 13, 2026. If approved, this would
bring the total dividend for the financial year 2025 to €0.52 per Share.
Capital events
Credit ratings
On May 31, 2022, the Company was assigned a Baa1 long-term credit rating and a Prime-2 short-term
credit rating, with stable outlook, by Moody’s. On May 29, 2024, the Company was assigned a BBB+
long-term credit rating, and on May 31, 2022, the Company was assigned an A-2 short-term credit
rating, with stable outlook, by S&P.
Euro Medium Term Note (EMTN) program
•
On December 15, 2025, the Company issued €40 million of 4.00% senior notes due December
15, 2038,
•
On September 25, 2025, the Company issued ¥7 billion of 2.25% senior notes due September
25, 2035,
•
On June 12, 2025, the Company issued a tap of €100 million of 4.00% senior notes due June
13, 2031,
•
On May 19, 2025, the Company issued a tap of €300 million of 3.75% senior notes due June
30, 2032,
•
On July 5, 2023, the Company issued ¥7 billion of 1.61% senior notes due July 5, 2038,
•
On June 13, 2023, the Company issued €750 million of 4.00% senior notes due June 13, 2031,
•
On June 30, 2022, the Company issued €500 million of 3.75% senior notes due June 30, 2032, and
•
On June 30, 2022, the Company issued €500 million of 3.00% senior notes due June 30, 2027,
under its Euro Medium Term Note program. The notes are admitted to trading on Euronext
Amsterdam. The proceeds have been used for the financing of general corporate purposes, including
the refinancing of indebtedness and payment of transaction fees and expenses.
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FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Negotiable European Commercial Paper (NEU CP) program
On June 30, 2025, the Company extended its Negotiable European Commercial Paper program, the
amount of which was increased from €1 billion to €2 billion in June 2024. The Company uses its
Negotiable European Commercial Paper program for the financing of general corporate purposes.
Investor Relations
UMG is committed to maintaining an open and constructive dialogue with Shareholders (including
potential Shareholders and other investors) and aims to keep Shareholders updated by informing
them clearly, accurately and in a timely manner about its strategy, performance and other matters
and developments that could be relevant to their investment decisions.
Capital Markets Day
The Company held a Capital Markets Day on September 17, 2024 at the Abbey Road Studios in
London. During this event, senior executives from across the Company presented a strategic update
and business outlook, and medium-term financial targets for revenue, subscription revenue and
adjusted EBITDA growth through the end of the financial year 2028 were shared.
Shares
On September 21, 2021, the Shares were admitted to listing and trading on Euronext Amsterdam
(ticker symbol: UMG). The Shares are included in a number of indices, including the AEX, which is a
free float market capitalization weighted index that reflects the performance of the thirty largest and
most actively traded shares listed on Euronext Amsterdam. At year-end 2025, the Company's share
price was €22.23 and its market capitalization was €40.7 billion. The average daily trading volume in
2025 was €40.1 million or 1.9 million Shares.
Share price information
2025
Market capitalization at year-end (€ billion)
40.7
Lowest closing price (December 8, 2025, €)
21.20
Highest closing price (February 14, 2025, €)
28.89
Closing price year-end (€)
22.23
Total shareholder return
-8.0%
Average daily trading volume on Euronext Amsterdam (shares)
1.9 million
January 2025
March
June
September
December
30
25
20
15
10
5
0
Per share data
2025
Dividend (€): 0.24 interim + 0.28 proposed final
0.52
EPS - basic (€)
0.84
EPS - diluted (€)
0.83
Adjusted EPS - basic (€)
1.04
Adjusted EPS - diluted (€)
1.03
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BOARD REPORT
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OTHER INFORMATION
APPENDIX
Contact
Further information on UMG is available from the Investor Relations department, which can be
reached by email:
. Further shareholder information is available on
the investor relations part of the UMG website:
https://investors.universalmusic.com
.
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NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
RISK AND RISK MANAGEMENT
UMG has a diverse portfolio of brands, music labels, artists, established (predictable) and developing
businesses, all spread across different geographies and business structures. Whilst this level of
diversification generally spreads risk across our business, it is critically important that the Company
manages risks in a proactive and responsible way to ensure we can deliver on our multi-faceted
growth strategies.
The Company’s risk management is designed to provide comfort that strategic and operational
objectives are met, legal requirements are complied with, and a level of assurance that the integrity
of the Company’s financial reporting and related disclosures is safeguarded. The material risks are
described in Risk Factors.
Risk appetite
The Board and management seek to manage risks consistently within the risk appetite. UMG’s risk
appetite differs depending on the type of risk, ranging from averse to a seeking approach. We believe
we must operate within the dynamics of the music industry and take risks needed to ensure we
continually revitalize our offerings for our artists and the way we work. At the same time, UMG
attaches prime importance to integrity, sustainability and compliance with laws and regulations.
Risk appetite for the four main risk categories is visualized below.
UMG does not classify these risks in order of importance.
Risk appetite
very low
low
medium
high
very high
Behavior towards risk
Averse
Prudent
Balanced
Considerable
Seeking
Strategic
e.g. Competition, streaming &
subscription adoption, reliance
on DSP’s, piracy
Operational
e.g. Attract & retain talent,
cybersecurity, geopolitical Instability
& economic downturn
Financial
e.g. Access to financing, change in
tax laws
Compliance
(Laws & Regulations)
e.g. Intellectual Property, data
protection, government regulations
Governance, Risk and Compliance
The Company has an Internal Control Framework (ICF) modelled upon the COSO (Committee of
Sponsoring of the Treadway Commission) 2013 framework. The ICF incorporates risk assessment,
control activities and monitoring into our business practices at entity wide and functional levels.
For the organization of risk management and internal control systems, we have adopted a ‘Three
lines’ model (see chart below) to provide assurance and comfort that risks to achieving important
objectives are identified and managed in line with the Company's risk appetite. We recognize
the inherent limitations of internal risk management and control systems. Whilst the Company
continuously works towards improving its processes and procedures, the internal risk management
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OTHER INFORMATION
APPENDIX
and control systems cannot provide assurance or comfort that all risks have been identified or are
effectively managed.
To enhance and coordinate risk management across the company, a Governance, Risk and
Compliance working group was established in 2022 and has continued to meet periodically since
inception to review and monitor UMG's risk and control environment.
FIRST LINE
Management
ROLE
Own and manage risk
SECOND LINE
Controls Assurance,
Compliance and other
specialized functions
ROLE
Independent monitoring
of controls, challenge
business
AUDIT COMMITTEE
THIRD LINE
Internal Audit
ROLE
Provide independent
assurance
BOARD OF DIRECTORS
CORPORATE MANAGEMENT
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OTHER INFORMATION
APPENDIX
Monitoring of our Risk Management and Internal Control Systems
In order to meet business needs and the requirements of the 2025 Dutch Corporate Governance
Code, including the newly introduced Statement on Risk Management (Verklaring Omtrent Risico
Beheersing) which is included on page 78 of this Annual Report, the Company has continued to
evolve the monitoring of its risk management and internal control systems.
The below summarizes key examples of how the Company has organized monitoring:
Area of Risk
Monitoring
Financial Reporting
The Company has a Group-wide management certification process in place, which requires that the designated executive management team member at each of the reporting entities send attestation
letters on a periodic basis to both the Corporate Financial Reporting Group (quarterly) and the Controls Assurance Function (semi-annually). In summary, these letters confirm (i) whether the reporting
entities have incorporated the ICF in local control policies and procedures and (ii) where deficiencies, non-adherence or breaches to the controls and/or procedures were found, that these have been
reported and (iii) that the necessary remedial action has been undertaken to ensure that the internal control systems remain effective.
All our businesses are required to maintain and manage a sound internal control environment with robust policies, procedures and controls and strong financial discipline.
The Controls Assurance function monitors the ICF through controls testing and other monitoring activities. Internal Audit undertakes regular risk-based audits that from time to time include financial
reporting topics.
Sustainability Reporting
UMG maintains formal quality controls over our sustainability reporting. For all quantitative sustainability disclosures, UMG uses a global data collection and consolidation platform for environmental and
social demographics reporting. The platform is designed to include mathematical coherency, checks for data consistency, and flags any potentially abnormal variation during the data input process.
Each UMG reporting entity conducts an initial validation and consistency check of their submission of quantitative sustainability data. The ESG team performs a second coherency check and validation
during the consolidation process. The ESG team also conducts a trend analysis, validates the results of this analysis with business unit leaders, and evaluates and documents explanations for variances.
For all qualitative sustainability disclosures, UMG maintains a centralized database for gathering, reviewing, and verifying information.
The Controls Assurance functions performs limited review procedures to monitor elements of the quantitative data reporting process referred to above.
For more information, see “Risk management and internal controls over sustainability reporting (Gov-5)” in the Sustainability Statement.
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OTHER INFORMATION
APPENDIX
Area of Risk
Monitoring
Operational
and Compliance
The Company uses a comprehensive business planning and performance review process to monitor the Company’s performance. This process covers the adoption of strategy, budgeting and the reporting
of current and projected results of operation. The company assesses business performance according to both financial and non-financial (including sustainability) targets.
Internal Audit conducts a company-wide risk assessment on at least an annual basis that includes strategic, operational, financial and compliance risks. The results of this risk assessment are reviewed
and discussed with members of senior management and are reported to the Audit Committee of the Board on an annual basis.
Internal Audit also undertakes regular risk-based audits that from time to time include operational and compliance topics.
Continuous ICF Improvements
Management continues to invest in the further improvement of the risk and internal control systems
in the Company. Through upgrading its systems (including computer hardware infrastructure),
optimizing financial and management controls as well as enhancing reporting systems and
procedures. Management will continue to make further improvements in 2026, which will be aimed
at, amongst other things:
•
Continuing to optimize the risk and control framework related to cybersecurity.
•
Deploying initiatives aimed at standardizing and automating processes and controls.
•
Optimizing the level of monitoring of the risk and control systems, including enterprise risk
management and a coordinated risk assurance process.
•
Continuing to improve the quality and in particular the level of documentation of key controls
across primary business processes.
Compliance and Integrity
As the world’s leading music company, UMG recognizes that we have a responsibility to lead by
example and ensure that all of our actions and decisions are based on honesty and integrity.
UMG’s global Code of Conduct sets our foundation that how we conduct business is as important
as our results. The Code of Conduct outlines the key responsibilities for all our employees, officers,
members of the board of directors, and (where permitted) third party consultants and advisors or
representatives and requires:
•
Honesty in all of our actions and decisions.
•
Treating everyone with respect.
•
Following the law and UMG policies when conducting company business.
•
Seeking guidance when we are not certain about the right thing to do.
•
Speaking up when we see a problem.
We meet these requirements by focusing on four key principles:
1.
SETTING THE RIGHT TONE WITH OUR PEOPLE
by valuing a diverse workforce; promoting a
respectful, safe and healthy workplace; and by protecting human rights.
2.
SETTING THE RIGHT TONE FOR OUR COMPANY
by properly disclosing or avoiding any conflicts of
interests and monitoring the receipt of gifts.
3.
SETTING THE RIGHT TONE IN THE MARKETPLACE
by following laws and regulations related to
bribery and corruption; marketing and advertising; fair purchase practices and international
trade regulations.
4.
SETTING THE RIGHT TONE IN OUR COMMUNITIES
by protecting the environment and contributing
to our communities.
The Code of Conduct provides all employees a road map of how to make ethical choices and how
to comply with our legal and regulatory obligations. Most importantly, it provides guidance on when
and where to seek guidance or to report a potential compliance breach. All UMG employees are
trained on the Code of Conduct annually and must certify compliance with the Code of Conduct
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OTHER INFORMATION
APPENDIX
on an annual basis. The Code of Conduct is available in the investor relations section of UMG’s
public website.
Our compliance obligations are overseen by our Compliance department as well as our Control
Assurance department, Internal Audit department and our Finance department. An internal control
framework, including policies, procedures and financial discipline underpins our risk management.
Corruption and Bribery
UMG is committed to complying with all applicable laws in each of the countries in which we operate,
including compliance with laws relating to anti-corruption and bribery. UMG does not tolerate any
form of corruption or bribery within its organization. Non-compliance with laws and regulations,
including anti-corruption, bribery and related laws could expose the Group to legal liability and
may negatively impact the Company’s reputation, financial position, results of operations and/or
prospects. These risks may manifest themselves in interactions with government bodies and
trade associations.
The Company has implemented a number of measures to counter the aforementioned risks. UMG’s
stance against, and prohibition of, corruption and bribery is covered not only in its Code of Conduct
but also in its global stand- alone anti-corruption and lobbying policy, which applies globally to
all of UMG’s employees and its directors. In addition to the annual Code of Conduct training, all
employees in all UMG territories are periodically expected to complete training specifically on the
topic of anti-corruption.
UMG’s anti-corruption compliance program provides risk mitigation guidance on matters including,
but not limited to: interactions with government officials; conflicts of interest; political contributions/
lobbying activities/charitable giving; gifts/travel and entertainment; and proper maintenance of
books and records. Employees are offered a multitude of ways to raise any concerns of anti-
corruption and bribery, including dedicated reporting channels for conflicts of interest and gifts/
hospitality, in addition to the option to use UMG’s dedicated whistleblower reporting line or by
making direct reports to supervisors, the General Counsel, or the Chief Compliance Officer.
Where relevant, UMG will take appropriate action in response to any allegations or reports of
misconduct, including investigations, disciplinary action and/or criminal or civil procedures. The
compliance department and internal audit department regularly monitor the effectiveness of the
company’s anti- corruption and bribery compliance program. UMG has a dedicated ethics committee
to ensure compliance with the Code. The Chief Compliance Officer provides regular reports to
the ethics committee of any material potential violations of the Code, including anti-corruption
and bribery, the status of any investigations, and the outcome of any investigations. The ethics
committee and the internal audit department will further notify the audit committee of the Board and
the Board, itself, as required, depending on the circumstances of the potential violation.
Fraud Risk
The Company maintains a global fraud risk register that summarizes risks and compensating
measures. The global fraud risk assessment is an annual process and was performed in the last
quarter of 2025.
The Company’s stance with regard to integrity is clearly outlined in its Code of Conduct, as also
explained in this Risk Management chapter. Any incidents of fraud and theft within the Company
will be promptly investigated, reported and, where appropriate, lead to disciplinary actions (from
warnings to immediate terminations). In addition, we carry out in-depth investigations of (possible)
fraud cases, which may lead to an intermediate update of the fraud risk assessment.
Whistleblowing Policy and Reporting
UMG’s Code of Conduct and our standalone Whistleblowing Policy (which can also be found in the
investor relations section of UMG’s public website:
https://investors.universalmusic.com/governance
)
provide numerous options for employees to seek guidance and report potential breaches of the
Code of Conduct, including contacting the company’s Chief Compliance Officer or General Counsel
directly. Additionally, UMG provides a global reporting line through a third-party provider. The global
compliance and ethics hotline is available 24 hours a day, seven days a week via telephone or
the internet. Reports can be made in all the languages in which we do business and may be
made anonymously in those jurisdictions which permit anonymous reporting. The whistleblower
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hotline is available not only to UMG employees but third parties as well. Reports are maintained as
confidentially as possible (or fully confidentially as may be required by law) and are investigated.
The Compliance Department also maintains and monitors email boxes dedicated to reporting
potential conflicts of interest.
In 2025, there were no substantiated reports of significant financial reporting, accounting, fraud or
ethical (including human rights) violations.
Prohibition Against Retaliation
In order to encourage reporting of potential breaches of the Code of Conduct or other company
policies, we prohibit retaliation of any kind against anyone who makes a complaint or report of a
potential violation of law or policy in good faith. Engaging in retaliation is itself a violation of our Code
and may result in disciplinary action, up to and including termination of employment.
Risk factors
UMG’s business, and the industry in which it operates, are subject to a number of risks. UMG believes
that the risk factors as set out below, are the key risks and uncertainties concerning UMG’s business
and industry, and that, alone or in combination with other events or circumstances, could have a
material adverse effect on UMG’s business, results and financial position.
In making this selection, UMG has considered circumstances such as the probability of the
risk materializing on the basis of the current state of affairs, the potential impact which the
materialization of the risk could have on the Group’s business, results and financial position, and
the attention that management would, on the basis of current expectations, have to devote to these
risks if they were to materialize.
While UMG believes that the risks and uncertainties described below are the key material risks and
uncertainties concerning its business and industry, they are not the only risks and uncertainties
relating to UMG.
Other risks, events, facts or circumstances not presently known to UMG, or that UMG currently
deems to be immaterial could, individually or cumulatively, prove to be important and may have
a significant negative impact on its business, results and financial position.
The risks have been divided into categories; however, some risk factors appear in more than
one category.
Risk
Likelihood
Impact
Challenge to attract, sign and retain successful artists a in a highly
competitive and evolving industry
High
Moderate
Decline in streaming revenue, subscription adoption and digital market share
Moderate
Moderate
Digital service provider dependency
Moderate
Moderate
Competition in evolving markets
High
Moderate
Inability to timely adapt to trends and developments in the markets in which
UMG operates
Moderate
Low
Content protection and piracy
High
High
Generative AI
High
High
Challenge to attract and retain internal talent
Moderate
Moderate
Cybersecurity
High
High
Changes in global economic and financial conditions
High
Moderate
Geopolitical Instability
High
Moderate
Dependency on information technology systems
Moderate
Moderate
Restructuring and reorganization
Moderate
Moderate
Acquisitions and other investments
Low
Moderate
Access to and cost of financing
Low
Low
Currency fluctuations
Moderate
Low
Changes in tax laws
Moderate
Moderate
Loss of intellectual property rights
Low
High
Data protection compliance
Moderate
High
Governmental and regulatory challenges
High
Moderate
Changes in laws and regulations
Moderate
High
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For each of the risks set out below, UMG has indicated examples of the programs, processes and
controls which are designed to help manage and mitigate the risks. These risk responses are
designed to manage risks towards, and should be read in conjunction with, the Risk Appetite as
described above.
It is however possible that these initiatives may not be successful in limiting fully or partly the
occurrence and impact of the risks on UMG's business, results and financial position.
Strategic risks
Challenge to attract, sign and retain successful artists in a highly competitive and
evolving industry.
UMG may be unable to compete successfully in the highly competitive industry and markets in
which it operates and UMG’s business may be adversely affected if UMG fails to identify, attract, sign
and retain successful recording artists and songwriters or by the absence of superstar releases.
The industry in which UMG operates is highly competitive, influenced by consumer preferences
and rapidly evolving. UMG’s competitive position is dependent on identifying, attracting, signing and
retaining recording artists and songwriters who are or will become commercially successful, who
have long-term potential, whose music is well received, whose subsequent music is demanded by
consumers and whose music will continue to generate sales as part of its catalog for years to come.
UMG uses external sources of data provided by streaming platforms or other external providers.
Limitations to access of such data could adversely impact UMG’s capability of identifying future
talents and therefore negatively affect its business. While UMG is required to devote significant
time and investment to signing, retaining and developing artists, the returns on these activities
are influenced by a number of factors, including factors outside of the control of UMG, and are
uncertain at the time of investment. To the extent that the expected returns from these activities
fail to materialize or are not in line with expectations, this may negatively impact UMG’s results and
financial position.
UMG’s competitors may become more successful at signing, marketing and promoting recording
artists, for example if UMG’s competitors increase the amounts they spend to discover, or to market
and promote, recording artists and songwriters or reduce the prices of their music in an effort to
expand market share, which may adversely impact UMG’s business, results and financial position.
UMG also faces competition from traditional music industry players as well as new entrants,
including investment funds whose investment thesis includes making acquisitions of collections
of musical compositions, or "catalog acquisitions". UMG also competes with other forms of
entertainment including new forms of entertainment and leisure activities.
UMG’s recorded music business is to a large extent dependent on rapid and significant technological
developments in order to remain competitive, including access to, selection and viability of new
technologies, and UMG’s recorded music business is subject to potential pressure from competitors
as a result of technological developments modifying the nature of UMG’s competition.
In addition, changing business practices, particularly due to the emergence of new technologies and
access to a global network of consumers, has and could further result in artists choosing to make
content available to consumers directly without being affiliated with a label or an intermediary, or
could result in music services playing some of the roles that UMG has traditionally played. In this
regard, UMG also competes with certain of the music distribution platforms who distribute the works
of artists and songwriters without the involvement of labels or intermediaries.
Adapting to, and competing with, rapid technological developments require substantial investment
of time and resources; however, such investment does not guarantee UMG’s success in developing,
implementing, transitioning to, competing with, utilizing or defending against new technology. Any
failure by UMG to accurately anticipate customers’ changing needs and emerging technological
trends could significantly harm UMG’s competitive position and results of operations.
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Risk response
With regard to the development of recording artists and songwriters, UMG believes that traditional,
high-touch, full-service label deals with its portfolio of world- renowned labels provide the most
long-term value to an artist and greatly increase the commercial success, consumer base and
longevity potential for artists at every stage of their careers. These deals provide for the full suite of
professional expertise and global resources of a major label, including a comprehensive approach
to content creation, organic artist development, timing, marketing, promotion, financial investment,
and forward planning.
UMG is pioneering partnerships with new platforms, continuing the decades-long fight for copyright
protections all around the world while combatting piracy in its many forms and creating commercial
environments for artists in countries where commerce in music was basically non-existent; UMG
continues investing in the next generation of creative leaders.
UMG has consistently demonstrated the value it represents to an artist’s success. Producing and
marketing music successfully requires significant upfront investment and involves collaborating
with the best writers and producers. UMG invests more money and expertise through its staff of
industry specialists than any other recorded music company in signing and developing talent.
Combining these investments and expertise with UMG’s excellence in marketing and in promoting
artists globally enables UMG to consistently lead the industry in breaking artists.
UMG’s diverse range of artists and labels helps the business consistently cater to changing
consumer trends. As a result of having such a broad array of artists and labels, UMG is not reliant on
one artist, or on a small number of artists, to generate revenue in any given year.
Decline in subscription adoption, streaming revenue and digital market share
If subscription adoption and streaming revenue or UMG’s digital market share fail to grow or grow
less rapidly than UMG anticipates, UMG's business may be adversely affected.
Revenues from subscription music services are important to UMG because they offset declines in
downloads and physical sales and represent a growing area of UMG's recorded music business. For
the year ended December 31, 2025, UMG generated €6,319 million of subscription and streaming
revenues, representing an increase of €281 million, or 4.7%, as compared to €6,038 for the year ended
December 31, 2024.
Consumption formats in the music industry are susceptible to technological advancements and
changing consumer preferences around how music is accessed, as illustrated in recent years by
the global decline in revenue derived from CD sales, and subsequently downloads, as subscription
music services and ad-supported streaming revenue increased. In addition, consumption in
streaming has started to shift from better monetized video platforms to short-form platforms,
according to IFPI Global Music Report 2024, which are not yet as well monetized. Technological
developments and other factors may, in the future, negatively impact streaming or otherwise disrupt
the music industry.
Large quantities of uploads with no meaningful engagement, including non-artist noise content
delivered daily to digital platforms (including via the use of generative AI), or misattribution
increase the challenges for marketing music to fans and policing infringements. Additionally,
technology around streaming manipulation, fraud and hacking is becoming increasingly refined
and subscription streaming services are vulnerable to such advancements which could undermine
consumer confidence and cause revenue loss.
Although UMG believes UMG's strategic initiatives, Artist-Centric Phase 2 and Streaming 2.0, will
offer new opportunities for future growth in paid streaming by providing for new paid subscription
tiers which UMG believes will increase UMG's revenue by maximizing customer value while also
continuing to grow UMG's subscription base, UMG may be unable to advance these initiatives with
UMG's partners. As subscription growth has slowed in established markets, UMG is focused on
subscriber growth potential in lower average revenue per user ("ARPU") markets. If, as a result, UMG’s
subscription or streaming revenue fail to grow, grow less rapidly than it has over the past several
years or declines, UMG’s recorded music business may experience reduced levels of revenue and
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operating income. Additionally, slower growth in streaming adoption or revenue is also likely to have
a negative impact on UMG’s music publishing business, which generates a significant portion of its
revenue from sales and other uses of recorded music.
The recorded music business also faces competition for consumer attention from other forms of
entertainment and leisure activities, such as cable and satellite television, on-demand television,
motion pictures, podcasts and video games and user-generated content in physical and digital
formats. UMG may face competition in the future from the development of any number of new
forms of entertainment and leisure activities. Streaming revenue and/or subscription adoption could
decline if UMG's recorded music business unsuccessfully competes against other existing or new
forms of entertainment and leisure activities or produces and distributes audio and audiovisual
recordings without broad consumer appeal. Any such decline in streaming adoption or revenue
could adversely impact UMG's business, results of operations, financial condition and prospects.
Risk response
UMG continues to actively and successfully work with existing and new streaming and subscription
partners (global, regional and local) to develop existing and create new revenue streams. UMG also
spearheaded the re-imagining of the subscription streaming model, encouraging digital partners to
tackle streaming manipulation and fraud, and to evolve the revenue model to reward real artists
that drive engagement and retention on streaming platforms. UMG plays an active role in promoting
the continued development of new digital services and consumer offerings in order to support a
competitive, healthy and increasingly global market, as well as in developing and growing new
categories for exploitation of digital music, including fitness and wellness. UMG has agreements
with several hundred global, regional and local digital service providers around the world, growing
legal consumption of music and legitimate commercial outlets in markets with high levels of
piracy, including the high-growth countries Brazil, India, China, Latin America, Africa, the Middle
East, Eastern Europe and Southeast Asia. These services have made music more accessible to fans,
offering a free-to-use option for consumers as an alternative to pirated content, with additional
upsell opportunities created.
The result of UMG’s leadership position, as well as its willingness to embrace new business
partners and spearhead the development of new business models around the world, has resulted
in an expanded market for music consumption and monetization, benefiting artists, fans, platform
partners and music companies. We executed our first major Streaming 2.0 deal in late 2024 when we
expanded our global partnership with Amazon, implementing artist centric initiatives, advancing Al
and fraud protections and promoting revenue growth. In 2025, we signed new multi-year agreements
with Spotify and YouTube platforms covering recorded music and music publishing that also
embrace our Streaming 2.0 framework. These agreements provide for new paid-subscription tiers,
the bundling of music and non-music content, and a richer audio and visual content catalog that we
believe will benefit artists, songwriters, platforms and consumers alike.
Digital service provider dependency
UMG relies on digital service providers for the online distribution and marketing of its music on the
basis of contractual terms that are subject to change.
UMG derives an increasing portion of its revenue from the licensing and distribution of music
through digital distribution channels and partners with several hundred music services around the
world. For the year ended December 31, 2025, the top 50 music services accounted for 97% of UMG’s
recorded music digital revenue, as compared to 98% for the year ended December 31, 2024. For
the year ended December 31, 2025, 70% of UMG’s recorded music revenue was derived from digital
channels, as compared to 70% for the year ended December 31, 2024.
UMG typically enters into relatively short-term agreements with digital music streaming services.
There can be no assurance that UMG will be able to renew agreements on the same terms or enter
into new agreements with any digital music service. The terms of these digital service provider
agreements, including the rates that UMG receives pursuant to them and the basis for calculation
of those rates, may change as a result of changes in the industry, changes in the law or for
other reasons. Decreases in rates or changes to other terms of agreements with digital music
streaming services could adversely impact UMG’s business, results of operations, financial condition
and prospects.
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Discovery of UMG’s music by users of digital music services is heavily influenced through playlists
curated by such services or generated via their algorithms (or a combination of both). Any
unfavorable changes made by such service providers to their algorithms or to the terms on which
they market or promote UMG’s music could adversely affect UMG’s business, results of operations,
financial condition, and prospects.
Risk response
While a number of digital service providers compete with each other in the music industry around
the world, they all seek to work closely with UMG, the largest supplier of content to all of the digital
service providers. This is because UMG’s artist content is a key driver of customer acquisition and
retention for all of these platforms. UMG’s world-renowned catalog, which is continuously growing
through UMG’s proven ability to develop and break new artists, makes UMG an important partner
for platforms. The introduction of new products, services and revenue streams across segments
spanning voice, fitness, wellness, social media, gaming, live streaming, brand partnerships, start-
ups and other categories helps to further mitigate the reliance on a limited number of digital
service providers. For example, we have partnerships that enable UMG’s content to be distributed
by global, regional and local DSPs, including Spotify, Apple, YouTube, Amazon, Deezer, Tencent Music
Entertainment and NetEase, among an increasingly important number of other partners. We also
generate revenues from social media and shortform video platform partners ranging from Meta,
YouTube and TikTok to digital fitness partners such as Peloton and Apple Fitness+ and gaming
platforms, among other emerging digital platforms.
Competition in evolving markets
UMG may be unable to compete successfully in the evolving markets in which it operates or unable
to execute its business strategy.
UMG's markets are constantly and rapidly evolving. UMG expects to increase revenues and cash flow
through a business strategy which requires, among other things, continuing to maximize the long-
term value of its music by expanding the licensing partners with which UMG works. UMG’s strategy
also includes continued diversification of its revenue streams by partnering with an increasing
array of new businesses that benefit from the use of music content to engage consumers, including
new digital platforms such as fitness and video games, and through business arrangements with
non-traditional partners, including social media platforms.
UMG has also in the past completed and, as part of its business strategy, will continue, from time
to time, to grow revenues and cash flow through strategic transactions, including acquisition(s)
of business(es) in high potential markets, other acquisitions, combinations or dispositions of
businesses or assets, or strategic alliances or joint ventures with companies engaged in music
entertainment, investing or other businesses. See "Where UMG acquires, combines with or invests
in other businesses or joint ventures, UMG will face risks inherent in such transactions” for more
information on perceived risks associated with acquisitions as well as UMG’s risk response.
UMG may incur significant costs deploying its business strategy, and there can be no assurance that
UMG will be capable of executing or furthering its business plans during economic downturns, and
UMG may not be able to recoup investments it has made in developing its business activities. UMG
faces competition from traditional music industry players as well as new entrants and may not
be able to execute its business strategy because of a failure to promote innovative products
and/or to keep pace with market evolutions and, as a result, may lose market share to existing or
new competitors.
Furthermore, the success of UMG’s initiatives relies on adequate third-party support and requires
UMG to accurately anticipate, forecast and keep up with technological developments and consumer
preferences relating to platforms and may require UMG to implement new business models or adapt
to new distribution platforms. If UMG is unable to implement its strategy successfully or properly
react to changes in consumer preference, then its financial condition, results of operations and cash
flows could be adversely affected.
Risk response
UMG is a key promoter of innovation across the digital ecosystem through partnerships in new
product categories and through proactive efforts to cause its partners to evolve and innovate.
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UMG maximizes opportunities to introduce new products, services and revenue streams in
various segments spanning voice, fitness, wellness, social media gaming, live streaming, brand
partnerships, start-ups and other categories. As discussed above, UMG also spearheaded the re-
imagining of the subscription streaming model.
Inability to timely adapt to trends and developments in the many markets in which
UMG operates
UMG operates in many jurisdictions around the world and therefore is subject to a variety of
trends, developments, legal and regulatory requirements and other limitations and risks in those
jurisdictions, which could affect it adversely.
UMG has offices engaged in recorded music, music publishing, merchandising and audiovisual
content in nearly 60 territories around the world. UMG’s local presences around the world have
become increasingly important as the popularity of music originating from a country’s own language
and culture is very significant, and more countries around the world have developed legitimate
business models to monetize music. In addition, UMG’s business model is increasingly focused
on developing business in new high-potential music markets. In 2025, UMG strengthened its
global presence through new activities, acquisitions, label launches and key partnerships in Africa,
Thailand and India, among other high-potential music markets. However, if UMG’s music does
not continue to have appeal in various countries, UMG’s results of operations could be adversely
impacted and its investments in new jurisdictions could fail to generate returns for UMG in line
with expectations. Additionally, UMG may not be successful in identifying and signing the most
promising artists in these markets, which may negatively impact UMG’s competitive position in
these geographies, its prospects and its ability to generate returns in these markets.
In countries in which UMG currently conducts, or may in the future conduct, its businesses,
UMG’s operations, growth strategy and development may be negatively impacted as a result of less
developed digital, internet and mobile network infrastructure. UMG’s success, particularly streaming
revenues, depend on the continued development and use of internet by consumers to access
music as well as increasing high-speed internet and smartphone penetration. If internet access or
smartphone penetration in these markets develops slower than expected, or is stalled, UMG’s growth
strategy could be adversely affected.
Further, depending on the customs and norms in various markets, UMG’s presence in and
generation of revenues from other countries may require UMG to accept longer accounts receivable
settlement cycles and may subject UMG to difficulties in collecting its accounts receivables. In
addition, the revenues UMG generates from other countries and in other currencies may be subject
to capital or currency control measures, which could delay or impair UMG’s ability to access or remit
such revenues.
Risk response
UMG is committed to shaping culture through artistry and is responsive to the needs and ambitions
of local talent. In 2025, 63% of UMG’s physical & digital recorded music revenues came from local
repertoires in their own countries, as compared to 62% in 2024. Prior to entering a new market, UMG
teams carefully identify areas of risk and develop a business case and strategic plan.
Content protection and piracy
Piracy continues to adversely impact UMG’s business and content protection is a key focus of
UMG’s business.
Technological advances and the conversion of music into digital formats have made it easy to
create, transmit and distribute high-quality unauthorized copies of music in a manner that does not
provide an economic return for UMG or its artists and songwriters.
Streaming fraud involves the creation of artificial ‘plays’ on digital music streaming services that do
not represent genuine listening. This activity constitutes fraud and damages the fan experience,
distorting charts and playlists. The impact of streaming fraud and piracy on legitimate music
revenues and subscriptions is hard to quantify, but UMG believes that illegal file sharing and
other forms of unauthorized activity, including stream manipulation and misattribution, have a
substantial negative impact on music revenues.
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If UMG is not successful in its content protection efforts, its business, results of operations, financial
condition and prospects may suffer.
Risk response
UMG invests significant resources in combatting the many forms of piracy of its music
including through litigation, lobbying and interdiction. UMG also encourages its digital partners to
support UMG’s content protection efforts by taking direct action against unauthorized activity on
their platforms.
Generative AI
Generative AI poses challenges to UMG's intellectual property rights and use of generative AI could
adversely affect UMG's business, financial condition, results of operations and prospects.
UMG believes that AI can be used to enhance human creativity in music and related commercial
opportunities. However, new technology for the production of AI-generated content, including sound,
text and images has introduced new challenges for the protection of intellectual property and
creator rights.
The unauthorised reproduction of copyrighted works, including music and lyrics, to train AI
technology for the production of AI-generated content infringes intellectual property rights and
embodies unauthorised and/or fraudulent renditions of artist voices, images and likenesses. Such
infringing AI-generated content, unlicensed training on UMG’s catalogues of copyright-protected
artists content, and fraud could create vast quantities of works that include content and consumer
engagement products improperly associated with artists and targeted at their fan bases. In addition,
large-scale use of legitimately produced AI generated music could also create vast quantities of
new musical works. Any of the foregoing may compete with consumption of, and dilute engagement
with, UMG’s copyright-protected material on digital music services, including royalty pool dilution
as well as undermine other licensing opportunities for UMG’s works, which could adversely affect
UMG’s results.
Furthermore, policymakers in many countries are considering new laws or changes to existing legal
and regulatory frameworks within which AI technologies operate, and it is impossible to predict the
full extent of current or future risks related thereto. New legislation or changes to existing legislation
and regulatory frameworks might adversely impact UMG’s ability to protect and/or license UMG’s
copyright-protected material in relation to AI thereby potentially impacting UMG’s revenue. As an
example of new AI legislation, the EU Artificial Intelligence Act (the EU AI Act) entered into force in
August 2024, with most of its obligations applying in phases from six to thirty-six months thereafter.
The EU AI Act as enacted includes significant requirements on both the providers and deployers of AI
technologies, and significant sanctions for breaches.
Laws and regulations related to AI technologies and UMG’s use of them may impose on UMG
significant obligations and costs related to monitoring and compliance. Moreover, claims for
damages in respect of AI technologies may also be possible. The costs of preparing for, monitoring
and complying with laws and regulations related to AI technologies, and any claims or penalties
as the result of any use of or reliance on AI technologies, could, if applicable, adversely affect UMG
and/or third parties connected to UMG (whether directly or indirectly), which could have an adverse
effect on UMG’s business.
In addition, the adoption and integration of generative AI technologies throughout UMG’s
organization—and by third parties with whom UMG collaborates—present a number of evolving
and interrelated risks that, individually or in the aggregate, could materially and adversely affect
UMG’s business, financial condition, results of operations and prospects. The adoption of AI-powered
products and services may draw greater scrutiny or generate negative reactions from fans or artists,
potentially leading to reduced engagement, reputational harm or loss of business opportunities.
UMG may also miss business opportunities because certain AI-generated products may primarily
depend on an artist’s name, image and likeness (NIL) or merchandise rights that would have
historically been areas where UMG would have contracted with artists. UMG’s rights in NIL and
merchandising are not as robust as they are in recorded music, and there is a risk that artists will
work with third parties using AI to monetise those rights rather than through UMG.
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As AI technologies and related regulations continue to evolve, new risks may emerge, and UMG’s
mitigation strategies may need to be updated accordingly. Failure to effectively manage these risks
could have a material adverse effect on UMG’s business, financial condition, results of operations
and prospects.
Risk response
We believe that Al will never replace human creativity because it will always lack the essential
spark that drives the most talented artists to do their best work. Forging a path on behalf of and
in collaboration with the entire music community will help enable us to empower this technology
responsibly to the benefit of the entire creative ecosystem.
UMG has developed a strategy that carefully choreographs offense and defense while placing artists’
interests at the center of the conversation. UMG has been exploring the opportunities emerging from
this technology for years, applying AI for advances in data analytics, marketing tools, enhanced
studio and audio production, while working to protect the long-term value of artistic content. Over
the past several years, UMG has put in place strategic AI-related agreements with established
platforms such as YouTube, KDDI and NVIDIA, as well as with emerging AI entrepreneurs such as
Udio, BandLab, ProRata, Soundlabs, KLAY Vision, Splice and Stability AI. UMG has also articulated
the importance of establishing effective tools, incentives and rewards that enable us to limit
AI’s potential downside while promoting its promising upside. UMG supports the Human Artistry
Campaign (‘HAC’) and its principles – the HAC is a global initiative formed in early 2023 to protect
creators’ rights in the age of AI, with more than 170 supporting organizations from 40+ countries. We
have also partnered with SoundPatrol Inc., a research lab for large music models on a first-of-a-kind
collaboration to protect artists from the unchecked copyright infringement activity coming from AI
music generators.
In addition to responsible and ethical AI industry collaborations and thought leadership, UMG
is pursuing the establishment of legislative and regulatory “guardrails” for AI, including backing
legislation that, if enacted, would establish a federal right of publicity in the United States to
help protect Americans’ image, likeness and voice – and helping to prevent deepfakes. UMG is
vigorously advocating for public policies furthering Responsible AI with governments around the
globe, including through multi-stakeholder coalitions and trade bodies, as well as on its own.
In addition, UMG is protecting creators’ rights in the AI environment through litigation. For
example, UMPG, alongside two other music publishers, filed a copyright infringement lawsuit against
Anthropic for its large-scale, wholesale copying of copyrighted lyrics.
Operational risks
Challenge to attract and retain internal talent
UMG’s ability to operate effectively could be impaired if it fails to attract and retain its executive
officers and other key personnel.
UMG’s success depends, in part, upon the continuing contributions of its executive officers and
key operational and creative personnel, led by its Chairman and Chief Executive Officer, Sir Lucian
Grainge. These executive officers and key personnel possess significant experience within the music
industry, and their established personal connections and relationships in the music industry are
important to the UMG’s operations. UMG competes with other music and entertainment companies,
record labels, DSPs, technology companies and other companies for top talent, including executive
officers and other key personnel.
If UMG were to unexpectedly lose a member of its key management team or were unable to attract
and retain qualified personnel in the future, at a reasonable cost or at all, its business activities,
results of operations, financial position and prospects could be materially and adversely affected.
Risk response
UMG is an established brand with both an attractive name and business reputation in the talent
market. UMG has taken proactive and preventative measures to attract and retain talent.
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UMG has added more offerings geared towards equitable professional development across UMG’s
diverse employee community. These include tailored programming and resources, such as
renowned guest instructors, and executive coaches to prepare employees for the next level of
their career at UMG. The initiatives are geared towards incentivizing early and mid-career employee
retention, which are the groups most susceptible to risk.
In addition, in 2022, UMG established an Equity Plan to provide long-term incentives to senior
employees which are linked to value creation and designed to attract, retain and motivate the best
possible workforce.
Restructuring and reorganization activities
UMG has engaged in effective restructuring and reorganization activities in the past, is currently
engaged in an Organizational Redesign and may need to implement further restructurings and
reorganizations in the future and its restructuring and reorganization efforts may not be successful
or generate expected cost savings.
UMG’s business has been, and may continue to be, impacted by significant ongoing changes in
the entertainment industry. In response, it has sought, and will continue to actively seek, to adapt
its operations and cost structure to the changing economics of the industry and to capitalize on
growth opportunities. For example, while physical sales are still significant in some markets, music
consumption has shifted from an ownership model, whereby consumers purchase vinyl records or
CDs, to an access model that includes subscription and ad-supported streaming formats.
UMG’s inability to implement the Strategic Organizational Redesign successfully or to structure its
operations based on evolving market conditions could impact UMG’s business. Furthermore, should
UMG fail to successfully complete the Strategic Organizational Redesign, UMG might not be able to
achieve the expected cost savings associated to it, or UMG might only achieve a portion thereof,
and the restructuring costs incurred in connection with the Strategic Organizational Redesign may
therefore be greater than the anticipated cost savings.
UMG may also in the future be required to implement further restructuring activities, make
additions or other changes to its management or workforce based on other cost reduction
measures or changes in the markets and industry in which it competes, including the evolving
skill sets required from its employees. Restructuring activities can also create unanticipated
consequences and negative impacts on its business, and UMG cannot be certain that any ongoing
or future restructuring efforts will be successful or generate expected cost savings. If UMG were
to unsuccessfully implement restructuring and re-organization plans, that could adversely impact
UMG’s business, results of operations, financial condition, and prospects.
Risk response
UMG has engaged in effective restructuring and reorganization activities in the past. UMG’s
executives have a broad range of experience, and UMG has engaged third party consultants, that
provide the discipline for effective execution of the restructuring plans.
Acquisitions and other investments
Where UMG acquires, combines with or invests in other businesses or joint ventures, UMG will face
risks inherent in such transactions.
UMG has in the past completed and, as part of its business strategy, will continue, from time to time,
to consider strategic transactions, which could involve acquisitions, combinations or dispositions
of businesses or assets, or strategic alliances or joint ventures with companies engaged in music
entertainment, entertainment, investing or other businesses. For example, Virgin Music Group,
UMG’s global independent music division, acquired Downtown Holdings LLC in the first quarter
of 2026. In addition, in 2024, UMG acquired a stake in (i) Chord Music Partners (Chord), pursuant
to a long-term strategic partnership with Chord’s other shareholders to actively manage Chord
through UMG’s global network and further develop its catalogue of music and intellectual property
and (ii) NTWRK, a premium live-video shopping platform and curated marketplace serving buyers
and sellers.
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UMG may not be successful in addressing any risks or problems encountered in connection with any
strategic transactions. UMG cannot assure that if it makes any future acquisitions, investments,
strategic alliances or joint ventures or enters into any business combination that they will be
completed in a timely manner, or at all, that they will be structured or financed in a way that
will enhance its creditworthiness or that they will meet its strategic objectives or otherwise be
successful. In addition, if any new business in which UMG invests or which it attempts to develop
does not progress as planned, it may not recover the funds and resources it has expended.
Furthermore, UMG faces risks in successfully integrating any businesses that it might acquire,
including those risks associated with integrating the acquired business’s personnel and various
systems and processes, and these risks are bolstered by the size and number of transactions
executed. Ongoing business may be disrupted, and management’s attention may be diverted
by acquisition, investment, transition or integration activities. In addition, integrating any
business UMG might acquire could impact UMG’s compliance with applicable legal and regulatory
requirements, including those related to privacy and data security. UMG may need to dedicate
additional management and other resources to any such M&A activity, and it may be difficult for
UMG to efficiently integrate acquired businesses into its ongoing operations and assimilate and
retain employees of those businesses into UMG’s culture and operations. The failure to achieve
synergies in acquisitions or loss of key executives, employees, customers, suppliers, vendors and
other business partners of businesses acquired may adversely impact the value of the assets,
operations or businesses.
Additionally, UMG has made investments into joint ventures with third parties in certain jurisdictions
and it may in the future enter into additional such joint ventures as a means of conducting its
business in various jurisdictions. While UMG seeks to ensure that it has appropriate rights when
entering into joint ventures, in the future other investors in the joint venture may have or require
certain rights under the terms of the joint venture, and therefore, UMG may not be able to unilaterally
make significant decisions or take timely actions with respect to its joint ventures. The failure of
UMG’s joint venture investments or UMG’s inability to take decisive unilateral action in respect to
its joint ventures could have a material adverse impact on UMG’s business, results of operations,
financial condition, and prospects.
Risk response
UMG has defined pre-acquisition due diligence procedures in place that enables informed decision
making, as well as post-acquisition integration procedures geared towards timely and effective
integration of acquired companies.
Cybersecurity
Cybersecurity presents ongoing risks that could adversely impact UMG’s global data and operations.
UMG’s systems may be vulnerable to damage from cybersecurity attacks and other data security
incidents. UMG processes personal data related to customers, employees, business partners, artists,
and vendors. UMG also maintains sensitive confidential business information of itself and, in some
cases, counterparties, as well as intellectual property including rights in music recordings and
compositions that in some cases are not yet released. UMG relies on both its computer systems
and those of its service providers for day-to-day operations and to manage these kinds of critical
business data. No computer system is immune from attacks or other incidents, and UMG’s systems
have in the past been and may in the future be vulnerable to, or may have suffered unknown,
security breaches by computer hackers and others that attempt to penetrate or otherwise defeat the
security measures that it has in place. Further, any use of AI technologies by UMG or its service
providers in connection with UMG’s business could make UMG more susceptible to cybersecurity
threats. A compromise of its security systems that results in the loss or exposure of personal
data, confidential information, or intellectual property could lead to operational disruptions and
significant expenditures to address the incident. Such a compromise could lead to the loss of
competitively sensitive information, theft of funds, reputational harm, litigation and investigations,
legal expenses, liability, penalties, or the imposition of ongoing monitoring or audit requirements
which may create operational disruptions and/or significant expenditures. Any of the foregoing may
adversely impact UMG’s business, results of operations, financial position, and prospects.
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Risk response
UMG employs multiple layers of cybersecurity defenses to protect assets, systems, and employees
from cyberattacks. These controls include broad deployment of advanced authentication controls
including multi-factor authentication, deprecation of privileged service accounts, active network and
system monitoring, centralized logging, and incident response and business continuity planning.
UMG has further implemented controls to enhance remote access security, augment visibility
to network behavior, and improve cybersecurity control governance. It has implemented a cross-
functional process to identify and improve incident response procedures and increase testing for
evolving attack vectors such as social engineering.
UMG's Global Security Office performs Security Assessments to ensure UMG systems are secured
against internal and external threats. All technology and software applications deployed by our
global organization, whether developed in house or by a third party is assessed to identify
potential risks or vulnerabilities that could cause a negative impact on our business, and provide
recommendations to improve the cyber security posture of the application. This includes Record
of Processing Activity (RoPA) assessments required by Article 30 of EU's General Data Protection
Regulation (GDPR), which create an internal register or inventory of business processes and
technologies that process personal data to ensure accountability and compliance, as well as to
identify high-risk processing activities.
UMG has also advanced security detection technology installed on all workstations and servers
that allows for rapid detection of ransomware and other common security issues, allowing for swift
isolation of potentially affected systems for review and remediation.
UMG conducts regular security training including regular phishing training of all employees and a
blend of online and in-person training covering general security as well as application and developer
security. It has implemented additional non-technical measures including cyber insurance policies,
security incident simulations, and audits to mitigate the risks of an adverse cybersecurity event.
Lastly, UMG's Information Security Policy is a commitment to protecting the confidentiality, integrity,
and availability of the company's information assets, and applies to all employees, contractors,
third-party service providers, and business partners who access, process, store, or transmit
UMG data. It encompasses all information systems, applications, cloud services, and physical
environments managed by or on behalf of UMG.
Changes in global economic and financial conditions
A weakening of anticipated global economic growth, a return to sustained high inflation rates or
other periods of declining economic conditions, either globally or in any of the markets in which
UMG operates, could adversely affect UMG’s business, results of operations, financial condition
and prospects.
Economic growth and consumer confidence are important for UMG’s growth and strategy. A
significant portion of UMG’s revenue relies on consumers spending discretionary funds on leisure
activities, such as music subscriptions, CDs, vinyl record albums and artist merchandise. Factors
like political uncertainty, and the state of the economy, including issues such as inflation, recession,
the availability of consumer credit, taxation, unemployment, and the impact of pandemics or
other severe public health events are all factors that can influence the prevailing macroeconomic
conditions and affect UMG’s business. Economic growth and consumer confidence are important for
UMG’s growth and strategy.
Central banks in the U.S. and several other countries have raised interest rates in the past several
years. Such increases in interest rates may reduce growth and may result in a global or regional
recession. Further market volatility may occur if inflation starts to rise again and markets respond
to the interest rate increases and the cessation of quantitative easing programmes by major
central banks. Increased inflation may impact the disposable income and shopping habits of UMG’s
customers which may in turn affect the demand for UMG’s products and services and UMG’s
ability to maintain its revenues in line with targets and expectations. Each of these events may
negatively impact discretionary funds available to consumers for leisure activities, and as a result
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may negatively impact UMG’s revenues and growth, which may in turn negatively impact UMG’s
business, results of operations, financial condition, and prospects.
Additionally, UMG has offices in nearly 60 territories around the world and exports music and
merchandise from country to country. UMG’s exports not only include physical exports, such as vinyl
records, CDs and merchandise, including apparel, but also digital trade and are subject to a variety
of export control and import laws and regulations and trade and tariff regulations. Compliance with
export control and import laws and regulations may create delays in the introduction of UMG’s
music and merchandise in international markets, resulting in a loss of opportunities and increase
costs due to import and export duties and tariffs.
Any change in export or import laws and regulations, shift in the enforcement or scope of existing
laws, sanctions and regulations, or change in the countries, governments, persons or technologies
targeted by such laws and regulations, could also result in decreased ability to export UMG’s
music and merchandise to consumers. Any limitation on UMG’s ability to export its music or
merchandise could materially adversely affect UMG’s business, results of operations, financial
condition, and prospects.
Risk response
UMG benefits from a diverse set of growth drivers, such as DSP penetration growth, social media
platforms, health/fitness applications, gaming, and audiovisual, among others, which makes UMG
less dependent on any one particular growth driver.
The direct impact of tariffs on UMG is limited because digital goods are not subject to tariffs and
physical music formats are exempt as information materials under U.S. law, leaving only a portion of
our revenue that is potentially exposed to tariffs.
Furthermore, music consumption is relatively inexpensive compared to other forms of media
entertainment, and DSP providers generally make all content available, thus not requiring multiple
subscriptions. In the past, music consumption has proven to be resilient to macro-economic
downturns and so far we have not seen any material impact from any global economic downturn
on UMG’s results (despite lower advertising-funded streaming income growth, as the advertising
industry was impacted by the difficult economic environment).
Geopolitical instability
UMG’s business may be adversely affected by geopolitical instability. Unfavorable conditions can
depress revenues in affected markets and prompt actions that adversely affect UMG's business
and/or financial performance.
Geopolitical concerns and other global events outside of our control have contributed and may
continue to contribute to global economic and political uncertainty, particularly as geopolitical
instability has in recent years become more prevalent. These concerns and events include,
without limitation, trade conflict, civil unrest, and security events, including war, terrorist acts
or other hostilities. For example, ongoing wars in the Middle East and Ukraine, and sanctions
and other measures imposed in response to these conflicts, have increased global economic and
political uncertainty.
In addition, the current U.S. presidential administration has stated its intention to make
governmental policy and regulatory changes in a variety of areas, including the imposition of
tariffs or other trade barriers. In that connection, certain countries subject to those changes have
expressed an intent to impose similar measures on American goods in return.
These conflicts and actions could result in market disruptions which could be significant and could
potentially have a substantial impact on the global economy for an unknown period of time. As a
result of UMG’s revenue profile being very geographically diverse, any such downturn in the global
economy that reduces the disposable income of UMG’s customers may in turn have a negative
impact on UMG’s revenues.
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Risk response
UMG monitors political and general societal changes and, where necessary, develops response
strategies to such events. Furthermore, music consumption has proven to be resilient in macro-
economic downturns in the past.
So far UMG has not experienced any material impact arising from the effect of international
sanctions. In the U.S., which is the world’s largest recorded music market, under U.S. law, the
government cannot impose tariffs on the import or export of informational materials– including
music. Consequently, any extension of sanctions or tariffs would likely only have a minimal impact
on UMG's results from operations.
Dependency on information technology systems
UMG’s operations are dependent on its information technology and information systems and
any disruption to UMG’s IT systems or failures in UMG's IT systems could adversely impact
UMG’s operations.
The integrity, reliability and operational performance of UMG’s information technology (IT)
infrastructure and technology network are critical to its operations. UMG relies upon the capacity,
reliability, and security of its IT hardware and software infrastructure and its ability to expand and
update this infrastructure in response to changing needs.
Certain elements of the IT systems infrastructure on which UMG depends are outsourced to third
parties. The services and functions provided by these third parties are critical to UMG’s business and
include (but are not limited to) storage, data processing and network.
The availability of UMG’s IT platforms and other services may be interrupted by damage or disruption
to the UMG’s or UMG’s third-party service providers’ IT systems, which may be caused by, for
example hardware or software defects, human error, unauthorized access, fire, power loss, natural
hazards, the impact of war and terrorism, disasters or similarly disruptive events, as well as planned
upgrades and improvements which may be subject to developmental delay or fail to be effective.
While UMG has business continuity procedures in place, there can be no assurance that these will
be fully successful in preventing all disruptions to the availability of UMG’s IT platforms or other
services. To the extent UMG outsources its business continuity or disaster recovery operations, it is
at risk of the vendor’s unresponsiveness in the event of breakdowns in UMG’s systems, which could
cause delays in recovering service.
Furthermore, performance issues, system interruptions or other failures in UMG’s IT systems could
expose UMG to potential liability to pay damages as well as reputational harm, additional operating
expenses to remediate the IT failures and exposure to other losses or other liabilities, all of which
could have a material adverse effect on UMG’s business, results of operations, financial condition,
and prospects. While UMG maintains what it considers to be an appropriate level of insurance
against some of these risks, UMG’s insurance coverage may not cover all of the costs and liabilities it
incurs as the result of any such interruptions or failures of UMG’s IT systems, and if UMG’s business
continuity and/or disaster recovery plans do not effectively and timely resolve issues resulting from
a disruption, UMG may suffer material adverse effects on its business.
Risk response
UMG continues to invest in the maintenance, upgrading and testing of its IT infrastructure and
technology network, in addition to maturation of failover and overall tech recovery plans to minimize
the risk impact of disruption. While UMG's insurance coverage may not cover all of the costs
and liabilities it incurs as the result of any such interruptions or failures of its IT systems, UMG
maintains what it considers to be an appropriate level of insurance against some of these risks.
Financial risks
Access to and cost of financing
UMG faces risks related to access to and the cost of financing.
Risks related to access to and cost of financing are assessed based on UMG’s capacity in the coming
twelve months to have ready access to cash and cash equivalents and available confirmed credit
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facilities and to generate sufficient cash flows and proceeds from sales to cover debt repayments,
dividend payouts and financial commitments.
Risk response
UMG has access to a €2 billion confirmed syndicated financing package (RCF) which provides the
necessary funds to cover UMG’s financial requirements and is used as back up for a €2 billion NEU
commercial paper program. The RCF was extended from April 2026 to April 2028. In addition, UMG
issued successfully in 2022 two tranches of bonds, including a €500 million tranche with a maturity
in 2027 and another €500 million tranche with a maturity in 2032. UMG also issued successfully in
2023 a €750 million bond with a 2031 maturity and a JPY 7 billion private placement with a 15- year
maturity (2038).
In 2025, UMG entered into a $500 million bilateral revolving credit facility which will mature in
April 2028, of which $500 million is drawn in February 2026. We also issued €300 million of senior
unsecured notes due 2032, €100 million of senior unsecured notes due 2031, ¥7 billion of senior
notes due 2035 and €40 million of senior notes due 2038.
UMG's average debt maturity is 3.7 years, its liquidity remains above € 1billion, and the fixed-rate net
debt ratio remains above 75%.
Currency fluctuations
Unfavorable currency exchange rate fluctuations could adversely affect UMG’s results of operations.
A significant portion of UMG’s assets, liabilities, revenues and costs are denominated in currencies
other than Euros, in particular U.S. Dollars. To prepare UMG’s Financial Statements, UMG must
translate those assets, liabilities, revenues and expenses into Euros from such currencies at then-
applicable exchange rates. Consequently, increases and decreases in the value of the Euro as
compared to such other currencies will affect the amount of these items in the UMG Financial
Statements, even if their value has not changed in their original currency. These translations could
result in significant changes to its business, results of operations, financial condition, and prospects
from period to period. In addition, exchange rate fluctuations could cause expenses to increase as a
percentage of net sales, affecting profitability and cash flows.
Risk response
From time to time, UMG enters into foreign exchange contracts to hedge the risk of unfavorable
foreign currency exchange rate movements. UMG seeks to hedge currency transaction risks by
offsetting opposing cash flows (natural hedging) and using derivative hedges.
Changes in tax laws
Changes in tax laws or challenges to UMG’s tax position could adversely affect UMG’s results of
operations and financial condition.
Given the footprint of UMG’s operations globally, UMG is subject to tax laws and regulations in
nearly 60 territories where it operates. Adverse developments in applicable tax laws or regulations,
or any change in the position by the relevant tax authorities or tax courts regarding the application,
administration or interpretation of any applicable tax laws or regulations, could subject UMG to
additional or increased tax payments, and in turn have a material adverse effect on UMG’s business,
results of operations, financial condition, and prospects. If UMG’s tax positions are challenged by
tax authorities, the potential imposition of additional or increased taxes could require UMG to pay
taxes that UMG currently does not collect or pay or increase the costs of UMG's services to track and
collect such taxes, which could in turn increase UMG’s costs of operations or the UMG’s effective tax
rate and could have an adverse impact on UMG’s business, results of operations, financial condition,
and prospects.
Moreover, any change in the tax law, such as an increase of tax rate or a change in determination of
tax basis, could have a material adverse impact. Given the international nature of UMG’s operations,
UMG may be particularly impacted by changes to regulations relating to transfer pricing and
withholding taxes on the repatriation of funds.
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Risk response
The Tax Policy supervised and approved by the Audit Committee states that UMG has a very low
tolerance to tax risk. The application of this guidance alleviates the potential adverse impact of
any change either in the application, administration or interpretation by tax administration or tax
courts. Moreover, as positions taken either for transactions, compliance and accounting purposes
are conservative any change in tax rates or tax basis might be mitigated.
Therefore, UMG’s tax procedures follow this governance and there is a process in place to implement
and monitor compliance with them. These procedures comply with tax rules in countries where UMG
operates as well as with requirements enacted by supra-national organizations, such as OECD and
the European Union. These procedures take into account the spirit of the laws and are updated as
necessary in order to incorporate any change of tax law or tax regulation impacting UMG. The Group
Tax Department and finance teams are in charge of establishing, maintaining and overseeing these
policies. The aim is to file all the required tax-relevant returns with the appropriate Tax Authorities
in a correct, timely and complete manner. To ensure this happens, (tax) compliance & reporting
processes are monitored through the Tax Risk and Control Framework which sets out the controls
established to assess and monitor tax risk for direct and indirect taxes (e.g., corporate income tax,
transfer pricing, VAT, wage tax and tax accounting).
The Group Tax Department monitors proposed changes in taxation legislation and ensures these are
taken into account when considering the operations and compliance. For this purpose, the Group
Tax Department employs qualified tax professionals who follow carefully any change in tax law
or tax regulations, with the assistance of qualified and reputable external advisors with requisite
qualifications and reputation.
Laws and regulations
Loss of intellectual property rights
The success of UMG’s business is dependent on the existence and maintenance of its intellectual
property rights and challenges in obtaining, maintaining, protecting and enforcing its intellectual
property rights, and involvement in intellectual property litigation could adversely affect UMG's
business, results of operations, financial condition, and prospects.
UMG’s intellectual property rights, as well as its ability to enforce such rights depend on the laws
and regulations of the many jurisdictions in which it conducts business, which are not consistent
across jurisdictions.
Third parties may be able to obtain and use UMG’s intellectual property without its permission, and
there is no guarantee that UMG will be able to successfully obtain, protect, maintain or enforce its
intellectual property rights in every instance.
UMG cannot be assured that its trademark applications, even for major trademarks, will be approved,
UMG endeavours to register major trademarks that are owned by UMG in every jurisdiction where
UMG believes the protection of these trademarks is important for its business. UMG also uses
certain major trademarks pursuant to license agreements, including the UNIVERSAL MUSIC GROUP,
DEF JAM RECORDINGS, and VIRGIN MUSIC trademarks. The duration of UMG’s licenses relating to the
DEF JAM RECORDINGS and VIRGIN MUSIC trademarks is perpetual and the earliest termination date
for UMG’s license relating to the UNIVERSAL MUSIC GROUP trademark is 2029. UMG’s licenses for
both the UNIVERSAL MUSIC GROUP and VIRGIN MUSIC trademarks may be terminated under certain
circumstances, including UMG’s material breach of the license agreement, non-use, and certain
events of insolvency. Upon any expiration or termination of any of these license agreements, UMG
may be required to either negotiate a new or reinstated agreement including with potentially less
favorable terms or otherwise lose its rights to use the licensed trademarks, which may require
UMG to change its corporate name and undergo other significant rebranding efforts. Any such
rebranding efforts may be disruptive to UMG’s business operations and require UMG to incur
significant expenses.
In addition, if UMG is alleged to have infringed, misappropriated or otherwise violated the intellectual
property rights of a third party (even where such claims are without merit), any litigation to defend
the claim could be costly and would divert the time and resources of management, regardless of
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the merits of the claim and whether the claim is settled out of court or determined in its favor.
There can be no assurance that UMG would prevail in any such litigation. If UMG were to lose a
litigation relating to intellectual property, in addition to the potential reputational damage, it could be
forced to pay monetary damages, to obtain a license, or to cease using certain intellectual property
or technologies.
Additionally, artists signed by UMG may seek to challenge and dispute the scope of intellectual
property rights under their contracts entered into with UMG, including potential disputes as to the
application and effect of technological developments and new formats to access music.
Furthermore, notwithstanding any potential benefit of AI, new challenges for protecting UMG’s
intellectual property and other rights of UMG’s artists and songwriters may also arise from
AI-generated music. The resulting new form of intellectual property infringement is caused by
unauthorized reproduction of copyrighted works, names, images, likeness and voices of UMG’s
artists and songwriters to “train” AI-generated applications to create unauthorized derivative works.
Any of the foregoing may cause UMG to suffer economic loss and reputational damage, which would
adversely affect UMG’s business, results of operations, financial condition, and prospects.
Risk response
In order to obtain, maintain, protect or enforce its intellectual property rights, UMG takes a variety
of measures, including, if necessary, litigation or proceedings before governmental authorities and
administrative bodies. UMG also has a content protection unit tasked with leading and coordinating
take downs of content that infringes its intellectual property rights. UMG also works through lobbying
(both directly and through trade associations) to try to influence any changes so that such changes
do not negatively affect the business or broader music industry and UMG’s stakeholders.
Data protection compliance
UMG faces heightened and accelerating privacy and data protection risk driven by rapid regulatory
expansion, materially increased enforcement activity, evolving technology practices—including
artificial intelligence—and the scale and complexity of its global data operations.
As a multinational organization operating in many countries, UMG is subject to laws, regulations,
rules and other obligations governing privacy, data protection, direct marketing and cybersecurity
in jurisdictions around the world. These laws impose restrictions on the way UMG and its
counterparties may collect, use, retain, secure, disclose and transfer personal information. These
laws may shape, for example, how UMG engages in eCommerce transactions or other transactions
with consumers; how UMG operates its online properties; how UMG engages in direct and behavioral
advertising, email marketing, mobile marketing and social media activities; and UMG’s internal
operations in areas such as employment and how UMG transfers data among its subsidiaries.
Further, UMG makes statements about its use and disclosure of personal information through its
privacy policies, information on its websites, and press statements.
These laws, and the ways in which authorities interpret and enforce them, continue to develop
and may be inconsistent from jurisdiction to jurisdiction. Complying with emerging and changing
requirements may cause UMG to incur substantial costs, change its business practices, modify its
product and service offerings, and forego other business opportunities.
UMG is subject to extensive and evolving European laws governing privacy, data protection,
cybersecurity, and digital technologies, including the EU General Data Protection Regulation (GDPR),
the ePrivacy Directive and related national laws, the U.K. GDPR and Data Protection Act 2018,
and recently adopted or forthcoming regulations such as the EU Artificial Intelligence Act, Digital
Services Act, Digital Markets Act, NIS2 Directive, and EU data governance and access frameworks.
These regimes impose significant and, in some cases, overlapping obligations relating to the
collection, use, security, transparency, and governance of personal and business data, as well as
the deployment of digital and AI-enabled technologies.
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The GDPR, which applies across the European Economic Area, provides regulators with broad
investigative and enforcement authority and authorizes administrative fines of up to €20 million
or 4% of global annual revenue, whichever is greater, in addition to corrective orders and
operational restrictions. Compliance with these expanding and increasingly complex regulatory
requirements requires substantial ongoing investment in governance, controls, and monitoring, and
may constrain business operations and technology use. Any failure to comply, or perceived failure
to comply, could result in significant fines, litigation, regulatory scrutiny, operational disruption, and
reputational harm.
In addition to European regulations, the number of comprehensive U.S. state privacy laws
has expanded rapidly, with approximately twenty states now having enacted consumer privacy
frameworks, fourteen of which were adopted within the last three years. Each of these laws are
unique in their requirements, including mandatory recognition of universal opt-out mechanisms
in certain jurisdictions, and new requirements for risk assessments, vendor contracting, and
sensitive data processing. Certain jurisdictions, such as California, have also elevated compliance
requirements, for example, requiring companies to produce risk assessments directly to regulators
upon request and within a short timeframe and to conduct annual Security Assessments. National-
scale digital operations and centralized data platforms such as UMG’s may incur substantial
operational, legal and other costs in attempting to harmonize divergent requirements and
implementing compliance programs that address new legal and regulatory requirements.
We engage in a wide array of online activities globally and are thus subject to a broad range of
related laws and regulations including, for example, those relating to privacy, consumer protection,
data retention and data protection, online behavioral advertising, AI, geo-location tracking, text
messaging, email advertising, mobile advertising, age verification, the protection of children online,
social media and other Internet, mobile and online-related prohibitions and restrictions.
Global privacy enforcement activity has increased materially in both volume and severity.
Noncompliance, or even allegations of noncompliance, with these laws or UMG’s public statements
or contracts in these areas, could lead government entities, supervisory authorities, or private actors
to institute investigations into or proceedings against UMG. These investigations or proceedings
may entail legal costs and reputational harm for UMG, and if defense of such proceedings is
unsuccessful even in part, UMG may face significant penalties, liability, or ongoing monitoring
or audit requirements. For example, The U.S. Federal Trade Commission continues aggressive
enforcement of privacy, data security, and AI-related representations under its unfair and deceptive
practices authority, holding organizations accountable for both their public representations and
their actual data practices. Responding to regulatory inquiries requires a significant investment of
time and financial resources. Successful FTC actions frequently impose long-term consent decrees,
independent audit obligations, and restrictions on data use, creating sustained operational and
financial exposure beyond monetary penalties.
UMG operates several thousand consumer-facing websites and digital properties. These properties
commonly deploy analytics, advertising, personalization, and third-party technologies, all of which
have become the subject of increased regulatory scrutiny and, in some cases, class action litigation.
For example, in the United States, privacy enforcement has increasingly intersected with consumer
protection and wiretap litigation theories. Given UMG’s scale, even modest implementation errors
can amplify regulatory, litigation and reputational risk.
UMG utilizes AI-enabled tools across business functions. AI use is regulated by a patchwork of global
regulations and guidance that legislate bias, accountability, governance, and lawful data use. These
regulations continue to change and evolve based on updates by legislative bodies and challenges
by government or private citizens. Monitoring and compliance with AI-related regulations may cause
UMG to incur substantial costs. Changes in regulations may cause UMG to change its business
practices or modify its product and service offerings. UMG also remains responsible for model
oversight and accountable for all outcomes of AI-enabled tools. Any actual or perceived governance
failures by UMG may cause customers and business partners, including artists, to lose trust in UMG.
UMG transfers a significant volume of data across international borders. The legal framework for
international data transfers is subject to ongoing uncertainty and frequent change. Regulators in the
U.S., European Union, China, and Brazil have emphasized that transfer mechanisms must be actively
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maintained, that organizations must understand and document actual data flows, and that onward
transfers and vendor access must be controlled.
Failure or perceived failure to comply with these cross-border data transfer requirements could
result in significant costs, regulatory investigations, fines, and restrictions on UMG’s ability to
transfer data internationally. As the regulatory environment continues to develop, UMG expects
the complexity and costs associated with cross-border data transfers to increase, and UMG
may face heightened operational and reputational risks in connection with UMG’s global data
processing activities.
Regulators increasingly treat security failures as privacy violations, particularly where deficiencies
expose personal data at scale or reflect systemic governance weaknesses. Enforcement actions
have underscored that excessive data collection, unjustified retention, and inadequate vendor
oversight materially increase both breach impact and enforcement severity. Privacy regulations
in California further require certain businesses conduct annual cybersecurity audits and make
reports available to regulators upon request. Identified deficiencies are expected to be remediated
through documented corrective actions, reinforcing expectations of continuous and demonstrable
security governance.
Any perceived or actual failure by UMG, including UMG’s third-party service providers, to protect
confidential data or any material non-compliance with privacy or data protection or other consumer
protection laws could cause customers to lose trust in UMG, reduce UMG’s ability to attract and
retain customers, artists and other business relationships and counterparties and result in litigation
or other actions being brought against UMG. Lastly, if third parties that UMG works with, such as
its suppliers, violate applicable laws or UMG’s policies, such violations may also put UMG’s data at
risk and could in turn have an adverse impact on UMG’s business, results of operations, financial
conditions, and prospects.
Risk response
UMG has data protection compliance initiatives in place, including personnel dedicated to
managing data protection risk. UMG’s data protection team partners with personnel throughout the
organization to identify and mitigate data protection risks.
Recent initiatives undertaken by the privacy team include the adoption of an enhanced website
cookie management platform to strengthen consent capture and compliance, a proactive review of
emerging global privacy regulations to assess alignment with and gaps in the current program, and
the update of cyber incident and breach response procedures to improve readiness, coordination,
and regulatory response. The team also implemented global artificial intelligence training for staff
to promote responsible use and risk awareness, refreshed supplier contract terms and standard
agreements—including updated data processing and data security addenda—to reflect evolving
legal and operational requirements, and provided ongoing support for enterprise data management
processes to improve data handling, governance, and accountability across the organization.
UMG’s data protection compliance initiatives are prioritized around streamlined global rules and
processes to manage increasingly complex requirements where possible. This improves the
efficiency of compliance efforts and reflects the interconnected nature of UMG’s artists, fans, and
business operations.
Our Global Security Office maintains and oversees UMG's Data Protection Policies, which apply
to all directors, employees, temporary staff, and consultants of UMG and its subsidiaries (“UMG”)
who process Personal Data, including but not limited to contact information, HR records, unique
identifiers, such as IP addresses and equipment identifiers. These policies establish the appropriate
guidelines and limitations for collecting, using, securing, transferring, and retaining personal data,
as well as the necessary disclosures to notify individuals of their rights.
We provide guidance to our labels and subsidiaries to ensure the proper collection and use of
personal data information and record keeping. This applies to our corporate websites, e-commerce
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stores, direct email marketing, third party marketing, and all other data collected in the course
of business.
The organization stays aware of emerging regulations and impending compliance requirements and
advocates (both directly and through trade associations) to influence any changes to the law so that
they do not negatively affect the business or broader music industry and its key stakeholders.
Governmental and regulatory challenges
A significant portion of UMG’s revenues are subject to regulation either by government entities or
by local third-party collecting societies throughout the world and rates on other income streams
may be set by governmental proceedings or be subject to legislative intervention, which may limit
its profitability.
Mechanical royalties and performance royalties (on both physical and digital sales) are two of
the main sources of income for UMG’s music publishing business, accounting for 15% of UMG’s
revenue in 2025 and 14% of revenue in 2024, and mechanical royalties are an expense for its
recorded music business (except in instances when DSPs pay such mechanical royalties directly
to publishers), representing 0.7% of UMG's revenue in 2025 compared to 0.7% in 2024. In the United
States, compulsory mechanical royalty rates are set every five years pursuant to an administrative
process under the U.S. Copyright Act, unless rates are determined through industry negotiations, and
performance royalty rates are most commonly, but not exclusively, determined by negotiations by
performing rights organizations, which in the U.S. include American Society of Composers, Authors
and Publishers (ASCAP), Broadcast Music, Inc. (BMI), the Society of European Stage Authors and
Composers (SESAC), and Global Music Rights, LLC (GMR). ASCAP and BMI are subject to a consent
decree rate-setting process if negotiations are unsuccessful.
The Antitrust Division of the U.S. Department of Justice (the DOJ) has previously reviewed its consent
decrees with ASCAP and BMI and, while in January 2021 the DOJ announced that it would take
no further action to modify or terminate such decrees, there is no guarantee that the DOJ will
not choose to review such decrees in the future. Changes to the mechanical royalty rate, the
performance royalty rates or consent decrees governing the U.S. performing rights organizations
could potentially impact the profitability of UMG’s music publishing business.
Outside of the U.S., mechanical rates are typically negotiated on an industry-wide basis (or for
multi-territorial online licensing, on a repertoire-specific basis but still necessarily in partnership
with collecting societies as rights holders) and may be subject to mandatory collecting regimes.
In most territories outside the U.S., mechanical royalties are typically based on a percentage of
wholesale prices for physical products and based on a percentage of consumer prices for digital
formats. Performance royalty rates are typically negotiated between the collecting society and the
individual licensee. The mechanical and performance royalty rates set pursuant to such processes
may adversely affect UMG by limiting its ability to increase the profitability of its music publishing
and/or recorded music businesses.
The performance royalty rates received by UMG’s recorded music business in the U.S. for statutory
webcasting and satellite radio are set every five years by an administrative process under the
U.S. Copyright Act unless rates are determined through industry negotiations. In most jurisdictions
outside the U.S., UMG’s recorded music business receives payment for the public performance
and broadcast of its sound recordings via collecting societies, with rates generally set by industry
agreement or rate setting tribunal. In certain jurisdictions, governments either have, are proposing
or face certain pressure to introduce legislation which may introduce and/or extend mandatory
collective licensing and direct remuneration claims for certain rights, such as (but not limited to) the
introduction of an additional remuneration right for performers for the so-called “making available”
of sound recordings on digital services.
As revenues continue to shift from physical to diversified distribution channels, it is important that
UMG receives fair value for all of the uses of its intellectual property as its business model now
depends upon multiple revenue streams from multiple sources. To the extent that the rates set
for recorded music and music publishing income sources through collecting societies or legally
prescribed rate-setting processes are set at levels which are not favorable or economically viable for
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UMG, this could have an adverse impact on its business, results of operations, financial conditions,
and prospects. financial condition, and prospects.
Risk response
UMG actively participates in rate-setting proceedings that affect the industry. The company works
with specialized counsel to build and present the best case in such proceedings.
We also educate stakeholders and advocate for policies that ensure music is appropriately valued.
In addition, the diversified nature of UMG’s business among several types of sources of income and
across many geographies mitigates the impact to UMG in case any individual jurisdiction were to
implement public policies that could adversely affect UMG.
Changes in laws and regulations and legal proceedings
Changes in laws and regulations, and legal proceedings that UMG is, or to which it could become
party, may have an adverse effect on UMG’s business.
UMG’s business is subject to a variety of laws, regulations and other public policies in jurisdictions
around the world, including those relating to intellectual property, content regulation, user privacy,
data protection and consumer protection, antitrust and competition, and environmental, social and
governance (ESG), among others.
Various governments currently have under consideration, and may in the future adopt, new
laws, regulations and policies regarding a wide variety of matters that could directly or indirectly
affect UMG’s business and operations, the ownership of UMG’s content assets or UMG’s ability to
maintain, protect or enforce its intellectual property rights. UMG’s licensing agreements, including
with streaming services, satellite radio, and web-based services may also be subject to regulatory
scrutiny and might be the subject of regulatory action or antitrust litigation.
For example, with the advent of generative AI, several jurisdictions around the world are considering
granting special privileges to help AI companies develop their AI platforms using copyright-protected
materials without authorization of the rights holders. Foremost among these have been proposals
for broad copyright exceptions for Text and Data Mining (TDM), a process by which online materials
are stripped from the Internet for use elsewhere. Such broad exceptions have been adopted in some
jurisdictions (such as Japan and Singapore) in active consideration in others (such as the United
Kingdom and Brazil) and rejected by others (such as Australia and Germany). Some already have
in place limited or narrow copyright exceptions, such as the European Union and United Kingdom
(for example limiting the exception to use for non-commercial research). The widespread adoption
of broad copyright exceptions for TDM could have a negative effect on UMG's ability to monetize
the licensing of these materials and build a responsible AI ecosystem in which the use of copyright-
protected material materials would be subject to rightsholders’ authorization.
Furthermore, as demonstrated by the TDM copyright exceptions, laws in various jurisdictions differ
from each other in significant respects, and the enforcement of such laws can be inconsistent and
unpredictable. This could affect the manner and level of UMG’s ability to operate its business in
various jurisdictions and undertake activities that UMG believes is beneficial to its business.
UMG could also be adversely affected by new laws and regulations, by the threat that additional laws
or regulations may be forthcoming and by changes in existing laws or changes in interpretation of
existing laws by courts and regulators. For example, legislation had been introduced in California
earlier this decade that would amend California Labor Code Section 2855 such that UMG’s ability to
recover damages from artists that fail to deliver on their contractually promised recordings after
more than seven years may be hindered. While that proposed legislation did not become law, similar
measures could be introduced in the future. Similarly, changes in the area of copyright law, in
particular, could directly or indirectly affect UMG’s operations, the ownership of UMG’s content assets
or UMG’s ability to maintain, protect or enforce its intellectual property rights.
Litigation and proceedings before governmental authorities, whether or not UMG is involved, may
serve as precedents that adversely impact UMG’s operations, ownership of content assets or
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intellectual property rights. UMG could incur substantial costs to comply with new or modified laws
and regulations or substantial penalties or other liabilities if UMG fails to comply with any such laws
and regulations. UMG could also be required by such laws and regulations to change or limit certain
of its business practices, which could impact UMG’s ability to generate revenues.
In addition, UMG’s operations are subject to a growing number of evolving rules and regulations
regarding ESG norms. While there is growing demand for increased disclosure and transparency,
in a number of jurisdictions globally, UMG must balance new disclosure requirements against the
ability to provide relevant, standardized and accurate data given the guidance available. In many
cases, sustainability regulations and their related guidance are new and continue to evolve. The
growing number of environmental regulations, their increased rigor and granularity, and in many
cases their lack of interoperability, could result in substantial costs of compliance. Furthermore, any
failure of UMG to comply with such rules and regulations due to UMG’s inability to adapt to changes
to applicable regulations could lead to fines and other penalties, as well as result in publicity which
may impact UMG’s brand reputation.
UMG is also regularly involved in lawsuits, disputes or investigations initiated by consumers,
business partners, competitors, artists, governmental entities, tax authorities and third parties. Such
lawsuits, disputes or investigations may relate to, inter alia, copyright infringement, contractual
disputes, employment disputes, antitrust and tax disputes. For example, on May 13, 2021, individual
and putative class action claims were filed against UMG Recordings, Inc. in the U.S. District Court
for the Central District of California for breach of contract and fraud related to certain royalty
calculations. Litigation and proceedings before courts or governmental authorities, whether or not
UMG is involved in such proceedings, may serve as precedents that could adversely affect UMG’s
operations, ownership of content assets or intellectual property rights. UMG could incur substantial
costs to comply with new or modified laws and regulations or substantial penalties or other liabilities
if it fails to comply. UMG could also be required by such laws to change or limit certain of its
business practices, which could impact its ability to generate revenues.
Any of the foregoing may adversely impact UMG’s business, results of operations, financial
condition, and prospects. See Note
26
“Litigation” in the Notes to the Consolidated Financial
Statements for additional information on legal proceedings.
Risk response
UMG advocates (both directly and through trade associations) to influence any changes to the law so
that they do not negatively affect the business or broader music industry and its key stakeholders.
The company has intensified and broadened its educational and advocacy campaigns around
various issues (such as TDM copyright exceptions). This includes, but is not limited to:
•
Industry thought leadership, including executive participation in communications and
presentations and meetings with policymakers and staff;
•
Support for relevant legislative proposals, such as federal and state legislation on name, image,
likeness and voice rights;
•
Active participation and leadership in industry and creative sector coalitions;
•
Conducting and funding research, such as economic impact analysis;
•
Hosting educational sessions and facility tours for policy makers;
•
Continued enhancements to royalty portals for artists and songwriters; and
•
Continued funding for industry trade bodies and refocusing their efforts on these issues.
UMG has a structure to oversee the company's compliance with relevant laws and changes in laws,
including with respect to ESG. See also “Corporate Governance” for additional information regarding
the roles and responsibilities of individuals in our sustainability management function.
In addition, UMG maintains a staff of senior litigation lawyers and may engage external lawyers to
assist with lawsuits, investigations and disputes. To the extent that changes in laws are the result of
litigation, UMG has a program of strategic litigation, both at the trade association and direct level, to
help build good precedents and avoid bad ones.
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SUSTAINABILITY STATEMENT
General information
General disclosures (ESRS 2)
General basis for preparation (BP-1)
The information contained in this Sustainability Statement has been prepared on a consolidated
basis and comprises Universal Music Group N.V. and its subsidiaries. Capitalized terms used but not
defined herein shall have the meaning assigned to them in the European Sustainability Reporting
Standards (ESRS).
Unless otherwise indicated, data is consolidated as of December 31, 2025. The scope of consolidation
is the same as the scope of consolidation for the Financial statements, unless stated otherwise.
This Sustainability Statement has been prepared to align with the ESRS on the assumption that
the Company will be bound by Dutch law requirements implementing obligations introduced by the
Corporate Sustainability Reporting Directive (CSRD). However, as the CSRD has not been transposed
into Dutch law as of the date of this Annual Report, this Sustainability Statement is provided on a
strictly voluntary basis.
This Sustainability Statement has been prepared to align with the requirements of the ESRS,
taking account of relevant CSRD-related requirements and guidance published by the European
Commission, the European Financial Reporting Advisory Group, and related regulators on or before
December 31, 2025. Given that such guidance has been published on an ongoing basis during
this early period of the CSRD implementation, it is possible that this Sustainability Statement may
not reflect guidance or other requirements published since that date. We expect to refine our
methodologies and significant assumptions in future reporting periods as more relevant information
becomes available.
Our materiality assessment of impacts, risks, and opportunities (IROs) included considerations of
our upstream and downstream value chain, including through our products and services, as well
as through our business relationships. The extent to which applicable policies, actions, targets,
or metrics extend to our value chain is described in each applicable topical section of this
Sustainability Statement.
The Company has omitted certain information in accordance with ESRS 1, section 7.7 as well as the
CSRD’s permitted omissions of information (CSRD, Article 19a and Article 29a).
The information in this Sustainability Statement is subject to limited assurance. See p. 278 for the
limited assurance report. Except as stated otherwise, no external body has validated the metrics in
this Sustainability Statement other than the independent assurance provider.
Disclosures in relation to specific circumstances (BP-2)
Time horizons
Short, medium, and long
‑
term time horizons are defined in line with ESRS 1 stipulations (i.e., one year
or less, one to five years, and over five years, respectively).
Value chain estimation, sources of estimation, and outcome uncertainty
UMG follows the Greenhouse Gas (GHG) Protocol for our emissions calculations and we aim to adhere
to the GHG Protocol’s five core principles of relevance, completeness, consistency, transparency,
and accuracy.
1
UMG collects primary emissions data from suppliers, where practicable, for our scope 3 GHG
emissions calculations. Where emissions data is not available, primary activity data (i.e., distance,
spend, units) is used to calculate emissions. In some cases, where primary data is not available for
the complete boundary of UMG activity, we use secondary data, such as extrapolations, benchmarks,
sector averages, expert opinions, or proxies, to develop the best available estimate for filling any
data gaps. Additionally, all of UMG’s reported emissions calculations utilize industry or country
1
GHG Protocol Corporate Accounting and Reporting Standard
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average emission factors maintained by third-party databases and may be subject to change. As
a result, there is inherent uncertainty in these calculations. Further details regarding our sources of
estimation and related outcome uncertainties are provided in “GHG emissions methodology” in the
Environmental information
section of this Sustainability Statement.
UMG performed a “screening” (as defined in the GHG Protocol) on the following scope 3 categories
due to limited data availability. Therefore, these categories are subject to a high level of
measurement uncertainty:
•
Downstream transportation and distribution (category 9)
: Data on downstream transportation
organized by customers is geographically limited; therefore, available data has been extrapolated
to ensure global estimation of this emissions source.
•
Franchises (category 14)
: Data on the retail value of licensed merchandised products is
geographically limited; therefore, available data has been extrapolated to ensure global estimation
of this emissions source.
UMG seeks to collect more primary emissions and activity data each year to improve our data quality
and to inform our emissions reduction strategies and initiatives. In 2025, approximately 16% of our
total scope 3 emissions were calculated using primary emissions data obtained from suppliers
or other value chain partners. This is an increase from 13% in 2024, which has been updated in
line with our 2024 emissions. For more information, see "Revisions and recalculations of previous
environmental metrics".
For more information on our scope 3 calculations, see “GHG emissions methodology” in the
Environmental information
section of this Sustainability Statement.
UMG maintains formal quality controls over our sustainability reporting. However, the accuracy
and completeness of sustainability data is subject to inherent limitations, such as the evolving
regulatory landscape, diverse data sources, manual processes, and limited automated controls. For
more information, see “Risk management and internal controls over sustainability reporting (GOV-5)”
in this Sustainability Statement.
Changes in preparation or presentation of sustainability information
Revisions and recalculations of previous environmental metrics
To enable comparability between GHG emissions metrics from prior years and the current reporting
period, we may, from time to time, recalculate our historical metrics. Our internal recalculation
policy, which follows GHG Protocol guidance, informs how we apply updates as of the current
reporting period to metrics from prior reporting periods, including our 2019 base year emissions
for our emissions reduction targets. These updates may include structural changes, changes to
methodology, the inclusion of additional activity data, improvements in the accuracy of emission
factors or activity data, or the correction of errors. In line with our policy, we have revised our
2024 comparative figures for certain scope 3 categories and we have recalculated our 2019 base
year emissions.
These updates primarily included the following:
Scope 1 & 2
:
•
We recalculated scope 1 and 2 emissions for our 2019 base year to reflect structural changes,
namely acquisitions, the Company has made since first calculating our 2019 base year.
Scope 3:
•
We recalculated scope 3 emissions for our 2019 base year to reflect structural changes, namely
acquisitions, the Company has made since first calculating our 2019 base year.
•
At the time of UMG’s initial 2019 base year calculation, in instances where global data was
not available, UMG focused on calculating scope 3 emissions for our major territories (US, UK,
France, Germany, and Japan) and did not include remaining rest of world (RoW) territories. For our
2024 GHG Inventory, new access to secondary data enabled UMG to estimate any remaining RoW
emissions for relevant scope 3 categories and/or subcategories. We have applied this methodology
in our recalculated 2019 base year emissions.
•
We made revisions to reflect enhanced calculation methodologies for 2024 physical audio
(category 1), indirect spend (category 1), downstream transportation and distribution (category 9),
and physical audio (category 12) by utilizing actual data for Q4 instead of estimates. For more
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information related to these revisions and their resultant effects on our 2024 GHG inventory,
see "GHG emissions methodology (E1-6)". The calculations for these categories still rely on other
estimates and assumptions. For more information, see "Value chain estimation, sources of
estimation, and outcome uncertainty".
•
We made revisions to reflect refinement to our mapping of emission factors for 2024 investments
(category 15) and the incorporation of newly available data for investees, which has improved our
extrapolation of emissions for UMG’s portfolio of investments in equity affiliates.
•
We made revisions to reflect newly available data for Japan and removed duplicate units in 2024
physical audio (category 1).
•
We made revisions to reflect improved data from a logistics supplier for 2024 upstream
transportation and distribution (category 4).
Because our 2019 base year calculations are outside of the scope of the Company’s third-
party assurance, UMG’s recalculations pertaining to our 2019 base year have not been
independently assured.
Incorporation by reference
Disclosure Requirements
Section
Chapter
Additional information, if any
Page
ESRS 2
General Disclosures
GOV-1
The role of the administrative, management and supervisory bodies
21 a
The number of executive and non-executive members
Board Report
Corporate Governance, The
Board, Composition
61
21 b
Information about representation of employees and other workers
Board Report
Corporate Governance, The
Board, Composition
None of the Non-Executive Directors
represents the Company's employees
and other workers.
61
21 c
Experience relevant to the sectors, products and geographic locations of the undertaking
Appendix
Biographies of the Corporate Executives,
Biographies of the Board of Directors
282-289
21 d
Percentage by gender and other aspects of diversity
Board Report
Corporate Governance, Diversity and
Inclusion, Overview
63-64
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Disclosure Requirements
Section
Chapter
Additional information, if any
Page
Non-Executive
Directors' Report
Non-Executive Directors' Report, Diversity
and Inclusion
162
21 e
The percentage of independent board members
Board Report
Corporate Governance, The
Board, Composition
% of independent Board members is
50%, calculated based on independent
Non-Executive directors (pg. 156), and
board members (pg. 60)
61
Non-Executive
Directors' Report
Non-Executive Directors'
Report, Independence
163
22 a
The identity of the administrative, management and supervisory bodies (such as a board committee or similar)
or individual(s) within a body responsible for oversight of impacts, risks and opportunities
Board Report
Corporate Governance, The Board,
Sustainability management
71
22 b
How each body's or individual's responsibilities for impacts, risks and opportunities are reflected in the
undertaking's terms of reference, board mandates and other related policies
Board Report
Corporate Governance, The Board,
Board committees
68-71
22 c
A description of management's role in the governance processes, controls and procedures used to monitor,
manage and oversee impacts, risks and opportunities, including:
Board Report
Corporate Governance, The Board,
Sustainability management
71
22 c i
Whether that role is delegated to a specific management-level position or committee and how oversight is
exercised over that position or committee
Board Report
Corporate Governance, The Board,
Board committees
68-71
22 c ii
Information about the reporting lines to the administrative, management and supervisory bodies
Board Report
Risk and Risk Management, Governance,
Risk and Compliance
85-86
22 c iii
Whether dedicated controls and procedures are applied to the management of impacts, risks and opportunities
and, if so, how they are integrated with other internal functions
Board Report
Risk and Risk Management, Governance,
Risk and Compliance
Risk and Risk Management, Monitoring
of our Risk Management and Internal
Control Systems
85-86
87-88
22 d
Disclosure of how administrative, management and supervisory bodies and senior executive management
oversee setting of targets related to material impacts, risks and opportunities and how progress towards them
is monitored
Board Report
Corporate Governance, The Board,
Sustainability management
71
23
Disclosure of how administrative, management and supervisory bodies determine whether appropriate skills
and expertise are available or will be developed to oversee sustainability matters
Board Report
Corporate Governance, The Board, Board
committees, Nomination committee
70
Non-Executive
Directors' Report
Non-Executive Directors' Report, Education
Non-Executive Directors are required
to follow an induction program aimed
at addressing any gaps in his or
her knowledge.
165
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ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Disclosure Requirements
Section
Chapter
Additional information, if any
Page
23 a
The sustainability-related expertise that the bodies, as a whole, either directly possess or can leverage, for
example through access to experts or training; and
Appendix
Biographies of the Corporate Executives,
Biographies of the Board of Directors
282-289
Non-executive
Directors' Report
Non-executive Directors' report, Education
165
Board Report
Organizational and Reporting Structure,
Corporate Executives
48-51
23 b
How those skills and expertise relate to the undertaking's material impacts, risks and opportunities
Appendix
Biographies of the Corporate Executives,
Biographies of the Board of Directors
282-289
Non-executive
Directors' Report
Non-executive Directors' report, Education
165
Board Report
Organizational and Reporting Structure,
Corporate Executives
48-51
GOV-2
Information provided to and sustainability matters addressed by the undertaking’s
administrative, management and supervisory bodies
26 a
Disclosure of whether, by whom and how frequently administrative, management and supervisory bodies are
informed about material impacts, risks and opportunities, implementation of due diligence, and results and
effectiveness of policies, actions, metrics and targets adopted to address them
Board Report
Corporate Governance, The Board,
Sustainability management
71
26 b
Disclosure of how administrative, management and supervisory bodies consider impacts, risks and
opportunities when overseeing strategy, decisions on major transactions and risk management process
Board Report
Corporate Governance, The Board,
Sustainability management
71
26 c
Disclosure of list of material impacts, risks and opportunities addressed by administrative, management and
supervisory bodies or their relevant committees
Board Report
Corporate Governance, The Board,
Sustainability management
71
GOV-3
Integration of sustainability-related performance in incentive schemes
29
Incentive schemes and remuneration policies linked to sustainability matters for members of administrative,
management and supervisory bodies exist
Board Report
Corporate Governance, The
Board, Remuneration
Incentive plans for the Executive
Directors do not currently incorporate
key performance indicators linked to
sustainability matters.
67-68
GOV-5
Risk management and internal controls over sustainability reporting
36 b
The risk assessment approach followed, including the risk prioritization methodology
Board Report
Risk and Risk Management, Risk Appetite
UMG’s risk appetite differs depending on
the type of risk, ranging from averse to a
seeking approach.
85
36 e
Description of periodic reporting of findings of risk assessment and internal controls to administrative,
management and supervisory bodies
Board Report
Corporate Governance, The Board,
Sustainability management
All our businesses are required to
maintain and manage a sound internal
control environment with robust policies,
71
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OTHER INFORMATION
APPENDIX
Disclosure Requirements
Section
Chapter
Additional information, if any
Page
Risk and Risk Management, Governance,
Monitoring of our Risk Management and
Internal Control Systems
procedures and controls and strong
financial discipline.
87-88
SBM-1
Strategy, business model and value chain
40 b
Total revenue
Board Report
Financial review, Consolidated statement of
profit and loss
Revenues
52-54
42 a
Description of inputs and approach to gathering, developing and securing inputs
About UMG
How UMG adds value
Input
24
42 b
Description of outputs and outcomes in terms of current and expected benefits for customers, investors and
other stakeholders
About UMG
How UMG adds value
Output
24
ESRS E1
Climate Change
E1.GOV-3
Integration of sustainability-related performance in incentive schemes
13
Disclosure of whether and how climate-related considerations are factored into remuneration of members of
administrative, management and supervisory bodies
Board Report
Corporate Governance, The
Board, Remuneration
Incentive plans for the Executive
Directors do not currently incorporate
key performance indicators linked to
sustainability matters.
67-68
ESRS S1
Own Workforce
S1-6
Characteristics of the undertaking's employees
50f
Disclosure of cross-reference of information reported under paragraph 50 (a) to most representative number in
financial statements
Financial Statements
Notes to the consolidated statements,
Costs of revenues and selling, general and
administrative expenses
256
S1-9
Diversity metrics
66 a
The undertaking shall disclose the gender distribution in number and percentage at top management level
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management, Overview
64
S1.MDR-
T
Minimum disclosure requirements - Targets
80 a
A description of the relationship of the target to the policy objectives
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
80 b
The defined target level to be achieved, including, where applicable, whether the target is absolute or relative
and in which unit it is measured;
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
80 c
The scope of the target, including the undertaking’s activities and/or its upstream and/or downstream value
chain where applicable and geographical boundaries;
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
80 e
The period to which the target applies and if applicable, any milestones or interim targets;
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
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OTHER INFORMATION
APPENDIX
Disclosure Requirements
Section
Chapter
Additional information, if any
Page
80 f
The methodologies and significant assumptions used to define targets, including where applicable, the
selected scenario, data sources, alignment with national, EU or international policy goals and how the targets
consider the wider context of sustainable development and/or local situation in which impacts take place;
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
80 j
The performance against its disclosed targets, including information on how the target is monitored and
reviewed and the metrics used, whether the progress is in line with what had been initially planned, and an
analysis of trends or significant changes in the performance of the undertaking towards achieving the target.
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
S1.MDR-
P
Minimum disclosure requirements - Policies
65 a
Description of key contents of policy
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
65 b
Description of scope of policy or of its exclusions
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
65 c
The most senior level in the undertaking’s organisation that is accountable for the implementation of
the policy
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
65 d
Disclosure of third-party standards or initiatives that are respected through implementation of policy
Board Report
Corporate Governance, The Board, Diversity
and Inclusion
The senior management
63-66
ESRS G1
Business Conduct
G1.GOV-1
The role of the administrative, management and supervisory bodies
5 a
Disclosure of role of administrative, management and supervisory bodies related to business conduct
Board Report
Corporate Governance, The Board,
Board committees
Among other responsibilities, Audit
committee supervises the effect of the
Code of Conduct.
68-71
5 b
Disclosure of expertise of administrative, management and supervisory bodies on business conduct matters
Appendix
Biographies of the Corporate Executives,
Biographies of the Board of Directors
282-289
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OTHER INFORMATION
APPENDIX
Governance
Statement on due diligence (GOV-4)
Core elements of due diligence
Relevant disclosures
(a) Embedding due diligence in
governance, strategy, and business model
GOV-2
GOV-3
SBM-3
(b) Engaging with affected stakeholders in
all key steps of the due diligence
GOV-2
SBM-2
IRO-1
G1-2
S1-1
S1-2
(c) Identifying and assessing
adverse impacts
IRO-1
SBM-3
G1-2
S1-2
(d) Taking actions to address those
adverse impacts
S1-3
(e) Tracking the effectiveness of these
efforts and communicating
E1-4
E1-6
S1-4
S1-5
S1-6
S1-16
Risk management and internal controls over sustainability reporting (GOV-5)
Sustainability internal control environment
For all quantitative sustainability disclosures, UMG uses a global data collection and consolidation
platform for environmental and social demographics reporting. The platform is designed to include
mathematical coherency checks for data consistency and to flag any potentially abnormal variation
during the data input process. Each reporting entity conducts an initial validation and consistency
check of their submission. The ESG department performs a second coherency check and validation
during the consolidation process. Lastly, the ESG department conducts a trend analysis, validates
the results of this analysis with business unit leaders, and evaluates and documents explanations
for variances. For all qualitative sustainability disclosures, UMG maintains a centralized database for
gathering, reviewing, and verifying information.
In 2025, UMG continued to strengthen its sustainability-related internal controls. Following the
integration of additional controls for CSRD-specific datapoints in 2024, our focus shifted towards
enhancing the precision and documentation of existing controls. Key improvements included
refining validation procedures, clarifying control ownership across relevant functions, and further
formalizing documentation and processes to promote consistency in control application.
Risk management and internal controls over sustainability reporting
As described in "Description of the process to identify and assess material impacts, risks, and
opportunities (IRO-1)", our DMA (as defined therein) considered the results of our latest annual risk
assessment and consulted our risk management team and senior leadership. We incorporated the
inputs of our latest risk assessment into our DMA through a series of validation exercises and
workshops. In 2025, the SteerCo (as defined in "Description of the process to identify and assess
material impacts, risks, and opportunities (IRO-1)"), which includes key risk management personnel,
reviewed, evaluated, and confirmed the results of our most recent DMA. In the future, we intend to
assess the extent to which our sustainability reporting processes may be further integrated into and
aligned with our general risk management processes as part of our overall management process.
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OTHER INFORMATION
APPENDIX
For more information on our process to identify, assess, prioritize, and monitor risks that may have
financial effects, as well as our risk assessment process, see the
Risk and Risk Management
section
of the Board report.
UMG maintains formal quality controls over our sustainability reporting. Both sustainability data
owners and the Global Controls and Assurance department conduct analyses to assess the
accuracy and completeness of sustainability information. However, the internal control framework
for sustainability data is at an earlier stage of maturity than that for financial reporting. This is due
to inherent limitations, such as the evolving regulatory landscape, diverse data sources, manual
processes, and limited automated controls. We continue to seek to improve our internal processes
and procedures to enhance the accuracy and completeness of our data in the future.
This section should be read in conjunction with the Verklaring Omtrent Risicobeheersing, included in
the "Statements of the Board" section of the Board report.
Strategy
Strategy, business model, and value chain (SBM-1)
Our DMA process, described in detail in "Description of the process to identify and assess material
impacts, risks, and opportunities (IRO-1)", identified the sustainability matters that are most
important to our business and to our stakeholders. The resulting identified material topics are
representative of the ways in which our business and sustainability strategies are connected.
As discussed in the
Strategy
section of the Board report, UMG’s creative and commercial foundation
is built on a set of key focal points, each of which is linked with our material sustainability
matters, as set forth below. As we work towards further defining our sustainability goals, we
will seek to further align our business strategy with sustainability considerations, creating value
for stakeholders while addressing the environmental and social challenges inherent in the
music industry.
•
Strategic focus:
Continuing our mission of discovering and breaking new artists and songwriters
and supporting them at every stage of their career to help them achieve their greatest creative
and commercial potential.
Related sustainability matters:
As further described in "Attraction and retention of artists" in the
Social information
section of this Sustainability Statement, artists are at the core of our business
and of our ability to generate positive cultural impacts.
Through our DMA process, we honed in on the interconnected nature of our material sustainability
matters. To successfully continue to discover, attract, retain, and support artists and songwriters,
we recognize the importance of successfully attracting and retaining top-tier talent and
continuing to foster a culture of belonging throughout our operations. For more information see
the
Social information
section of this Sustainability Statement.
•
Strategic focus:
Maximizing and protecting the value of our extraordinary catalog, both now and
into the future.
Related sustainability matters:
We are committed to proactively protecting our intellectual
property and using it to create socioeconomic value for our artists. We continue to face
longstanding challenges, such as streaming fraud and illegal file-sharing, as well as new
challenges, such as intellectual property infringement using AI. Our dedicated Content Protection
team continues to address these challenges. Our approach to the challenges and our key actions
to protect our intellectual property are described in further detail in "Intellectual property, piracy,
and content protection" in the
Governance information
section of this Sustainability Statement.
•
Strategic focus:
Driving growth in our subscription and ad-supported streaming revenue around
the world and expanding our capabilities and repertoire in high-growth markets.
Related sustainability matters:
We are committed to expanding our presence and accelerating our
growth in both high-growth markets and far-reaching regions to discover exciting new music
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APPENDIX
and artists globally, expand our catalog and repertoire, create opportunities to connect with
local music fans, help introduce new music to global audiences, and increase market share.
As markets grow in emerging territories, so does the challenge of leaks in those regions. As
further described in "Intellectual property, piracy, and content protection" in the
Governance
information
section of this Sustainability Statement, we continue to partner with our international
trade organizations and expand our global presence to build content protection strategies and
workstreams that support the development of emerging music markets.
•
Strategic focus:
Building winning partnerships with tech innovators to create innovative
commercial opportunities and explore how technology can be used to benefit our artists in
creating product, driving engagement and discovery, further fueling fandom and consumption.
Related sustainability matters:
As a corollary to building partnerships for innovation, we continue
to collaborate with our partners to protect the value of our artists’ work. We continue to work with
our licensed service partners to share intelligence and introduce workflows to counter the threat
of streaming fraud, among other challenges. We are also taking steps to advocate and fight for
the responsible use of AI. For more information, see "Intellectual property, piracy, and content
protection" in the
Governance information
section of this Sustainability Statement.
•
Strategic focus:
Working to maximize the power, influence, and impact of music to drive social
conversation. Progressing thought leadership on key industry issues and public policies to help
maintain a vibrant and growing music ecosystem.
Related sustainability matters:
We believe that our purpose – to shape culture through the power
of artistry – includes supporting action on climate change. We remain committed to reducing our
GHG emissions. To support this commitment, we have set science-based targets and report on our
scope 1, 2, and 3 emissions annually.
Challenges to reducing our scope 1 and 2 emissions include the availability of renewable energy
solutions in markets where we operate; barriers to purchasing renewable energy for small, leased
facilities; and potential increased costs for renewable energy solutions. Challenges to reducing
our scope 3 emissions include the breadth of supplier engagement required to measure and
reduce environmental impacts across our value chain; the availability of innovative, scalable
solutions and their associated potential costs; and the ability to collect complete, accurate, and
timely supplier data. We are developing strategies and initiatives to address these challenges and
will continue to share our progress for reducing our emissions. For more information on this topic,
see the
Environmental information
section of this Sustainability Statement.
•
Strategic focus:
Advancing data and insights to help fuel discovery, furthering our ability to
connect our artists with their fans anywhere in the world and to identify superfans.
Related sustainability matters:
As discussed further in the
Strategy
section of the Board report, our
data and analytics team comprises analysts, data scientists, and coders who develop algorithms
to help UMG identify talent faster and more efficiently than our competition, supporting our
ability to attract artists, as further described in "Attraction and retention of artists" in the
Social
information
section of this Sustainability Statement. As we continue to leverage data, we recognize
that the ethical and compliant collection, use, and sharing of data is essential to maintaining the
trust of our stakeholders. To this end, our global data protection compliance program includes
governance and data management processes, data subject rights processes, privacy disclosures,
employee training, cross-border transfer agreements, supplier contract terms, internal audit
procedures, and incident response processes. For more information on this topic, see "Privacy
and cybersecurity" in the
Governance information
section of this Sustainability Statement.
•
Strategic focus:
Enhancing our capabilities to comprehensively serve and maximize the value of
superfans through D2C/eCommerce/product development, increasing monetization.
Related sustainability matters:
In recent years, the launch of UMG’s own dynamic global
eCommerce platform has enabled our D2C, digital goods, merchandise, and eCommerce divisions
to accelerate and amplify artists’ ability to create experiential, commerce, and content offerings
for their fans. This is economically vital to our artists, as further described in "Attraction and
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APPENDIX
retention of artists" in the
Social information
section of this Sustainability Statement.
As we continue to explore ways to strengthen and better serve the artist-fan relationship through
superfan experiences and products, we seek to partner with suppliers who share our vision
for a sustainable future. To support this goal, we incorporate our Supplier Social Responsibility
Policy into all global manufacturing agreements, have developed targeted, ongoing sustainability
strategies for the product development teams for Bravado, UMG’s merchandising arm, and
Universal Music Manufacturing & Logistics (UML), and implemented our Environmental Exhibit
to drive our suppliers to set and validate their own science-based targets to further reduce GHG
emissions, among other efforts. For more information, see "Supply chain management" in the
Governance information
section of this Sustainability Statement.
For a description of the key elements of our general strategy that relate to or affect sustainability
matters, as well as additional information regarding the key elements of our business model and
value chain, see the
Strategy
section of the Board report.
For employee headcount breakdowns by geographical area pursuant to SBM-1 40(a) iii, see the
Social
information
section of this Sustainability Statement.
The current ESRS definitions of industry sectors do not include industry sectors that are applicable
to UMG.
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UPSTREAM
OWN OPERATIONS
DOWNSTREAM
MUSIC PUBLISHING
OUR VALUE CHAIN
MERCHANDISING
SUPPLIERS
PHYSICAL SUPPLY
CHAIN & LOGISTICS
ARTISTS AND
SONGWRITERS
MERCHANDISING
CONTENT PUBLISHERS,
COLLECTION SOCIETIES,
PERFORMANCE RIGHTS OWNERS
DIGITAL SUPPLY CHAIN
FANS
RECORDED MUSIC
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
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Interests and views of stakeholders (SBM-2)
Stakeholder Engagement
We actively engage with our stakeholders regarding our strategic direction and seek their input
when evaluating our sustainability matters (see “Our Double Materiality Assessment” for further
information). As applicable, stakeholder input is shared with our management or Board through
various channels, including through our Investor Relations team, as part of our DMA process and
through regular internal periodic reporting.
UMG has six key stakeholder groups with whom we engage as set forth in the table below
and, as applicable, pursuant to our DMA process. For information about how our administrative,
management, and supervisory bodies are informed about the interests of our stakeholders with
respect to sustainability matters, see “
Corporate Governance
—Sustainability management”.
Stakeholder group
How we engage
Purpose and outcome of engagement
Artists
•
Maintaining close direct connections with artists at every label and division of the company,
including through A&R, marketing, and merchandising teams;
•
Interacting with our artists indirectly through their advisors; and
•
Offering artists a full range of services.
•
Investing in continued artist development at all stages of their careers;
•
Fostering creative expression and collaboration within our diverse roster of artists;
•
Partnering with an expansive network of distribution partners so that artists can share their work with a growing global fan base;
•
Working with distribution partners and regulators to achieve fair compensation for music content;
•
Embracing new technologies that can increase music consumption and fan engagement; and
•
Creating new and exciting experiences for artists to engage with their fans.
Fans
•
Direct-to-fan communications through email, SMS, and community platforms;
•
Facilitating new experiences for fans to engage with their favorite artists and music; and
•
Promoting direct connections between artists and fans.
•
Meeting fan product demands, including developing premium products for super fans;
•
Helping fans engage with their favorite artists in new and exciting ways;
•
Driving technological innovation to improve the creative process, and artist- fan connections;
•
Partnering with an expansive network of distribution partners and retailers to facilitate access to our artists’ music and merchandise;
•
Enabling D2C sales through ecommerce and merchandising opportunities;
•
Creating premium consumer products via our production, manufacturing and distribution arms;
•
Tailoring and personalizing fan experiences; and
•
Further developing artists’ relationships with their fans and deepening their connections.
Employees
•
Written and in-person communications from our People, Inclusion & Culture (PIC) team;
•
Formal and informal feedback channels to encourage open dialogue;
•
Online resources to answer employee questions quickly and easily;
•
Regularly assessing the employee experience and culture including by conducting lifecycle and
pulse surveys; and
•
Holding employee forums, resource groups, and events.
•
Measuring each employee’s individual experience at various stages of the employee lifecycle (first week new hire, 90-day new hire,
and exit);
•
Encouraging and assessing employee engagement across our global workforce;
•
Building a culture in which all employees feel safe, seen, heard, respected, and connected;
•
Working together to improve learning, diversity and inclusion, engagement, retention and wellbeing;
•
Tapping into innovation, collaboration, creativity, and artistry across UMG’s businesses;
•
Encouraging a growth mindset through mentoring and programs that support a culture of innovation; and
•
Investing in employee training programs to support learning and development.
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Stakeholder group
How we engage
Purpose and outcome of engagement
Distribution partners
•
Ongoing dialogue with our digital and corporate business development teams; and
•
Regular product innovation discussions, data and analysis sessions, and deal negotiations.
•
Developing content and marketing plans aligned with growing engagement on partners’ platforms;
•
Investing in talent in both developed and emerging music markets;
•
Promoting all UMG artists to fans around the world; and
•
Embracing technological advancements that improve the sound quality of our historic catalog.
Public officials
•
Responding to formal information requests (such as public hearings and consultations);
•
Convening and participating in educational and advocacy meetings;
•
Advocating for public policies that protect and grow the music ecosystem;
•
Joining music industry trade organizations and non-government organizations, and contributing
to their published products and educational and advocacy efforts;
•
Conducting and sharing economic, opinion and other research on the impact of music and the
music community;
•
Facilitating office and studio tours to educate policymakers and staff; and
•
Maintaining an ongoing dialogue between policymakers and our public policy team.
•
Educating public officials about how proposed policies would impact our business and industry;
•
Creating employment and generating economic benefits for the communities in which we operate;
•
Supporting culture through the creation and distribution of great music and associated content;
•
Working to ensure that our perspectives and policy positions are communicated and understood by policymakers;
•
Leading the industry in establishing sound public policy positions that benefit the music ecosystem;
•
Maintaining a reputation for smart and ethical engagement of public officials;
•
Confirming UMG’s leadership in the industry; and
•
Supporting our artist-centric culture and mission.
Shareholders
•
In person meetings and virtual teleconferences with our Investor Relations (IR) team
and management;
•
Publishing interim and annual reports;
•
Presenting quarterly financial results webcasts with management Q&A sessions;
•
Hosting in-person annual general meetings;
•
Providing annual general meeting agendas and associated materials on our IR website;
•
Publicly sharing the voting results and transcripts from our annual general meetings;
•
Disseminating notable developments via public press releases;
•
Maintaining UMG corporate and IR websites;
•
Responding to all queries via a dedicated IR email address; and
•
Participating in financial and industry conferences.
•
Clearly communicate our strategic priorities and rationale;
•
Discuss recent developments in the business;
•
Educate investors about the music industry and our competitive position;
•
Provide detail around our reporting segments, revenue types and associated growth drivers;
•
Answer questions relating to our publicly disclosed information, earnings results and announcements;
•
Provide updates related to our sustainability targets and progress; and
•
Gather feedback to better understand shareholder views on all proxy matters.
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APPENDIX
Material impacts, risks, and opportunities and their interaction with strategy and business
model (SBM-3)
Except as otherwise indicated, information regarding our material IROs is presented in the table
below and in each applicable topical section of this Sustainability Statement.
Unless stated otherwise, the policies, actions, metrics, and targets presented in each topical section
of this Sustainability Statement are applicable to the IROs pertaining to the material topics addressed
in each such section. UMG did not identify any material risks or opportunities for which there is a
significant risk of a material adjustment within the next annual reporting period.
Material topic
I/R/O
Description
Impact
Value chain
Time
horizon
Discussion of effects
on business model,
value chain, strategy,
decision-making (page)
GHG emissions
Climate change (E1)
I (-)
UMG has GHG emissions which negatively impact the environment
Actual
Downstream
M
142-148
Attraction
and retention
of employees
Own Workforce (S1)
I (+)
Attraction and retention of skilled employees may increase morale, job satisfaction, and employee well-being
Actual
Own operations
L
149-154
I (+)
Retention of skilled employees may create reputational benefits, furthering the ability to attract greater talent
Potential
Own operations
L
149-154
I (+)
Attraction and retention of skilled employees may increase the ability to attract and retain artists
Actual
Own operations
L
149-154
I (-)
Failure to attract or retain talent may result in reputational damage and/or decreased morale, job satisfaction, and/or wellbeing among existing workforce
Potential
Own operations
M
149-154
I (+)
Multiple skill sets and points of view can increase our resilience as a company as well as the creativity behind our products and services
Actual
Own operations,
downstream
S
149-154
I (+)
Compensation that reflects each employee's role, responsibilities, performance, skills, and experience promotes fairness and may lead to socioeconomic
benefits for employees and their communities
Actual
Own operations
S
149-154
Attraction and
retention of artists
Entity-specific disclosure
I (+)
Supporting talented artists can generate socioeconomic and cultural benefits throughout the music ecosystem
Actual
Upstream,
own operations,
downstream
S
154-165
R
UMG’s business may be adversely affected if UMG fails to identify, attract, sign, and retain successful recording artists and songwriters or by the absence
of superstar releases
Actual
Upstream,
own operations
S
154-165
O
Our artists' success directly financially benefits UMG, generates long-term value to artists, and greatly increases the commercial success, consumer base,
and longevity potential for artists at every stage of their careers
Actual
Upstream,
own operations
L
154-165
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Material topic
I/R/O
Description
Impact
Value chain
Time
horizon
Discussion of effects
on business model,
value chain, strategy,
decision-making (page)
Intellectual property,
piracy, and
content protection
Entity-specific disclosure
I (+)
Protecting intellectual property rights encourages creators to invest time, resources, and effort into developing new ideas, inventions, and artistic works
and incentivizes innovation and creativity.
Actual
Upstream
S
157-159
I (+)
UMG encourages its digital partners to support content protection by taking direct action against unauthorized activity on their platforms
Actual
Downstream
M
157-159
I (-)
UMG’s failure to manage this topic could result in brand exposure challenges for artists, for instance, where poor quality bootlegs are illegally released
Potential
Upstream
M
157-159
I (-)
UMG’s failure to manage this topic could result in harm to creators’ rights, including through intellectual property infringement through the unauthorized
reproduction of copyrighted works to train AI technology, which in turn enables the creation of AI generated works that embody unauthorized renditions of
artist voices, images, and likenesses
Potential
Upstream
M
157-159
I (-)
UMG’s failure to manage this topic could deprive artists of their ability to authentically share their art and connect with their fans
Potential
Upstream
S
157-159
R
Piracy, including stream manipulation, enables the distribution of music in a manner that does not provide an economic return for UMG or its artists
and songwriters
Actual
Upstream,
own operations
M
157-159
R
Sales of counterfeit merchandise may undermine UMG’s brand value, interfere with marketing strategies of our artists, and divert potential customers
from legitimate purchases, which may directly impact UMG’s revenue growth
Actual
Upstream,
own operations
M
157-159
O
A substantial number of tracks uploaded to digital streaming platforms (DSPs) are frequently misattributed or intentionally mislabeled, preventing UMG
from earning revenue from the creative works of artists and labels. UMG’s ability to detect and accurately attribute these tracks presents a financial
opportunity for the business
Actual
Upstream,
own operations
M
157-159
Privacy and
cybersecurity
Entity-specific disclosure
I (-)
Failure to manage this topic may result in harm to other members of our value chain whose data and content we protect
Actual
Upstream
S
159-160
I (-)
The availability of UMG’s IT platforms and other services may be interrupted by damage or disruption to UMG or UMG’s third-party service providers’
IT systems. While UMG has in place business continuity procedures, there can be no assurance that these will be fully successful in preventing all
disruptions to the availability of UMG’s IT platforms or other services
Potential
Upstream,
own operations
M
159-160
R
Noncompliance, or even allegations of noncompliance, with data protection laws could lead government entities, supervisory authorities, or private actors
to institute investigations into or proceedings against UMG that may entail legal costs and reputational harm, and if defense of such proceedings is
unsuccessful even in part, UMG may face significant penalties, liability, or ongoing monitoring or audit requirements
Actual
Own operations
S
159-160
R
Any perceived or actual failure by UMG, including its third-party service providers, to protect confidential data could reduce UMG’s ability to attract and
retain customers
Potential
Own operations
M
159-160
R
If third parties that UMG works with, such as UMG’s suppliers, violate applicable laws or UMG’s policies, such violations may also put UMG data at risk and
could in turn have an adverse impact on our business, results of operations, financial conditions and prospects
Potential
Own operations,
downstream
M
159-160
Supply chain
management
Business conduct (G1)
I (+)
Actively managing our supply chain may allow UMG to promote innovation, promote human rights and local economies, and have a positive
environmental impact
Actual &
potential
Upstream,
downstream
M
156-157
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Impact, risk, and opportunity management
Description of the process to identify and assess material impacts, risks, and
opportunities (IRO-1)
Our Double Materiality Assessment Process
In 2022, we conducted our first materiality assessment to identify the ESG topics most material to
UMG. Topics were evaluated based on their importance to the business as well as their importance
to stakeholders, and the potential impacts of each topic were considered across the broader
economy, environment, and society at large. In 2023, we further validated our material topics
with subject matter experts and a cross-functional group of over 100 UMG leaders across our
business operations.
As part of our preparation of this Sustainability Statement and in accordance with the requirements
of the CSRD, we refreshed our materiality assessment methodology and undertook an updated
assessment process. We expect to continue to refine our methodology as further guidance emerges
and additional information becomes available.
To determine the materiality of sustainability matters and identify our material IROs, UMG applied
the principle of double materiality. Double materiality incorporates an assessment of UMG’s actual
and potential impacts on sustainability matters (impact materiality) alongside an evaluation of
the actual and potential financial effects of various sustainability matters on our enterprise value
(financial materiality).
Impact Materiality
As part of our Double Materiality Assessment (DMA) process, we considered the material actual or
potential, positive or negative impacts on sustainability matters within the meaning of the CSRD and
ESRS over the short-, medium-, or long-term. Such impacts include those connected with our own
operations, upstream, and downstream value chain, including through our products and services, as
well as through our business relationships.
When evaluating actual negative impacts, we considered the severity of the impact, meaning
the scale, scope, and irremediable character of the impact. For potential negative impacts, we
considered the severity and likelihood of the impact. For our evaluation of actual positive impacts,
we considered the scale and scope of the impact. For potential positive impacts, we considered the
scale, scope, and likelihood of the impact.
Financial Materiality
To evaluate financial materiality, we considered the sustainability matters that generate risks or
opportunities that have a material influence, or could reasonably be expected to have a material
influence, on our development, financial position, financial performance, cash flows, access to
finance, or cost of capital over the short-, medium-, or long-term. This included information on
material risks and opportunities attributable to our business relationships.
As part of this process, we leveraged our annual risk assessment process and consulted our risk
management team and senior leadership. We incorporated the inputs of our latest risk assessment
into our DMA through a series of validation exercises and workshops. In the future, we intend
to assess the extent to which our DMA process may be further integrated into and aligned with
our general risk management processes as part of our overall management process. For more
information on our process to identify, assess, prioritize, and monitor risks and opportunities
that may have financial effects, as well as our risk assessment process, see the
Risk and Risk
Management
section of the Board report.
Identifying Our Material Impacts, Risks, and Opportunities
Using the definitions for impact and financial materiality described above, we performed our DMA in
the following steps:
1.
Understand Our Activities, Value Chain and Business Relationships
Developed an overview of our business activities and relationships, including the activities,
products, and services within our own operations as well as our upstream and downstream value
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chain across geographies. For more information on our value chain, please see p. 122 of this
Sustainability Statement.
2.
Identify Sustainability Matters
Generated an extensive list of potentially material sustainability matters composed of those listed
in Application Requirement (AR) 16 of ESRS 1, as well as additional matters based on industry and
geographical research, sustainability frameworks and standards, consultation with independent
third-party advisors, and our prior year materiality assessment. In advance of the stakeholder
engagement described in step 3, below, the ESG team, with the guidance and input of each of
the Steering Committee (SteerCo) and an independent third-party consultant, performed an initial
relevance screening of these matters as well as a side-by-side evaluation against the original list
of potentially material matters to review and validate the basis for exclusion for each matter.
3.
Assess Impact and Financial Materiality
Engaged internal and external stakeholders to assess and refine our understanding of UMG’s
IROs from across our activities, business relationships, and geographies. Internal stakeholders
included a broad array of UMG employees across various business units, internal roles, and
geographies, among other factors, who were consulted directly through open-ended interviews.
These stakeholders assessed each of the financial and impact materiality of the potentially
material matters. External stakeholders included artists, shareholders, and distribution partners.
These stakeholders were consulted, by proxy, through interviews and survey questions tailored to
each type of stakeholder. Additionally, the ESG team and SteerCo each performed an independent
assessment of each sustainability matter. The results of all assessment methods were then
consolidated and presented to the SteerCo for review, discussion, and validation, as described
in step 4, below. For more information on our key stakeholders and our methods of stakeholder
engagement, see "Interests and views of stakeholders (SBM-2)" in this Sustainability Statement.
4.
Validate Material Topics
Conducted internal working sessions with senior leadership, the SteerCo, and subject matter
experts to review, analyze, and assess the results of step 3. This process included cross-checking
the results of UMG’s financial risk assessment as described in the
Risk and Risk Management
section of the Board report, discussing potential connections between impacts and dependencies
with the risks and opportunities that may arise from those impacts and dependencies, and
evaluating factors that could potentially give rise to a heightened risk of adverse impacts.
Following these working sessions, the SteerCo and ESG team validated and approved a final list
of material topics and underlying IROs. The final list was then presented to the Audit Committee
for review.
In 2025, UMG assessed whether a new DMA should be performed for the 2025 reporting period. This
assessment, undertaken with the oversight and advisement of the SteerCo, included the review of
applicable standards, guidance, and best practices and consultations with relevant business unit
owners and subject matter experts. Among other considerations, the Company specifically evaluated
the circumstances set forth in
EFRAG Implementation Guidance 1 Materiality Assessment, 5.3, FAQ
7, para. 171
. The Company concluded that it was not required to complete a new DMA for the 2025
reporting period.
In connection with this assessment, the ESG team, the SteerCo, and subject matter experts also
reviewed and evaluated UMG’s 2024 IROs for completeness, accuracy, and applicability for the 2025
reporting period. This review resulted in select typographical and textual updates to the IROs for
purposes of improving the accuracy, completeness, relevance, and clarity of presentation. These
changes did not result in, and are not reflective of, any changes to the materiality of the associated
reportable datapoints.
Identification of Impacts, Risks, and Opportunities Related to Specific Topical Standards
Climate Change
In addition to our general DMA process described above, our process to identify and assess
climate-related IROs includes assessment of our GHG footprint in accordance with the GHG
Protocol, including scope 1 emissions, scope 2 location-based emissions, scope 2 market-based
emissions; and scope 3 emissions for the following categories: purchased goods and services
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(category 1); capital goods (category 2); fuel- and energy-related activities not included in scope 1
or scope 2 (category 3); upstream transportation and distribution (category 4); waste generated in
operations (category 5); business travel (category 6); employee commuting (category 7); downstream
transportation and distribution (category 9); end-of-life treatment of sold products (category
12); franchises (category 14); and investments (category 15). For additional information, see the
Environmental information
section of this Sustainability Statement.
In 2025, UMG conducted climate scenario analysis, aligned with the recommendations of the Task
Force on Climate-Related Financial Disclosures (TCFD) to identify the physical and transition risks
and opportunities relevant to the business. This analysis included an in-depth assessment of
UMG's exposure to physical and transition risks for UMG's operations across multiple emissions
scenarios and time horizons. The analysis concluded that there were no material climate-related
risks to UMG’s operations across the evaluated scenarios and time horizons. Relevant sections of
the climate scenario analysis have been included in the
Environmental information
section of this
Sustainability Statement.
Other Topical Standards
As described above, as part of our DMA process, we generated an extensive list of potentially
material sustainability matters. This list included potentially material IROs at the sub-topic level,
including for pollution, water and marine resources, biodiversity and ecosystems, resource use and
circular economy, and business conduct. We conducted our DMA as described above and did not
perform additional screening of assets or activities, assessment of site locations, or conduct local
engagement at site locations with respect to these topics. Except as otherwise indicated in this
Sustainability Statement, we did not identify these topics as material.
Because our DMA did not identify biodiversity as a material topic, we do not currently conduct
biodiversity and ecosystems scenario analysis. In the event that our DMA identifies biodiversity as a
material topic in the future, we may conduct such analysis.
Disclosure Requirements in ESRS covered by our sustainability statement (IRO-2)
The following content index indicates the Disclosure Requirements we have identified to be material
as a result of our DMA process, as described above. For an explanation of how we determined the
material information to be disclosed in relation to our identified IROs, see “Description of the process
to identify and assess material impacts, risks, and opportunities (IRO-1)”.
Topical Standard
Material Topic
ESRS
Disclosure Requirement
Derived from other
EU legislation
1
Page
ESRS E1
Climate Change
GHG emissions
ESRS 2 IRO-1
Description of the process to identify and assess material impacts, risks and opportunities
127-129
ESRS 2 SBM-3
Material impacts, risks and opportunities and their interaction with strategy and business model
125-126
E1-1
Transition plan for climate change mitigation
141
E1-2
Policies related to climate change mitigation and adaptation
141
E1-3
Actions and resources in relation to climate change policies
141
E1-4
Targets related to climate change mitigation and adaptation
x
141-142
E1-6
Gross scopes 1, 2, 3 and total GHG emissions
x
147
E1-7
GHG removals and GHG mitigation projects financed through carbon credits
141
E1-8
Internal carbon pricing
141
ESRS S1
Own Workforce
2
Attraction and retention of employees
Diversity, inclusion and belonging
Gender equality and equal pay
S1-1
Policies related to own workforce
x
149
S1-2
Processes for engaging with own workforce and workers’ representatives about impacts
149-150
S1-3
Processes to remediate negative impacts and channels for own workforce to raise concerns
x
150
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Topical Standard
Material Topic
ESRS
Disclosure Requirement
Derived from other
EU legislation
1
Page
S1-4
Taking action on material impacts on own workforce, and approaches to managing material risks and pursuing material
opportunities related to own workforce, and effectiveness of those actions
150-151
S1-5
Targets related to managing material negative impacts, advancing positive impacts, and managing material risks
and opportunities
151-152
S1-6
Characteristics of the undertaking’s employees
153-154
S1-9
Diversity metrics
66, 154
S1-16
Remuneration metrics
x
154
ESRS G1
Business Conduct
Supply chain management
G1-2
Management of relationships with suppliers
156-157
Entity-specific
Attraction and retention of artists
Entity-specific
Attraction and retention of artists
154-155
Entity-specific
Privacy and cybersecurity
Entity-specific
Privacy and cybersecurity
159-160
Entity-specific
Intellectual property, piracy, and
content protection
Entity-specific
Intellectual property, piracy, and content protection
157-159
ESRS 2
General Disclosures
General disclosures
BP-1
General basis for preparation of sustainability statements
111
BP-2
Disclosures in relation to specific circumstances
111-112
GOV-1
The role of the administrative, management and supervisory bodies
x
113-115
GOV-2
Information provided to and sustainability matters addressed by the undertaking’s administrative, management and supervisory bodies
115
GOV-3
Integration of sustainability-related performance in incentive schemes
115
GOV-4
Statement on due diligence
x
121
GOV-5
Risk management and internal controls over sustainability reporting
115-116
118-119
IRO-1
Description of the process to identify and assess material impacts, risks and opportunities
127-129
IRO-2
Disclosure requirements in ESRS covered by the undertaking’s sustainability statement
129-130
SBM-1
Strategy, business model and value chain
119-122
SBM-2
Interests and views of stakeholders
123-124
SBM-3
Material impacts, risks and opportunities and their interaction with strategy and business model
125-126
1
The table includes all data points that derive from other EU legislation as listed in ESRS 2 Appendix B, which are material for UMG, indicating where the data points can be found in the report. Other data points which are not included in the table above, are considered
not material.
2
Except as expressly stated otherwise, UMG's material impacts on our own workforce are limited to UMG employees.
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Environmental information
Disclosures pursuant to Article 8 of Regulation 2020/8526 (Taxonomy Regulation)
The European Commission has set ambitious sustainability targets with the overarching aim to be a
net zero continent by 2050. An important component of the EU Action Plan on Sustainable Finance,
which supports this ambition, is to steer cash flows toward sustainable investments.
In accordance with European Regulation 2020/852 of June 18, 2020 and 'Besluit bekendmaking niet-
financiële informatie', UMG is obligated to disclose the Taxonomy-eligible, Taxonomy non-eligible,
and Taxonomy-aligned turnover, capital expenditures, and operating expenditures for economic
activities relating to the Taxonomy's six environmental objectives.
EU Taxonomy Objectives and Scope
The EU Taxonomy Regulation serves as a standardized and mandatory classification system to
determine which economic activities are considered environmentally sustainable in the EU. The
results of this classification are reported annually on a company-specific basis.
Article 9 of the EU Taxonomy regulation identifies six (6) environmental objectives:
1.
Climate change mitigation (CCM)
2.
Climate change adaption (CCA)
3.
Sustainable use and protection of water and marine resources (WTR)
4.
Transition to a circular economy (CE)
5.
Pollution prevention and control (PPC)
6.
Protection and restoration of biodiversity and ecosystems (BIO)
Regarding the classification of an activity as environmentally sustainable, the EU Taxonomy
Regulation distinguishes between Taxonomy-eligible and Taxonomy-aligned activities:
•
Activities are
Taxonomy-eligible
if they match the description of the activity included in Delegated
Acts supplementing Regulation (EU) 2020/852 of the European Parliament, irrespective of whether
they fulfill the alignment criteria.
•
Activities are
Taxonomy-aligned
if they fulfill the technical screening criteria for the activity. In
this case, they make a substantial contribution to the respective environmental objective (fulfill
the substantial contribution criteria), cause no significant harm to any of the other environmental
objectives (Do No Significant Harm, DNSH), and observe and comply with the minimum safeguards
for human rights, corruption, taxation, and fair competition (MS).
EU Taxonomy disclosure requirements for 2025 reporting are:
•
The proportion of Taxonomy-eligible, Taxonomy non-eligible and Taxonomy-aligned economic
activities in Key Performance Indicators (as identified in Delegate Regulation (EU) 2021/2139,
Delegated Regulation (EU) 2022/1214, Delegated Regulation (EU) 2023/2485, and Delegated
Regulation (EU) 2023/2486).
•
Qualitative information relevant for disclosures, including accounting policy, assessment of
compliance with Regulation (EU) 2020/852, and contextual information about KPIs (Disclosures
Delegate Act (EU) 2021/2178, Article 10).
Accounting Policies
The table on the following page provides the basis for the numerator and denominator of EU
Taxonomy-eligibility and alignment for Turnover, CapEx, and OpEx as defined in the Delegated
Regulation (EU) 2021/2178 (Annex I, Section 1.1).
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Turnover
CapEx
1
OpEx
1
Numerator
Revenue derived
from products and/or
services associated
with EU Taxonomy-
eligible/aligned activities.
Capital expenditures that are
related to assets or processes
associated with EU taxonomy-
eligible/aligned activities.
Operating expenses that are
related to assets or processes
associated with EU Taxonomy-
eligible/aligned activities.
Denominator
Revenue recorded in
the consolidated financial
statements under IFRS as
per Revenue Accounting
policy described in
the consolidated
financial statements.
Additions to tangible
and intangible assets
recorded in the consolidated
financial statements under
IFRS during the financial
year, considered before
depreciation, amortization, and
any re-measurements.
Direct non-capitalized costs recorded
in the consolidated financial
statements under IFRS that relate to
R&D, building renovation measures,
short-term leases, maintenance and
repair (excluding expenses reported
as cost of sales), and any other direct
expenditures relating to the day-to-
day servicing of PPE assets.
1
There are no capital or operating expenditures related to a capital plan or purchase of output from Taxonomy-aligned economic
activities such as individual measures enabling target activities to become low-carbon, activities leading to GHG emissions
reductions, or individual renovation measures planned to be implemented and operational within eighteen (18) months.
The financial information for calculating the metrics was gathered from UMG’s financial reporting
system, excluding intercompany transactions. Eligible economic activities are identified for CapEx
KPI, under CCM and CE objectives. Where an activity contributes to several environmental objectives,
UMG includes all activity codes, and highlights the most relevant one in bold. UMG considers the
allocation of revenues and expenditures to the numerator for only one environmental objective per
objective, to avoid double counting.
In 2025, UMG did not issue sustainability-linked bonds or debt securities.
Assessment of Compliance with Regulation (EU) 2020/852
For 2025, UMG assessed eligibility and alignment under each KPI and concludes as follows, with
subsequent explanations for each KPI.
•
Turnover: No revenue activities are considered eligible and therefore also not aligned.
•
CapEx: Taxonomy-eligible CapEx is calculated at 28%, however, it does not meet the substantial
contribution criteria, and therefore Taxonomy-aligned CapEx is 0%.
•
OpEx: Taxonomy OpEx is calculated at 1% of the total of selling, general and administrative
expenses and cost of revenues and is not considered material.
Turnover KPI
The basis of the turnover KPI covers UMG business activities as of December 31, 2025. The turnover
denominator is reconciled with the revenue recorded in Note 3 of the Consolidated Financial
Statements under IFRS as per the Revenue Accounting policy described in the Notes to the
Consolidated Financial Statements. It consists of revenue from Recorded Music, Music Publishing,
Merchandising, and Other.
Eligibility Assessment
Management analyzed the activities 13.1. Creative, arts and entertainment activities and 13.3.
Motion picture, video and television programme production, sound recording and music publishing
activities to evaluate whether these activities should be considered Taxonomy-eligible pursuant to
CCA. This analysis was conducted in consultation with the EU Taxonomy Regulation text, the EU
Taxonomy Climate Delegated Act, including supplemental notices in the form of FAQs approved by
the EU Commission, publications by the Platform on Sustainable Finance, and peer disclosures.
Based on the EU Commission notice C/2023/305 these activities are considered as “adapted-enabling
activities” and require becoming adapted themselves (adapted activity) and enabling other activities
to make a substantial contribution (enabling activity).
UMG completed climate scenario analysis to evaluate potential exposure to climate-related physical
and/or transition risks for operations across multiple emissions scenarios and time horizons. There
were no risks resulting in Significant or Major impact to UMG’s operations across all scenarios
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and time horizons. Separately, UMG assessed whether its turnover activities enable other economic
activities to make a substantial contribution to one or more environmental objectives. Based on
the nature of UMG’s turnover activities, these do not provide products or services that enable other
activities to make a substantial contribution. Accordingly, the criteria for an enabling activity is
not met.
Management continues to monitor relevant developments and guidance and will revisit this
analysis as new information becomes available. Based on the performed analysis, UMG’s eligible
Turnover, CapEx or OpEx in relation to the environmental objective CCA amounts to zero.
The percentage for Taxonomy-eligible Turnover amounts to zero. There are no Turnover activities
eligible and assessed for alignment.
CapEx KPI
Under the EU Taxonomy Regulation, the total CapEx covers additions to tangible and intangible
assets during the financial year considered before depreciation, amortization, and any re-
measurements recognized by UMG according to IAS16, IFRS16, and IAS38, including those resulting
from revaluations and impairments for the relevant financial year and excluding fair value changes.
Total CapEx (denominator) can be reconciled with the sum of the lines ’Additions’ disclosed in Note
10 Changes in content assets and other intangibles (excluding royalty advances), Note 11 Property,
Plant and Equipment (PPE), and Note 12 Leases within the consolidated financial statements.
Eligibility Assessment
For UMG, most of the CapEx relates to additions to catalogs and other intangibles, which are not
eligible. The eligible CapEx comes from the capitalized cost of renovations and leased assets (EU
Taxonomy activities under CCM: 7.2 Renovation of existing buildings, 7.7 Acquisition and ownership
of buildings, and CE: 3.2 Renovation of existing buildings.).
The breakdown by type of eligible CapEx is as follows:
(in millions of euros)
CCM 7.2,
CE 3.2
Renovation of
existing buildings
1
CCM 7.7
Acquisition and ownership
of buildings
2025
2024
2025
2024
Additions to PPE, leases, and intangible assets
114
56
55
85
Acquisitions through business combinations
0
0
3
0
Expenses incurred for Taxonomy-aligned activities and
as part of CapEx plan
0
0
0
0
Total Taxonomy-eligible CapEx
114
56
58
85
1
To avoid double counting, the most relevant activity (CCM 7.2) has been indicated in bold.
Alignment Assessment
7.2 and 3.2 Renovation of existing buildings
UMG has assessed the substantial contribution criteria and evaluated that the leasehold
improvements are conducted to meet UMG's business needs and do not meet the substantial
contribution criteria for CCM under Activity 7.2, and CE under Activity 3.2., as energy performance
requirements were not retested and the documentation required to demonstrate compliance with
the circular economy criteria was not available for the renovation projects.
7.7 Acquisition and ownership of buildings
For 2025, thirty-one (31) properties were identified as eligible under the substantial contribution
criteria for CCM. While UMG developed a validation approach using internationally recognized energy
certificates and primary energy demand (PED) measures, there was insufficient national and regional
data for the thirty-one (31) locations to determine energy performance. Therefore, the new properties
did not meet the energy performance requirements under substantial contribution criteria for CCM
and are not further assessed for alignment.
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As none of the Company’s Taxonomy-eligible activities meet the substantial contribution criteria,
they are not considered Taxonomy-aligned. Accordingly, the assessment of minimum safeguards is
not required for alignment purposes. A high-level screening of minimum safeguards was performed
during the reporting period. Based on this screening, no issues or indications of non-alignment with
the minimum safeguards were identified.
The percentage for Taxonomy-aligned CapEx amounts to zero.
OpEx KPI
The OpEx denominator includes direct, non-capitalized costs for research and development
expenses, building renovation measures, short-term leasing, maintenance and repair expenses, and
any other direct expenditure relating to the day-to-day servicing of assets of property, plant, and
equipment necessary to ensure the continued and effective functioning of such assets.
For UMG, most of the Taxonomy OpEx relates to the maintenance of buildings, assets used in
business operations, and short-term leases.
The nature of UMG’s business model relates to people and the arts and is not centered around
tangible assets. In 2025, UMG calculated Taxonomy OpEx at 1% of the total of selling, general and
administrative expenses and cost of revenues. Management concludes that Taxonomy OpEx is not
material for UMG’s business model. UMG makes use of the materiality exemption per the Disclosure
Delegated Act Annex I, Section 1.1.3.2, doesn’t assess eligibility and alignment of OpEx, and discloses
the numerator as equal to zero.
EU Taxonomy KPI Disclosure Tables
The KPI tables below summarize the outcome of UMG’s Turnover, CapEx and OpEx assessment.
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Proportion of Turnover from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2025
Financial year 2025
Year
Substantial Contribution Criteria
DNSH criteria (“Does Not Significantly
Harm”) (
Economic Activities (1)
Code
(2)
Turnover
(3)
Proportion of Turnover, year 2025 (4)
Climate Change Mitigation (5)
Climate Change Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change Mitigation (11)
Climate Change Adaptation (12)
Water (13)
Pollution (14)
Circular Economy (15)
Biodiversity (16)
Minimum Safeguards (17)
Proportion
of
Taxonomy
aligned
(A.1.) or
-eligible
(A.2.)
turnover,
year 2024
(18)
Category
enabling
activity
(19)
Category
transitional
activity
(20)
Text
millions
of euros
%
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
No activities
N/A
€0
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
N/A
N/A
Turnover of environmentally sustainable activities (Taxonomy-aligned) (A.1)
€0
0%
0%
0%
0%
0%
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
Of which enabling
€0
0%
0%
0%
0%
0%
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
E
Of which transitional
€0
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
T
A.2.
Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
No activities
N/A
€0
0%
N/A
N/A
N/A
N/A
N/A
N/A
0%
Turnover of Taxonomy-eligible but not environmentally sustainable activities
(not Taxonomy-aligned activities) (A.2)
€0
0%
0%
0%
0%
0%
0%
0%
0%
A.
Turnover of Taxonomy eligible activities (A.1 + A.2)
€0
0%
0%
0%
0%
0%
0%
0%
0%
B.
TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of Taxonomy-non-eligible activities
€ 12,507
100%
TOTAL
€ 12,507
100%
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Proportion of CapEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2025
Financial year 2025
Year
Substantial Contribution Criteria
DNSH criteria (“Does Not
Significantly Harm”)
Economic Activities (1)
Code
(2)
CapEx
(3)
Proportion of CapEx, year 2025 (4)
Climate Change Mitigation (5)
Climate Change Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change Mitigation (11)
Climate Change Adaptation (12)
Water (13)
Pollution (14)
Circular Economy (15)
Biodiversity (16)
Minimum Safeguards (17)
Proportion
of
Taxonomy
aligned
(A.1.) or
-eligible
(A.2.)
CapEx, year
2024 (18)
Category
enabling
activity
(19)
Category
transitional
activity
(20)
Text
millions
of euros
%
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
No activities
N/A
€0
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
N/A
N/A
CapEx of environmentally sustainable activities (Taxonomy-aligned) (A.1)
€0
0%
0%
0%
0%
0%
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
Of which enabling
€0
0%
0%
0%
0%
0%
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
E
Of which transitional
€0
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
T
A.2.
Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
Renovation of existing buildings
1
CCM 7.2
/CE 3.2
€ 114
19%
EL
N/EL
N/EL
N/EL
EL
N/EL
9%
Acquisition and ownership of buildings
CCM 7.7
€ 58
9%
EL
N/EL
N/EL
N/EL
N/EL
N/EL
14%
CapEx of Taxonomy-eligible but not environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
€ 172
28%
100%
0%
0%
0%
0%
0%
23%
A.
CapEx of Taxonomy eligible activities (A.1 + A.2)
€ 172
28%
100%
0%
0%
0%
0%
0%
23%
B.
TAXONOMY-NON-ELIGIBLE ACTIVITIES
CapEx of Taxonomy-non-eligible activities
€ 445
72%
TOTAL
€ 617
100%
1
To avoid double counting, the most relevant activity (CCM 7.2) has been indicated in bold.
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Proportion of OpEx from products or services associated with Taxonomy-aligned economic activities – disclosure covering year 2025
Financial year 2025
Year
Substantial Contribution Criteria
DNSH criteria (“Does Not
Significantly Harm”)
Economic Activities (1)
Code
(2)
OpEx (3)
Proportion of OpEx, year 2025 (4)
Climate Change Mitigation (5)
Climate Change Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change Mitigation (11)
Climate Change Adaptation (12)
Water (13)
Pollution (14)
Circular Economy (15)
Biodiversity (16)
Minimum Safeguards (17)
Proportion
of
Taxonomy
aligned
(A.1.) or
-eligible
(A.2.) OpEx
year 2024
(18)
Category
enabling
activity (19)
Category
transitional
activity (20)
Text
millions
of euros
%
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y; N; N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
No activities
N/A
€0
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
N/A
N/A
OpEx of environmentally sustainable activities (Taxonomy-aligned) (A.1)
€0
0%
0%
0%
0%
0%
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
Of which enabling
€0
0%
0%
0%
0%
0%
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
E
Of which transitional
€0
0%
0%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
0%
T
A.2.
Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
EL; N/EL
No activities
N/A
€0
0%
N/A
N/A
N/A
N/A
N/A
N/A
0%
OpEx of Taxonomy-eligible but not environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
€0
0%
0%
0%
0%
0%
0%
0%
0%
A.
OpEx of Taxonomy eligible activities (A.1 + A.2)
€0
0%
0%
0%
0%
0%
0%
0%
0%
B.
TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpEx of Taxonomy-non-eligible activities
€ 115
100%
TOTAL
€ 115
100%
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Proportional overview of KPIs
Proportion of Turnover/Total Turnover
Taxonomy-aligned per objective
Taxonomy-eligible per objective
2025
2024
2025
2024
CCM
0%
0%
0%
0%
CCA
0%
0%
0%
0%
WTR
0%
0%
0%
0%
CE
0%
0%
0%
0%
PPC
0%
0%
0%
0%
BIO
0%
0%
0%
0%
Proportion of OpEx/Total OpEx
Taxonomy-aligned per objective
Taxonomy-eligible per objective
2025
2024
2025
2024
CCM
0%
0%
0%
0%
CCA
0%
0%
0%
0%
WTR
0%
0%
0%
0%
CE
0%
0%
0%
0%
PPC
0%
0%
0%
0%
BIO
0%
0%
0%
0%
Proportion of CapEx/Total CapEx
Taxonomy-aligned per objective
Taxonomy-eligible per objective
2025
2024
2025
2024
CCM
0%
0%
28%
23%
CCA
0%
0%
0%
0%
WTR
0%
0%
0%
0%
1
CE
0%
0%
0%
0%
PPC
0%
0%
0%
0%
BIO
0%
0%
0%
0%
1
In 2025 (19%) and 2024 (9%), a portion of UMG's activities was assessed as eligible
to make a substantial contribution for both CCM 7.2 and CE 3.2. To avoid double
counting, only activities for the most relevant activity (CCM 7.2), are included in
the table.
Row
Fossil gas related activities
No
4.
The undertaking carries out, funds or has exposures to construction or operation of electricity generation
facilities that produce electricity using fossil gaseous fuels.
No
5.
The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined
heat/cool and power generation facilities using fossil gaseous fuels.
No
6.
The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat
generation facilities that produce heat/cool using fossil gaseous fuels.
No
Prospects
The EU Taxonomy Regulation does not yet recognize all sustainability efforts. For more information
about UMG’s sustainability initiatives, see Climate Change (E1) in the
Environmental information
section of this Sustainability Statement.
Management continues to monitor developments under the EU Taxonomy Regulation and to assess
new requirements as the basis for UMG’s annual disclosures. During the reporting period, UMG
reviewed Commission Delegated Regulation (EU) 2026/73, which will apply from 1 January 2026. UMG
has not taken the option to early adopt the regulation for the current reporting period.
Nuclear and fossil gas related activities
Row
Nuclear energy related activities
No
1.
The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of
innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from
the fuel cycle.
No
2.
The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear
installations to produce electricity or process heat, including for the purposes of district heating or industrial
processes such as hydrogen production, as well as their safety upgrades, using best available technologies.
No
3.
The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that
produce electricity or process heat, including for the purposes of district heating or industrial processes such as
hydrogen production from nuclear energy, as well as their safety upgrades.
No
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Climate change (E1)
Climate change requires collective action. We believe that our purpose, to shape culture through the
power of artistry, includes supporting collective action on climate change. Achieving reductions in
our own GHG emissions is an important demonstration of our commitment to meaningful change,
along with understanding our climate risks and opportunities. To support this commitment, we
measure and mitigate our environmental footprint and climate risks, as discussed below.
Climate scenario analysis (E1.IRO-1, E1.SBM-3)
In 2025, UMG conducted climate scenario analysis to identify any climate-related physical or
transition risks or opportunities relevant to the business. This analysis included an in-depth
assessment of UMG's exposure to physical and transition risks for UMG's operations across multiple
emissions scenarios and time horizons.
These scenarios are subject to inherent assumptions and uncertainties, including uncertainties
regarding the ways in which these scenarios may develop.
For each scenario, UMG assessed the potential effects on business operations across a short-,
medium-, and long-term time horizon. These time horizons were selected in alignment with our
DMA and other risk management processes:
•
Short-term: 0-1 years (2025-2026);
•
Medium-term: 1-5 years (2026-2030); and
•
Long-term: 5+ years (2030-2050).
Three climate scenarios from the
Intergovernmental Panel on Climate Change
(IPCC) were
selected to provide consistency and comparability in the analyses and disclosure, to account for
recommendations and requirements by the TCFD and the ESRS, and to account for the most likely
and worst outcomes in the assessment:
•
IPCC SSP1-2.6: a “sustainable development” scenario, which assumes that the world shifts
pervasively toward a more sustainable path and that global heating can be kept within ~1.8°C
by 2100;
•
IPCC SSP2-4.5: a “middle-of-the-road” scenario, which assumes that social, economic, and
technological trends do not shift markedly from historical patterns and that global heating can
be kept within ~2.7°C by 2100; and
•
IPCC SSP5-8.5: a “worst-case” scenario, which assumes the adoption of resource and energy
intensive lifestyles around the world and that global heating will rise to ~4.4°C by 2100.
Each risk's impact was assessed based on three criteria determined for each time horizon and
climate scenario:
•
Likelihood of occurrence: determined for each time horizon, estimated based upon current
trajectory of regional and global developments;
•
Severity of impact: potential influence of the hazard independent of likelihood and assuming no
relevant business, strategy, and financial planning; and
•
Existing resiliency measures: based on the current resiliency measures in place including
relevant business, strategy, and financial planning.
The levels of impact are defined as follows:
•
Low: risks are managed as part of existing processes;
•
Moderate: risks require additional adaptation planning and mitigation responses;
•
Significant: risks are likely to require significant pivot of business strategy or operational
protocols; and
•
Major: risks require major pivot to business, strategy, or financial planning.
The impact assessment identified only Low and Moderate-level risks. No risks resulting in Significant
or Major impacts to UMG’s operations were identified. Climate-related opportunities were also
identified to highlight potential benefits to UMG’s profitability and reputation. The list of climate-
related risks and climate-related opportunities are presented in Tables 1 and 2, respectively. None of
these climate-related risks or opportunities were determined to be material such as to be included
as IROs.
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For more information on the results of the assessment and impact on business, see "Identification
of Impacts, Risks, and Opportunities Related to Specific Topical Standards, Climate Change" in the
ESRS 2 General information
section of this Sustainability Statement.
Table 1 - Climate-Related Risks
Category
Description
Short-term
Medium-term
Long-term
Physical -
Acute/Chronic
Direct operational disruption and costs from climate-related physical hazards.
Increased operational costs and decreased revenues as a result of direct operational disruption from acute (e.g., floods, cyclones, wildfires) and chronic (e.g., heat stress, sea level risk)
physical hazards. These events can disrupt production, logistics, or facility operations, potentially increasing costs or delaying deliveries.
Low
Low
Low
Physical -
Acute/Chronic
Increased operational costs and decreased revenues as a result of supply chain disruption from environmental and climate-related risks.
These risks include physical hazards (e.g., floods, cyclones, heat stress), natural resources constraints, and environmental compliance requirements. Disruption in upstream or downstream
suppliers could affect manufacturing, distribution, and result in operational challenges as a result of increased pricing or product unavailability or delays.
Low
Low
Low
Market
Increased costs to transition to more sustainable materials and technologies.
Increased costs during the transition to using more sustainable materials (including alternatives to vinyl, reground vinyl, sustainable fabrics, recycled materials, etc.) for sold products and
merchandise. Lower-carbon technologies may result in higher cost inputs, new manufacturing processes, or supply chain adjustments.
Low
Low
Moderate
Policy & Legal
Regulatory compliance and operational risk from climate laws.
Increased operational costs or decreased efficiencies as it relates to compliance with climate-related laws and regulations (e.g., disclosure requirements, carbon pricing schemes, etc.) as
well as reputational impacts due to failure to comply with these laws.
Low
Low
Low
Reputation
Reputational risk from heightened stakeholder pressure to demonstrate credible climate action
.
This may result from the perception of changes in ambition, transparency, or performance on climate issues, disengagement or retention issues from employees or artists. Collectively, these
pressures may weaken UMG's market or brand position.
Low
Low
Low
Table 2 – Climate-Related Opportunities
Category
Description
Short-term
Medium-term
Long-term
Energy Source
Decreased emissions as a result of scaling renewable energy across the supply chain, operations, offices, and manufacturing facilities.
Adoption of renewable energy can reduce Scope 1 & 2 emissions across operations, lower reliance on fossil fuels, and improve energy efficiency.
Low
Low
Low
Markets
Enhanced brand reputation through climate initiatives, stakeholder engagement (both upstream and downstream), and tailored artist engagement.
This may stem from being perceived as a leader on climate issues, which can enhance stakeholder confidence in UMG, strengthen supplier relationships, and support the retention of
employees and artists. Collectively, these factors can reinforce UMG’s market and brand position, ultimately contributing to positive financial performance.
Low
Low
Low
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Category
Description
Short-term
Medium-term
Long-term
Resource Efficiency
Enhanced operational and energy efficiency from investing in updated assets and technologies.
Investing in updated assets and technologies (e.g., BREEAM, LEED, ENERGY STAR) enhances operational and resource efficiency across energy use and digital operations. This can lead to
reduced operating costs, improved energy performance across UMG’s portfolio, and lower emissions.
Low
Low
Low
Transition plan, policies, and key actions (E1-1, E1-2, E1-3, E1-7, E1-8)
UMG is developing a climate transition plan, which we aim to adopt by 2027. The initial steps we have
taken in laying the groundwork for the development of our climate transition plan include:
•
We conducted our first TCFD-aligned analysis in 2022 and conducted a formal update of this
analysis in 2025 (see “Identification of impacts, risks, and opportunities related to specific
topical standards”).
•
We set science-based targets which were approved by the Science-Based Targets initiative (SBTi)
in 2023 (see “Targets related to climate change mitigation and adaptation (E1-4)”, below).
•
We continued to meet with ESG working groups to collaborate on initiatives related to our
material scope 3 categories and supply chain engagement (for more information on our
ESG working groups, see the “Sustainability Management: Roles & Responsibilities” in the
Corporate Governance
section of the Board report and “Supply Chain Management” in this
Sustainability Statement).
•
We continued to engage with key stakeholders to evaluate activities that could have an impact on
actual and potential future GHG emissions.
•
We continued our renewable energy transition analysis and developed strategies for switching
more properties to renewable power.
•
We identified key actions we can take to reduce our product-related emissions, including the use
of alternative materials and modes of distribution, which will inform our decarbonization strategy.
In 2025, UMG adopted an environmental policy that addresses our approach to sustainability in
our business, within our value chain, and across our industry. The policy sets out our approach to
minimizing UMG’s negative impacts on the environment, including our commitments to managing
our GHG emissions; achieving our SBTi-approved targets; engaging and collaborating with our
stakeholders, including our suppliers, on our environmental efforts; working to comply with all
applicable environmental laws and regulatory requirements; and working to improve and report on
our environmental performance on an ongoing basis.
The Head of Sustainability is responsible for implementation of the policy. The policy is available on
our website and upon request.
UMG does not have internal carbon pricing schemes, GHG removals and storage, or GHG
mitigation projects financed through carbon credits. UMG is not excluded from the EU Paris-
aligned Benchmarks.
Targets related to climate change mitigation and adaptation (E1-4)
In 2023, UMG became the first major standalone music company to announce science-based targets
approved by the SBTi. We committed to reduce:
•
Absolute scope 1 and 2 GHG emissions 58% by 2032 from a 2019 base year, an ambition which is in
line with a 1.5°C trajectory.
•
Scope 3 GHG emissions from purchased goods and services, capital goods, fuel- and energy-
related activities, upstream transportation and distribution, waste generated in operations,
business travel, and employee commuting by 62% per EUR value added
1
within the
same timeframe.
1
“Value added“ is defined as EBITDA plus all personnel costs. EBITDA is defined in the Appendix to the Annual Report.
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UMG’s ESG team developed the science-based targets based on the GHG Protocol and the SBTi Criteria
and Recommendations Version 5.0.
1
Our science-based targets cover all seven GHGs, where relevant:
carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons
(PFC), sulfur hexafluoride (SF6), and nitrogen trifluoride (NF3). Our science-based targets are aligned
with the boundaries of our GHG Inventory (see “GHG emissions methodology”, below). We seek
to ensure this alignment by following the GHG Protocol for our emissions calculations and target-
setting process, and through the SBTi validation. Our science-based targets align with the climate
scenario laid out in the Paris Agreement. Our science-based targets were not derived using a
sectoral decarbonization approach.
With regard to our target base year, the SBTi allows flexibility in base year selection to consider
circumstances that may make a given year's emissions unrepresentative. At the time of our
assessment, UMG considered 2019 as the most representative year of normal operations prior
to the effects of the COVID-19 pandemic, so we selected 2019 as the base year for our science-
based targets.
We report our scope 1, 2, and 3 emissions and our progress towards achieving our science-based
targets annually (see “Science-based targets progress” and “Gross scopes 1, 2, 3 and total GHG
emissions”, below). UMG is developing the decarbonization levers and evaluating their potential
quantitative contributions to achieve our science-based targets as part of our climate transition
plan. We have not set 2030 emissions reduction targets as our SBTi-approved targets were set in
advance of the implementation of the CSRD.
Science-based targets progress (E1-4)
Target
Base Year
2019
1
2025
Reduction from
2019-2025
Reduction Target
by 2032
Scope 1 & 2 (market-based) (absolute tCO
2
e)
12,617
8,306
-34%
-58%
Scope 3 (tCO
2
e per million EUR value added)
2,3
219
122
-44%
-62%
1
We recalculated emissions for our 2019 base year to enable comparability between prior years and the current reporting period.
For more information, see "Revisions and recalculations of previous environmental metrics" on p. 112 of this Sustainability
Statement. Because our 2019 base year calculations are outside of the scope of the Company’s third-party assurance, UMG’s
recalculations pertaining to our 2019 base year have not been independently assured.
2
Our scope 3 target covers the following emissions categories: purchased goods and services, capital goods, fuel- and
energy-related activities, upstream transportation and distribution, waste generated in operations, business travel, and
employee commuting.
3
“Value added“ is defined as EBITDA plus all personnel costs. EBITDA is defined in the Appendix to the Annual Report.
Key drivers for decreases in our scope 1 and 2 (market-based) emissions since our base year
include a decrease in standard electricity consumption, an increased share of renewable electricity,
a reduction in the number of vehicles and associated fuel use, and lower refrigerant emissions.
Decreases in our scope 3 intensity metric, both since our base year and since the prior year, are
primarily due to significant increases in UMG's value added and modest decreases in the emissions
within our target boundary.
GHG emissions methodology (E1-6)
Overview
UMG follows the GHG Protocol, a globally recognized framework for measuring and reporting
emissions. Our GHG inventory includes our relevant scope 1, scope 2 (location-based), scope 2
(market-based), and scope 3 emissions sources.
Reporting scope
The reporting scope for scope 1 and 2 emissions is primarily driven by the status of UMG’s owned
and leased properties. In 2025, the reporting scope applied to 58 countries and 189 properties, which
1
SBTi Criteria and Recommendations V5.0
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represents 95% of our property portfolio and all properties where there is employee headcount.
Properties in scope for environmental reporting include UMG offices, studios, and facilities with
active leases in the reporting year. Properties are considered out of scope if they meet any of the
following criteria: the property closed prior to the reporting year and UMG does not have an active
lease; the property is under construction; or the property is land.
UMG collects actual global data for our scope 3 emissions to the fullest extent possible. For a limited
number of subcategories, global data collection is infeasible. For these subcategories, UMG collects
data from our top five territories (United States, United Kingdom, Japan, Germany, and France) and
estimates for rest of world emissions.
1
Methodology
Scope 1 & 2 emissions
Scope 1 emissions are direct GHG emissions that occur from sources that are owned or controlled
by UMG. These include emissions from the consumption of natural gas and domestic heating fuel,
the leakage of refrigerants during normal air-conditioning operation, and consumption of fuel from
mobile sources, such as directly owned vehicles and vehicles on long-term leases. Emission factors
were obtained from DESNZ/BEIS conversion factors.
Scope 2 emissions are indirect GHG emissions resulting from the use of purchased electricity,
steam/imported heat, and cooling. In accordance with the GHG Protocol, UMG considers both
location-based and market-based scope 2 emissions.
The scope 2 location-based method reflects the average emissions intensity of grids on which
energy consumption occurs. These emissions are calculated based on the grid emissions factor
for the geographic location of the site from which electricity, steam/imported heat, or cooling is
purchased. Emission factor sources include IEA Emission Factors, United States Environmental
Protection Agency (EPA) eGrid Factors, and DESNZ/BEIS Conversion Factors.
The scope 2 market-based method reflects emissions from electricity that UMG has specifically
chosen, including the use of certified renewable electricity through contractual instruments or
onsite generation. Emission factor sources include IEA, DESNZ/BEIS, Association of Issuing Bodies
Residual Mix (AIB) Factors, and Green-e Residual Mix Factors. In the case of the supplier sourcing
energy from renewable sources, the emission factor applied is 0 kgCO2e/kWh.
Scope 3 emissions
Scope 3 includes external indirect GHG emissions from non-owned sources within UMG’s
value chain.
Purchased goods and services (category 1) includes all upstream (i.e., cradle-to-gate) emissions
from the production of products purchased or acquired by UMG in the reporting year. This category
includes emissions associated with indirect spend across our global operations that are not
otherwise captured in UMG’s GHG Inventory; manufacturing of physical audio and merchandise
products; use of third-party recording studios; use of third-party cloud service providers; and
consumption of water at UMG properties. Emissions were calculated using the supplier-specific
method, hybrid method, and spend-based method. Emission factor sources include CEDA EEIO,
ecoinvent LCA, and DESNZ/BEIS. We made revisions to reflect enhanced calculation methodologies
for 2024 physical audio and indirect spend by utilizing actual data for Q4 instead of estimates
for these subcategories. However, the calculations for the category still rely on other estimates
and assumptions. For more information, see "Value chain estimation, sources of estimation, and
outcome uncertainty". Additionally, we made revisions to reflect newly available data for Japan and
removed duplicates in our 2024 physical audio emissions. For more information, see "Revisions and
recalculations of previous environmental metrics" on p. 112 of this Sustainability Statement. The
resulting difference in this metric as compared to our 2024 Annual Report is 36,175 tCO
2
e.
1
For FY25, UMG applied a rest of world emissions estimate to the following scope 3 subcategories: category 1 emissions related to third-party recording studios, physical audio, and merchandise; category 6 emissions related to business jets; and category 12 emissions
related to physical audio and merchandise.
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Capital goods (category 2) includes all upstream emissions from the production of capital goods
purchased or acquired by UMG in the reporting year. Emissions were calculated using the spend-
based method and emission factors were obtained from CEDA EEIO.
Fuel- and energy-related activities (category 3) includes emissions related to the production of fuels
and energy purchased and consumed by UMG in the reporting year that are not included in scope 1
or scope 2. This category is comprised of well-to-tank (WTT) and transportation and distribution (T&D)
loss emissions. Emissions were calculated using the fuel-based method and emission factors were
obtained from DESNZ/BEIS and IEA.
Upstream transportation and distribution (category 4) includes emissions related to the
transportation and distribution of products purchased by UMG between our tier 1 suppliers and own
operations in vehicles and facilities not owned or controlled by the reporting company. Additionally,
this category includes emissions related to third-party transportation and distribution services
purchased by UMG in the reporting year (either directly or through an intermediary), including
inbound logistics, outbound logistics, and third-party transportation and distribution between our
own facilities. Emissions calculated include both WTT and tank-to-wake (TTW) emissions, and
account for the effects of radiative forcing in air freight. Emissions are calculated using the distance-
based method and emission factors were obtained from the DESNZ/BEIS Conversion Factors. We
made revisions to reflect improved data from a logistics supplier for 2024. For more information, see
"Revisions and recalculations of previous environmental metrics" on p. 112 of this Sustainability
Statement. The resulting difference in this metric as compared to our 2024 Annual Report is
17,575 tCO
2
e.
Waste generated in operations (category 5) includes emissions from third-party disposal and
treatment of waste that is generated in UMG’s owned or controlled operations in the reporting year.
This category includes general waste generated at our owned and leased properties, electronic waste
reported by our third-party treatment provider, and Bravado merchandise scrap waste collected by
our third-party recycling partner. Emissions were calculated using the waste-type-specific method
and emission factors were obtained from DESNZ/BEIS.
Business travel (category 6) includes emissions from the transportation and lodging of UMG
employees for business-related activities in vehicles or assets owned or operated by third parties.
This category includes air, road, rail, business jet, and hotel activity that is booked by UMG across
our global operations; artist travel that is booked by an artist management company is excluded
from these calculations. Emissions calculated include both WTT and TTW emissions. Emissions were
calculated using the distance-based method and spend-based method, and emission factors were
obtained from DESNZ/BEIS and CEDA EEIO database.
Employee commuting (category 7) includes emissions from the transportation of UMG employees
between their home and their worksites. This category includes emissions related to the commuting
of employees across UMG’s global operations. Emissions were calculated using the average data
method and distance-based method and emission factors were obtained from DESNZ/BEIS.
Downstream transportation and distribution (category 9) includes emissions from the transportation
and distribution of products sold by UMG in the reporting year between our operations and retail
stores (if not paid for by UMG), in vehicles and facilities not owned or controlled by UMG. This
calculation is currently classified as a “screening” due to the high level of estimation utilized due
to limited data availability.
1
Emissions calculated include both WTT and TTW emissions. Emissions
were calculated using the average data method and distance-based method, and emission factors
were obtained from DESNZ/BEIS. We made revisions to reflect enhanced calculation methodology for
2024 by utilizing actual data for Q4 instead of estimates. For more information, see "Revisions and
recalculations of previous environmental metrics" on p. 112 of this Sustainability Statement. The
resulting difference in this metric as compared to our 2024 Annual Report is 2,181 tCO
2
e.
End-of-life treatment of sold products (category 12) includes emissions from the waste disposal
and treatment of products sold by UMG in the reporting year, at the end of their life. The category
1
For more information, please see “Value chain estimation, sources of estimation, and outcome uncertainty” on p. 111-112 of this Sustainability Statement.
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includes the total expected end-of-life emissions from all physical audio and merchandise products
sold in the reporting year. Emissions were calculated using the waste-type-specific method and
emission factors were obtained from DESNZ/BEIS. We made revisions to reflect enhanced calculation
methodology for 2024 physical audio by utilizing actual data for Q4 instead of estimates for
the subcategory. However, the calculations for the category still rely on other estimates and
assumptions. For more information, see "Revisions and recalculations of previous environmental
metrics" on p. 112 of this Sustainability Statement. The resulting difference in this metric as
compared to our 2024 Annual Report is 1,619 tCO
2
e.
Franchises (category 14) includes emissions associated with UMG’s licensing of sold merchandise.
This calculation is currently classified as a “screening” due to the high level of estimation utilized
due to limited data availability.
2
Emissions were calculated using the spend-based method and
emission factors were obtained from CEDA EEIO.
Investments (category 15) includes emissions associated with the UMG’s investments in the
reporting year that are not included in scope 1 or scope 2. This calculation was previously classified
as a “screening”; however, we incorporated newly available data for investees, which has improved
our extrapolation of emissions for UMG’s portfolio of investments in equity affiliates. Emissions
were calculated using the spend-based method and emission factors were obtained from CEDA EEIO.
We made revisions to reflect refinement to our mapping of emission factors for 2024 investments
(category 15) and the incorporation of newly available data for investees, which has improved
our extrapolation of emissions for UMG’s portfolio of investments in equity affiliates. For more
information, see "Revisions and recalculations of previous environmental metrics" on p. 112
of this Sustainability Statement. The resulting difference in this metric as compared to our 2024
Annual Report is 78,750 tCO
2
e.
The following scope 3 categories are excluded from our GHG inventory because they are not relevant
to UMG:
•
Upstream leased assets (category 8) - emissions from leased assets are reported in scope 1 and
scope 2;
•
Processing of sold products (category 10) - UMG does not sell intermediate products;
•
Use of sold products (category 11) - UMG does not sell products with direct use-phase
emissions; and
•
Downstream leased assets (category 13) - UMG does not lease assets to other entities.
Other estimates, approximations, and forecasts
For our GHG emissions calculations, data is generally requested for Q1-Q3 and estimates are applied
for Q4 to allow time for data validation, consolidation, and reporting.
3
Estimation of emissions follows
one of the following methodologies:
1.
Q4 Projections: uses Q4 activity projections provided directly from relevant data contributors
in calculations.
2.
Historical Average: uses quarterly activity data for previous years to calculate the historical
average ratio of total Q1-Q3 to Q4 activity data. This ratio is then applied to the Q1-Q3 activity
data in the current year to estimate for Q4.
3.
Current Year Average: estimates Q4 activity volume using the average quarterly activity volume for
Q1-Q3 in the current year.
Q4 projections provided by data contributors are preferred for all calculations. The Historical Average
method is used where this is not possible and when data is available at quarterly granularity, at
a minimum, in previous years. The Historical Average Method accounts for seasonal differences
in business activity; the calculated average ratio considers data from as many previous years as
possible, with the average ratio weighted by total activity per year. For emissions sources where
these two methods are not possible, a Current Year Average is applied.
2
For more information, please see “Value chain estimation, sources of estimation, and outcome uncertainty” on p. 111-112 of this Sustainability Statement.
3
This excludes the following scope 3 subcategories, which utilize Q4 actuals in FY25: indirect spend and physical audio (category 1), capital goods (category 2), downstream T&D (category 9), and physical audio (category 12). However, other estimates and assumptions are
still used in these calculations. For more information, please see “Value chain estimation, sources of estimation, and outcome uncertainty” on p. 111-112 of this Sustainability Statement.
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For FY25, the Q4 Projections method is used in the emissions calculations for scope 3 category 1
and category 12; the Historical Average method is used in the emissions calculations for scope 3
categories 1 and 4; and the Current Year Average method is used in the emissions calculations for
scope 1, scope 2 (location-based), scope 2 (market-based), and scope 3 categories 1, 3, 4, 5, 6, and 12.
Structural changes – such as mergers, acquisitions, and divestments – that occur during the
reporting year are reflected in UMG’s GHG inventory using actual data, where available. In instances
where actual data is not available, UMG estimates emissions data. In 2025, UMG estimated emissions
data for the following structural changes: RLM Spain, 8ball Music, Hundred Days Digital, A-Sketch, and
Pigeons & Planes.
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Gross scopes 1, 2, 3 and total GHG emissions (E1-6)
1
Retrospective
Milestones and target years
2019 (Base Year)
2
2024
2025
% 2025 / 2024
2032 (Target Year)
Annual % target / 2019
Scope 1 GHG emissions
Gross scope 1 GHG emissions (tCO
2
e)
5,239
1,797
2,436
36
1,865
4.46
3
Percentage of scope 1 GHG emissions from regulated emission trading schemes (%)
0
0
0
-
-
-
Scope 2 GHG emissions
Gross location-based scope 2 GHG emissions (tCO
2
e)
4
8,727
8,816
7,819
-11
-
-
Gross market-based scope 2 GHG emissions (tCO
2
e)
7,378
6,467
5,870
-9
2,945
4.46
3
Significant scope 3 GHG emissions
Total gross indirect (scope 3) GHG emissions (tCO
2
e)
5
594,118
562,805
548,753
-2
-
-
1 Purchased goods and services
383,935
363,629
387,574
7
-
-
2 Capital goods
37,425
32,153
28,695
-11
-
-
3 Fuel and energy-related activities (not included in scope 1 or scope 2)
3,246
2,789
2,632
-6
-
-
4 Upstream transportation and distribution
43,363
73,305
56,111
-23
-
-
5 Waste generated in operations
236
556
470
-15
-
-
6 Business travel
70,214
50,967
36,184
-29
-
-
7 Employee commuting
9,893
5,823
6,259
7
-
-
9 Downstream transportation and distribution
1,380
5,797
4,548
-22
-
-
12 End-of-life treatment of sold products
3,630
7,227
7,502
4
-
-
14 Franchises
23,207
6,052
2,777
-54
-
-
15 Investments
17,589
14,507
16,000
10
-
-
Total GHG emissions
6
Total GHG emissions (location-based) (tCO
2
e)
608,084
573,418
559,008
-3
-
-
Total GHG emissions (market-based) (tCO
2
e)
606,735
571,069
557,059
-2
-
-
1
Due to rounding, amounts may not add up precisely to the totals provided.
2
We recalculated emissions for our 2019 base year to enable comparability between prior years and the current reporting period. For more information, see "Revisions and recalculations of previous environmental metrics" on p. 112 of this Sustainability Statement. The
resulting differences as compared to the same metrics in our 2024 Annual Report is 56,351 tCO
2
e for each of Total GHG emissions (location-based) and Total GHG emissions (market-based).
3
UMG's target is to reduce absolute scope 1 and 2 GHG emissions 58% by 2032 from a 2019 base year; the annual reduction rate required to achieve this target is 4.46%.
4
UMG does not have a target covering scope 2 location-based emissions; therefore, there is no data in the 'Milestones and target years' columns.
5
UMG does not have an absolute scope 3 target; therefore, there is no data in the 'Milestones and target years' columns. See “Science-based targets progress” for relevant data on UMG’s science-based scope 3 intensity target.
6
UMG does not have a target covering total GHG emissions; therefore, there is no data in the 'Milestones and target years' columns.
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Scope 1 and 2 GHG emissions breakdown
1
2024
2025
Scope 1 GHG emissions
1,797
2,436
Mobile sources (tCO
2
e)
1,058
965
Stationary sources (tCO
2
e)
739
1,470
Of which refrigerants
35
546
Of which domestic fuel oil
1
249
Of which natural gas
703
675
Scope 2 GHG emissions (location-based)
8,816
7,819
Electricity (tCO
2
e)
7,620
6,901
Steam/imported heat (tCO
2
e)
1,196
916
Urban cooling (tCO
2
e)
-
2
Scope 2 GHG emissions (market-based)
6,467
5,870
Electricity (tCO
2
e)
5,271
4,952
Steam/imported heat (tCO
2
e)
1,196
916
Urban cooling (tCO
2
e)
-
2
1
In 2025, UMG included two new sources in our scope 2 emissions – the consumption of electricity from electric vehicles and
urban cooling. Additionally, UMG estimated emissions for five residential properties in 2025 and allocated emissions to scope 2 in
the absence of actual data.
GHG emissions per net revenue (E1-6)
1
Metric
2024
2
2025
Total GHG emissions (location-based) per net
revenue (tCO
2
e/million EUR)
48.5
44.7
Total GHG emissions (market-based) per net
revenue (tCO
2
e/million EUR)
48.3
44.5
1
See "Consolidated Statement of Profit or Loss" in the Board report.
2
We enhanced our calculation methodology for 2024 for several Scope 3 categories, resulting in differences as compared to the
same metrics in our 2024 Annual Report. For more information, see "Revisions and recalculations of previous environmental
metrics" on p. 112 of this Sustainability Statement.
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Social information
Own workforce (S1)
Attraction and retention of employees
UMG is powered by the talents of our people. We recognize that our ability to attract and retain
talented employees with a wide range of skill sets and perspectives is closely tied to our business
model, particularly to the extent that attracting and retaining talented employees can enhance our
ability to attract and retain artists. The management and advancement of our employees’ wellbeing,
development, compensation and benefits, and engagement strengthen our workforce by attracting
and retaining top talent at all levels.
Policies related to our workforce (S1-1)
Code of Conduct and Whistleblowing Policy
UMG’s Code of Conduct, implemented by our Chief Compliance Officer, is applicable to every
person conducting business for UMG, including employees, interns, officers, members of the
Board, and third parties such as consultants, independent contractors, and company advisors or
representatives. Relevant aspects of our Code of Conduct are described further below.
To achieve the standards set out in our Code of Conduct, our Board adopted a standalone
Whistleblowing Policy, implemented by our Chief Compliance Officer. The purpose of our
Whistleblowing Policy, discussed further below, is to encourage all employees and other
stakeholders (e.g. shareholders, suppliers, and customers) to report genuine concerns or complaints
about unethical behavior, malpractices, illegal acts or failure to comply with regulatory requirements
without fear of reprisal should they act in good faith when reporting such concerns or complaints.
Human rights commitments
At UMG, we believe that respecting human rights is essential to fostering a workplace where
individuals can thrive creatively and professionally. UMG's Code of Conduct prohibits harassment,
discrimination, violence, child labor, slavery, human trafficking, and unsafe working conditions.
These values are reflected across our operations and we only conduct business with partners,
suppliers, and customers who share our commitment to protecting human rights. We also empower
employees to speak up if they witness or suspect any human rights violations. Our Code of Conduct
is consistent with the United Nations Guiding Principles on Business and Human Rights.
Our Code of Conduct also covers our approach to workplace safety, security and the health of our
employees, as well as procedures to help us to create a safe work environment.
Anti-discrimination and inclusion
Our Code of Conduct encourages an inclusive environment that promotes individual expression,
creativity, innovation, and achievement and emphasizes that within UMG diverse backgrounds and
skills are valued as well as individual differences in race, ethnicity, gender or gender identity, sexual
orientation, disability, religious affiliation, age, experience, and thought.
Our Board has also adopted a separate diversity and inclusion policy (the D&I Policy) as per articles
2:142b and 2:166 of the Dutch Civil Code and best practice provision 2.1.5 of the Code, laying down
the elements of a diverse and inclusive composition of the Board and senior management as well
as appropriate and ambitious aspirations in this respect. The D&I Policy is detailed in the
Corporate
Governance
section of the Board report.
Processes for engaging with own workforce and workers’ representatives about
impacts (S1-2)
UMG maintains a dedicated Employee Listening program. Employee Listening is how we pass the mic
to hear thoughts and opinions on the employee experience at UMG. Our strategy consists of a series
of surveys that follow the employee lifecycle to measure each employee’s individual experience,
and company-wide surveys to pulse where we are in meeting our objectives. The Strategy, Insights
& Planning Team, within our PIC department under the oversight of our Executive Vice President,
Chief People and Inclusion Officer, is responsible for our workforce surveys. In the U.S., Korea, and
Southeast Asia, with a planned global expansion in coming years, we continuously run Lifecycle
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Surveys (first week new hire, 90-day new hire, and exit surveys) to capture key information along the
employee journey. Globally, we run engagement or pulse surveys on an as-needed basis to measure
progress on our objectives. Additionally, our labels leverage our Strategy, Insights & Planning team to
gather enterprise and label-specific insights.
As described in this Sustainability Statement, we also directly consult our employees as part of our
DMA process and ongoing employee engagement. See "Description of the process to identify and
assess material impacts, risks, and opportunities (IRO-1)" and "Interests and views of stakeholders
(SBM-2)" in
ESRS 2 General information
for more information.
Processes to remediate negative impacts and channels for own workers to raise
concerns (S1-3)
UMG addresses material negative impacts on our own workforce through a global framework
overseen by the Compliance and PIC departments using a multi-pronged approach and consistent
with local laws: (1) training and guidance to our workforce as to their rights and obligations
while working at UMG; (2) multiple channels to raise questions, needs, concerns, or allegations
of impropriety; (3) a system to investigate any allegations requiring review; (4) prohibition against
retaliation for raising good faith concerns; and (5) periodic assessments to ensure the processes
are effective. Any material negative impacts to UMG's own workforce are also addressed within
the Company's internal Ethics and Compliance Committee and, where appropriate, raised to
UMG's Board.
As set forth in our Code of Conduct and Whistleblowing Policy, UMG provides multiple channels for
our workforce and anyone conducting business for UMG to raise questions or voice concerns. They
can also address their needs and concerns through direct communication with their supervisor or
department leadership or by contacting the PIC department, legal counsel, General Counsel or Chief
Compliance Officer and through our Global Compliance and Ethics hotline (the “Hotline”). The Hotline,
supported by a third-party provider, permits employees to raise concerns 24 hours a day, seven days
a week via telephone or the internet. Additionally, such concerns may be made anonymously where
permitted by local law.
UMG's grievance and complaint mechanisms are described in our Code of Conduct, Whistleblowing
Policy, and territory-specific grievance procedures as may be required by local law. UMG takes
each report of suspected violations seriously, regardless of how the matter is disclosed to the
Company. Pursuant to our Code of Conduct, all reports of misconduct must be investigated promptly,
thoroughly, and objectively. Depending on the nature of the complaint, UMG determines how the
complaint should be investigated, considering such factors as whether the investigation should
be conducted internally or using external resources, whether forensic expertise will be required,
and potential language barriers. Complaints are communicated to appropriate internal parties on
a need-to-know basis, whether to select executives in the region where the report originated, the
Ethics Committee or the Board. Confidentiality is maintained to the fullest extent possible and as
required by applicable local laws. Upon conclusion of an investigation, if misconduct is found, UMG
administers appropriate discipline to those involved, consistent with local laws. Our Whistleblowing
Policy prohibits retaliation against anyone who reports a concern in good faith.
UMG seeks to ensure that our workforce is aware of the multiple channels to ask questions and
report concerns by: (1) issuing our Code of Conduct and Whistleblowing Policy to all employees
globally every year and confirming the acknowledgement and understanding of these policies by
each employee; (2) including the methods by which employees can ask questions/report concerns
in all global training courses; (3) emailing information regarding the Hotline to all employees; and (4)
conducting workforce surveys, which include issues related to knowledge of the reporting channels
and likelihood of use of the channels.
Taking action on material impacts on own workforce, and approaches to mitigating material
risks and pursuing material opportunities related to own workforce, and effectiveness of those
actions (S1-4)
Cultivating work environments that are welcoming, inclusive, free of discrimination, and that
promote a diversity of perspectives and backgrounds can increase our resilience as a company as
well as the creativity behind our products and services.
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In 2025, we continued to act on this belief through continued investment in our talent and by
working to cultivate a culture of belonging. In addition to the actions described below, please see p.
65 of the Board report for further information regarding our actions on this topic.
Internally, our Employee Resource Groups (ERGs) continue to provide a platform for employees to
network, share experiences, and influence employee programming. All employees are encouraged to
become members and participate. Our ERGs include:
•
BLACK LABEL: Fosters community and cultivates leaders at UMG, while celebrating Black culture
across the music industry.
•
CULTURA: Celebrates the diversity and unity of Latinx and Hispanic people by promoting cultural
awareness, supporting Latinx communities, and empowering current and future Latinx and
Hispanic leaders at UMG.
•
PRISM: Cultivates a space to build community and celebrate LGBTQ+ identifying individuals and
allies within UMG and across the music industry.
•
UTOPIAA: Provides a community and platform for employees that identify as Asian American &
Pacific Islander (AAPI) and their allies.
•
WOMEN’S NETWORK: Serves to advance the position of women in the music industry by providing
a support system that allows members to express themselves and realize their goals – both
professional and personal.
•
JEWISH HERITAGE: Provides a space where employees can connect, share stories, and celebrate
the richness of Jewish history, culture, and traditions.
To attract the next generation of talent, UMG continues to host internship programs for students
across a variety of institutions. To continue to foster talent throughout all career stages, UMG
maintains various training programs throughout the employee lifecycle. Our “The 6” series of
development programs aims to equip employees with essential skills for career growth and effective
team management, such as team development, cross-functional collaboration, communication,
and productivity. In 2025, we conducted training programs tailored to cohorts of team members,
people managers, director-level leaders, and senior-level leaders, respectively. UMG also maintains
a global job architecture project, launched in 2023, to standardize career leveling and remuneration,
addressing concerns related to compensation disparities, and supporting retention.
As further described in the
Corporate Governance
section of the Board report, UMG supports
equitable pay practices by conducting pay equity studies, and through the implementation of
our global job architecture, in which individual pay reflects experience, skillset, performance
against goals, and scope of responsibilities, but does not differentiate on the basis of
protected characteristics.
Globally, our employee benefits continue to be suited for the diverse needs of our workforce and
support a company-wide culture of physical health, mental health awareness, and overall wellbeing.
In addition to competitive compensation structures, our total rewards program is central to our
strategy for enhancing our appeal as an employer and creating a positive, healthy workplace. While
specific benefits vary by region, in the United States, for instance, UMG’s medical plans provide
unlimited access to mental health services at no cost when using in-network providers; include
comprehensive family programs and supports women’s health through targeted benefits; include 12
weeks of paid family leave time to care for loved ones; and cover travel for employees and eligible
dependents for fertility-related medical care.
Targets related to managing material negative impacts, advancing positive impacts, and
managing material risks and opportunities (S1-5)
As enshrined in our D&I policy, we are committed to improving the gender diversity among our
senior managers and to promoting diversity and inclusion in the boardroom. Our specific aspirations
pertaining to these commitments, which were developed with input from our senior management
and unanimously approved by our Board, are discussed in further detail in the
Corporate Governance
section of the Board report.
Methodology (S1-6, S1-9, S1-16)
The reporting scope covers all UMG employees and data is collected from our global human resource
platform. For the calculations of pay gap and annual total remuneration ratio, data is also collected
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from our local payroll systems. UMG defines an "employee" as an individual who (i) works for UMG
and (ii) is in a contractual relationship with UMG.
Headcount-related indicators are expressed in number of employees as of December 31, 2025.
Headcount by gender is based on the gender indicated by employees in our global human resource
platform. Employees that selected they prefer not to disclose their gender are reported under ‘other’.
Employees that did not select a gender are reported under ‘not reported’.
For the employee turnover calculation, the numerator of the rate is the aggregate of the number
of employees who leave voluntarily or due to dismissal, retirement, or death in service. The
denominator of the rate is the total number of employees during the reporting period.
Top management comprises: (i) the executive directors of the Board, including the Chairman and
CEO, (ii) the Chairman and CEO’s direct reports who lead a label or business or with a primary
function, (iii) for other key labels or businesses, their leaders and in some instances, certain of their
direct reports, and (iv) key large function leaders.
The pay gap is calculated using the following formula: (Average gross hourly pay level of male
employees – average gross hourly pay of female employees) / Average gross hourly pay level of male
employees) x 100.
The annual total remuneration ratio is calculated using the following formula: Annual total
remuneration of the highest paid individual / Median employee annual total remuneration
(excluding the highest paid individual). The Company’s calculation of the annual total remuneration
ratio is exclusive of certain component information, in accordance with ESRS 1, section 7.7 as well as
the CSRD’s permitted omissions of information (CSRD, Article 19a and Article 29a).
Subject to the above, the pay gap and annual total remuneration ratio calculations include
the following:
1.
Base salary, which is the sum of guaranteed, short-term, and non-variable cash compensation;
2.
Benefits in cash, which is the sum of the base salary and cash allowances, bonuses,
commissions, cash profit-sharing, and other forms of variable cash payments; and
3.
Direct remuneration, which is the sum of benefits in cash, and total fair value of all annual
long-term incentives.
As we are early in our journey of collecting and analyzing this information, we have not developed
targets relating to pay gap or the annual total remuneration ratio.
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Employee headcount by gender (S1-6)
Gender
Number of employees (headcount)
2024
2025
Male
4,955
4,961
Female
5,370
5,566
Other
6
4
Not reported
15
64
Total employees
10,346
10,595
Employee headcount by country (S1-6)
Country
Number of employees (headcount)
2024
2025
United States
3,512
3,533
United Kingdom
1,562
1,653
Other countries
5,272
5,409
Total employees
10,346
10,595
Pursuant to ESRS S1-6 50(a), employee headcount breakdowns are reported by country for countries
in which UMG has 50 or more employees representing at least 10% of our total number of employees
Employee headcount by geographical area (SBM-1)
Geographical area
Number of employees (headcount)
2024
2025
APAC
1,504
1,629
EMEA
4,512
4,571
LATAM & Iberia
615
662
North America
3,715
3,733
Total employees
10,346
10,595
Pursuant to ESRS SBM-1 40(a) iii, employee headcount breakdowns are reported
by geographical area.
Employees by contract type, broken down by gender (S1-6)
Contract type
Female
Male
Other
Not reported
Total
2024
2025
2024
2025
2024
2025
2024
2025
2024
2025
Permanent
employees
4,918
5,052
4,703
4,697
6
4
9
38
9,636
9,791
Temporary
employees
452
514
252
264
-
-
6
26
710
804
Total employees
5,370
5,566
4,955
4,961
6
4
15
64
10,346
10,595
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Employee turnover (S1-6)
Turnover rate by type
2024
2025
All employees
22%
16%
Permanent employees
17%
12%
Voluntary turnover
9%
7%
The total number of departures declined from 2,265 in 2024 to 1,702 in 2025.
"Voluntary turnover" refers to employees who initiated termination of employment with UMG. Of the
above indicators, only turnover of all employees is required by the ESRS.
Employee headcount by age group (S1-9)
Age group
2024
2025
Under 30 years old
2,450
2,466
30-50 years old
5,553
5,699
Over 50 years old
2,313
2,366
Not reported
30
64
Total employees
10,346
10,595
Remuneration metrics (S1-16)
In 2025, UMG’s pay gap was 47.96%, compared to 44.68% in 2024. In 2025, UMG’s annual total
remuneration ratio was a factor of 764.38, compared to 720.59 in 2024.
1
In any given year, executives
may receive non-standard compensation changes, including changes relating to LTIP maturity
payments or other non-recurring payments, resulting in a high degree of variance of these metrics
from year to year.
For additional information on UMG’s remuneration, including remuneration policies, key
remuneration elements and approach to the remuneration for 2025, and remuneration and company
performance development, see our
Remuneration Report
.
Attraction and retention of artists
Artists are at the core of our business. Our traditional full-service A&R approach, portfolio of
world-renowned labels, diversity of genres, and robust content and copyright protection measures
drive long-term value for our artists and increase their commercial success, consumer base, and
longevity potential. This topic impacts our direct operations as well as stakeholders across our value
chain, especially our artists, fans, and the creative community.
UMG’s competitive position is dependent on identifying, attracting, signing and retaining recording
artists and songwriters who are or will become commercially successful, who have long-term
potential, whose music is well received, whose subsequent music is demanded by consumers, and
whose music will continue to generate sales as part of its catalog for years to come. Our approach
to managing the risks associated with this topic are addressed in the
Risk and Risk Management
section of the Board report.
We believe that by attracting, retaining, and supporting talented artists, we can drive socioeconomic
benefits throughout our own operations, value chain, and industry, and enhance the operational
stability, well-being, and creative output for artists.
1
The Company’s calculation of the annual total remuneration ratio is exclusive of certain component information, in accordance with ESRS 1, section 7.7 as well as the CSRD’s permitted omissions of information (CSRD, Article 19a and Article 29a). For more information,
see "Methodology (S1-6, S1-9, S1-16)".
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Key actions
Several elements, discussed in further detail in the
Strategy
section of the Board report, form the core
of this effort and present positive actual or potential impacts and financial opportunities.
In addition, the following represent key actions we have taken, and continue to take, to drive our
positive impacts and realize our financial opportunities:
•
Streaming model and social media solutions
We continue to explore artist-centric principles and solutions with streaming and social platforms
including Deezer, Spotify, Tidal, TikTok, YouTube, Meta, SoundCloud, and Snap. Through the
collaborative efforts below, we seek to ensure fair compensation, among other benefits. Aspects of
these actions are further discussed in the "Intellectual property, piracy, and content protection"
section of this report.
•
Reward Real Artists: Find ways to better reward artists whose content drives value to platforms.
•
Clean Up Clutter: Take steps to limit non-artist noise content, including sounds, functional
music, and thirty-second AI tracks that are designed to profit inappropriately from the artist
royalty pool.
•
Improving Correct Attribution: Aggressively seek correct attribution so that royalties are directed
toward the proper artists at a significant scale.
•
Protect future artists and songwriters: Advocate and fight for AI guardrails that will protect
artists, songwriters and their works from future dilution caused by unlicensed generative AI.
•
Further advancing global diversification plans and partnerships
UMG continues to expand its repertoire, reach and capabilities globally, expanding our presence
and accelerating our growth in new regions. We partner strategically with leading local labels,
artist managers, and entrepreneurial companies to support and boost them with global
promotion, distribution, and a full suite of artist services. This allows us to discover new music
and artists globally, expanding our catalog and repertoire, and creating opportunities to increase
market share.
•
Exploring new avenues for monetizing music
We are actively pursuing opportunities to bring our artists and music to the categories of health
and wellness and gaming, partnering with established and growing platforms, and embarking on
R&D to not only maximize existing commercial opportunities for our labels and artists, but to
identify future opportunities, fan behaviors, and consumption trends. Important to this activity is
our commitment to enhance the company’s D2C strategy and capabilities.
•
Defining and establishing responsible AI
We have been working across the services landscape, through collaboration and participation with
innovative companies like Stability AI, SoundPatrol, KDDI, KLAY vision, SoundLabs, and ProRata
AI, while also driving broader industry initiatives like the Human Artistry Campaign and the
“Principles for Music Creation with AI”, launched in 2024 in collaboration with Roland Corporation.
•
Facilitating the connection between artists and fans
UMG is committed to exploring ways to strengthen and better serve the artist-fan relationship
through superfan experiences and products. We have built a robust network of tools and services
for UMG artists to build comprehensive global campaigns that will help them reach fans around
the world. Superfans, a growing and influential category of music enthusiasts drive increased
activity on platforms and through UMG’s rapidly growing direct-to-consumer, ecommerce and
merchandising businesses, which represent a significant opportunity for UMG to grow authentic
engagement between fans and the artists they love.
Our multi-label structure, discussed in the
Board report
, enables entrepreneurs and encourages
artistic diversity. Each of our labels maintains its own approach to, and tracks the effectiveness of,
developing, cultivating, and promoting artistic talent. For this reason, UMG does not maintain global
policies or targets pertaining to this topic. For more information about developments within this
topic during the reporting period, see
About UMG
and the
Introduction
and
Strategy
sections of the
Board report.
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Governance information
Business conduct (G1)
Management of relationships with suppliers (G1-2)
To support alignment with our business strategy, enhance service, and maximize value to superfans,
UMG partners with suppliers who share our vision for a sustainable future. Suppliers are integral
to our business and we are dedicated to working alongside our partners to advance sustainability.
UMG can make a positive impact by overseeing and actively managing our supply chain to more
effectively control our scope 3 emissions, promote product innovation, and promote human rights
and local economies, delivering greater value to our stakeholders.
Supplier relationships are managed by business units within UMG. UML manages suppliers for
physical audio products – which range from vinyl to CDs and DVDs – and Bravado manages suppliers
of merchandise. The UML and Bravado ESG working groups drive progress towards embedding
sustainability across UMG’s supply chain, as detailed below. For more information on our ESG
working groups, see "Sustainability management" in the
Corporate Governance
section of the
Board report.
Key policies
Supplier Social Responsibility Policy
The UMG Supplier Social Responsibility Policy is foundational to our approach. The policy, overseen
by our Chief Compliance Officer and SVP, Head of Sustainability, is incorporated into all global
manufacturing agreements and sets out specific principles that we expect every supplier to follow
across environmental, social, and ethical impact areas as an extension of our own efforts to reduce
risk and optimize opportunities throughout our value chain.
The policy is anchored by internationally recognized frameworks, including the UN Guiding
Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, the
UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions, the
Children’s Rights and Business Principles established by UNICEF, the UN Global Compact, and Save
the Children principles. The policy requires our suppliers to comply with relevant national legal
standards and industry benchmark standards relating to stated impact areas, while establishing a
pathway for suppliers to implement corrective action when performance falls below provided criteria.
To track the effectiveness of our suppliers’ alignment with the Supplier Social Responsibility Policy,
UMG embeds controls and measures across various stages of the procurement lifecycle. For
example, Bravado requires certain direct suppliers in the US and UK, based on spend and risk, to
undergo the Sedex SMETA 2 Pillar Audit (or equivalent), which covers labor standards and health
and safety – key risk areas for the apparel manufacturing sector. In 2025, Bravado rolled out more
comprehensive requirements, the SMETA 4-Pillar Audit, which includes additional environment and
business ethics considerations. Subject suppliers are required to upgrade from 2-pillar to 4-pillar
audits upon renewal.
Key actions
Environmental Exhibit and reporting
Bravado and UML are laying the groundwork for deeper supplier engagement through a standardized
set of environmental-related terms and conditions set forth in an Environmental Exhibit. We began
integrating the Environmental Exhibit into certain physical audio and merchandise manufacturing
partner agreements in the US and UK in 2024 and continued its rollout to additional partner
agreements in 2025.
The Environmental Exhibit is designed to drive environmental performance across our value chain,
particularly in relation to our scope 3 GHG emissions, and enables us to screen and evaluate the
environmental performance of new suppliers based on their ability to accept and comply with the
provided terms. It is imperative that we engage our supply chain in our decarbonization efforts, as
their support will be critical in helping us achieve our GHG reduction targets, which were validated by
SBTi in 2023.
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To support our GHG reduction trajectory, and to enable UMG to measure the extent to which suppliers
can serve UMG's broader business strategy and create value for stakeholders, the Environmental
Exhibit requires our suppliers to set and validate their own science-based targets within a stated
timeline. The Environmental Exhibit also requires suppliers to submit two surveys to UMG on an
annual basis. The first of these surveys, the Supplier GHG Survey, collects GHG emissions data
(including emissions attributable to UMG). The second survey, the Supplier Sustainability Survey,
collects information on current sustainability programs and future plans within key environmental,
social, and ethical impact areas.
We leverage survey results to evaluate supplier performance, more effectively track and manage
our scope 3 GHG footprint, identify opportunities to scale innovative technologies, partnerships, and
processes, and surface potential sustainability-related risks and areas for improvement. Survey
insights are synthesized into an annual supplier benchmarking report. Based on report findings, we
share additional tools and resources with suppliers, as needed, to help them with their own efforts to
enhance their performance in targeted areas. We also invite suppliers to participate in one-on-one
meetings to support deeper understanding of our expectations and to provide additional resources.
In 2025, our efforts continued to center on gathering information from and generating awareness
among our suppliers. With this as our focus, we have not set specific targets for this topic. We believe
that targets can serve as a useful tool to continue our efforts and may adopt them in future years to
help us continue to drive progress.
Additional supply chain measures
While the annual surveys tied to our Environmental Exhibit serve to assess supplier sustainability
performance, Bravado also evaluates Tier 1 suppliers on a quarterly basis according to product,
pricing, and delivery criteria. Bravado leverages results to inform procurement decisions, prioritizing
partners that demonstrate expanded product capabilities and innovation.
In 2025, we continued to define targeted, ongoing sustainability strategies for Bravado and UML
product development teams. Strategy development is informed by internal and external stakeholder
engagement throughout the year. For instance, UMG's 2025 Sustainability Summit, held at East
Iris Studios in Nashville, Tennessee, assembled UMG employees, artist managers, key non-profit
partners, industry thought leaders, and suppliers to explore sustainability-related advancements
across our industry. The event highlighted innovative supply chain developments, including
Bravado’s
Tees Reborn
initiative, which upcycles obsolete Bravado merchandise into new products
at scale.
Intellectual property, piracy, and content protection
Security of content against piracy or theft is a key focus of our business. Technological advances
and the conversion of music into digital formats have made it easy to create, transmit and distribute
high-quality unauthorized copies of music. In addition, technology to create AI-generated music
and images has introduced new challenges for the protection of intellectual property and artist
rights. These include intellectual property infringement through the unauthorized reproduction of
copyrighted works to train AI technology, which in turn enables the creation of AI-generated works
that infringe intellectual property rights and embody unauthorized renditions of artist voices, images
and likenesses.
The nature of these risks and our response to them are further discussed in the
Risk and Risk
Management
section of the Board report.
Key policies
UMG’s content protection framework, established and implemented by our Content Protection
department and overseen by our EVP, Business and Legal Affairs and Head of Litigation, includes
five key principles:
•
Defend
- Work with our internal security teams, our labels, and our artists to protect our content at
all stages in the release lifecycle to help prevent leaks by implementing best practices.
•
Detect
- Use resources and technology to detect leaks and infringing content on web sites,
marketplaces and within social messaging communities.
•
Disrupt
- Work with our trade organizations to cause piracy disruption through intermediary,
regulatory and enforcement actions.
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•
Dismantle
- Work with our trade organizations to pursue civil and / or law enforcement authorities
on the enforcement of pirate sites operators and networks.
•
Develop
- Work with our internal teams, artists and labels to provide data and create a landscape
in which artists and talent can thrive.
The Content Protection department is responsible for communicating key aspects of the framework
to relevant stakeholders.
Key actions
At UMG, we are fully dedicated to protecting the creative works of our artists and songwriters.
Beginning in 2002, we were the first major music company to create a Content Protection
department, which serves to identify threats and create strategies and workflows to stop them.
Steered by our Content Protection team, we engage with internal and external stakeholders to help
identify and analyze risks to UMG content, brands, labels, and artists. In collaboration with global
trade organizations, our content protection initiatives span several areas:
•
Label support
The Content Protection department is the primary point of contact for labels who require
content to be removed from DSPs and aggregators, including copyright infringement, unauthorized
remixes, mis-labelled uploads, and non-UMG tracks that have been tagged with a UMG artist.
This work helps us to try to ensure that only authorized tracks exist on DSPs and are
correctly attributed.
•
Pre-release protection
Releases face the highest level of risk during the pre-release phase, when producers and sound
engineers collaborate ahead of production. We advise on security best practices and work with
stakeholders, external platforms, and websites to spot and remove leaked content to seek to
minimize risks of further unauthorized distribution.
•
Post-release protection
Once content has been released, infringing uploads and posts frequently occur on sites without
a license. By identifying and removing these sites, posts, and uploads, we increase each release's
value over time. Additionally, as part of this workstream, we identify unlicensed sites that present
a commercial opportunity for UMG.
•
Emerging markets
As markets grow in emerging territories, so does the risk of leaks in those regions. We continue
to work with our international trade organizations to build content protection strategies and
workstreams that support the development of emerging music markets. By removing illegal
websites, posts, and uploads, we help direct users within emerging markets to legitimate content
sources to enhance their listening experience and protect UMG revenue streams. In 2025, we
continued to prioritize action in this area by establishing a Vietnam-based team dedicated to 24/7
coverage against infringement of the rights of our labels, artists and creators.
•
Mobile applications
We have a dedicated team focused on mobile app piracy that works alongside our trade
organizations to detect and remove infringing applications and content globally across all major
application stores. We treat mobile application piracy as one of our priority initiatives and have
established working groups to coordinate resources and enforce against infringers in this area.
•
Merchandising
Due to its popularity and affiliation with UMG artists, Bravado merchandise is often counterfeited
or impersonated. Our Content Protection team works closely with Bravado to remove infringing
products from major online marketplaces and retailers. In addition to our merchandise protection,
we also protect our brands and artist likenesses from being used without authorization within
digital environments.
•
UMPG
Content Protection supports UMPG by removing unauthorized covers, masters, and live recordings
- as well as infringing uses of our publishing rights. Supporting UMPG directly ensures that we can
remove unauthorized content quickly and avoid duplication.
We have developed specialized workflows to remove unauthorized posts and have built bespoke
software to collect release information and project rulesets globally, thereby maximizing our labels’
marketing and promotional efforts and preserving the integrity of our artists’ creations and their
ability to connect with fans authentically.
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We work with law enforcement to stem the flow of criminal physical and digital piracy by assisting
with witness statements and providing training to help to ensure that they are fully aware of new
trends and investigative techniques in digital piracy.
In 2025, we established a dedicated Fraud Prevention team focused on investigating stream
manipulation and copyright infringement. We continue to work with our licensed service partners
to share intelligence and introduce workflows to counter the threat of streaming fraud. We continue
to work with vendors that use sophisticated systems to identify falsely labelled tracks to ensure
that our legitimate artist and label receive both credit and revenue for their works. We also have an
internal cross-functional task force established to combat this activity.
We use multiple datapoints to inform our content protection strategies. In partnership with the
Global Security Office, the Content Protection team maintains a database of all of UMG’s criminal
referrals. Our trade organizations also maintain investigative databases that allow us to track repeat
threats to UMGs artists and labels. We measure “takedown” requests—that is, the formal notice of
legal process to remove an unauthorized track—across various licensed platforms through internal
business intelligence systems that are automatically populated based on takedown requests,
regardless of whether we issue these requests directly to platforms or indirectly through our trade
organizations. To inform our content protection strategies with respect to physical piracy, we track
the number and estimated value of seizures of counterfeit and unauthorized physical products.
Content protection is part of our business-as-usual approach and ongoing daily operations. As such,
UMG does not have time-bound targets with respect to this topic. For more information on UMG's
approach to this topic, see p. 41-43 and p. 43-45 in the
Strategy
section of the Board report.
Privacy and cybersecurity
UMG maintains the trust of our artists and partners through the ethical and compliant collection,
use, and sharing of data. Technology, security, and compliance teams work to continuously improve
processes and technologies to minimize risk and optimize UMG’s use of data and technology.
The nature of our risks relating to privacy and cybersecurity, and our response to them, are further
discussed in the
Risk and Risk Management
section of the Board report.
Key policies
Our publicly available
Code of Conduct
, implemented by our Chief Compliance Officer, applies to
every person conducting business for UMG, including employees, interns, officers, members of the
board of directors, and third parties such as consultants, independent contractors, and company
advisors or representatives. Our Code of Conduct outlines best practices and acceptable behavior
with respect to data privacy and cybersecurity matters, including the responsible protection of
confidential information and the responsible use of information and communication systems.
In addition, UMG employs a wide variety of tools and services to ensure the integrity and
security of our critical assets which are supported by a number of policies and procedures that
cover topics including cloud security, business continuity, vulnerability management, and security
incident response, among others. Our Chief Security Officer is responsible for the implementation of
these policies.
All policies and procedures are reviewed and updated as needed on a regular basis.
Key actions
To uphold stakeholder trust and comply with privacy and cybersecurity regulations, UMG maintains
a global data protection compliance program via its Privacy Office which includes governance
and data management processes, data subject rights processes, privacy disclosures, employee
training, cross-border transfer agreements, supplier contract terms, internal audit procedures and
incident response processes. UMG's Global Security Office (GSO) is responsible for company-wide
cybersecurity policies, described above, as well as standards development, cybersecurity education
(including a minimum of 28 annual phishing simulation trainings and other security trainings) and
compliance monitoring. The GSO has developed a mature cybersecurity program that encompasses
aggressive vulnerability management, centralized log collect, use of a 24x7 managed security service
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provider, a robust security incident response process, regular penetration testing and extensive use
of threat management and threat hunting teams.
Cybersecurity is a part of our business-as-usual approach and ongoing daily operations. As such,
UMG does not have time-bound targets with respect to this topic. As of the date of this Annual Report,
we have not identified any breaches of cybersecurity or related risk threats that have a financially
material impact on our business.
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Non-Executive
Directors' Report
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
NON-EXECUTIVE DIRECTORS' REPORT
As the Non-Executive Directors, we are responsible for supervising the Executive Directors’ policy
and performance of duties and the Company’s general course of affairs and business, and rendering
advice and direction to the Executive Directors. In performing our duties, we are guided by the
Company’s corporate interests, which extend to the interests of all of the Company’s stakeholders,
including the Shareholders and the Company’s creditors, customers and employees.
Composition
The Board has a one-tier board structure and currently consists of two Executive Directors and nine
Non-Executive Directors:
Name
Function
Sir Lucian Grainge
Executive Director, Chairman and Chief Executive Officer
Vincent Vallejo
Executive Director, Deputy Chief Executive Officer, Corporate
Sherry Lansing
Non-Executive Director, Chairman of the Board
Margaret Frerejean-Taittinger
Non-Executive Director, Vice-Chairman of the Board
Cathia Lawson-Hall
Non-Executive Director
Eric Sprunk
Non-Executive Director
Haim Saban
Non-Executive Director
James Mitchell
Non-Executive Director
Luc van Os
Non-Executive Director
Mandy Ginsberg
Non-Executive Director
Nicole Avant
Non-Executive Director
None of the Non-Executive Directors represents the Company’s employees and other workers.
Diversity and inclusion
The elements of a diverse and inclusive composition of the Board as well as appropriate and
ambitious aspirations in this respect are laid down in the D&I Policy as per articles 2:142b and
2:166 of the Dutch Civil Code and best practice provision 2.1.5 of the Code. In accordance with
the D&I Policy, the Non-Executive Directors are committed to promoting diversity and inclusion
in the boardroom and to ensuring that all Non-Executive Directors are able to contribute to
Board discussions.
They furthermore have the aspiration:
•
to improve or safeguard gender diversity among the Non-Executive Directors, such that at least
one third of the Non-Executive Directors is female and at least one third of the Non-Executive
Directors is male, thereby at all times taking into account the Dutch statutory gender diversity
requirement with regards to the Non-Executive Directors.
•
to improve or safeguard diversity with regards to age, nationality, ethnicity and cultural or other
background, as well as to create and maintain a variation in expertise, experience, competencies,
other personal qualities and perspectives among the Non-Executive Directors.
The Non-Executive Directors are further committed to considering candidates for Non-Executive
Director positions from a wide pool, including candidates with no prior publicly listed company board
level experience.
The elements as laid down in the D&I Policy with respect to the composition of the Board are all
important drivers in the selection procedure and will all be considered when identifying a candidate
for a Non-Executive Director position. However, when identifying a candidate, the qualifications of
such candidate and the requirements for the Non-Executive Director position shall in principle
always prevail.
The Non-Executive Directors considered that their composition as at December 31, 2025 was diverse
and with women representing 56% of the Non-Executive Directors, also in line with the gender
diversity aspiration included in the D&I Policy, as well as with the gender diversity requirement
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APPENDIX
included in Dutch law. Among the Non-Executive Directors, there were six nationalities (American,
British, Dutch, French, Israeli and Togolese) and age ranged between 40 and 81.
Independence
The Non-Executive Directors endorse the principle that their composition shall be such that they are
able to operate independently and critically vis-à-vis one another, the Executive Directors and any
particular interests involved.
Given the shareholder base of the Company, the Non-Executive Directors are of the opinion that,
in the context of preserving the continuity of UMG and ensuring a focus on sustainable long-term
value creation, it is in the Company’s corporate interests and in the interests of the Company’s
stakeholders that among the Non-Executive Directors, there are persons who represent a (group of
affiliated) substantial shareholder(s), even if those persons are considered non-independent within
the meaning of best practice provision 2.1.8 of the Code.
As set out in the Corporate Governance section under "The Board--Independence", best practice
provision 2.1.8 of the Code states that a Non-Executive Director shall not be considered independent
if such Non-Executive Director, among others, (i) is a member of the management (or executive)
board or supervisory (or non-executive) board – or is a representative in some other way – of a
legal entity which holds at least 10% of the issued share capital of the Company, or (ii) has been an
Executive Director in the five years prior to his or her appointment.
As at December 31, 2025, two out of nine Non-Executive Directors were considered non-independent
on the basis of being persons who represent a (group of affiliated) substantial shareholder(s), being:
•
Cathia Lawson-Hall, who is a member of the supervisory board of Vivendi which holds
approximately 10% of the issued share capital of the Company; and
•
James Mitchell, who is a representative of Tencent Holdings which (indirectly through two of its
subsidiaries) holds approximately 11.45% of the issued share capital of the Company.
Although as at December 31, 2025, two out of nine Non-Executive Directors (one of whom is the same
as above) were former statutory managing directors of (a predecessor of) the Company, being:
•
James Mitchell, in the period from February 26, 2021 until September 20, 2021; and
•
Luc van Os, in the period from December 4, 2020 until September 20, 2021,
the Company did not consider them non-independent on the basis of being former Executive
Directors given the short period during which they were appointed as statutory managing directors
of (a predecessor of) the Company prior to, and primarily in preparation for, the Listing, while the
Company performed no operational activities. For the avoidance of doubt, and as set out in the
preceding paragraph, James Mitchell was nonetheless considered non-independent on the basis of
being a person who represents a (group of affiliated) substantial shareholder(s).
As at December 31, 2025
Non
-
Executive Directors
Independent
7
Non-Independent
2
Total
9
% Independent
78
% Non-Independent
22
Accordingly, as at December 31, 2025, two out of nine Non-Executive Directors were considered non-
independent, being Cathia Lawson-Hall and James Mitchell. However, the other seven Non-Executive
Directors, who were (and continue to be) independent, including the Chairman of the Board, were
comfortable that those two non-independent Non-Executive Directors were nonetheless able to act
independently and critically, and all of the Non-Executive Directors were of the opinion that the
independence requirements referred to in best practice provision 2.1.10 of the Code were fulfilled.
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OTHER INFORMATION
APPENDIX
Remuneration
On May 16, 2024, the General Meeting adopted the revised remuneration policy for the Non-Executive
Directors, pursuant to which the Non-Executive Directors are entitled to receive part of their
remuneration in the form of restricted share units (RSUs). The remuneration of the Non-Executive
Directors shall be determined by the Board with due observance of the remuneration policy for the
Non-Executive Directors. The remuneration policy for the Non-Executive Directors is available on
the investor relations part of the UMG website. In the Remuneration Report, details of the individual
remuneration of the Non-Executive Directors are set out.
Board meetings and activities
Meetings
In 2025, the Board held ten meetings, four of which were in-person meetings and six of which
took place via video calls. The meetings were attended by both the Executive Directors and the
Non-Executive Directors as well as by several corporate and other senior executives, as appropriate.
Among the items discussed were (i) the Annual Report, the semi-annual financial report, the
quarterly results and the accompanying press releases, (ii) the external auditor’s findings and
audit report, (iii) the external auditor’s engagement to audit the financial statements and audit
plan, (iv) the external auditor's engagement to provide (limited) assurance on the sustainability
reporting, (v) the reappointment of the external auditor for the financial years 2026 and 2027, which
reappointment must be submitted for approval at the annual General Meeting to be held in 2026,
(vi) the (final and interim) dividend proposals, (vii) the annual budget and business plan, (viii) the
Company's financing, including the entering into of a USD 500 million bilateral revolving credit
facility and a tap issuance of EUR 300 million under the Company’s 3.75% senior notes due June 30,
2032, (ix) (the progress made on) the internal audit and internal control plans, (x) the remuneration
of the Executive Directors, including the payout scales under the 2024 short-term and 2022-2024
long-term incentive plans and the selection of appropriate performance metrics and targets for
the 2025 short-term and 2025-2027 long-term incentive plans, (xi) the revision of the remuneration
policy for the Executive Directors, which revision was adopted at the annual General Meeting held
on May 14, 2025, (xii) the introduction of the Executive Director stock ownership policy, (xiii) the
implementation of the 2022 UMG Global Equity Plan, (xiv) the nomination for the reappointment of
Vincent Vallejo as Executive Director at the annual General Meeting held on May 14, 2025, (xv) the
nomination for the reappointment of Sherry Lansing, Haim Saban and Luc van Os as Non-Executive
Directors at the annual General Meeting held on May 14, 2025, (xvi) (the results and feedback of
the Board evaluation assessing) the functioning of the Board, the various Board committees and
the individual Directors, (xvii) strategy updates, (xviii) business updates, including on milestone
accomplishments of UMG artists and their relationships with the Company, (xix) sustainability
updates, (xx) any significant transactions, including on the progress made on the regulatory approval
process for the Downtown acquisition and the Company's work resulting from Pershing Square's
exercise of its right to request an offering and secondary listing in the United States of America
under the registration rights agreement between Pershing Square and the Company and (xxi) any
related party transactions, including the delivery of the Initial Notice by Tencent Holdings under the
Greater China option agreement.
Sustainable long-term value creation
The Board, who is responsible for developing a view on sustainable long-term value creation by the
Company and for formulating a strategy, as well as specific objectives in line with this view, has
on numerous occasions discussed the Company’s strategy. In particular, the Board discussed, at
several of its meetings, the Company’s views for Streaming 2.0, including the first major Streaming
2.0 deals with certain DSPs, such as Amazon, Spotify and YouTube, the further roll-out of its artist-
centric model with partner platforms adopting principles that are expected to transform the way
in which artists are compensated for their content, its initiatives to unlock superfan monetization
through innovative new products and experiences that are expected to deepen the artist-fan
engagement, its response to the opportunities and risks of (generative) artificial intelligence,
including with respect to content protection, and its high-potential markets strategy. The Board
also spent two full days at the Company's operational headquarters in Santa Monica, United States
of America, including to spend time with some of UMG's senior executives to hear more about
their vision for the music business and UMG as a whole. In addition, the Board is responsible for
approving the annual budget as well as any transaction with a value in excess of €300,000,000.
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APPENDIX
Education
Each time a new Non-Executive Director is appointed to the Board by the General Meeting, such Non-
Executive Director is required to follow an induction program geared to his or her role and aimed at
addressing any gaps in his or her knowledge. Such program typically covers general financial, social
and legal affairs, financial and sustainability reporting, aspects that are unique to the Company,
and the responsibilities of a non-executive director of a Dutch publicly listed company. Further
Non-Executive Director educational needs are identified as part of the Board evaluation. In 2025, as
their first RSUs were going to vest, the Non-Executive Directors received an extensive training on
applicable trading restrictions and notification obligations.
Board evaluation
In the fourth quarter of 2025 and the first quarter of 2026, at the initiative of the Nomination
Committee, the Board undertook a comprehensive Board evaluation, assessing the effectiveness of
the Board, the Board committees and the individual Directors. As part of the process, each Director
completed an anonymous structured questionnaire, covering critical areas such as composition,
governance, culture, leadership and strategy. To complement the questionnaire, Directors were
also invited to provide qualitative comments and observations. The key insights from the Board
evaluation were first discussed during an executive session of the Nomination Committee at the end
of 2025. These insights were then, where relevant, shared with the chairs of the Board committees,
and consequently presented and discussed during an executive session of the full Board in the first
quarter of 2026. The Board evaluation concluded that the Board had made clear and meaningful
progress and highlighted positive trends in, among others, the functioning of the Board committees
and the information flow, enabling a more constructive debate and greater engagement. Based on
the results and feedback, the Board committed to continuous growth, identifying targeted actions to
further improve the effectiveness of the Board.
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NON-EXECUTIVE DIRECTORS' REPORT
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APPENDIX
Share positions
According to the AFM register, as at December 31, 2025, the Executive Directors and Non-Executive
Directors held the following capital interest and/or voting rights in the Company:
Shareholder
Notification date
Shares
RSUs
1
PSUs
2
PSOs
3
Voting rights
Sir Lucian Grainge
December 13, 2025
742,512.00
2,235,773.44
1,207,111.76
8,624,917.00
742,512.00
Vincent Vallejo
April 30, 2024
102,172.00
-
-
-
102,172.00
Sherry Lansing
May 19, 2025
7,457.00
7,897.00
-
-
7,457.00
Margaret Frerejean-Taittinger
May 20, 2025
5,681.00
6,017.00
-
-
5,681.00
Cathia Lawson-Hall
May 19, 2025
8,037.00
6,017.00
-
-
8,037.00
Eric Sprunk
October 29, 2025
5,730.00
6,017.00
-
-
5,730.00
Haim Saban
October 29, 2025
5,730.00
6,017.00
-
-
5,730.00
James Mitchell
-
-
-
-
-
-
Luc van Os
November 7, 2025
2,856.00
6,017.00
-
-
2,856.00
Mandy Ginsberg
May 21, 2025
5,681.00
6,017.00
-
-
5,681.00
Nicole Avant
May 19, 2025
5,681.00
6,017.00
-
-
5,681.00
1
(Unvested) restricted share units
2
(Unvested) performance share units
3
(Unexercised) performance stock options
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APPENDIX
Board committees
The Board has appointed from among its Non-Executive Directors three Board committees to assist
it in discharging its responsibilities: the Audit Committee, the Remuneration Committee and the
Nomination Committee. Without prejudice to the collegiate responsibility of the Board, the duty of
these Board committees is to prepare the decision-making of the Board.
The Board has drawn up regulations for each Board committee, setting out the role and
responsibilities of the Board committee concerned, its composition and size and the manner in
which its meetings should be held. These regulations are available on the investor relations part of
the UMG website.
The current composition of the Board committees is detailed in the following table:
Audit
Committee
Remuneration
Committee
Nomination
Committee
Sherry Lansing
Member
Member
Margaret Frerejean-Taittinger
Member
Chair
Cathia Lawson-Hall
Member
Eric Sprunk
Member
Member
James Mitchell
Member
Luc van Os
Chair
Mandy Ginsberg
Member
Chair
Nicole Avant
Member
The Audit Committee
The Audit Committee shall advise the Board in relation to its responsibilities, shall undertake
preparatory work for the Board’s decision-making regarding the supervision of the integrity and
quality of the Company’s financial and sustainability reporting and the effectiveness of the
Company’s internal risk management and control systems and shall prepare resolutions of the
Board in relation thereto.
In addition to the foregoing, the Audit Committee’s main responsibilities include: (i) supervising and
monitoring, and discussing with and advising the Board on, the effectiveness of the design and
operation of the internal risk management and control systems, (ii) supervising the enforcement of
all applicable laws and regulations and supervising the effect of the Code of Conduct, (iii) supervising
the preparation and submission of financial and sustainability information by the Company, (iv)
supervising the compliance with recommendations, comments and observations of the internal
auditor, the external auditor(s) and any other external party involved in providing assurance on
the sustainability reporting, (v) instructing the external auditor(s) and the internal audit function
to inform the Executive Directors and the chair of the Audit Committee without delay if it or they
discover(s) or suspect(s) an instance of misconduct or irregularity, (vi) supervising the functioning of
the internal audit function, (vii) ensuring that the way in which the internal audit function fulfills its
responsibility is assessed by an independent third party at least every five years, (viii) supervising
the policy of the Company on tax planning, (ix) supervising the financing of the Company, (x)
supervising the applications of information and communication technology, including risks relating
to cybersecurity and data protection and risks relating to new technologies, (xi) maintaining
frequent contact and supervising the relationship with the internal auditor, the external auditor(s)
and any other external party involved in providing assurance on the sustainability reporting,
(xii) implementing the procedure for the selection of the external auditor(s) and submitting a
recommendation to the Non-Executive Directors for the (re)appointment or dismissal of the external
auditor(s) by the General Meeting, (xiii) informing the Board of the outcome of the statutory audit
and explaining how the statutory audit contributed to the integrity of the financial reporting and
what the role of the Audit Committee was in that process, (xiv) monitoring the financial reporting and
submitting recommendations or proposals to ensure its integrity, (xv) determining whether, and if so,
how the external auditor(s) shall be involved in the content and publication of financial reports other
than the financial statements, (xvi) issuing a recommendation on the appointment and dismissal of
the Chief Audit Officer, (xvii) submitting a proposal to the Board for the engagement of the external
auditor(s) to audit the financial statements and (xviii) considering and, where appropriate, approving
for recommendation to the Board the (semi-annual) financial statements, the annual budget and
major capital expenditures of the Company.
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The Audit Committee is also responsible for reporting to the Board on its deliberations and findings,
which report addresses, among others: (i) the methods used to assess the effectiveness of the design
and operation of the internal risk management and control systems, (ii) the methods used to assess
the effectiveness of the internal and external audit processes, (iii) material considerations regarding
the financial and sustainability reporting and (iv) the way in which material risks and uncertainties
have been analysed and discussed and the manner in which the Board's risk management
statement can be substantiated.
In 2025, the Audit Committee held six meetings, three of which were in-person meetings and three
of which took place via video calls. The meetings were attended by the Audit Committee members as
well as by the Chief Financial Officer, the Controller, the Chief Audit Executive, the external auditor(s)
and other corporate and senior executives, as appropriate.
Among the items discussed were (i) the Annual Report, the semi-annual financial report, the
quarterly results and the accompanying press releases, (ii) the external auditor’s findings and
audit report, (iii) the external auditor’s engagement to audit the financial statements and (the
progress made on) the external audit plan, (iv) the external auditor’s engagement to provide
(limited) assurance on the sustainability reporting, (v) the functioning and independence of the
external auditor and the reappointment of the external auditor for the financial years 2026 and
2027, which reappointment must be submitted for approval at the annual General Meeting to be
held in 2026, (vi) the (final and interim) dividend proposals, (vii) the annual budget and business
plan, (viii) the Company's financing, including the entering into of a USD 500 million bilateral
revolving credit facility, a tap issuance of EUR 300 million under the Company’s 3.75% senior notes
due June 30, 2032, a tap issuance of EUR 100 million under the Company's 4.00% senior notes
due June 13, 2031, a JPY 7 billion private placement of 2.25% senior notes due September 25,
2035 and a EUR 40 million private placement of 4.00% senior notes due December 15, 2038, (ix)
tax, including the impact of certain new tax laws and regulations, (x) compliance, including the
application of the Code of Conduct and applicable laws and regulations, and any reported alleged
material misconducts or irregularities, (xi) information and communication technology, including
cybersecurity, (xii) sustainability, including Company initiatives and its work on, and the material
impacts, risks and opportunities identified as part of the double materiality assessment process
undertaken in accordance with, the Corporate Sustainability Reporting Directive (the CSRD) and
the implications of certain new sustainability laws and regulations, (xiii) the functioning of and
updates from the Internal Audit and Controls Assurance departments, (xiv) (the progress made
on) the internal audit and internal control plans, (xiv) the Company's work on the preparation
and substantiation of the Board's risk management statement and (xv) the annual risk and fraud
risk assessments.
In addition, the chair of the Audit Committee had regular update meetings with the external
auditor(s), the Chief Financial Officer, the Chief Audit Executive and other corporate and senior
executives, as appropriate.
Within the Audit Committee, each Audit Committee member is considered to have competence in
accounting and/or auditing and the Audit Committee members as a whole are considered to have
competence relevant to the sector in which the Company operates.
The Remuneration Committee
The Remuneration Committee shall advise the Board in relation to its responsibilities, shall
undertake preparatory work for the Board’s decision-making regarding the determination of the
remuneration of the individual Executive Directors and Non-Executive Directors, with observance of
the remuneration policies for the Executive Directors and Non-Executive Directors, respectively, and
shall prepare resolutions of the Board in relation thereto.
In addition to the foregoing, the Remuneration Committee’s main responsibilities include: (i) at least
every four years, submitting a proposal to the Board for the remuneration policies for the Executive
Directors and Non-Executive Directors, to be submitted to the General Meeting for adoption and
(ii) annually preparing the Remuneration Report, to be submitted to the General Meeting for a non-
binding advisory vote.
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APPENDIX
The Remuneration Committee is also responsible for reporting to the Board on its deliberations
and findings.
In 2025, the Remuneration Committee held five meetings, all of which took place via video calls. The
meetings were attended by the Remuneration Committee members as well as by the Chief People
and Inclusion Officer and other corporate and senior executives, as appropriate.
Among the items discussed were (i) the Remuneration Report and the non-binding advisory vote
thereon, (ii) the remuneration of the Executive Directors, including the payout scales under the 2024
short-term and 2022-2024 long-term incentive plans and the selection of appropriate performance
metrics and targets for the 2025 short-term and 2025-2027 long-term incentive plans, (iii) the
revision of the remuneration policy for the Executive Directors, which revision was adopted at the
annual General Meeting held on May 14, 2025, (iv) the introduction of the Executive Director stock
ownership policy, (v) compliance by the Non-Executive Directors with the minimum ownership
guideline included in the Non-Executive Director stock ownership policy, (vi) the implementation
of the 2022 UMG Global Equity Plan, including its role in the attraction, retention and motivation
of skilled employees, (vii) the Company’s peer groups, (viii) various (benchmark) studies and
analyses on dilution and run rate, competitive pay, short-term and long-term incentive plan design
and performance as well as regulatory trends and (ix) the independence of the Remuneration
Committee's compensation consultant.
In addition, the chair of the Remuneration Committee had regular update meetings with the Chief
People and Inclusion Officer and other corporate and senior executives, as appropriate.
The Nomination Committee
The Nomination Committee shall advise the Board in relation to its responsibilities, shall undertake
preparatory work for the Board’s decision-making and shall prepare resolutions of the Board in
relation thereto.
In addition to the foregoing, the Nomination Committee’s main responsibilities include: (i) drawing
up selection criteria and appointment procedures for Directors, (ii) annually assessing the size and
composition of the Board, and making a proposal for the profile for Non-Executive Directors, (iii)
annually evaluating the functioning of the Board as a whole, the individual Directors and the various
Board committees, ensuring that such evaluation periodically takes place under the supervision of
an external expert and reporting on this to the Board, (iv) formulating succession plans for Directors
and drawing up a retirement schedule, (v) making recommendations for the (re)appointment of
Directors and (vi) supervising the policy of the Board on the selection criteria and appointment
procedures for senior management.
The Nomination Committee is also responsible for reporting to the Board on its deliberations
and findings.
In 2025, the Nomination Committee held four meetings, two of which were in-person meetings and
two of which took place took place via video calls. The meetings were attended by the Nomination
Committee members as well as by the General Counsel and other corporate and senior executives,
as appropriate.
Among the items discussed were (i) the nomination for the reappointment of Vincent Vallejo as
Executive Director at the annual General Meeting held on May 14, 2025, (ii) the nomination for the
reappointment of Sherry Lansing, Haim Saban and Luc van Os as Non-Executive Directors at the
annual General Meeting held on May 14, 2025, (iii) the independence or non-independence of the
individual Non-Executive Directors, (iv) the composition of the Board committees, (v) (the results
and feedback of the Board evaluation assessing) the functioning of the Board, the various Board
committees and the individual Directors and (vi) the (Non-Executive) Director succession planning
and retirement schedule.
In addition, the chair of the Nomination Committee had regular update meetings with the Chairman
of the Board and the Chairman and Chief Executive Officer and other corporate and senior
executives, as appropriate.
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APPENDIX
Attendance and availability
The following table provides an overview of the attendance rate of the individual Executive Directors
and Non-Executive Directors at the Board and Board committee meetings. Attendance is expressed
as a number of meetings attended out of the number of meetings held during 2025 while the
individual Executive Director or Non-Executive Director was a member of the Board or the Board
committee in question.
Board
Audit
Committee
Remuneration
Committee
Nomination
Committee
Sir Lucian Grainge
10 - 10
Vincent Vallejo
10 - 10
Sherry Lansing
10 - 10
4 - 5
4 - 4
Margaret Frerejean-Taittinger
10 - 10
6 - 6
4 - 4
Cathia Lawson-Hall
10 - 10
6 - 6
Eric Sprunk
9 - 10
6 - 6
5 - 5
Haim Saban
8 - 10
James Mitchell
10 - 10
4 - 5
Luc van Os
10 - 10
6 - 6
Mandy Ginsberg
9 - 10
6 - 6
5 - 5
Nicole Avant
9 - 10
4 - 4
All Non-Executive Directors have had sufficient time available for their responsibilities as evidenced
by their prompt responses to e-mails, their availability for meetings, including ad hoc meetings,
educational sessions and calls and their well-preparedness for and active participation in such
meetings, sessions and calls. Where a Non-Executive Director was not available for a particular
meeting, he or she was given the opportunity to provide input beforehand and was updated
afterwards. At all Board and Board committee meetings, there was a quorum present, such in
accordance with the Board Regulations or the regulations of the Board committees.
Appreciation
As the Non-Executive Directors, we wish to express our gratitude to the Executive Directors and all
UMG employees for their hard work and dedication in 2025.
The Non-Executive Directors:
Sherry Lansing
Margaret Frerejean-Taittinger
Cathia Lawson-Hall
Eric Sprunk
Haim Saban
James Mitchell
Luc van Os
Mandy Ginsberg
Nicole Avant
Hilversum, March 26, 2026
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APPENDIX
REMUNERATION REPORT
Dear Fellow Shareholders:
I am pleased to present the 2025 Remuneration Report, which provides insights into the
remuneration of both Executive and Non-Executive Directors.
Remuneration Policies and approvals
On May 14, 2025, the General Meeting adopted the Executive Directors’ Remuneration Policy,
establishing the framework for determining Executive Director compensation. Details of the Policy
may be found on Universal Music Group's
investor relations website
.
At the 2026 Annual General Meeting on May 13, 2026, we will be seeking approval from shareholders
for an Employee Stock Purchase Plan. Executive Directors and other very senior executives will not
be eligible to participate in this new program.
Committee Decisions and Pay Outcomes
During the year, the Committee reviewed the compensation peer group to ensure correct alignment
to UMG’s strategy and talent market, and to reflect M&A activity amongst some peers. Details of the
revised peer group may be found on page 174.
Universal Music Group's 2025 financial and strategic performance resulted in short-term incentive
payouts for performance in 2025 of 148.4% of target for Sir Lucian Grainge and 126.3% of target for
Vincent Vallejo. Further details may be found on page 175 and 176.
The Performance Share Units granted on April 30, 2023 will vest on April 30, 2026 for performance
over the three-year period 2023-25. Based on the Board’s assessment of performance against the
three financial targets in this equity award, vesting will occur at 156.4% of target. Further details may
be found on page 177.
Sir Lucian Grainge has exceeded the share ownership guideline introduced in the new
Remuneration Policy.
Stakeholder engagement
At our last Annual General Meeting, 72.9% of shareholders supported the 2024 Remuneration Report
and 68% supported the new Executive Directors’ Remuneration Policy. In both cases, the level of
shareholder support increased relative to previous years.
This Remuneration Report has been prepared in accordance with Article 2:135b of the Dutch Civil
Code and the Dutch Corporate Governance Code. It will be presented for an advisory vote at the
Annual General Meeting on May 13, 2026.
We remain committed to engagement with shareholders about executive compensation and a
number of our shareholders expressed a desire for enhanced disclosure and transparency on
the strategic objectives for Sir Lucian Grainge’s short-term incentive plan. In response, the Board
included the three key strategic objectives for 2025 and this Report includes selected highlights of
his accomplishments against those key objectives on page 176.
I sincerely thank our shareholders for their continued support and look forward to presenting this
report at the Annual General Meeting.
Mandy Ginsberg
Chairman of the Remuneration Committee
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FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
This Remuneration Report has been prepared in accordance with article 2:135b of the Dutch Civil
Code and the relevant principles and best practice provisions of the Dutch Corporate Governance
Code. It will be presented for an advisory vote to the Shareholders at the annual General Meeting to
be held on May 13, 2026.
Executive Directors’ Remuneration Policy
The objective of the Executive Directors’ Remuneration Policy is to provide a compensation
framework that allows UMG to attract, motivate and retain highly qualified Executive Directors and to
incentivize and reward long-term, sustainable growth of UMG. In order to ensure that the Executive
Directors' Remuneration Policy is aligned with UMG’s identity, mission and core values, it is built on
the following principles:
•
Focus on Company performance by including at-risk pay for the Executive Directors;
•
Linkage of performance objectives with UMG’s strategy;
•
Alignment of Shareholders’ interests with Executive Directors’ compensation design;
•
Ensure competitiveness with relevant markets and competitors to support UMG’s ability to attract,
motivate, and retain high caliber talent, in particular focusing on global entertainment companies;
•
Support a simple and transparent framework.
Overview of the Key Remuneration Elements and Approach to the
Remuneration for 2025
In 2025, the Executive Directors were as follows:
Executive Director
Position
Sir Lucian Grainge
Chairman and Chief Executive Officer (Chairman and CEO)
Vincent Vallejo
Deputy Chief Executive Officer, Corporate (Deputy CEO)
The following table sets out the key elements of the remuneration provided for in the Executive
Directors’ Remuneration Policy versus the remuneration approach in 2025 for Sir Lucian Grainge
under the Current Agreement (as defined under 'Chairman and CEO Employment Agreement') and
for Vincent Vallejo under his management services agreement. Sir Lucian Grainge’s compensation is
denominated in U.S. dollars but is reflected throughout this Remuneration Report in euros based on
the average monthly U.S. dollar to euro exchange rate in 2025 of 0.8934.
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Element
Key remuneration elements per Executive Directors’ Remuneration Policy
Remuneration approach for 2025
Base salary
Fixed cash compensation, aligned with the Executive Directors’ experience, scope of responsibilities and the
external market, and intended to attract, motivate and retain Executive Directors necessary to execute the
Company's strategy (as set out above under ‘Strategy’).
Pursuant to each
Executive Director's agreement, base salaries are as follows:
•
Chairman and CEO: €4,467,000
•
Deputy CEO: €960,000
Short-term incentive (STI)
1
Variable compensation payable annually in cash, or shares, or a combination thereof, subject to the achievement
of annually pre-established goals to ensure Executive Director alignment with, and motivate the achievement of,
the annual business priorities for the relevant year.
Target payout of up to 300% of base salary; minimum payout of 0% of target bonus amount if the threshold level
of achievement of the goals is not met and maximum payout of no more than 200% of target bonus amount for
overachievement of the goals.
Chairman and CEO:
Annual cash bonus with a target payout of €8,934,000 (target bonus amount) (200% of base salary), a minimum payout
of €0 (0% of target bonus amount) and a maximum payout of €13,401,000 (150% of target bonus amount), subject to
the achievement of specific financial and non-financial goals detailed below.
Deputy CEO:
Annual cash bonus with a target payout of €480,000 (target bonus amount) (50% of base salary), a minimum payout
of €0 (0% of target bonus amount) and a maximum payout of €960,000 (200% of target bonus amount), subject to the
achievement of specific financial goals detailed below.
Long-term incentive (LTI)
1
Variable compensation payable annually in cash, or share awards, or a combination thereof, subject to the
achievement of annually pre-established goals and/or continued services to retain Executive Directors necessary
to execute the Company’s strategy, to strengthen the alignment of the interests of Executive Directors with those
of Shareholders and other stakeholders, and to reward delivery of sustainable long-term value creation linked to
the Company’s strategy. Grant value is capped at 500% of base salary.
Chairman and CEO: Annual award of €17,868,000 in a combination of restricted stock units (RSUs) and performance
stock units (PSUs), subject to the achievement of specific financial goals detailed below.
Deputy CEO: No annual award.
Retirement and other post-
employment benefits
Customary retirement income and severance benefits to provide future income security, aligned with relevant
market levels.
Chairman and CEO
2
: Pension allowance equals 20% of base salary, capped at €1,429,440 base salary per year, for a
total potential maximum pension allowance of €285,888 per year.
Deputy CEO: Participates in the local UMG pension plan.
Other benefits
Customary and market competitive arrangements to compensate reimburse for any reasonable costs incurred in
or perks required for the performance of Executive Directors' duties.
Chairman and CEO: Covers, among other things, health and welfare, housing allowance, automobile, tax equalization,
security, home leave.
Deputy CEO: Covers health and welfare, housing allowance, automobile, tax consultation and life insurance.
1
When establishing the threshold, target and maximum goals for the short-term and long-term incentive awards, scenario analysis was conducted whereby the potential achievement of these various goals and their alignment to the Company's strategic financial goals
assisted in determining that the final goals were appropriate.
2
Additional severance detail under the Severance Payments and Termination Provisions section below.
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APPENDIX
The Remuneration for the Executive Directors in 2025
Chairman and CEO Employment Agreement
Under Sir Lucian Grainge's agreement signed on March 30, 2023, as set out in further detail below,
a significant portion of Sir Lucian Grainge's remuneration is performance-based (i.e., subject to the
achievement of annually pre-established goals) and share-based (i.e., aligned with Shareholders’
interests generally) as follows:
RSU
28.6%
Salary
14,2%
Target
Annual Bonus
28.6%
Performance-Based
Compensation
57.2%
Target PSU
28.6%
Stock-Based
Compensation
57.2%
CEO ANNUAL TARGET PAY
Deputy CEO Management Services Agreement
Vincent Vallejo’s remuneration for 2025 continued to be subject to legacy arrangements
contractually agreed prior to his appointment to the Board under his management services
agreement. In 2025, there were no changes to Vincent Vallejo's remuneration under his management
services agreement.
UMG Peer Group
Below is the 2025 compensation peer group (the
UMG peer group
) reviewed by the Remuneration
Committee to inform its decision-making process and ensure compensation levels are set at a
competitive level against other companies in the media, entertainment and tech industries.
Electronic Arts Inc.
News Corporation
The Walt Disney Company
Endeavor Group Holdings, Inc.
1
Paramount Global
2
Warner Bros. Discovery, Inc.
Fox Corporation
Sirius XM Holdings Inc.
Warner Music Group Corp.
Live Nation Entertainment, Inc.
Spotify Technology S.A.
Netflix, Inc.
Take-Two Interactive Software, Inc.
1
Endeavor Group Holdings was acquired by Silver Lake in March 2025 making it a private company
2
Paramount Global merged with Skydance Media in August 2025 to form Paramount Skydance Corporation
Key Remuneration Elements and Approach to Remuneration for 2025
The following is a discussion of the key remuneration elements of 2025 for each of the
Executive Directors.
Base Salary
Base salary provides competitive fixed cash compensation reflective of the Executive Director’s
skills, experience, scope of responsibilities and the external market. The following sets out the 2025
base salary for each Executive Director, as well as their relative changes to the 2024 base salary:
Executive Director
Actual 2024
Actual 2025
% Change
1
Sir Lucian Grainge
€4,602,000
€4,467,000
-2.9%
Vincent Vallejo
€960,000
€960,000
0.0%
1
Sir Lucian Grainge's base salary has not changed since April 2023. Any discrepancy is due to the year-over-year change in
the U.S. dollar to euro exchange rate. As noted above, the remuneration for Sir Lucian Grainge under the Current Agreement is
denominated in U.S. dollars.
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Short-Term Incentive
Each Executive Director is eligible for an annual short-term incentive bonus. In 2025, the Board (i)
removed Adjusted EPS from the short-term incentive plan of the Executive Directors and moved it to
the long-term PSU award and (ii) adjusted the weights of each metric to better align the Company's
incentive programs with the long-term strategic objectives.
For 2025, the annual short-term incentive bonus target for each Executive Director was as follows:
Executive Director
Target Percentage
of Base Salary
Target Bonus Amount
Sir Lucian Grainge
200.0%
€8,934,000
Vincent Vallejo
50.0%
€480,000
Under the current agreement, Sir Lucian Grainge is entitled to an annual target bonus of €8,934,000.
The target bonus is payable on the achievement of performance goals to be determined by the Board
and the target performance metric will be no less favorable than the Company’s annual budget,
as approved by the Board. Under the current agreement, the maximum total bonus payout cannot
exceed 150% of target bonus and the minimum payout for the threshold level of achievement will
be no less favorable than 50% for 90% achievement of the target performance levels. Performance at
less than 90% achievement of the target performance levels will result in a 0% payout.
For 2025, Sir Lucian Grainge was measured on the following performance metrics and performance
results (prior year and current year amounts are restated at plan 2025 FX rate):
Performance Metric
Threshold
(50% Payout
1
)
Target
(100% Payout
1
)
Maximum
(200% Payout
1
)
Actual
Earned %
Weighting
Weighted
Earned %
Revenue as % of
Prior Year
100.5%
105.8%
111.1%
108.8%
157.0%
35%
55.0%
Adjusted EBITDA as %
of Prior Year
98.6%
109.5%
115.0%
108.6%
95.6%
35%
33.4%
Strategic Objectives
200.0%
30%
60.0%
Total
2
148.4%
1
Payout percentage of target bonus amount.
2
Total payout cannot exceed 150% of target bonus amount or $15 million (USD)
For the strategic objectives performance metric, the Board assessed Sir Lucian Grainge's
contributions to the Company’s accomplishments in the following strategic areas: (i) advancement
of artist-centric principles and laying the foundation for streaming 2.0, (ii) increase engagement with
superfans through direct-to-consumer offerings, and (iii) focus on accelerating UMG’s presence in
high-growth markets. At the recommendation of the Remuneration Committee, the Board determined
that Sir Lucian Grainge's payout percentage against his 2025 strategic objectives will be 200%.
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Strategic
Objectives
Selected 2025 Highlights
Streaming
2.0
•
Secured multi-year agreements with three major global DSP partners to drive ARPU growth and
enhance consumer value.
•
9 of the Top 10 Global Artists of 2025. Source: IFPI
Superfans/
D2C
•
Signed first-of-their-kind agreements with AI platforms Udio and Klay Vision to build new
music experiences for superfans; partnered with NVIDIA to use AI to improve music discovery,
engagement, and listening.
•
Strategic investment in and partnership with Stationhead, the leading fan engagement platform.
Focus on
High-
Potential
Markets
•
India: significant minority stake in Excel Entertainment, a leading Indian film and digital studio;
partnered with Maddock Films; and delivered the biggest global non-Bollywood hit from India.
•
China: Exclusive global agreement with Liu Huan (the “King of Chinese Pop”); partnered with
Mandopop artist David Tao; launched Deutsche Grammophon China and Blue Note Records China.
•
Other emerging markets: Acquired “Queen of Turkish Pop” Sezen Aksu’s music catalogue; topped
the Spotify year-end charts in Brazil (Henrique & Juliano) and Vietnam (So’n Tùng M-TP).
•
Increased market share in 10 high-potential markets or regions in AMEA during 2025.
For 2025, Vincent Vallejo was measured on the following performance metrics and performance
results (prior year and current year amounts are restated at plan 2025 FX rate):
Performance Metric
Threshold
(50% Payout
1
)
Target
(100% Payout
1
)
Maximum
(200% Payout
1
)
Actual
Earned %
Weighting
Weighted
Earned %
Revenue as % of
Prior Year
100.5%
105.8%
111.1%
108.8%
157.0%
50%
78.5%
Adjusted EBITDA as %
of Prior Year
98.6%
109.5%
115.0%
108.6%
95.6%
50%
47.8%
Total
126.3%
1
Payout percentage of target bonus amount.
The targets for the Revenue and Adjusted EBITDA performance metrics align with the Company’s
annual budget, as approved by the Board. Similar to last year, in deviation from the Current
Agreement, the Board determined, and Sir Lucian Grainge agreed, that the threshold level of
achievement required for payout of the annual short-term incentive bonus would be 95% (in lieu
of the contractual 90%) of target for the Revenue performance metric which increases the rigor
for payout at threshold; and as required under the Current Agreement, the Board applied the 90%
of target for the Adjusted EBITDA performance metric as the threshold level of achievement for
this metric. Achievement of the threshold level in each case would result in a 50% payout, and
achievement of less than the threshold level would result in a 0% payout. In addition, the Board
determined that the maximum payout of the annual short-term incentive bonus for Sir Lucian
Grainge is 150% of his target bonus amount in accordance with the Current Agreement and for
Vincent Vallejo is 200% of his target bonus amount. Payout for performance between threshold and
target, and target and maximum are linearly interpolated.
Long-Term Incentive
Under the Current Agreement, Sir Lucian Grainge is entitled to an annual grant of RSUs and PSUs
with an aggregate equity grant value of €17,868,000, with no more than 50% of the grant being
in the form of PSUs. The first set of awards after the Listing were granted in 2023. The RSUs are
time-based and vest ratably over 3 years. The PSUs are performance-based where payout depends
on the level of achievement of the performance metrics that are determined by the Board. Under
the Current Agreement, the target for each performance metric will be no less favorable than the
Company’s annual budget, as approved by the Board. The maximum payout of the PSUs is 200% of
target and, in accordance with the Current Agreement, the minimum payout for the threshold level
of achievement will be no less favorable than 50% for 90% achievement of the target performance
levels. Performance at less than 90% achievement of the target performance levels will result in a
0% payout under the PSUs. Payout for performance between threshold and target, and target and
maximum are linearly interpolated.
2025 Annual Equity Grants
In 2025, Sir Lucian Grainge received the following:
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Type
Grant size
Performance metrics and vesting requirements
RSU
€8,934,000
Requires continued services; vests ratably over 3 years
PSU
€8,934,000
1
Requires continued services; vests 100% after 3 years
Metrics
˚ 1/3 to vest based on 3-year Revised EPS CAGR target
˚ 1/3 to vest based on 3-year Revenue CAGR target
˚ 1/3 to vest based on 3-year Relative TSR (Total Shareholder Return) target
1
Reflects the economic value of the underlying award as opposed to the accounting value under IFRS2.
With respect to the PSUs, the Board selected these performance metrics, which represent key
performance indicators used by the Company, to provide a foundation for sustainable long-term
growth and promote sustainable long-term value creation. To better align with the Company's long-
term strategy, the Board replaced Adjusted EBITDA with Revised EPS
1
and adjusted the weightings
of the three metrics such that each carry equal weight. Additionally, in deviation from the Current
Agreement, the Board determined, and Sir Lucian Grainge agreed, that the threshold level of
achievement required for payout of the fiscal year 2025 PSU award would be 95% (in lieu of 90%)
of target for the Revenue CAGR and Revised EPS CAGR performance metrics which increases the rigor
for payout at threshold.
The targets for Revised EPS CAGR and Revenue CAGR are not disclosed as doing so could create
competitive harm. The Relative TSR target measures the Company’s 20-trading day average closing
share price performance against the S&P 500 Media & Entertainment Index and is as follows:
Metric
Threshold
(50% Payout)
Target
(100% Payout)
Maximum
(200% Payout)
Relative TSR
25th percentile
50th percentile
75th percentile
PSU23-25 Payment
In 2025, Sir Lucian Grainge received payment of his PSU23-25 award, which was measured on the
following performance metrics and performance results (in constant currency):
Performance Metric
Threshold
(50% Payout)
Target
(100%
Payout)
Maximum
(200%
Payout)
Actual
Earned %
Weighting
Weighted
Earned %
Adjusted
EBITDA CAGR
7.4%
10.0%
12.5%
12.2%
186.9%
50%
93.4%
Adjusted
Revenue CAGR
3.2%
5.0%
6.7%
9.1%
200.0%
25%
50.0%
Relative Total
Shareholder Return
25th percentile
50th
percentile
75th
percentile
25.9
Percentile
51.8%
25%
13.0%
Total
156.4%
1
Revised EPS is defined as actual EPS as reported in UMG’s financials excluding any increases/decreases in the valuation of listed company investments.
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APPENDIX
Executive Directors Stock Ownership Policy
In order to ensure alignment between the interests of the Executive Directors and the Company’s
sustainable long-term value creation, the Board approved the implementation of a stock ownership
policy that applies to any Executive Director who receives remuneration in the form of equity
for serving as an Executive Director. The policy requires Executive Directors to hold Shares at a
minimum of 6X of their annual base salary for Sir Lucian Grainge and 3X for any other Executive
Director. As of December 31, 2025, Sir Lucian Grainge, who is the only Executive Director receiving
remuneration in the form of equity, met the guideline.
Malus and Claw-Back
In 2025, no application of claw-back was applied on any kind of variable payments for the
Executive Directors.
Severance Payments and Termination Provisions
In 2025, no severance payments were made to the Executive Directors.
Sir Lucian Grainge
Sir Lucian Grainge is entitled to the following severance benefits under the Current Agreement
in case he terminates his employment for ‘Good Reason’, Universal Music Group, Inc. (
UMG, Inc.
)
terminates his employment without ‘Cause’, or in case of ‘Non-Renewal’ of the Current Agreement
(all as defined below):
1.
a lump-sum cash amount equal to Sir Lucian Grainge’s unpaid base salary earned up to the date
of his termination of employment plus an amount equal to two years of base salary;
2.
a lump-sum cash amount equal to the unpaid portion of any earned bonuses with respect to the
last fiscal year ended prior to the date of Sir Lucian Grainge’s termination of employment plus the
target annual bonus for the year in which Sir Lucian Grainge’s termination of employment occurs
plus two years of the target annual bonus;
3.
a lump-sum cash amount equal to the amount that UMG, Inc. would have paid during the 2 years
following Sir Lucian Grainge’s termination of employment (based on rates in effect at the time of
termination of employment) to provide Sir Lucian Grainge with the benefits he would have been
entitled to receive under the additional pension allowance and the broad base of benefit plans
in which Sir Lucian Grainge may participate, provided that such amount will not include any
vacation benefits;
4.
each equity award outstanding at the termination of Sir Lucian Grainge’s employment, with each
such equity award vesting on a pro rata basis in accordance with the terms of the applicable
equity award agreement, except that Sir Lucian Grainge will be deemed to be continuously
employed for a period of 2 years from the date of termination for ’Good Reason’, ’without Cause’
or following a ’Non-Renewal’, with any performance-based equity awards continuing to vest for a
period of 2 years from the date of termination and such vested portion of applicable performance-
based equity awards to be settled at target.
‘Good Reason’ includes:
1.
removal of Sir Lucian Grainge from his position as an Executive Director or as Chairman and CEO
of UMG, Inc. or the Company resulting in a material diminution in Sir Lucian Grainge’s authority,
duties or responsibilities, or in the budget over which Sir Lucian Grainge retains authority;
2.
the requirement for Sir Lucian Grainge to report to anyone with materially less authority, duties
or responsibilities;
3.
a material decrease in Sir Lucian Grainge’s authority, duties or responsibilities, including, but not
limited to, a material adverse change to Sir Lucian Grainge’s authority, duties or responsibilities as
they relate to managing Sir Lucian Grainge’s direct reports or Sir Lucian Grainge’s involvement in
setting UMG’s annual budget or UMG’s strategy;
4.
a reduction in Sir Lucian Grainge’s base salary or target annual bonus or annual equity award
constituting a material diminution in Sir Lucian Grainge’s base compensation as determined for
purposes of Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations
and guidance promulgated thereunder;
5.
the requirement that Sir Lucian Grainge’s principal place of employment be located other than at
the principal offices of UMG, Inc. located in Los Angeles, California, provided that such change in
location is a material change in the geographic location at which Sir Lucian Grainge must provide
his services as determined for purposes of Section 409A of the Internal Revenue Code of 1986, as
amended, and the regulations and guidance promulgated thereunder;
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6.
a material breach by UMG, Inc. of the Current Agreement (whether or not otherwise set forth in
clauses (1) — (5) above);
7.
a ‘Change in Control’.
A ’Change in control’ is defined as a change in the ownership of the Company, which occurs on the
date that any one person would be entitled to, directly or indirectly, exercise at least 30% of the votes
in a General Meeting (Predominant Control) (which would pursuant to Dutch law trigger a mandatory
public takeover offer for all of the outstanding Shares); provided, however that no change in control
will be considered to exist (i) if the voting power of any one person, or more than one person acting
in concert, who at the date of the Current Agreement was already entitled to exercise 30% or more
of the votes in a General Meeting increases, and (ii) if the person who acquired Predominant Control
loses such Predominant Control within 30 days of acquiring it, unless the Person who acquired
Predominant Control has exercised its voting rights in that 30-day period.
‘Cause’ has a commonly used meaning.
‘Non-Renewal’ means the expiration of the Current Agreement, with UMG, Inc. not having made an
offer of employment on terms at least as favorable as the terms set forth in the Current Agreement at
least 90 days before the expiration date of the Current Agreement.
In addition, Sir Lucian Grainge cannot compete against UMG for 24 months following any termination
of employment (whether by UMG or by Sir Lucian Grainge) and following expiration of the term of the
Current Agreement. In cases where Sir Lucian Grainge is entitled thereto, the severance payment is
also considered consideration for the non-competition.
Vincent Vallejo
Vincent Vallejo’s management services agreement converted into an indefinite-term agreement on
October 1, 2023. His management services agreement does not provide for a severance payment, but
he may be eligible for a severance payment in accordance with Dutch law.
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APPENDIX
Total Remuneration
1
Total remuneration of the Executive Directors is presented in the table below. The equity
remuneration in the table below reflects the grant value of the awards. The increase in Sir Lucian
Grainge's total remuneration is primarily driven by increased security costs arising from specific
incidents and threats that prompted the Board to review and approve enhanced security for Sir
Lucian Grainge; an outside consultant was retained to create a comprehensive risk assessment
and support the security upgrades. The increase in total remuneration was partially offset by the
year-over-year change in the U.S. dollar to euro exchange rate.
Name
Reported
year
Fixed remuneration
Variable remuneration
Benefits and one-off amounts
Total
remuneration
Proportion
fixed – variable
remuneration
Base Salary
Short-Term
Incentive
Long-Term Incentive
One-Time
Transition Award
Retirement Benefits
Other
Benefits
Other
Payments
Sir Lucian Grainge,
Chairman and CEO
1
2025
€4,467,000
€13,258,056
€17,868,000
2
€0
€285,888
€5,265,744
€0
€41,144,688
24% / 76%
2024
€4,602,000
€10,869,924
€18,408,000
3
€0
€294,528
€2,381,640
€0
€36,556,092
20% / 80%
Vincent Vallejo,
Deputy CEO
2025
€960,000
€606,240
€0
€0
€33,840
€60,783
€0
€1,660,862
63% / 37%
2024
€960,000
€566,400
€0
€0
€41,053
€57,834
€0
€1,625,286
65% / 35%
1
Sir Lucian Grainge’s remuneration has been converted from U.S. dollars into euros using a monthly average FX rate of 0.9204 for FY24 and 0.8934 for FY25. Sir Lucian Grainge's base salary, long-term incentive, and retirement benefits have not changed compared to prior
year. Any discrepancy is due to the year-over-year change in the U.S. dollar to euro exchange rate.
2
For 2025, Sir Lucian Grainge's long-term incentive reflects the grant value as of the grant date (March 31, 2025 at a grant price of €25.43 per RSU/PSU).
3
For 2024, Sir Lucian Grainge's long-term incentive reflects the grant value as of the grant date (March 31, 2024 at a grant price of €27.88 per RSU/PSU).
1
The Remuneration Table includes information and figures that are audited as part of
Note 25
of the Consolidated Financial Statements and
Note 11
of the Company Financial Statements.
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ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Share-Based Remuneration of the Executive Directors
The total share-based remuneration of the Executive Directors awarded during 2025 and outstanding
as of December 31, 2025 is presented in the table below:
Name of
Director position
The main conditions of share award plans
Expire
Date
Strike
Price
Information regarding reported financial year
Opening balance
During the year
Closing Balance
Specification
of plan
Award
type
Performance
period
Award
date
Vesting
date
End of
holding
period
1
Units awarded
at the beginning
of the year
Units
awarded
Dividend
Equivalents
Added
Units
vested
Units subject to
a performance
condition
Units awarded
and unvested as
of year end
Units subject
to a holding
period
Sir Lucian Grainge,
Chairman and CEO
2022 UMG Global
Equity Plan
RSU
N/A
4/30/2023
4/30/2026
2
N/A
N/A
N/A
320,239
0
3,274
160,119
0
163,394
N/A
PSU
1/1/2023 -
12/31/2025
4/30/2023
4/30/2026
3
N/A
N/A
N/A
480,357
0
9,823
0
490,180
490,180
N/A
RSU
N/A
4/30/2023
4/30/2028
4
N/A
N/A
N/A
1,921,426
0
29,469
480,356
0
1,470,539
N/A
PSO
N/A
4/30/2023
4/30/2027
5
N/A
4/30/2033
€19.81
8,624,917
0
0
718,743
6
8,624,917
7,187,431
N/A
RSU
N/A
3/31/2024
3/31/2027
2
N/A
N/A
N/A
338,355
0
4,613
112,785
0
230,183
N/A
PSU
1/1/2024 -
12/31/2026
3/31/2024
3/31/2027
3
N/A
N/A
N/A
338,355
0
6,919
0
345,275
345,275
N/A
RSU
N/A
3/31/2025
3/31/2028
2
N/A
N/A
N/A
0
364,209
7,448
0
0
371,657
N/A
PSU
1/1/2025 -
12/31/2027
3/31/2025
3/31/2028
3
N/A
N/A
N/A
0
364,209
7,448
0
371,657
371,657
N/A
1
As noted in the Corporate Governance section under ”Compliance with the Code”, Shares, once vested, are not subject to a holding period.
2
RSUs awarded as part of Sir Lucian Grainge's Long-Term Incentive, vesting 1/3 annually.
3
PSUs awarded as part of Sir Lucian Grainge's Long-Term Incentive which vest between 0% and 200% after 3 years depending on the achievement of performance metrics.
4
50% of the One-Time Transition Award, which vests 1/5 annually.
5
50% of the One-Time Transition Award, which vests 1/4 annually and are only exercisable if the following share price hurdles are met: 1/3 at €26.50, 1/3 at €30.00, and 1/3 at €38.00.
6
The first share price hurdle of €26.50 was achieved on January 29, 2024. These PSOs are exercisable as they have vested due to the passage of time and exercisable have become eligible due to the first share price hurdle having been achieved.
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ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Remuneration Expense and Company Performance Development
The overview below provides insight into the development of the remuneration expense of the
Executive Directors, Company performance and employee pay as of the Listing in 2021. In 2023,
the share-based compensation expense for Sir Lucian Grainge had a partial year impact consistent
with when he executed his Current Agreement. For Sir Lucian Grainge, the year-over-year decrease
of 8% in total remuneration expense from 2024 to 2025 was primarily driven by the decrease in
his share-based compensation expense. Additionally, the average annual remuneration expense
on an FTE basis of employees decreased by 9% primarily due to the decrease in share-based
compensation expense.
Element
2021
2022
2023
1
2024
1
2025
Remuneration
Expense
Chairman and CEO
€40,861,707
€47,291,068
€64,274,250
€69,292,930
€63,894,109
Annual Change
Not applicable
16%
36%
8%
-8%
Deputy CEO
2
€2,630,851
€2,624,471
€2,686,990
€1,625,286
€1,660,862
Annual Change
Not applicable
0%
2%
-40%
2%
Company
performance
Adjusted EBITDA
(in millions of euros)
€1,788
€2,135
€2,369
€2,661
€2,810
Annual Change
Not applicable
19%
11%
12%
6%
Average annual remuneration
expense on an FTE basis
of employees
Average annual
3
€131,961
€142,039
€180,684
€157,265
€143,338
Annual Change
Not applicable
8%
27%
-13%
-9%
Internal Pay Ratio
310
333
356
441
446
Annual Change
N/A
8%
7%
24%
1%
1
The share-based compensation expense in this table is based on the annual total remuneration expense as reported in the
Consolidated Financial Statements included in the Annual Report in accordance with IFRS. In contrast, the equity remuneration in
the Total Remuneration Table reflects the grant value of the equity awards and not the IFRS share-based compensation expense.
2
The Deputy CEO was employed by UMG effective April 2021. Accordingly, the remuneration expense for 2021 has been updated and
annualized from €2,185,698 to €2,630,851 for year-over-year comparison purposes.
3
Reflects the total personnel costs reported in
Note 5
of the Consolidated Financial Statements, adjusted to be comparable with the
remuneration expense of Executive Directors disclosed above. The total personnel costs include all remuneration components
(such as fixed salary, variable remuneration in cash, the share-based compensation expense part of the remuneration, social
security contributions, pensions, expense allowance, etc.) as included in the Consolidated Financial Statements. The average
annual remuneration expense of the employees is determined by dividing the total personnel costs by the average number of
FTEs during the financial year.
The Remuneration for the Non-Executive Directors in 2025
The objective of the Non-Executive Directors’ Remuneration Policy is to provide a remuneration
structure that allows UMG to attract, motivate and retain highly qualified Non-Executive Directors
who possess the necessary leadership skills to promote the Company’s strategy, long-term interests
and sustainability. In order to ensure that the Non-Executive Directors’ Remuneration Policy is
aligned with UMG’s identity, mission and core values, it is built on the following principles:
•
The program is simple and transparent;
•
Non-Executive Directors should be compensated competitively against market, considering the
level of work required for a company that is similar in size, scope, and complexity to UMG;
•
Non-Executive Directors’ remuneration is differentiated, as appropriate, for differing Board
committee responsibilities and time commitments;
•
In order to ensure independent supervision, remuneration of Non-Executive Directors is fixed and
not dependent on the Company’s financial results or the attainment of performance conditions.
In 2025, the Non-Executive Directors’ remuneration for serving on the Board and Board committees
was as follows:
Role
Non-Executive Director
Chairman of the
Board (Premium)
Member of a
Board Committee
Chair of a Board
Committee (Premium)
Cash Retainer
€90,000
€50,000
€20,000
€10,000
Annual RSU Grant
€160,000
€50,000
-
-
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BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Share Ownership Policy for Non-Executive Directors
In order to ensure alignment between the interests of the Non-Executive Directors and the
Company’s sustainable long-term value creation, the Board adopted a share ownership policy for
the Non-Executive Directors, whereby the Non-Executive Directors may in principle not transfer or
otherwise dispose of the Shares that were received by them upon vesting of the RSUs until they meet
a certain Minimum Ownership Guideline (as defined below).
Pursuant to the share ownership policy, each Non-Executive Director who receives remuneration in
the form of RSUs is required to maintain beneficial ownership of a number of RSUs so granted to
him or her and/or Shares so received by him or her upon vesting of the RSUs with a value equal
to 4 times his or her annual cash retainer for serving as a Non-Executive Director, not including
any additional retainer paid for service on any Board committee, or as Chairman of the Board or
as chair of any Board committee (the Minimum Ownership Guideline) for so long as he or she is
a Non-Executive Director. Until a Non-Executive Director meets the Minimum Ownership Guideline,
such Non-Executive Director shall not be permitted to transfer or otherwise dispose of Shares so
received, except that a Non-Executive Director may sell Shares to the extent necessary to pay any
tax imposed on vesting of the RSUs and receipt of the Shares. As of December 31, 2025, the Non-
Executive Directors are in compliance with the share ownership policy.
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ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Total Remuneration
Total remuneration of the Non-Executive Directors paid in 2025 is presented in the table below:
Non-Executive
Director
Commencement
Date
Board
1
Audit
Committee
1
Remuneration
Committee
1
Nomination
Committee
1
2025 Cash
Retainer (in €)
2025 Equity
Remuneration (in €)
2
2025 Total
Remuneration (in €)
C.F.L. Lawson-Hall
9/20/2021
Member
Member
110,000
159,992
269,992
C.M.C. Bolloré
3
5/12/2022
62,473
159,992
222,465
E. Sprunk
5/16/2024
Member
Member
Member
130,000
159,992
289,992
H. Saban
5/11/2023
Member
90,000
159,992
249,992
J.G. Mitchell
4
9/20/2021
Member
Member
0
0
0
L.A.J. Van Os
9/20/2021
Member
Chair
120,000
159,992
279,992
M. Frerejean- Taittinger
9/20/2021
Member
Member
Chair
140,000
159,992
299,992
M. Ginsberg
5/16/2024
Member
Member
Chair
140,000
159,992
299,992
M.L. Doherty
5,4
9/20/2021
0
0
0
N.A. Avant
5/12/2022
Member
Member
110,000
159,992
269,992
S.L. Lansing
5/12/2022
Chairman of
the Board
Member
Member
180,000
209,981
389,981
W.A. Ackman
6,4
5/12/2022
0
0
0
1
Composition of the Board and Board committees as of December 31, 2025.
2
Variances in equity remuneration awarded compared to the amounts noted in the Non-Executive Directors Remuneration Policy (€160,000 for Non-Executive Directors and an additional €50,000 for the Chairman of the Board) is due to rounding for partial shares.
3
Cyrille Bolloré acted as Non-Executive Director until July 25, 2025 and his awards were forfeited because of his resignation from the Board.
4
Voluntarily elected to not receive any Non-Executive Director remuneration in 2025.
5
Manning Doherty acted as Non-Executive Director until March 21, 2025.
6
Bill Ackman acted as Non-Executive Director until May 14, 2025.
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OTHER INFORMATION
APPENDIX
Remuneration
Development
2025
vs.
2024
1
2024 vs.
2023
1
2023 vs.
2022
1
2022 vs.
2021
1
C.F.L. Lawson-Hall
0%
145%
-8%
0%
C.M.C. Bolloré
2
-18%
145%
0%
N/A
E. Sprunk
0%
N/A
N/A
N/A
H. Saban
0%
178%
N/A
N/A
J.G. Mitchell
3
N/A
N/A
N/A
N/A
L.A.J. Van Os
0%
133%
-8%
0%
M. Frerejean-Taittinger
0%
114%
0%
0%
M. Ginsberg
0%
N/A
N/A
N/A
M.L. Doherty
4
3
N/A
N/A
N/A
0%
N.A. Avant
0%
145%
0%
N/A
S.L. Lansing
0%
122%
59%
N/A
W.A. Ackman
5
3
N/A
N/A
N/A
N/A
1
2024, 2023, 2022, and 2021 remuneration amounts have been annualized for purposes of calculating the year-over-year change.
2
Cyrille Bolloré acted as Non-Executive Director until July 25, 2025.
3
Voluntarily elected to not receive any Non-Executive Director remuneration in 2025, 2024, 2023, 2022, and, if applicable, 2021.
4
Manning Doherty acted as Non-Executive Director until March 21, 2025.
5
Bill Ackman acted as Non-Executive Director until May 14, 2025.
The Non-Executive Directors’ remuneration is fixed and not dependent on the Company’s financial
results or the attainment of performance conditions. The Non-Executive Directors are also entitled
to reimbursement of reasonable expenses incurred in connection with the performance of their
duties for the Company. The Non-Executive Directors are not entitled to receive any compensation
on termination of their appointment and are not entitled to participate in the Company’s bonus or
pension schemes.
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ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Share-Based Remuneration of the Non-Executive Directors
The total share-based remuneration of the Non-Executive Directors awarded during 2025 and
outstanding as of December 31, 2025 is presented in the table below:
Name of Director,
position
The main conditions of share award plans
Information regarding reported financial year
Opening balance
During the year
Closing Balance
Specification
of plan
Award
type
Award
date
Vesting
date
End
of holding
period
Units awarded at
the beginning of
the year
Units
awarded
Units
Forfeited
Units
vested
Units subject to
a performance
condition
Units awarded
and unvested as
of year end
Units subject to
a holding
period
C.F.L. Lawson-Hall,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
0
5,681
0
0
N/A
C.F.L. Lawson-Hall,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
0
0
0
6,017
N/A
C.M.C. Bolloré
1
,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
0
5,681
0
0
N/A
C.M.C. Bolloré
1
,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
6,017
2
0
0
0
N/A
E. Sprunk,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
5,681
0
0
N/A
E. Sprunk,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
0
0
6,017
N/A
H. Saban,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
5,681
0
0
N/A
H. Saban,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
0
0
6,017
N/A
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BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Name of Director,
position
The main conditions of share award plans
Information regarding reported financial year
Opening balance
During the year
Closing Balance
Specification
of plan
Award
type
Award
date
Vesting
date
End
of holding
period
Units awarded at
the beginning of
the year
Units
awarded
Units
Forfeited
Units
vested
Units subject to
a performance
condition
Units awarded
and unvested as
of year end
Units subject to
a holding
period
J.G.Mitchell
3
Non-
Executive Director
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
L.A.J. Van Os,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
5,681
0
0
N/A
L.A.J. Van Os,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
0
0
6,017
N/A
M. Frerejean-
Taittinger,
Non-Executive
Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
5,681
0
0
N/A
M. Frerejean-
Taittinger,
Non-Executive
Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
0
0
6,017
N/A
M. Ginsberg,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
5,681
0
0
N/A
M. Ginsberg,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
0
0
6,017
N/A
M.L. Doherty
3,4
,
Non-
Executive Director
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N.A. Avant,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
5,681
0
5,681
0
0
N/A
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BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
Name of Director,
position
The main conditions of share award plans
Information regarding reported financial year
Opening balance
During the year
Closing Balance
Specification
of plan
Award
type
Award
date
Vesting
date
End
of holding
period
Units awarded at
the beginning of
the year
Units
awarded
Units
Forfeited
Units
vested
Units subject to
a performance
condition
Units awarded
and unvested as
of year end
Units subject to
a holding
period
N.A. Avant,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
6,017
0
0
6,017
N/A
S.L. Lansing,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/16/2024
5/16/2025
N/A
7,457
0
7,457
0
0
N/A
S.L. Lansing,
Non-
Executive Director
2022 UMG Global
Equity Plan
RSU
5/14/2025
5/14/2026
N/A
0
7,897
0
0
7,897
N/A
W.A. Ackman
3,5
Non-
Executive Director
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
1
Cyrille Bolloré acted as Non-Executive Director until July 25, 2025.
2
Cyrille Bolloré's awards were forfeited because of his resignation from the Board.
3
Voluntarily elected to not receive any Non-Executive Director remuneration in 2025, 2024, 2023, 2022, and, if applicable, 2021.
4
Manning Doherty acted as Non-Executive Director until March 21, 2025.
5
Bill Ackman acted as Non-Executive Director until May 14, 2025.
Other items
2024 Remuneration Report Voting Results
At the annual General Meeting held on May 14, 2025, 72.90% of the Shareholders supported the 2024
Remuneration Report compared to the 70.95% vote on the 2023 Remuneration Report.
After the annual General Meeting held on May 14, 2025, UMG engaged with Shareholders to
understand their perspective on the 2024 Remuneration Report and solicit overall feedback about
the Executive and Non-Executive Director pay design and practices. Shareholders expressed a desire
for enhanced disclosure and transparency on the strategic goals included as part of Sir Lucian
Grainge's short-term incentive plan and the threshold of the performance financial metrics. In
response to that feedback, the Board explicitly disclosed strategic objectives and included selected
highlights of Sir Lucian's achievements in 2025 and added the threshold for both the short-term and
long-term incentive plans. Separately, the Board approved moving the Adjusted EPS metric from the
short-term incentive plan to the long-term incentive plan and updated the weightings of the metrics
in both programs to better align the incentive programs with the focus on long-term value creation
for Shareholders.
Deviation from Executive Directors' or Non-Executive Directors' Remuneration Policy
UMG did not deviate from the Executive Directors’ or Non-Executive Directors’ Remuneration Policy.
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Financial Statements
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
CONSOLIDATED STATEMENTS
CONTENTS OF CONSOLIDATED STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2025
Consolidated Statements of Profit or Loss
191
Consolidated Statements of Comprehensive Income
192
Consolidated Statements of Financial Position
193
Consolidated Statements of Cash Flows
194
Consolidated Statements of Changes in Equity
195
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
197
Note 1.
General information
197
Note 2.
Basis of preparation
197
Note 3.
Segment data
211
Note 4.
Acquisitions and divestments
215
Note 5.
Cost of revenues and selling, general and
administrative expenses
215
Note 6.
Financial income and expenses
216
Note 7.
Income taxes
216
Note 8.
Earnings per share
219
Note 9.
Goodwill
220
Note 10.
Content assets (catalogues and royalty advances) and
other intangibles
221
Note 11.
Property, plant and equipment
223
Note 12.
Leases
224
Note 13.
Investments in equity affiliates
224
Note 14.
Capital and financial risk management
225
Note 15.
Trade and other receivables
229
Note 16.
Trade and other accounts payable
230
Note 17.
Cash position and borrowings
230
Note 18.
Contractual obligations and other commitments
232
Note 19.
Financial assets and liabilities
233
Note 20.
Equity
235
Note 21.
Expenses and income directly recognized in other
comprehensive income
236
Note 22.
Provisions
236
Note 23.
Post-retirement employee benefits
237
Note 24.
Share-based compensation plans
239
Note 25.
Related parties
243
Note 26.
Litigation
245
Note 27.
List of consolidated entities
245
Note 28.
Statutory auditors fees
246
Note 29.
Audit exemptions
246
Note 30.
Subsequent events
247
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ABOUT UMG
BOARD REPORT
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APPENDIX
Consolidated Statements of Profit or Loss
Year ended December 31,
(millions of euros)
Note
2025
2024
Revenues
3
Cost of revenues
5
(7,196 )
(6,746 )
Selling, general and administrative expenses
5
(2,982 )
(3,015 )
Amortisation and impairment losses on intangible assets
9, 10
(331 )
(298 )
Operating profit
3
Financial income
6
Financial expenses
6
(233 )
(187 )
Income/(loss) from equity affiliates
13
(18 )
Profit before income taxes
Income taxes
7
(546 )
(778 )
Net profit
Of which:
Net profit attributable to equity holders of the parent
Net profit attributable to non-controlling interests
Earnings per share (in euros)
Earnings for the period attributable to equity holders of the parent - basic
8
Earnings for the period attributable to equity holders of the parent - diluted
8
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APPENDIX
Consolidated Statements of Comprehensive Income
Year ended December 31,
(millions of euros)
Note
2025
2024
Net profit
Actuarial gains/(losses) related to employee defined benefit plans, net of tax
(12 )
Financial assets at fair value through other comprehensive income, net of tax
(1 )
(4 )
Items not subsequently reclassified to profit or loss, net of tax
(16 )
Foreign currency translation adjustments
14
(642 )
Other comprehensive income/(loss) from equity affiliates, net of tax
(66 )
Net gain/(loss) on hedge of net investment and cash flow hedges
Items to be subsequently reclassified to profit or loss, net of tax
(685 )
Other comprehensive income/(loss), net of tax
21
(680 )
Total comprehensive income, net of tax
Of which
Total comprehensive income attributable to equity holders of the parent
Total comprehensive income attributable to non-controlling interests
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APPENDIX
Consolidated Statements of Financial Position
Year ended December 31,
(millions of euros)
Note
2025
2024
Goodwill
9
Non-current royalty advances
3, 10
Catalogues
3, 10
Other intangible assets
3, 10
Property, plant and equipment
11
Right of use assets
12
Investments in equity affiliates
13
Non-current financial assets
19
Deferred income tax assets
7
Other non-current assets
Non-current assets
Inventories
Current tax receivables
7
Current royalty advances
3, 10
Other current financial assets
19
Trade and other receivables
14, 15
Cash and cash equivalents
17
Current assets
TOTAL ASSETS
Year ended December 31,
(millions of euros)
Note
2025
2024
Shareowners equity
20
Non-controlling interests
Total equity
Non-current provisions
22
Long-term borrowings and other financial liabilities
17
Deferred tax liabilities
7
Long-term lease liabilities
12
Other non-current liabilities
19
Non-current liabilities
Current provisions
22
Short-term borrowings and other financial liabilities
17
Trade and other payables
14, 16
Short-term lease liabilities
12
Current tax payables
7
Current liabilities
Total liabilities
TOTAL EQUITY AND LIABILITIES
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APPENDIX
Consolidated Statements of Cash Flows
Year ended December 31,
(millions of euros)
Note
2025
2024
Operating activities
Operating profit
3
Adjustments
14
Royalty advances payments, net of recoupments
(402 )
(186 )
Gross cash provided by/(used for) operating activities before income
tax paid
Other changes in net working capital
14
(5 )
Net cash provided by/(used for) operating activities before income
tax paid
Income tax paid
7
(403 )
(349 )
Net cash provided by/(used for) operating activities
Investing activities
Catalogue investments
(345 )
(266 )
Other intangible assets investments
(125 )
(92 )
Capital expenditures
11
(70 )
(91 )
Purchases of consolidated companies, after acquired cash
(62 )
(163 )
Investments in equity affiliates
(198 )
(390 )
Purchase of financial assets
(152 )
(145 )
Investments
(952 )
(1,147 )
Proceeds from sales of property, plant, equipment and intangible assets
Proceeds from sale of financial assets
Divestitures
Dividends received from equity affiliates
13
Dividends received from investments
Net cash provided by/(used for) investing activities
(854 )
(1,051 )
Year ended December 31,
(millions of euros)
Note
2025
2024
Financing activities
Distributions to shareowners
20
(953 )
(933 )
Dividends paid by consolidated companies to their non-
controlling interests
(6 )
(4 )
Transactions with shareowners
(959 )
(937 )
Proceeds from borrowings
Repayments of borrowings
(4,369 )
(3,755 )
Interest, net
(81 )
(81 )
Other cash items related to financing activities
(9 )
Transactions on borrowings and other financial liabilities
Repayment of lease liabilities
12
(72 )
(81 )
Payment of interest of lease liabilities
12
(21 )
(21 )
Net cash provided by/(used for) financing activities
(988 )
(552 )
Net change in cash and cash equivalents
(103 )
Foreign currency translation adjustments
(65 )
Change in cash and cash equivalents
17
(168 )
Cash and cash equivalents
At beginning of the period
17
At end of the period
17
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APPENDIX
Consolidated Statements of Changes in Equity
(millions of euros)
Note
Number
of shares
(in thousands)
Share capital
Additional
paid-in capital
Treasury
shares
Retained
earnings
Shareowners
equity
Non-
Controlling
interest
Total equity
BALANCE AS OF DECEMBER 31, 2024
1,829,281
(5 )
(28,803 )
Net profit
-
Income and expenses directly recognized in other comprehensive income, net of tax
21
-
(676 )
(676 )
(4 )
(680 )
TOTAL COMPREHENSIVE INCOME
-
Dividends paid and payable by UMG N.V.
20
-
(953 )
(953 )
(6 )
(959 )
Share-based compensation plans
24
4,901
NCI on acquired business
1
-
(2 )
(2 )
Acquired/(exercised) put options over NCI
1
-
TOTAL CHANGES OVER THE PERIOD
4,901
(942 )
(840 )
(3 )
(843 )
BALANCE AS OF DECEMBER 31, 2025
1,834,182
(5 )
(28,888 )
1
These line items relate to non-controlling interests arising from business combinations and certain acquired catalogues held in entities that are not businesses. In some cases, NCI holders are granted put options enabling them to sell their shares to UMG at a
specified date or time period. Resulting transactions are included at line items Acquired/(exercised) put option over NCI.
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(millions of euros)
Note
Number
of shares
(in thousands)
Share capital
Additional
paid-in capital
Treasury
shares
Retained
earnings
Shareowners
equity
Non-
Controlling
interest
Total equity
BALANCE AS OF DECEMBER 31, 2023
1,821,665
(5 )
(30,244 )
Net profit
-
Income and expenses directly recognized in other comprehensive income, net of tax
21
-
TOTAL COMPREHENSIVE INCOME
-
Dividends paid and payable by UMG N.V.
20
-
(933 )
(933 )
(4 )
(937 )
Share-based compensation plans
24
7,616
NCI on acquired business
1
-
Acquired/(exercised) put options over NCI
1
-
(2 )
(2 )
(2 )
TOTAL CHANGES OVER THE PERIOD
7,616
(912 )
(789 )
(3 )
(792 )
BALANCE AS OF DECEMBER 31, 2024
1,829,281
(5 )
(28,803 )
1
These line items relate to non-controlling interests arising from business combinations and certain acquired catalogues held in entities that are not businesses. In some cases, NCI holders are granted put options enabling them to sell their shares to UMG at a
specified date or time period. Resulting transactions are included at line items Acquired/(exercised) put option over NCI.
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Notes to the Consolidated Financial Statements
the Netherlands and listed on Euronext Amsterdam under the symbol ‘UMG.AS’. As used herein, the
term UMG ("The Group") is used for Universal Music Group N.V. (‘the Company’) and its subsidiaries
within the meaning of Section 2:24b of the Dutch Civil Code. UMG’s statutory seat is located in
Amsterdam and its principal office is located at:
merchandising. It owns more than 50 labels covering all music genres. UMG is home to some of the
greatest local and international artists of all time, including The Beatles, Rolling Stones, U2, Andrea
Bocelli, Lady Gaga, Helene Fischer and more, as well as many of the biggest artists of the year, such
as Taylor Swift, KPop Demon Hunters cast, Morgan Wallen, Lady Gaga and Sabrina Carpenter.
•
The recorded music business discovers and develops recording artists, marketing and promoting
their music across a wide array of formats and platforms. Its activities also extend to other areas,
such as live events, sponsorship, film and television.
•
The music publishing business discovers and develops songwriters and owns and administers
the copyright for musical compositions used in recordings, public performances and related uses,
such as films and advertisements.
•
The merchandising business produces and sells artist-branded and other branded products
through multiple sales channels, including fashion retail, concert touring and online. Its activities
Note 2. Basis of preparation
The Consolidated financial statements have been prepared in accordance with IFRS Accounting
Standards (IFRS) as issued by the International Accounting Standards Board (IASB), IFRS as endorsed
by the European Union (EU) and comply with the statutory provisions of Part 9, Book 2 of the Dutch
Civil Code. IFRS as endorsed by the EU differs in some respects from IFRS as issued by the IASB. The
authorized for issue on March 26, 2026 and will be submitted for adoption to the Annual General
•
prepared on a historical cost basis, unless stated otherwise
•
are presented in millions of euros, and rounded to the nearest million, unless stated otherwise
The Consolidated financial statements comprise the financial statements of UMG N.V. and its
Separation from Vivendi and Listing
Until February 26, 2021, the arrangement that constituted the combined UMG Group was not a legal
entity in its own right and was made up of entities under the common control of Vivendi. Until this
date, UMG’s scope of combination principally comprised the entities held directly and indirectly by
UMG Inc. and UIM B.V.
On February 26, 2021, in UMG B.V.’s Consolidated financial statements, the contribution of
€33,000 million was directly recorded as an increase in equity attributable to UMG B.V. shareowners
(€18,500 million in share capital and €14,500 million in additional paid-in capital), and the
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contribution of €33,000 million was fully neutralized in UMG B.V.’s retained earnings. The
reorganization of its shareholding structure, which is a common control business combination, has
no impact on UMG’s scope of combination or consolidation.
On September 21, 2021, the shares of Universal Music Group N.V. (UMG N.V.) started trading on the
regulated market of Euronext Amsterdam. Vivendi completed the distribution in kind of UMG shares
to Vivendi shareholders on the basis of one UMG N.V. share for every eligible Vivendi share. The
detachment date (ex-date) of the distribution in kind was September 21, 2021. Settlement occurred on
Subsidiaries are all companies over which UMG has control. Control over an entity exists when UMG
is exposed, or has rights, to variable returns from its involvement with the entity and has the ability
to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the
date on which control commences until the date on which control ceases.
Intra-group balances and transactions, any unrealized gains and losses or income and expenses
arising from intra-group transactions are eliminated in preparing the Consolidated financial
statements. Unrealized gains arising from transactions with associates and joint ventures are
eliminated against the investment to the extent of UMG’s interest in the investee. Unrealized losses
are eliminated in the same way as unrealized gains, but only to the extent that there is no evidence
Impact of global events
Global economic conditions continue to show a high degree of uncertainty because of several
factors, including recent geopolitical events and conflicts. Inflation rates and interest rates globally
remain high, with associated impacts on commodity prices, foreign exchange rates and other
macroeconomic factors. Nevertheless, UMG’s operations continue to demonstrate resilience in the
face of these economic headwinds. UMG will continue to monitor economic developments and the
impact on the Group’s operations and financial position.
Climate change
UMG considered the impact of climate-related risks on the financial reporting judgements, estimates
or assumptions used in preparing the Consolidated financial statements with no material impact
identified for the year ending 31 December 2025.
UMG identified and assessed climate related risks as described in our Sustainability Statement (see
“Environmental information”). This assessment concluded that there were no climate-related risks
resulting in significant or major impact to UMG’s operations across the evaluated scenarios and
time horizons. Therefore, UMG does not expect that climate change-related risks will have significant
impact on the Group and would qualitatively influence management's decisions.
In 2023 UMG’s near-term science-based targets (designed to measure the performance of our
climate-related reduction initiatives) were approved by the SBTi. UMG has assessed the short term
financial impact of achieving the near-term emissions targets and these would not have a material
impact on the financial statements.
For details on UMG’s near-term emissions targets and climate-related risks refer to the
Sustainability Statement
.
Application of the accounting policies requires judgements that impact the amounts recognised.
All significant judgements and estimates are disclosed in the notes to the Consolidated financial
statements. Information and considerations regarding areas of significant judgements and
estimates have been included in the table below. It is reasonably possible, that outcomes of these
judgements and estimates within the next financial year are different from the assumptions, which
could require a material adjustment to the carrying amount of the asset or liability affected.
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Area |
Significant judgement |
Note |
Significant judgement is required to identify performance obligations |
||
under contracts with customers, whether these performance |
2.3.5. Revenues and |
|
Revenue |
obligations are satisfied at a point of time or over time, and |
associated costs |
probability that collectability is assured and significant reversal will |
||
not occur. |
||
Uncertain tax |
Judgement in assessing the uncertainty of whether it is probable that |
|
positions and |
a taxation authority will accept or revise the uncertain tax treatment |
2.3.20. Income taxes |
deferred taxes |
and, future results enabling realisation of deferred taxes. |
|
Lease liabilities |
Judgement in determining the lease term of contracts with renewal |
|
and right-of- |
and termination options at the commencement date of each |
2.3.10. Leases |
use assets |
lease contract. |
Area |
Significant estimate |
Note |
Estimation on the timing of the consequent usage and the amounts |
2.3.5. Revenues and |
|
| Revenue |
that are probable to be collected. |
associated costs |
Assumptions relating to impairment tests performed on each of the |
2.3.7. Goodwill |
|
Intangible assets, |
Group’s cash-generating units (CGUs) or intangible assets, future |
and 2.3.8. Content |
including goodwill |
cash flows and discount rates are updated annually. Estimation of |
assets and |
| and content assets |
(remaining) useful life for intangible assets, other than goodwill. |
other intangibles |
Provisions |
Estimating the likelihood and timing of potential cash flows relating |
2.3.18. Provisions |
to royalty claims and litigation. |
||
Estimates of the future performance of artists and repertoire owners |
2.3.8. Content |
|
Artist |
who are paid advances that are recognized in the Consolidated |
assets and |
| royalty advances |
Statement of Financial Position. |
other intangibles |
Area |
Significant estimate |
Note |
Share- |
Estimation of the grant date fair value and number of |
2.3.21. Share- |
based payments |
equity instruments. |
based payments |
Pension liability |
Assumptions for discount rates, inflation, future pension increases |
2.3.19. Employee |
and life expectancy to calculate the defined benefit obligation. |
benefit plans |
For more details on these significant judgement areas and resulting estimates refer to the
Foreign currency transactions are initially recorded in the functional currency of the entity at
the exchange rate prevailing at the date of the transaction. At the closing date, foreign currency
monetary assets and liabilities are translated into the entity's functional currency at the exchange
Financial statements denominated in a foreign currency
The assets and liabilities of foreign operations with functional currencies other than the Euro
are translated using exchange rates prevailing at the reporting date. The income and expenses
of foreign operations are translated using monthly average exchange rates which approximate
prevailing exchange rates at the dates of the underlying transactions. The resulting translation
gains and losses are recognised in other comprehensive income and presented within equity. For
foreign operations that are not wholly-owned subsidiaries, the proportionate share of the translation
differences are allocated to non-controlling interests. The cumulative amount in the translation
reserve is (either fully or partly) reclassified to the income statement upon disposal (either fully or
partly) or liquidation.
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UMG presents basic and diluted earnings per share (EPS) data for its shares. Basic EPS is calculated
by dividing the net profit or loss attributable to shareholders of UMG by the weighted average number
of shares outstanding during the year, adjusted for the weighted average number of own shares held
in the year. Diluted EPS is determined by dividing the profit or loss attributable to shareholders by
the weighted average number of shares outstanding, adjusted for the weighted average number of
own shares held in the year and for the effects of all dilutive potential shares which comprise share
The Consolidated Statement of Cash Flows is prepared using the indirect method starting from
Operating profit. Dividends received from equity affiliates and investments are included in the
investing cash flow. It also includes any cash flows arising from the gain or loss of control
of subsidiaries. Interest paid, including interest paid on lease liability, is included in the
Associates are entities in which UMG has significant influence, but not control or joint control.
Significant influence is generally obtained by ownership of more than 20% but less than 50% of the
voting rights. Joint ventures are the arrangements in which UMG has joint control.
UMG’s investments in associates and joint ventures are accounted for using the equity method of
accounting, meaning they are initially recognised at cost. The Consolidated financial statements
include UMG’s share of the net profit or loss of the associates and joint ventures whereby the
result is determined using the accounting policies of UMG. When UMG’s share of losses exceeds
the carrying amount of the associate or joint venture, the carrying amount is reduced to nil and
recognition of further losses is discontinued except to the extent that UMG has an obligation or has
Revenues from contracts with customers are recorded when performance obligations promised in
the contract are satisfied, and for an amount for which it is highly probable that a significant
reversal in the amount of cumulative revenue recognized will not occur. Revenues are reported net
of discounts.
Intellectual property licensing (musical works)
These licenses transfer to a customer either a right to use an entity's intellectual property as it exists
at the point in time at which the license is granted (static license), or a right to access an entity's
intellectual property as it exists throughout the license period (dynamic license).
Revenues are accounted for when the performance obligation promised in the contract is satisfied
(static license) or over time upon satisfaction (dynamic license), i.e., when the seller transfers the
control over the right to use/access the intellectual property and the customer obtains control of the
use/access of that license. Consequently, revenues from static licenses are recognized at the point
in time when the license is transferred and the customer is able to use and benefit from the license.
Revenues from dynamic licenses are accounted for over time, over the license period from the date
the customer is able to use and benefit from the license and in line with the sale or usage.
Consideration received in the current year, which represents income from ordinary activities related
to the prior years, is recorded within revenue, unless it was accrued before. Court settlements in
relation to the unauthorized usage of UMG's intellectual property in previous years are recorded in
revenue as they relate to activities carried out within the ordinary course of business.
Analysis of the Agent/Principal relationship in sales transactions involving a third party
If the nature of the entity's undertaking is a performance obligation to provide the specified goods
or services itself, then the entity acts on its own behalf and it is “principal” in the sale transaction:
it accounts for revenue as the gross amount of consideration to which it expects to be entitled in
exchange for the goods or services provided, and the commission due to the third-party as cost of
revenues. If the entity arranges for a third-party to provide the goods or services specified in the
contract, then it recognizes as revenues the net amount of consideration to which it expects to be
entitled in exchange for the goods or services provided.
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Financing Component and other
UMG does not adjust the transaction price for the effects of significant financing components if, at
contract inception, it is expected that the period between customer payment and the transfer of
goods or services is one year or less. This applies to the majority of sales transactions.
The transaction price may be variable due to discounts, rebates, or similar arrangements. In
determining the transaction price UMG considers the fair value of any non-cash consideration.
Revenue is only recognized for the part of the consideration for which it is highly probable that a
significant reversal in the amount of cumulative revenue recognized will not occur. Judgement is
required in determining the probability and level of discounts and rebates that will be granted. The
estimate is updated throughout the term of the contract.
Revenue recognition by business segment
Recorded Music
The sales of recorded music (physical, digital downloading or streaming) are intellectual property
licenses granted by UMG to distributors or digital platforms and which give them certain rights over
UMG's musical works.
Physical sales of recorded music (CDs, DVDs and Vinyls)
These intellectual property licenses are static licenses transferring to the customer a right to use
UMG‘s recordings as they exist at the point in time at which the license is granted, i.e., on the
physical device sold.
Revenues from the physical sales of recorded music, net of a provision for estimated returns and
rebates, if any, are accounted for, either: (i) upon the sale to the distributor, at the shipping point for
products sold free on board (FOB) or on delivery for products sold free on destination; or (ii) upon the
sale to the final customer for consignment sales.
Digital sales of recorded music, via streaming by paid subscription, ad-supported or downloading.
These intellectual property licenses are generally dynamic licenses providing a right to access the
entire catalogue of recorded music as it exists throughout the license period considering potential
add-ons to, or withdrawals from, the catalogue during that period.
The consideration paid by the digital platform is variable in the form of a sales-based or a usage-
based royalty. Revenues are then accounted for when these subsequent sales or usages occur.
Revenues from digital sales of recorded music, for which UMG has sufficient, accurate, and reliable
data from digital platforms, are recognized at the end of the month in which the sale or usage is
made by the end customer.
For digital sales of recorded music via paid subscription or ad-supported streaming, certain
contracts may include a non-refundable minimum guarantee which is generally recoupable and
is in substance an advance payment. In the case of a dynamic license, the minimum guarantee is
spread over the period to which it relates and takes into account the amount of royalties that are
actually recoupable. The minimum guarantee is apportioned in accordance with the accounting for
these royalties.
Music Publishing
Music Publishing relates to the use by a third party of the copyrights on musical works owned or
administered by UMG, which are intellectual property licenses that UMG grants to the third party
and which provides a right to access a catalogue of recorded music, as these intellectual property
licenses are dynamic licenses. For these contracts, revenues are recognised on the basis of sales
and usage royalties, using the best available estimate on the timing of the consequent usage and
the amounts that are probable to be collected.
Merchandising
Revenues from merchandising are recognized when control has been passed either upon sale to the
end customer, from direct sales during touring, concessions and over the internet; on delivery for
sales by a third-party distributor; or for sales of rights attached to merchandising products when a
contract is signed and collectability is probable and on a sales and usage basis.
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Provisions for estimated returns and price guarantees
are deducted from sales of products to
customers through distributors. The provisions are estimated based on past sales statistics and take
Cost of revenues
primarily includes product costs and artists costs.
Selling, general and administrative expenses
primarily include salaries and employee benefits,
consulting and service fees, insurance costs, travel and entertainment expenses, depreciation of
capital expenditure and right of use assets, administrative department costs, value allowances for
receivables, restructuring expenses and other operating expenses and are expensed when incurred.
Advertising costs
are expensed when incurred.
Slotting fees and cooperative advertising expenses
are recorded as a reduction in revenues.
However, cooperative advertising is not treated as a reduction of transaction price but marketing
UMG accounts for business combinations using the acquisition method when the acquired set of
activities and assets meets the definition of a business and control is transferred to the Group. In
determining whether a particular set of activities and assets is a business, UMG assesses whether
the set of assets and activities acquired includes, at a minimum, an input and substantive process
and whether the acquired set has the ability to produce outputs.
Under the acquisition method, upon the initial consolidation of an entity over which UMG has
acquired exclusive control:
•
the identifiable assets acquired, and the liabilities assumed are recognized at their fair values on
the acquisition date; and
•
non-controlling interests are measured either at fair value or at the non-controlling interest's
proportionate share of the acquiree’s net identifiable assets. This option is available on a
transaction-by-transaction basis.
Contingent consideration in a business combination is recorded at fair value on the acquisition date,
and any subsequent adjustment occurring after the purchase price allocation period is recognized in
Goodwill represents the difference between the fair value of the net assets acquired and the
transaction price in a business combination. Goodwill arising on the acquisition of associates and
joint ventures is included in their carrying amounts.
Subsequently, goodwill is measured at its initial amount less accumulated impairment losses. On
the acquisition date, to the extent possible, goodwill is allocated to each cash-generating unit likely
Content assets include royalty advances to artists, songwriters and co-publishers as well as
recorded music and music publishing catalogues, artists’ contracts and rights. Music catalogues,
trade names, subscribers’ bases and market shares generated internally are not recognized as
intangible assets.
Intangible assets separately acquired are recorded at cost, and intangible assets acquired in a
business combination are recorded at their fair value at the acquisition date. Amortisation is
charged to profit or loss on a straight-line basis over the estimated useful life. UMG believes that
straight-line depreciation most accurately reflects the expected pattern of consumption of the future
economic benefits embodied in these intangible assets.
Useful lives are determined based on the asset’s expected pattern of the future earnings and the
period of the contractual arrangements. Useful lives are reviewed at the end of each reporting period.
Music catalogues and publishing rights
The majority of the music catalogues are amortised over 20 years on a straight-line basis. Some
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Royalty advances to artists, songwriters, and co-publishers are capitalized as an asset when
their current popularity and past performances provide a reasonable basis to conclude that the
probable future recoupment of such royalty advances against earnings otherwise payable to them
is reasonably assured. Royalty advances are recognized as an expense as subsequent royalties are
earned by the artist, songwriter or co-publisher. Any portion of capitalized royalty advances not
deemed to be recoverable against future royalties is expensed during the period in which the loss
Other intangibles mainly includes software for internal use. Direct internal and external costs
incurred for the development of software for internal use are capitalized during the development
stage if the resulting product or process is technically and commercially feasible, cost can be
reliably measured, UMG has sufficient resources and the intention to complete its development.
Research costs are expensed when incurred. Costs of significant upgrades and enhancements
resulting in additional functionality are also capitalized.
The software for internal use is generally amortized over 3 years and included within
Property, plant and equipment are carried at historical cost less any accumulated depreciation
and impairment losses. Land and assets under construction are not depreciated. Depreciation is
calculated using the straight-line method based on the estimated useful life of the assets. Leasehold
improvements are depreciated over a period not longer than the lease term.
Useful lives are reviewed at the end of each reporting period and are as follows:
•
buildings: 5 to 40 years;
•
equipment and machinery: 3 to 8 years; and
•
The main lease contracts for UMG correspond to real estate leases for which UMG is the lessee. Real
estate leases for which UMG is the lessee are recorded at the commencement date and result in
the recognition of a lease liability equal to the present value of future lease payments against a
right-of-use asset relating to leases.
Right-of-use assets are initially measured at cost, less any accumulated depreciation and
impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-
use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and
lease payments made at or before the commencement date less any lease incentives received.
The recognized right-of-use assets are depreciated on a straight-line basis over the shorter of its
Lease liabilities
UMG recognizes lease liabilities initially measured at the present value of future lease payments
over the lease term. The lease payments include in-substance fixed payments (less any lease
incentives receivable), variable lease payments that depend on an index or a rate, and amounts
expected to be paid under residual value guarantees. The lease payments also include payments
of penalties for terminating a lease, if UMG has the option to terminate and it is reasonably certain
that this option will be exercised. In calculating the present value of lease payments, UMG uses the
incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease
is not readily determinable.
After the commencement date, the amount of lease liabilities is increased to reflect the accretion
of interest and reduced for the lease payments made. The carrying amount of lease liabilities is
remeasured if there is a modification, a change in the lease term or a change in the in-substance
fixed lease payments.
Short-term leases and leases of low-value assets
UMG applies the short-term lease recognition exemption to the real-estate leases with a lease term
of 12 months or less from the commencement date and do not contain a purchase option. It also
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applies the lease of low-value assets recognition exemption to leases of office chattels and other
equipment that are considered of low value. Lease payments on short-term leases and leases of
low-value assets are recognized as an expense on a straight-line basis over the lease term.
Accounting for leases
UMG determines the lease term as the non-cancellable term of the lease, together with any periods
covered by an option to extend the lease if it is reasonably certain to be exercised, or any periods
covered by an option to terminate the lease, if it is reasonably certain not to be exercised. When
determining the lease term, UMG considers all relevant facts and circumstances that create an
economic incentive to exercise an extension option, or not to exercise a termination option. These
circumstances include UMG’s real estate planning.
In estimating the lessee’s incremental borrowing rate, UMG takes into account the residual lease
term and its duration to reflect the interest rate of a loan with a similar payment profile to the
Each time events or changes in the economic environment indicate a risk of impairment of
goodwill, content assets and other intangible assets, property, plant and equipment, investments
in associates and joint ventures, rights-of-use assets, UMG re-examines the value of these assets.
In addition, in accordance with applicable accounting standards, goodwill and intangible assets in
progress are all subject to an annual impairment test undertaken in the fourth quarter of each
fiscal year. This impairment test is performed to compare the recoverable amount of each Cash
Generating Unit (CGU) to the carrying value of the corresponding assets (including goodwill). A CGU
is the smallest identifiable group of assets that generates cash inflows that are largely independent
of the cash inflows from other assets or groups of assets. UMG operates through different content
businesses. Each business offers different products and services that are marketed through various
channels. CGUs for goodwill correspond to the UMG's operating segments.
The recoverable amount is determined for each individual asset as the higher of: (i) its value in use;
and (ii) its fair value (less costs to sell) as described hereafter. If the asset does not generate cash
inflows that are largely independent of other assets or groups of assets, the recoverable amount
is determined for the group of assets. In particular, in the case of goodwill, an impairment test is
performed by UMG for each CGU.
The value in use of each asset or group of assets is determined, subject to exceptions, by the
Discounted Cash Flow method (DCF) using cash flow projections consistent with the budget of the
following year and the most recent forecasts prepared by the operating segments.
Applied discount rates are determined by reference to available external sources of information,
usually based on financial institutions’ benchmarks, and reflect the current assessment by UMG of
the time value of money and risks specific to each asset or group of assets.
Perpetual growth rates used for the evaluation are those used to prepare budgets for each CGU,
and beyond the period covered, are consistent with growth rates estimated by the business by
extrapolating growth rates used in the budgets, without exceeding the long-term average growth rate
for the markets in which UMG operates.
The fair value (less costs to sell) is the price that would be received from the sale of an asset or
group of assets in an orderly transaction between market participants at the measurement date, less
costs to sell of the asset or group of assets. These values are generally determined based on market
data (stock market prices or comparison with similar listed companies, with the value attributed
to similar assets or companies in recent transactions) or, in the absence of such data, based on
discontinued cash flows.
If the recoverable amount is lower than the carrying value of an asset or group of assets, an
impairment loss equal to the difference is recognized in Operating profit. In the case of operating
segments, this impairment loss is first recorded against goodwill.
The impairment losses recognized in respect of property, plant and equipment, and intangible assets
(other than goodwill) may be reversed in a later period if the recoverable amount becomes greater
than the carrying value, within the limit of impairment losses previously recognized. Impairment
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Financial assets are classified into the accounting categories “financial assets at amortized cost”,
“financial assets at fair value through other comprehensive income” and “financial assets at fair
value through profit or loss”.
This classification depends on UMG‘s business model for managing the financial assets and on
contractual terms enabling to determine whether the cash flows are solely payments of principal
and interest (SPPI). The financial assets that contain an embedded derivative are considered in full to
determine whether their cash flows are SPPI.
Except for trade receivables, at initial recognition, UMG measures financial assets at fair value, and
for financial assets not classified as fair value through profit or loss, including transaction costs that
are directly attributable to the acquisition or issuance of those financial assets. In most cases, fair
value at initial recognition is equal to transaction price. UMG recognises trade receivables initially in
accordance with the policy disclosed at
2.3.5
Revenues and associated costs.
have expired or have been transferred and UMG has transferred substantially all the risks and
These include financial assets at fair value through other comprehensive income, derivative
financial instruments with a positive value and other financial assets measured at fair value
through profit or loss. Most of these financial assets are actively traded in organized financial
markets, as their fair value is calculated by reference to the published market price at the period
end. Fair value is estimated for financial assets which do not have a published market price on an
active market. As a last resort, when a reliable estimate of fair value cannot be made using valuation
techniques in the absence of an active market, UMG values financial assets at historical cost, less
These financial assets are recognized initially on trade date when UMG becomes a party to the
contractual provisions of the instrument. Dividend income is recognised when the UMG's right to
Financial assets at amortised cost include trade receivables, other receivables, loans issued and
bank deposits which are not cash equivalents. Loans, receivables and deposits are recognized on the
date they are originated.
Financial assets at amortized cost consist of debt instruments as described above held within a
business model whose objective is to hold financial assets to collect contractual cash flows that are
solely payments of principal and interest on the principal amount outstanding. At the end of each
period, these assets are measured at amortized cost using the effective interest method.
UMG assesses the expected credit loss associated with its financial assets recognized at amortized
cost on a prospective basis. A loss allowance for expected credit loss based on probability of default
is recognized at initial recognition. The loss allowance is updated for changes in these expected
credit losses at each reporting date to reflect changes in credit risk since initial recognition.
To assess whether there has been a significant increase in credit risk, UMG compares the credit
risk at the reporting date with the credit risk at the date of initial recognition based on reasonable
forward-looking information and events, including credit ratings if available, significant adverse
economic changes (actual or expected), financial or business environment that are expected to
result in a material change in the borrower's ability to meet its obligations.
Trade accounts receivable are initially recognised at their transaction price. Expected loss rates
on trade receivables and contract assets are calculated by the relevant operating entities over
their lifetime from initial recognition and are based on historical data that also incorporates
forward-looking information. In addition, account receivables from customers subject to insolvency
proceedings or customers with whom UMG is involved in litigation or a dispute are generally
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Cash and cash equivalents include all cash balances and short-term highly liquid investments with
an original maturity of three months or less that are readily convertible into known amounts of cash.
Bank overdrafts form an integral part of UMG’s cash management and often fluctuate from being
positive to overdrawn and are included as a component of cash and cash equivalents for the
purpose of the statement of cash flows.
early termination option and bank accounts subject to restrictions (blocked accounts), other than
restrictions due to regulations specific to a country or activity sector (e.g., exchange controls), are not
A financial liability is recognized when UMG becomes party to the contractual provisions on the
instrument. UMG classifies financial liabilities as subsequently measured at amortised cost or fair
value through profit or loss. At initial recognition, UMG measures financial liabilities at fair value, and
for financial liabilities subsequently measured at amortised cost, including transaction costs and
fees that are directly attributable to their issuance. In most cases, fair value at initial recognition is
equal to transaction price.
Financial liabilities measured at fair value through profit or loss include contingent consideration
and derivative financial instruments that are not designated as hedging instruments for which
hedge accounting is applied. Gains or losses on these liabilities are recognised in the statement
of profit or loss. Financial liabilities subsequently measured at amortised cost include trade and
other payables, bonds and borrowings. These liabilities are subsequently measured at amortised
Derivative financial instruments are recognised initially at fair value. Subsequent accounting for
derivatives depends on whether or not the derivatives are designated as hedging instruments in a
cash flow, fair value or net investment hedge. Derivatives with positive fair values are recorded as
assets and negative fair values as liabilities. Beginning in 2023, foreign currency translation risks
are hedged to a limited extent, as the underlying currency positions are generally considered to be
long-term in nature. If a hedge is entered into, it is accounted for as a net investment hedge.
the instruments or calculated as the present value of the estimated future cash flows based on
observable interest yield curves, basis spread and foreign exchange rates. These calculations are
tested for reasonableness by comparing the outcome of the internal valuation with the valuation
Inventories are valued at the lower of cost or net realizable value. Cost comprises purchase costs,
production costs and other supply and packaging costs. These are usually calculated using the
weighted average cost method. Net realizable value is the estimated selling price in the normal
course of business, less estimated completion costs and selling costs. Inventories at UMG mostly
Provisions are recognized when, at the end of the reporting period, UMG has a legal obligation
(statutory, regulatory or contractual) or a constructive obligation, as a result of past events, and it
is probable that an outflow of resources embodying economic benefits will be required to settle
the obligation and the obligation can be reliably estimated. Where the effect of the time value of
money is material, provisions are discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money. If the amount of the obligation
cannot be reliably estimated, no provision is recorded and a disclosure is made in the Notes to the
Consolidated Financial Statements.
Provisions for royalty audit claims
Up to the completion of the royalty claim audit, the timing and the amount of the potential
pay-outs is uncertain. UMG makes its best possible estimate of the outcome using any available
data, including history of claims with rights owners. When the estimate is performed for large
homogeneous claims and contract terms, the statistical valuation method is used.
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Litigation provisions
In the ordinary course of business, UMG may be involved in a number of legal and arbitration
proceedings and administrative actions. The costs which may result from these proceedings are
accrued at the reporting date if UMG has a present obligation toward a third party resulting from
a past event and it is probable that an outflow of resources embodying economic benefits will be
required to settle the obligation and the amount of that liability can be quantified or estimated within
a reasonable range. The amount of provision recorded is based on a case-by-case assessment of the
risk level, and events arising during the course of legal proceedings may require a reassessment of
this risk at any time.
Defined contribution plans
Contributions to defined contribution and multi-employer plans are expensed during the year when
related services are provided.
Defined benefit plans may be funded by investments in various instruments such as insurance
contracts or equity and debt investment securities, excluding shares in any UMG entity or
debt instruments.
Pension expenses and defined benefit obligations are calculated by independent actuaries using
the projected unit credit method. This method is based on annually updated assumptions, which
include the probability of employees remaining with UMG until retirement, expected changes in
future compensation and an appropriate discount rate for each country in which UMG maintains
a pension plan. The discount rate is determined for each country by reference to yields on notes
issued by investment grade companies having a credit rating of AA and maturities identical to that
of the valued plans, generally based on relevant rate indices. The expected return on plan assets is
estimated by using the selected discount rate to value the obligations of the previous year.
The calculation is performed separately for each plan. A provision is recorded in the Statement
of Financial Position equal to the difference between the actuarial value of the related benefits
(actuarial liability) and the fair value of any associated plan assets, and this includes past service
costs and actuarial gains and losses.
The cost of defined benefit plans consists of three components recognized as follows:
•
the service cost is included in selling, general and administrative expenses. It comprises current
service cost, past service cost resulting from a plan amendment or a curtailment, immediately
recognized in profit and loss, and gains and losses on settlement;
•
the financial component, recorded in other financial expenses and income, consists of the
unwinding of the interest component of the discount, less the expected return on plan assets
determined using the discount rate retained for the valuation of the benefit obligation; and
•
the remeasurements of the net defined benefit liability (asset), recognized in items of other
comprehensive income not reclassified as profit and loss, mainly consist of actuarial gains
and losses, i.e., changes in the present value of the defined benefit obligation and plan assets
resulting from changes in actuarial assumptions and experience adjustments (representing
the differences between the expected effect of some actuarial assumptions applied to previous
valuations and the effective impact).
Where the value of plan assets exceeds benefit obligations, a financial asset is recognized up to the
present value of future refunds and the expected reduction in future contributions.
Some other post-employment benefits, such as life insurance and medical coverage (mainly in
the United States) are subject to provisions which are assessed through an actuarial calculation
Current income tax assets and liabilities are measured at the amount expected to be recovered from
or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those
that are enacted or substantively enacted at the reporting date in the countries where UMG operates
and generates taxable income.
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UMG periodically evaluates positions taken in its tax returns with respect to situations
in which applicable tax regulations are subject to interpretation and establishes provisions
where appropriate.
Differences existing at closing between the tax base value of assets and liabilities and their
carrying value in the Consolidated Statement of Financial Position give rise to temporary differences.
Pursuant to the liability method, these temporary differences result in the accounting of:
•
deferred tax assets, when the tax base value is greater than the carrying value (expected future
tax saving); and
•
deferred tax liabilities, when the tax base value is lower than the carrying value (expected future
tax expense).
Deferred tax assets and liabilities are measured at the expected tax rates for the year during which
the asset will be realized or the liability settled, based on tax rates (and tax regulations) enacted or
substantially enacted by the closing date. They are reviewed at the end of each year, in line with any
changes in applicable tax rates.
Deferred tax assets are recognized for all deductible temporary differences, tax loss carry-forwards
and unused tax credits, insofar as it is probable that a taxable profit will be available, or when
a current tax liability exists to make use of those deductible temporary differences, tax loss carry-
forwards and unused tax credits, except where the deferred tax asset associated with the deductible
temporary difference is generated by initial recognition of an asset or liability in a transaction which
is not a business combination, and that, at the transaction date, does not impact net profit, nor tax
income or loss.
For deductible temporary differences resulting from investments in subsidiaries, joint ventures and
other associated entities, deferred tax assets are recorded to the extent that it is probable that the
temporary difference will reverse in the foreseeable future and that a taxable profit will be available
against which the temporary difference can be utilized.
The carrying value of deferred tax assets is reviewed at each closing date, and revalued or reduced to
the extent that it is more or less probable that a taxable profit will be available to allow the deferred
tax asset to be utilized. When assessing the probability of a taxable profit being available, account
is taken, primarily, of prior years’ results, forecasted future results, non-recurring items unlikely to
occur in the future and the tax strategy. As such, the assessment of UMG's ability to utilize tax losses
carried forward is to a large extent judgement-based. If the future taxable results of UMG proved to
differ significantly from those expected, UMG would be required to increase or decrease the carrying
value of deferred tax assets with a potentially material impact on UMG's Statement of Financial
Position and Statement of Profit or Loss.
Deferred tax liabilities are recognized for all taxable temporary differences, except where the deferred
tax liability results from goodwill or initial recognition of an asset or liability in a transaction which is
not a business combination, and that, at the transaction date, does not impact net profit, tax income
or loss.
For taxable temporary differences resulting from investments in subsidiaries, joint ventures and
other associated entities, deferred tax liabilities are recorded except to the extent that both of the
following conditions are satisfied: the parent, investor or venturer is able to control the timing of
the reversal of the temporary difference and it is probable that the temporary difference will not be
reversed in the foreseeable future.
Current tax and deferred tax shall be charged or credited directly to equity, and not profit if the tax
relates to items that are credited or charged directly to equity. Current tax liabilities not expected to
be paid within the next 12 months are recorded as long term current tax liability.
In 2023, UMG adopted International Tax Reform—Pillar Two Model Rules – Amendments to IAS
12. These amendments introduced (i) a mandatory temporary exception to the accounting for
deferred taxes arising from the jurisdictional implementation of the Pillar Two model rules and (ii)
disclosure requirements for affected entities to give financial statement users an understanding of
Equity-settled share-based compensation expense is recognized as a personnel cost over the
vesting period of the award at the fair value of the equity instruments granted at the grant date with
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a corresponding increase in equity. For cases in which the grant date occurs after the employees to
whom the equity instruments were granted have begun rendering services (for example, if a grant
of equity instruments is subject to shareholder approval), UMG estimates the grant date fair value
of the equity instruments by estimating the fair value of the equity instruments at the end of the
reporting period, for the purposes of recognising the services received during the period between
service commencement date and grant date. Once the date of grant has been established, UMG
revises the earlier estimate so that the amounts recognised for services received in respect of the
grant are ultimately based on the grant date fair value of the equity instruments.
Fair value of the shares granted is fixed at the grant date and is equal to the share price at the
grant date with a deduction for the aggregate discounted value of the dividends that will not be
received over the vesting period, unless the conditions of the plan prescribe compensation for the
vesting period dividends, and after taking into account the discount for non-transferability during
the retention period.
The cumulative expense recognized for equity-settled transactions at each reporting date reflects
the extent to which the vesting period has expired and UMG’s best estimate of the number of equity
instruments that will ultimately vest. The expense or credit in the Statement of Profit or Loss for a
period represents the movement in cumulative expense recognized as at the beginning and end of
that period. Service and non-market performance conditions are not considered when determining
the grant date fair value of awards, but the likelihood of the conditions being met is assessed as
part of UMG’s best estimate of the number of equity instruments that will ultimately vest. Market
A related party is a person or an entity that is related to UMG. These include both people and
entities that have, or are subject to, the influence or control of UMG (e.g. key management personnel).
Transactions with related parties are accounted for in accordance with the requirements of relevant
Non-financial guarantees are accounted for as a contingent liability until such time it becomes
probable that UMG will be required to make a payment under the guarantee.
Contingent liabilities are possible or present obligations of sufficient uncertainty that it does
not quality for recognition as a provision, unless it is assumed in a business combination.
Contingent liabilities are reviewed continuously to assess whether an outflow of resources has
Financial guarantee is a contract that requires the issuer to make specified payments to reimburse
the holder for a loss it incurs because a specified debtor fails to make payments when due in
accordance with the terms of a debt instrument.
Financial guarantees are initially recognised at fair value and are subject to the expected credit loss
2.4.1. Accounting policy changes originating from the IFRS amendments
UMG has amended its accounting policies for new or amended IFRS standards and interpretations
that became effective as of 1 January 2025. The following amendments applied for the first time and
did not have a material impact on adoption:
•
Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability
UMG has not early adopted any standards, interpretations or amendments that have been issued but
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New and amended standards and interpretations that are issued, but not yet effective, up to the date
of issuance of UMG's financial statements are disclosed below. UMG expects to adopt these new and
amended standards and interpretations, if applicable, when they become effective.
•
Amendments to IFRS 9 Classification and Measurement Requirements and IFRS 7 Disclosures,
effective 1 January 2026
•
IFRS 18 Presentation and Disclosures in Financial Statements, effective 1 January 2027
•
IFRS 19 Subsidiaries without Public Accountability: Disclosures, effective 1 January 2027
Amendments to IFRS 9 Classification and Measurement Requirements and IFRS 7 Disclosures
The IASB issued amendments to IFRS 9 classification and measurement requirements and IFRS 7
disclosures effective for UMG on 1 January 2026. The amendments include:
•
The amendments clarify that a financial liability is derecognized on ‘settlement date’ and
introduce an accounting policy choice to derecognise financial liabilities settled using an
electronic payment system before the settlement date if certain criteria are met;
•
The classification of financial assets with ESG linked features has been clarified via additional
guidance on the assessment of contingent features;
•
Clarifications have been made on non-recourse loans and contractually linked instruments;
•
Additional disclosures are introduced for financial instruments with contingent features and
equity instruments classified at fair value through OCI.
UMG does not expect that adoption of these amendments will have a material impact on the
Consolidated financial statements.
IFRS 18 Presentation and Disclosures in Financial Statements
On April 9, 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements,
which replaces IAS 1 Presentation of Financial Statements. IFRS 18, effective for UMG on 1 January
2027, introduces new requirements on presentation within the statement of profit or loss, including
specified subtotals. It also requires disclosure of management-defined performance measures and
includes enhanced requirements for aggregation and disaggregation of financial information in the
primary financial statements and the notes. The IASB also issued narrow scope amendments to IAS 7
Statement of Cash Flows, and some requirements previously included within IAS 1 have been moved
to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, which has been renamed
IAS 8 Basis of Preparation of Financial Statements. Other minor amendments were made to other
standards. IFRS 18 and the other amendments are effective for reporting periods beginning on or
after 1 January 2027 and may be adopted early. UMG is currently assessing the impact that IFRS 18
and the other amendments will have on UMG’s consolidated financial statements.
IFRS 19 Subsidiaries without Public Accountability: Disclosures
Subsidiaries without public accountability of a parent that prepares consolidated financial
statements available for public use are eligible to apply IFRS 19. This standard will not impact UMG’s
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Operating segment data
The segment reporting that follows is aligned with internal reporting used by UMG Management
to assess UMG’s performance. UMG’s operating segments are organised by nature of the business
and are the same as its reportable segments: Recorded Music, Music Publishing and Merchandising
and Other. Each of these is described at Note
1
. Corporate centre represent amounts not allocated
to the operating segments and includes certain costs related to central activities as well as group
enabling functions. Management also receives information about segment's revenue and assets.
Inter-segment pricing is determined on an arm's length basis. Segment results, assets and liabilities
include items directly attributable to a segment as well as those that can be allocated on a
Segment Adjusted EBITDA is included in these disclosures because it is the primary measure of
profit or loss used by UMG Management to assess each segment’s performance and make decisions
about allocating resources. Adjusted EBITDA is a non-IFRS measure. Adjusted EBITDA is calculated
as Operating Profit excluding amortisation of intangible assets, impairment of goodwill and other
intangibles, depreciation of tangible assets including right of use assets, gains/losses on the sale
of tangible assets including right of use assets and intangible assets, restructuring expenses,
non-cash share-based compensation expenses and certain one-time items that are deemed by
management to be significant and incidental to normal business activity.
UMG consider Adjusted EBITDA to be a relevant measure to assess performance of UMG's operating
activities excluding items that may be incidental to normal business activity and excluding
restructuring expenses and non-cash share-based compensation which may impact period-to-
period comparability.
Main aggregates of the Statement of profit or loss
Elimination of |
|||||||
Recorded |
Music |
Merchandising |
Corporate |
intersegment |
|||
(millions of euros) |
Note |
Music |
Publishing |
and other |
centre |
transactions |
Total |
Year ended December |
|||||||
31, 2025 |
|||||||
External revenue |
9,454 |
2,244 |
809 |
- |
- |
12,507 |
|
Intercompany revenue |
2 |
16 |
2 |
- |
(20) |
- |
|
Revenues |
9,456 |
2,260 |
811 |
- |
(20) |
12,507 |
|
Operating profit |
1,985 |
371 |
12 |
(370) |
- |
1,998 |
|
Amortisation and |
228 |
159 |
2 |
57 |
- |
446 |
|
depreciation expense |
|||||||
Restructuring expenses 1 |
69 |
1 |
2 |
23 |
- |
95 |
|
(Gain)/loss on sale |
|||||||
of tangible and |
(3) |
- |
- |
(1) |
- |
(4) |
|
intangible assets |
|||||||
Impairment on |
|||||||
intangible assets |
3 |
- |
- |
- |
- |
3 |
|
Non-cash share-based |
|||||||
compensation expense |
24 |
135 |
18 |
- |
74 |
- |
227 |
Certain one-time items 2 |
6 |
- |
- |
39 |
- |
45 |
|
Adjusted EBITDA |
2,423 |
549 |
16 |
(178) |
- |
2,810 |
1
Restructuring expenses include employee termination costs and other related expenses that result from a material change in the
scope of a UMG business or the manner in which a UMG business is conducted.
2
Certain one-time items consists of US listing preparation costs and certain M&A advisory costs.
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Annual Report 2025 |
212
Elimination of |
|||||||
Recorded |
Music |
Merchandising |
Corporate |
intersegment |
|||
(millions of euros) |
Note |
Music |
Publishing |
and other |
centre |
transactions |
Total |
Year ended December |
|||||||
31, 2024 |
|||||||
External revenue |
8,900 |
2,100 |
834 |
- |
- |
11,834 |
|
Intercompany revenue |
1 |
21 |
8 |
- |
(30) |
- |
|
Revenues |
8,901 |
2,121 |
842 |
- |
(30) |
11,834 |
|
Operating profit |
1,752 |
321 |
38 |
(336) |
- |
1,775 |
|
Amortisation and |
|||||||
depreciation expense |
205 |
161 |
2 |
41 |
- |
409 |
|
Restructuring expenses 1 |
138 |
4 |
2 |
25 |
- |
169 |
|
(Gain)/loss on sale |
|||||||
of tangible and |
(24) |
- |
- |
1 |
- |
(23) |
|
intangible assets |
|||||||
Impairment on |
|||||||
intangible assets |
2 |
- |
- |
- |
- |
2 |
|
Non-cash share-based |
|||||||
compensation expense |
24 |
202 |
25 |
1 |
101 |
- |
329 |
Certain one-time items 2 |
- |
- |
- |
- |
- |
- |
|
Adjusted EBITDA |
2,275 |
511 |
43 |
(168) |
- |
2,661 |
1
Restructuring expenses include employee termination costs and other related expenses that result from a material change in the
scope of a UMG business or the manner in which a UMG business is conducted.
2
Certain one-time items consists of US listing preparation costs and certain M&A advisory costs.
UMG has a global network and operates in local countries, which enables it to maintain the
relationships with clients and to understand the local market, legal and other conditions. As a result,
the geographic basis of the operating companies is the basis in determining the split of revenues
from external customers per geographical areas.
Year ended December 31, |
Year ended December 31, |
|||
(millions of euros) |
2025 |
2024 |
||
U.S. |
6,056 |
48% |
5,971 |
51% |
UK |
1,200 |
10% |
1,065 |
9% |
Japan |
908 |
7% |
761 |
6% |
Germany |
626 |
5% |
604 |
5% |
France |
483 |
4% |
459 |
4% |
Rest of the world 1 |
3,234 |
26% |
2,974 |
25% |
Total revenues |
12,507 |
100% |
11,834 |
100% |
1
Disaggregated revenue information
Recorded Music
Year ended December 31, |
||
(in millions of euros) |
2025 |
2024 |
Streaming revenue |
1,435 |
1,414 |
Subscription revenue |
4,884 |
4,624 |
Downloads and other digital revenue |
234 |
180 |
Physical revenue |
1,475 |
1,358 |
License and other revenue |
1,428 |
1,325 |
Recorded Music revenue |
9,456 |
8,901 |
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Annual Report 2025 |
213
Music Publishing
Year ended December 31, |
||
(in millions of euros) |
2025 |
2024 |
Performance revenue |
456 |
442 |
Synchronisation revenue |
272 |
253 |
Digital revenue |
1,371 |
1,268 |
Mechanical revenue |
107 |
103 |
Other revenue |
54 |
55 |
Music Publishing revenue |
2,260 |
2,121 |
Subscriptions and streaming represents the largest type of recorded music revenue and is
recognised over time and is 51% (51% in 2024) of total UMG revenues. Physical recorded music
revenues are recognised at a point in time and represent 12% (12% in 2024) of total UMG revenues.
Other Recorded Music revenues mostly include neighbouring rights income which are recognized
over time.
Merchandising revenue is recognised at a point in time. Music Publishing revenue is mostly
recognised over time.
In 2025, UMG had 3 customers that each individually represented over 10% of total revenues
(3 customers in 2024) and which represented total revenues of 20%, 11% and 11% respectively
(20%, 11% and 10% in 2024). Each customer reports revenues in both Recorded Music and Music
Publishing segments.
The amount of revenue recognized for the year ended December 31, 2025 from performance
obligations satisfied (or partially satisfied) in previous periods amounts to €226 million (2024:
Segment assets
Segment assets by Segment
Segment assets that are reported to the executive board include items that are directly attributable
to a segment as well as those that can be allocated on a reasonable basis. Unallocated assets mainly
comprise of cash and deferred tax assets which are managed at the Group level.
Recorded |
Music |
Merchandising |
Corporate |
|||
(millions of euros) |
Note |
Music |
Publishing |
and other |
centre |
Total |
Year ended December 31, 2025 |
||||||
Goodwill |
9 |
959 |
698 |
97 |
- |
1,754 |
Royalty |
||||||
advances, non-current |
10 |
1,242 |
566 |
182 |
- |
1,990 |
Catalogues |
10 |
1,696 |
1,354 |
- |
- |
3,050 |
Property, plant |
||||||
& equipment |
11 |
238 |
6 |
- |
11 |
255 |
Other intangible assets |
10 |
50 |
41 |
- |
171 |
262 |
Right of use relating |
||||||
to leases |
12 |
454 |
9 |
- |
3 |
466 |
Royalty |
||||||
advances, current |
10 |
580 |
478 |
88 |
- |
1,146 |
Other assets |
5,649 |
909 |
114 |
688 |
7,360 |
|
Total segment assets 1 |
10,868 |
4,061 |
481 |
873 |
16,283 |
|
Unallocated assets |
1,173 |
|||||
Total assets |
17,456 |
1
Total segment assets in the Netherlands was €3,941 million in 2025 (€3,558 million in 2024).
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Annual Report 2025 |
214
Recorded |
Music |
Merchandising |
Corporate |
|||
(millions of euros) |
Note |
Music |
Publishing |
and other |
centre |
Total |
Year ended December 31, 2024 |
||||||
Goodwill |
9 |
1,003 |
788 |
104 |
- |
1,895 |
Royalty |
||||||
advances, non-current |
10 |
1,138 |
730 |
217 |
- |
2,085 |
Catalogues |
10 |
1,732 |
1,661 |
- |
- |
3,393 |
Property, plant |
||||||
& equipment |
11 |
227 |
5 |
- |
10 |
242 |
Other intangible assets |
10 |
52 |
40 |
- |
140 |
232 |
Right of use relating |
||||||
to leases |
12 |
442 |
4 |
- |
- |
446 |
Royalty |
||||||
advances, current |
10 |
566 |
551 |
94 |
- |
1,211 |
Other assets |
5,112 |
821 |
132 |
543 |
6,608 |
|
Total segment assets 1 |
10,272 |
4,600 |
547 |
693 |
16,112 |
|
Unallocated assets |
1,208 |
|||||
Total assets |
17,320 |
Content assets by segment
| December 31, 2025 |
|||||
Recorded |
Music |
Merchandising |
|||
(millions of euros) |
Note |
Music |
Publishing |
and other |
Total |
Catalogues (of music and publishing rights) |
1,696 |
1,354 |
- |
3,050 |
|
Royalty advances (to artists and |
1,822 |
1,044 |
270 |
3,136 |
|
repertoire owners) |
|||||
Of which: |
|||||
Non-current |
1,242 |
566 |
182 |
1,990 |
|
Current |
580 |
478 |
88 |
1,146 |
|
Content assets, net |
10 |
3,518 |
2,398 |
270 |
6,186 |
Current content assets |
580 |
478 |
88 |
1,146 |
|
Non-current content assets |
2,938 |
1,920 |
182 |
5,040 |
|
| December 31, 2024 |
|||||
Recorded |
Music |
Merchandising |
|||
(millions of euros) |
Note |
Music |
Publishing |
and other |
Total |
Catalogues (of music and publishing rights) |
1,732 |
1,661 |
- |
3,393 |
|
Royalty advances (to artists and |
|||||
repertoire owners) |
1,704 |
1,281 |
311 |
3,296 |
|
Of which: |
|||||
Non-current |
1,138 |
730 |
217 |
2,085 |
|
Current |
566 |
551 |
94 |
1,211 |
|
Content assets, net |
10 |
3,436 |
2,942 |
311 |
6,689 |
Current content assets |
566 |
551 |
94 |
1,211 |
|
Non-current content assets |
2,870 |
2,391 |
217 |
5,478 |
|
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Annual Report 2025 |
215
UMG did not complete any material acquisitions of interests in equity affiliates or business
combinations during 2025. During 2024, UMG completed investments in Chord Music Partners
("Chord"), NTWRK, Mavin Global ("Mavin") and [PIAS]. Total cash used in 2024 for these investments
was €528 million. UMG accounts for its investments in Chord and NTWRK as associates using
the equity method while the investments in Mavin and [PIAS] were recognised as business
combinations. The NTWRK and Chord transactions closed in March 2024. The Mavin and [PIAS]
acquisitions occurred in May 2024 and October 2024, respectively.
Year ended December 31, |
|||
(millions of euros) |
Note |
2025 |
2024 |
Included in cost of revenues: |
|||
Artist costs |
5,836 |
5,464 |
|
Product costs |
1,360 |
1,282 |
|
Of which: |
|||
Personnel costs |
30 |
33 |
|
Included in selling, general and administrative expenses: |
|||
Depreciation of tangible assets |
11 |
36 |
34 |
Depreciation of right of use assets |
12 |
82 |
79 |
Personnel costs |
1,674 |
1,755 |
|
Year ended December 31, |
|||
(millions of euros) |
Note |
2025 |
2024 |
Salaries |
1,175 |
1,156 |
|
Social security and other employment expenses |
192 |
196 |
|
Wages and expenses |
1,367 |
1,352 |
|
Share-based compensation plans |
24 |
256 |
360 |
Employee defined contribution plans |
54 |
52 |
|
Employee defined benefit plans |
23 |
2 |
1 |
Other |
25 |
23 |
|
Personnel costs |
1,704 |
1,788 |
|
Annual average number of full-time equivalent employees |
|||
(in thousands) |
10.0 |
9.7 |
|
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Annual Report 2025 |
216
Year ended December 31, |
|||
(millions of euros) |
Note |
2025 |
2024 |
Interest income from cash, cash equivalents and other |
25 |
19 |
|
Change in fair value of financial instruments through profit or loss |
19 |
285 |
1,170 |
Remeasurement on investment for step acquisition |
13 |
- |
62 |
Expected return on plan assets related to employee benefit plans |
23 |
- |
1 |
Gain on derivative instruments at fair value through profit or loss 1 |
27 |
24 |
|
Income from investments |
2 |
3 |
|
Financial income |
339 |
1,279 |
|
Interest expense on borrowings |
(108) |
(107) |
|
Change in fair value of financial instruments through profit or loss |
19 |
(37) |
(17) |
Unwinding of interest component |
(2) |
(2) |
|
Interest cost related to employee benefit plans |
23 |
(6) |
(6) |
Interest expenses on lease liabilities |
12 |
(21) |
(20) |
Foreign exchange loss |
(1) |
(3) |
|
Loss on derivative instruments at fair value through profit or loss 1 |
(21) |
(19) |
|
Cost of finance |
(8) |
(4) |
|
Other |
(29) |
(9) |
|
Financial expenses |
(233) |
(187) |
|
Net total financial income and (expenses) |
106 |
1,092 |
|
1
The net gain/(loss) on derivative instruments at fair value through profit or loss relates to foreign exchange forward contracts that
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
(Expense)/income |
||
Current tax |
||
Current year |
(455) |
(389) |
Over/(under) provided in previous years |
28 |
(6) |
Uncertain tax positions |
(27) |
- |
Withholding tax |
(84) |
(83) |
(538) |
(478) |
|
Deferred tax |
||
Origination and reversal of temporary difference and tax attributes 1 |
(34) |
(310) |
Recognition/(de-recognition) of deferred tax assets |
43 |
7 |
Effect of changes in tax rates |
(4) |
(3) |
Over/(under) provided in previous years |
(13) |
6 |
(8) |
(300) |
|
Total income tax expense in statement of profit and loss |
(546) |
(778) |
1
Included the deferred tax charge relating to the revaluation gain recorded through profit or loss related to the investments in
Spotify, Tencent Music Entertainment and other listed investments for an aggregate expense amount of €67 million in 2025,
compared to €301 million expense in 2024.
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Annual Report 2025 |
217
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
(Expense)/income |
||
Current tax related to items recognized during the year: |
||
To Equity |
||
Share based compensation |
- |
1 |
- |
1 |
|
Deferred tax related to items recognized during the year: |
||
To Equity |
||
Share based compensation |
4 |
12 |
To Other Comprehensive Income |
||
Net (gain)/loss on equity instruments designated at fair value through OCI |
- |
- |
Remeasurement (gain)/loss on actuarial gains and losses |
(3) |
5 |
Foreign currency translation and (gain)/loss on hedge of net investments and cash |
||
flow hedges |
10 |
(6) |
11 |
11 |
|
Total income tax charged to equity and other comprehensive income |
11 |
12 |
Effective tax rate
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Net profit /(loss) from continuing operations |
1,540 |
2,093 |
Income taxes |
546 |
778 |
Profit before income taxes |
2,086 |
2,871 |
Dutch statutory tax rate |
25.8% |
25.8% |
Theoretical provision for income taxes based on Dutch statutory tax rate |
(538) |
(741) |
Reconciliation of the theoretical and effective provision for income taxes |
||
Corporate tax rate differences |
13 |
8 |
Impacts of the changes in tax rates |
(4) |
(3) |
Recognition/(de-recognition) of deferred tax assets |
43 |
7 |
Adjustments to tax expense from previous years |
15 |
- |
Outside basis differences |
(1) |
(6) |
Non-deductible expenses |
(24) |
(15) |
Withholding taxes (net of Corporate Income tax benefit) |
(66) |
(64) |
Uncertain tax positions |
(27) |
- |
Foreign Derived Intangible Income (FDII) deduction (United States) |
47 |
33 |
Other |
(4) |
3 |
Provision for income taxes |
(546) |
(778) |
Effective tax rate |
26.2% |
27.1% |
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Annual Report 2025 |
218
Changes in current tax receivables/(payables), net
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Opening balance of current income tax receivables/(payables) |
(66) |
(34) |
Income tax expense in statement of profit and loss |
(427) |
(395) |
Income tax charged to equity and other comprehensive income |
- |
1 |
Income tax paid/(received) |
403 |
349 |
Changes in foreign currency translation adjustments and other |
(13) |
13 |
Closing balance of current income tax receivables/(payables), net |
(103) |
(66) |
Reflected in the statement of financial position as follows: |
||
Current tax receivables |
65 |
30 |
Current tax payables |
(168) |
(96) |
Changes in deferred tax assets/(liabilities), net
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Opening balance of deferred tax assets/(liabilities) |
(545) |
(197) |
Income taxes |
(8) |
(300) |
Expenses and income directly recorded in equity and other comprehensive income |
11 |
11 |
Business combinations |
5 |
(57) |
Changes in foreign currency translation adjustments and other |
(20) |
(2) |
Closing balance of deferred tax assets/(liabilities), net |
(557) |
(545) |
Components of deferred tax assets and liabilities
Statement of financial position |
Statement of profit or loss |
|||
(millions of euros) |
2025 |
2024 |
2025 |
2024 |
Deferred tax |
||||
Tax attributes |
35 |
22 |
(13) |
10 |
Non-deductible provisions |
116 |
100 |
(23) |
(23) |
Employee benefits |
85 |
114 |
22 |
25 |
Lease liabilities |
91 |
106 |
23 |
(29) |
Asset revaluations |
(133) |
(188) |
(18) |
(20) |
Financial instruments 1 |
(837) |
(727) |
111 |
440 |
Right of use assets |
(95) |
(85) |
(19) |
29 |
Working capital and other |
181 |
113 |
(75) |
(132) |
Deferred tax expense/(benefit) |
8 |
300 |
||
Net deferred tax assets/(liabilities) |
(557) |
(545) |
||
Reflected in the statement of financial |
||||
position as follows: |
||||
Deferred tax assets |
657 |
625 |
||
Deferred tax liabilities |
(1,214) |
(1,170) |
||
1
Primarily related to the deferred tax liabilities stemming from the revaluation of the investments in Spotify, Tencent Music
Entertainment and other investments.
The amounts of tax attributes (including tax losses and tax credits) were estimated at the end of the
relevant fiscal years. As a result, the amount of tax attributes shown in this table and the amount
reported to tax authorities at the time of the filing of the tax returns may differ, and if necessary, may
need to be adjusted in this table at the end of the following year. UMG's forward-looking assumptions
support that it is probable that future operational results will generate sufficient taxable income to
utilize these tax attributes. Relevant developments potentially impacting the period and probability
of recovery will be monitored closely.
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Annual Report 2025 |
219
Deferred tax assets have not been recognized in respect of gross tax attributes for €1,026 million
(2024: €1,194 million), as it is not probable that there will be future taxable profits within the entities
against which these can be utilized. €10 million of the unrecognized gross tax attributes will expire
within 5 years and €988 million will not expire.
There are no income tax consequences attached for the Company to the payment of dividends in
Pillar Two
UMG has carried out a study on the financial impact of the Pillar Two rules on 2025 and future years.
Based on the currently available information UMG estimates that this impact is not material. UMG
will closely monitor the legislative developments and guidance issued to assess potential changes
in the impact on the Pillar Two rules.
For 2025 an accrual of less than €1 million (2024: less than €1 million) has been recorded regarding
top-up tax in jurisdictions which base income tax rate is lower than 15%.
Tax audits and uncertain tax positions
In the normal course of their business, UMG is subject to tax audits by the relevant tax authorities in
the countries in which it conducts or has conducted business. Various tax authorities have proposed
ordinary adjustments to the financial results reported by UMG in prior years, under statutes of
limitation applicable to UMG. Regarding ongoing tax audits, a provision is recorded where the impact
Year ended December 31, |
||
(millions of euros and shares, except per share data) |
2025 |
2024 |
Net profit attributable to equity holders of the parent |
1,533 |
2,086 |
Weighted average number of shares outstanding (after deduction of treasury |
||
shares) during the year |
1,833 |
1,827 |
Potential dilutive effects related to share-based compensation |
20 |
25 |
Diluted weighted average number of shares |
1,853 |
1,852 |
Earnings per share (in euros) |
||
Basic earnings per share |
0.84 |
1.14 |
Diluted earnings per share |
0.83 |
1.13 |
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Annual Report 2025 |
220
Changes in goodwill
(millions of euros) |
2025 |
2024 |
Balance as at January 1 |
||
Goodwill, gross |
1,997 |
1,720 |
Accumulated impairment losses |
(102) |
(96) |
Goodwill, net |
1,895 |
1,624 |
Changes in book value: |
||
Acquisitions |
56 |
180 |
Foreign currency translation adjustments |
(197) |
91 |
Total changes |
(141) |
271 |
Balance as at December 31 |
||
Goodwill, gross |
1,845 |
1,997 |
Accumulated impairment losses |
(91) |
(102) |
Goodwill, net |
1,754 |
1,895 |
In 2024, UMG recognised additional goodwill of €165 million as a result of the Mavin and [PIAS]
business combinations, refer to Note
4
.
Goodwill by cash generating unit
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Recorded Music |
959 |
1,003 |
Music Publishing |
698 |
788 |
Merchandising & Other |
97 |
104 |
Closing balance |
1,754 |
1,895 |
Cash generating units
For impairment testing, goodwill is allocated to cash-generating units, which represent the lowest
level at which the goodwill is monitored internally for management purposes. The cash-generating
units correspond to the operating segments as disclosed in Note
3
above.
Goodwill impairment test
UMG conducted the full annual impairment test in the fourth quarter of 2025.
The goodwill was tested for impairment by comparing it with a recoverable amount. The recoverable
amount is determined as the higher of the value in use determined by the discounted value
of future cash flows (Discounted Cash Flow method (DCF)) and the fair value (less costs to sell),
determined on the basis of market data (stock market prices, comparable listed companies,
comparison with the value attributed to similar assets or companies in recent acquisition
transactions). For a description of the methods used for the impairment test, please refer to Note
2
. In 2025 and 2024, the recoverable amounts of cash generating units were determined using their
value in use.
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Annual Report 2025 |
221
Key assumptions used in the impairment tests for the cash-generating units were sales growth
rates and the rates used for discounting the projected cash flows. These cash flow projections were
determined using management's internal forecasts that cover an initial period of 2025 to 2028 (2024:
initial period of 2024 to 2028) that matches the period used for our strategic planning process with
an additional two-year extrapolation until 2030 (2024: extrapolation until 2029), after which a terminal
value was calculated.
The sales growth rates used to estimate cash flows are based on:
•
past performance, including the label pool revenue forecasts derived from commercial
agreements with customers;
•
external market growth assumptions among which is the overall population and corresponding
growth in streaming penetration rate among the population;
•
expected market share developments;
•
industry long-term growth averages.
Key assumptions
| 2025 |
2024 |
|||||
Compound |
Compound |
|||||
Annual |
Extrapolation |
Annual |
Extrapolation |
|||
Revenue |
revenue |
Revenue |
revenue |
|||
Growth |
growth rate |
Pre-tax |
Growth |
growth rate |
Pre-tax |
|
In % per year |
2025-2028 |
after 2028 |
discount rates |
2024-2028 |
after 2028 |
discount rates |
Recorded Music |
6.9% |
3.3% |
10.3% |
7.0% |
3.3% |
10.2% |
Music Publishing |
7.9% |
3.3% |
10.3% |
7.0% |
3.3% |
10.2% |
Merchandising |
8.4% |
2.2% |
10.3% |
13.4% |
2.1% |
10.2% |
The annual impairment test for Recorded Music, Music Publishing and Merchandising showed
significant headroom and management did not identify an impairment for these CGUs. The
sensitivity analysis around the key assumptions in the impairment tests have indicated that a
reasonably possible change in any of the assumptions would not cause the recoverable amount to
Net book value 2025
December 31, 2025 |
|||
Accumulated |
|||
amortisation and |
|||
impairment |
|||
(millions of euros) |
Asset value, gross |
losses |
Net book value |
Catalogues (of music and publishing rights) |
6,190 |
(3,140) |
3,050 |
Royalty advances (to artists and repertoire owners) |
3,136 |
- |
3,136 |
Content assets |
9,326 |
(3,140) |
6,186 |
Other intangible assets |
735 |
(473) |
262 |
Net book value 2024
December 31, 2024 |
|||
Accumulated |
|||
amortisation and |
|||
impairment |
|||
(millions of euros) |
Asset value, gross |
losses |
Net book value |
Catalogues (of music and publishing rights) |
6,623 |
(3,230) |
3,393 |
Royalty advances (to artists and repertoire owners) |
3,296 |
- |
3,296 |
Content assets |
9,919 |
(3,230) |
6,689 |
Other intangible assets |
684 |
(452) |
232 |
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Annual Report 2025 |
222
Changes in content assets and other intangibles
Catalogues (of |
Royalty advances |
Total intangible |
||
music and |
(to artists and |
assets |
||
(millions of euros) |
publishing rights) |
repertoire owners) |
Other intangibles |
& advances |
Balance December 31, 2023 |
3,020 |
2,634 |
180 |
5,834 |
Amortisation |
(245) |
- |
(51) |
(296) |
Impairment |
(2) |
- |
- |
(2) |
Additions |
217 |
1,965 |
92 |
2,274 |
Disposals |
(4) |
- |
(1) |
(5) |
Recoupments |
- |
(1,445) |
- |
(1,445) |
Business combinations |
245 |
36 |
2 |
283 |
Changes in foreign currency translation |
162 |
106 |
10 |
278 |
adjustments and other |
||||
Balance December 31, 2024 |
3,393 |
3,296 |
232 |
6,921 |
Amortisation |
(256) |
- |
(72) |
(328) |
Impairment |
(3) |
- |
- |
(3) |
Additions |
275 |
1,551 |
125 |
1,951 |
Disposals |
(36) |
- |
- |
(36) |
Recoupments |
- |
(1,350) |
- |
(1,350) |
Business combinations |
23 |
(10) |
- |
13 |
Changes in foreign currency translation |
(346) |
(351) |
(23) |
(720) |
adjustments and other |
||||
Balance December 31, 2025 |
3,050 |
3,136 |
262 |
6,448 |
Cash movements from additions and recoupments detailed in the changes in content assets table
The significant music catalogues and publishing rights were acquired through business
combinations of BMG Publishing (BMG) and EMI Recorded Music (EMI). The BMG catalogue was
acquired in 2007 with a fair value of €1,241 million and has carrying amount of €181 million (2024:
€265 million) with a remaining useful life of 2 and 32 years for the respective catalogue components.
The EMI catalogue was acquired in 2012 with a fair value of €1,046 million, and has a carrying
amount of €434 million (2024: €541 million) with a remaining useful life of 7 and 37 years for the
respective catalogue components.
In 2024, UMG recognised additional catalogue assets of €227 million as a result of the Mavin and PIAS
business combinations, refer to Note
4
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Annual Report 2025 |
223
Equipment |
|||||
Land and |
and |
Other fixed |
Assets under |
||
(millions of euros) |
buildings |
machinery |
assets |
construction |
Total |
Cost |
|||||
Balance as at January 1, 2025 |
272 |
125 |
77 |
45 |
519 |
Additions |
13 |
6 |
6 |
45 |
70 |
Transfers and reclassifications |
12 |
37 |
2 |
(51) |
- |
Disposals |
(14) |
(9) |
(19) |
- |
(42) |
Changes in foreign currency translation |
|||||
adjustments and other |
(21) |
(11) |
(7) |
(3) |
(42) |
Balance as at December 31, 2025 |
262 |
148 |
59 |
36 |
505 |
Depreciation and impairment losses |
|||||
Balance as at January 1, 2025 |
(126) |
(94) |
(57) |
- |
(277) |
Depreciation during the year |
(18) |
(12) |
(6) |
- |
(36) |
Disposals |
14 |
9 |
19 |
- |
42 |
Changes in foreign currency translation |
10 |
6 |
5 |
- |
21 |
adjustments and other |
|||||
Balance as at December 31, 2025 |
(120) |
(91) |
(39) |
- |
(250) |
Carrying amount |
|||||
As at January 1 |
146 |
31 |
20 |
45 |
242 |
As at December 31 |
142 |
57 |
20 |
36 |
255 |
Equipment |
|||||
Land and |
and |
Other fixed Assets under |
|||
(millions of euros) |
buildings |
machinery |
assets construction |
Total |
|
Cost |
|||||
Balance as at January 1, 2024 |
242 |
122 |
74 |
24 |
462 |
Additions |
32 |
2 |
3 |
54 |
91 |
Transfers and reclassifications |
20 |
7 |
7 |
(34) |
- |
Disposals |
(31) |
(8) |
(9) |
- |
(48) |
Changes in foreign currency translation |
|||||
adjustments and other |
9 |
2 |
2 |
1 |
14 |
Balance as at December 31, 2024 |
272 |
125 |
77 |
45 |
519 |
Depreciation and impairment losses |
|||||
Balance as at January 1, 2024 |
(136) |
(92) |
(57) |
- |
(285) |
Depreciation during the year |
(18) |
(10) |
(6) |
- |
(34) |
Disposals |
31 |
10 |
8 |
- |
49 |
Changes in foreign currency translation |
|||||
adjustments and other |
(3) |
(2) |
(2) |
- |
(7) |
Balance as at December 31, 2024 |
(126) |
(94) |
(57) |
- |
(277) |
Carrying amount |
|||||
As at January 1 |
106 |
30 |
17 |
24 |
177 |
As at December 31 |
146 |
31 |
20 |
45 |
242 |
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Annual Report 2025 |
224
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Opening balance |
446 |
316 |
Depreciation |
(82) |
(79) |
Additions |
147 |
220 |
Disposals |
(5) |
(24) |
Foreign currency translations and other |
(40) |
13 |
Closing balance |
466 |
446 |
Lease liabilities
Year ended December 31, |
|||
(millions of euros) |
Note |
2025 |
2024 |
Opening balance |
541 |
410 |
|
Additions |
146 |
219 |
|
Disposals |
(5) |
(24) |
|
Accretion of interest |
6 |
21 |
20 |
Payments |
(93) |
(102) |
|
Of which interest |
(21) |
(21) |
|
Of which principal |
(72) |
(81) |
|
Foreign currency translations and other |
(49) |
18 |
|
Closing balance |
561 |
541 |
|
Maturity of lease liabilities
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Maturity |
||
< 1 year |
81 |
66 |
Between 1 and 5 years |
241 |
252 |
> 5 years |
239 |
223 |
Lease liabilities |
561 |
541 |
Cash outflow for leases and lease-related expenses
Total cash outflow and expenses for the leases of real-estate with maturity shorter than 12 months
and expense relating to low-value assets recorded in the Statement of Profit or Loss amounted
to €21 million for the year ended December 31, 2025 (compared to €19 million for the year ended
UMG’s investments in associates and joint ventures that are accounted for using the equity method
include investments in:
•
Vevo LLC, a global music videos and entertainment services platform incorporated in the
United States;
•
Chord, an investment entity formed in Canada that holds a pure-play catalogue of premier music
intellectual property; and,
•
NTWRK, a premium live-video shopping platform and curated marketplace incorporated in the
United States.
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Annual Report 2025 |
225
UMG’s holds ownership interests in Vevo, Chord and NTWRK of 49.2%, 25.5% and 34.1%, respectively.
As of December 31, 2025, the total carrying amount of these investments was €541 million (2024:
€474 million).
Change in value of investments in equity affiliates
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Opening balance |
578 |
222 |
Acquisitions 1 |
220 |
395 |
Business combinations 2 |
- |
(56) |
Write-downs |
(1) |
- |
(Loss)/income from equity affiliates |
(18) |
4 |
Change in other comprehensive income |
(66) |
25 |
Dividends |
(18) |
(12) |
Closing balance |
695 |
578 |
1
Investments were acquired in Chord and NTWRK during 2024. Refer to Note 4. During 2025 additional investments were made in
both companies.
2
In connection with the [PIAS] business combination, a step acquisition, UMG derecognised its pre-acquisition investment in [PIAS],
UMG objectives when managing capital are to safeguard UMG’s ability to continue to create value
for shareholders, support the sustainable growth of the Group, and maintain a capital structure that
optimizes its cost of capital. As a result, UMG endeavours to maintain a satisfactory economic return
for its shareholders and guarantee economic access to external sources of funds.
The syndicated RCF financial covenant requires that UMG maintain Baa2/BBB long term ratings with
Moody’s and S&P.
UMG and its subsidiaries are not subject to external capital requirements, other than the financial
To support this strategic goal, UMG management remains focused on the robust performance of the
Free Cash Flow, a non-IFRS measure, and effective Working Capital management, details on both are
presented below.
Free Cash Flow is calculated as net cash provided by/(used for) operating activities plus net cash
provided by/(used for) investing activities, less repayment of lease liabilities and related interest
expense, interest paid, net and other cash items related to financing activities. UMG considers Free
Cash Flow to be a relevant indicator of its cash flow generated to fund dividend payments and
repayment of debt. Free Cash Flow does not necessarily represent funds available for discretionary
use and is not necessarily a measure of our ability to fund our cash needs.
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226
Free cash flow
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Operating profit |
1,998 |
1,775 |
Amortisation and depreciation expense |
446 |
409 |
Non-cash share-based compensation expense, net of employees tax withheld |
111 |
131 |
Impairment on intangible assets |
3 |
2 |
Changes in provision, net |
(48) |
1 |
(Gain)/loss on sale of assets |
(4) |
(23) |
Adjustments |
508 |
520 |
Royalty advance payments, net of recoupments |
(402) |
(186) |
Other changes in net working capital |
38 |
(5) |
Net cash provided by/(used for) operating activities before income tax paid |
2,142 |
2,104 |
Income tax paid |
(403) |
(349) |
Net cash provided by/(used for) operating activities |
1,739 |
1,755 |
Net cash provided by/(used for) investing activities |
(854) |
(1,051) |
Repayment of lease liabilities and related interest expenses |
(93) |
(102) |
Interest, net |
(81) |
(81) |
Other cash items related to financing activities |
(9) |
2 |
Free cash flow |
702 |
523 |
Changes |
||||||
Changes |
in foreign |
|||||
in operating |
currency |
|||||
December 31, |
working |
Business |
translation |
December 31, |
||
(millions of euros) |
2024 |
capital 1 |
combinations |
adjustments |
Other 2 |
2025 |
Inventories 3 |
255 |
35 |
(3) |
(24) |
- |
263 |
Trade accounts |
||||||
receivable and other |
2,497 |
291 |
8 |
(169) |
(20) |
2,607 |
Of which: |
||||||
Trade |
||||||
accounts receivable |
813 |
(107) |
5 |
(45) |
7 |
673 |
Expected credit losses |
(42) |
(1) |
- |
2 |
- |
(41) |
Working capital assets |
2,752 |
326 |
5 |
(193) |
(20) |
2,870 |
Trade accounts payable |
||||||
and other |
(6,394) |
(369) |
(15) |
521 |
28 |
(6,229) |
Other non- |
||||||
current liabilities |
(1,456) |
5 |
(1) |
41 |
(38) |
(1,449) |
Working |
||||||
capital liabilities |
(7,850) |
(364) |
(16) |
562 |
(10) |
(7,678) |
Net working capital |
(5,098) |
(38) |
(11) |
369 |
(30) |
(4,808) |
1
Excludes content investments.
2
Mainly includes the change in net working capital relating to content investments, capital expenditures and other investments.
3
Total inventory obsolescence expense for the period was €44 million.
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Annual Report 2025 |
227
Changes |
||||||
Changes |
in foreign |
|||||
in operating |
currency |
|||||
December 31, |
working |
Business |
translation |
December 31, |
||
(millions of euros) |
2023 |
capital 1 |
combinations |
adjustments |
Other 2 |
2024 |
Inventories 3 |
210 |
32 |
5 |
8 |
- |
255 |
Trade accounts |
||||||
receivable and other |
2,246 |
110 |
40 |
51 |
50 |
2,497 |
Of which: |
||||||
Trade |
||||||
accounts receivable |
646 |
107 |
35 |
18 |
7 |
813 |
Expected credit losses |
(49) |
4 |
- |
- |
3 |
(42) |
Working capital assets |
2,456 |
142 |
45 |
59 |
50 |
2,752 |
Trade accounts payable |
||||||
and other |
(5,711) |
(137) |
(75) |
(214) |
(257) |
(6,394) |
Other non- |
(715) |
- |
(30) |
(23) |
(688) |
(1,456) |
current liabilities |
||||||
Working |
||||||
capital liabilities |
(6,426) |
(137) |
(105) |
(237) |
(945) |
(7,850) |
Net working capital |
(3,970) |
5 |
(60) |
(178) |
(895) |
(5,098) |
1
Excludes content investments.
2
Mainly includes the change in net working capital relating to content investments, capital expenditures and other investments.
3
UMG business activities expose the Group to financial risks, including credit risk, liquidity risk, and
market risk. Market risk comprises three types of risk: interest rate risk, foreign currency risk and
other price risks.
These risks are inherent to how UMG operates as a multinational with locally operating subsidiaries.
To manage these risks, UMG has developed specific policies. The essence of measuring the
performance of these policies is to strike a balance between managing risks and contributing to
the financial results of UMG. UMG policies are risk-averse in that regard. Enforcement of procedures
related to financial risk management is carried out by UMG Group Treasury in line with the guiding
principles of the Group Treasury Policies.
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other
party by falling to discharge an obligation.
UMG's maximum credit risk exposure is equal to the carrying amounts of Trade and other
receivables, refer to Note
15
, and Cash position and borrowings, refer to Note
17
, as presented in
the Statement of Financial Position. Also, for the derivatives and assets at fair value via profit and
loss, the maximum exposure to credit risk at the end of the reporting period is equal to the carrying
amount, refer to Note
19
. The maximum credit risk exposure on guarantees issued corresponds to
their nominal amounts, as presented in Note
18
.
UMG aims to centralize its cash management with its Tier 1 banks, of which all the banks have credit
ratings of minimum of A-.
UMG performs ongoing evaluations of the financial and non-financial condition of UMG customers
and adjusts credit limits when appropriate. In instances where a customer's creditworthiness is
determined not to be sufficient to grant the required credit limit, there are several mitigation
tools that can be utilized to close the gap, including reducing payment terms, cash on delivery,
prepayments and pledges on assets.
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228
UMG’s operational subsidiaries have set up procedures and systems to track their trade accounts
receivable and recover outstanding amounts. In addition, some subsidiaries have insured their main
Liquidity risk is the risk that UMG will not be able to meet its financial obligations as they fall due.
The primary objective of liquidity management is providing sufficient cash to enable UMG to meet its
liabilities when due, under normal and stressed conditions, without incurring losses.
Neither the aged receivables of individual customers, nor the profile of the accounts receivable
portfolio per segment, impose a significant threat to UMG’s liquidity planning.
UMG Treasury provides for the short-term day-to-day cash management needs of the Group by
organizing sweeps between international cash poolings. For medium term financing requirements,
UMG Group Treasury determines the Group's overall debt position and its planned evolution based
on the Group’s 13-month rolling cash forecast. A liquidity analysis is performed to ensure the proper
funding is in place to face medium-term needs.
Cash is pooled up to UMG NV from all territories participating in the international cash pooling
arrangement. Cash is extracted from countries outside the cash pooling through dividends or
upstream loans.
The objectives of liquidity management are to repay UMG's external debt and to pay UMG's dividend
to the Group's shareholders. The list of permitted banks for liquidity management includes nine
banks with minimum rating of A-.
The liquidity analysis includes a buffer of €400 million to provide for intra-month treasury
swings and the incompressible treasury float. Adequate bank facilities are available as backup
for Commercial paper. The maturity schedule for long-term external debt is maintained above
3 years and the current average maturity for long term external debt is 3.73 years (2024: 4.5
years). UMG Treasury ensures central compliance with financial covenants, pari-passu, and negative
pledge clauses.
Total cash and cash equivalents position as at December 31, 2025, is disclosed in Note
17
.
Contractual obligations and their timing are disclosed in Note
18
.
In addition, as at December 31,
2025, UMG has undrawn Revolving Credit Facilities (RCF) of €1,615 million (2024: €1,250 million). The
Market risk is the possibility that an entity will experience losses due to factors that affect
the financial markets. Market risk includes currency risk and interest rate risk as addressed below,
but also risk of change in fair value of the financial instruments, including those traded on the active
markets. At December 31, 2025, UMG held financial instruments measured at fair value as disclosed
in Note
19
, where the exposure of the risk and sensitivity are presented.
UMG risk management policies cover refinancing risk to ensure that under any market
circumstances, UMG can refinance its debt on time and a reasonable cost. The objectives of
refinancing risk management are to benefit from sufficient flexibility granted by the access to capital
markets (in particular, Euro commercial papers, private placement and bond markets) and not rely
solely on bank borrowings.
Interest rate risk is the risk of the fair value or future cash flows of a financial instrument fluctuating
because of changes in the market interest rates. Financial instruments included in borrowings
create an inherent interest rate risk.
UMG seeks to limit the period over which it is exposed to interest rate risk on the Group's borrowings.
The preferred method of hedging interest rate risk is issuing long-term fixed-rate bonds. The use of
interest-rate plain vanilla derivatives is also authorized. The list of authorized instruments includes
interest rate swaps, FRAs, caps, and floors.
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As for currency risk management, interest rate hedging operations are handled solely by UMG
Treasury according to the Group’s strategic goals set by the Group Chief Financial Officer. The
speculative use of interest rate derivatives is strictly prohibited.
As of December 31, 2025, UMG had a ratio of fixed-rate debt to total outstanding debt of approximately
80% (2024: 68%). A sensitivity analysis conducted in January 2026 on the gross debt portfolio shows
that if short term EURIBOR were to increase instantaneously by 0.5% from their level of December 31,
2025, with all other variables held constant, the total change in annualized interest expense result
would be €2 million (2024: €4 million).
Foreign currency risk
As any multinational group, UMG is exposed to transactional foreign currency risk on committed
and forecast cash flows, that are denominated in a currency other than the transacting entity's
functional currency. UMG is also exposed to translational risk, resulting from the translation of
foreign operations into Euros. The main currencies that drive UMG's foreign currency risk are U.S.
Dollar, British Pound and Japanese Yen.
UMG’s exposure to foreign exchange transactional risk is greatly limited due to the offsetting
of inflows and outflows in local currencies to the extent possible as a natural hedge. UMG
Treasury mainly manages foreign currency risk exposure on balance sheet positions, primarily cash
concentrations in non-Euro currencies held under the Group's cash pooling arrangements. UMG
Treasury's foreign currency risk management policy is to hedge recognized assets and liabilities
denominated in foreign currencies above a predefined threshold. UMG uses forward exchange rate
contracts and foreign exchange swaps to manage this exposure. All material foreign currency
balance sheet exposures are offset by derivatives, so potential foreign currency rate fluctuations
as of December 31, 2025 would have no significant impacts on UMG’s financial results. UMG did not
apply hedge accounting to these derivatives in 2025 or 2024. Currency derivatives are not used for
speculative purposes. The average maturity of these contracts is one month.
The table below summarises the net nominal value of the foreign currency balance sheet exposure
and foreign exchange rate derivatives used to offset it as of December 31, 2025.
(millions of euros) |
USD |
GBP |
JPY |
Other |
Total |
Nominal value of Balance sheet exposure |
225 |
(165) |
(138) |
(403) |
(481) |
Foreign exchange rate derivatives |
(225) |
165 |
138 |
403 |
481 |
Net exposure |
- |
- |
- |
- |
- |
Foreign currency translation risks are hedged to a limited extent, as the underlying currency
positions are generally considered to be long-term in nature. If a hedge is entered into, it is
Year ended December 31, |
||
(millions of euros) |
2025 |
2024 |
Trade receivables and accrued income |
2,299 |
2,244 |
Other receivables |
308 |
253 |
Trade and other receivables |
2,607 |
2,497 |
Year ended December 31,
(millions of euros)
2025
2024
Current
2,205
2,160
Overdue 0-30 days
52
44
Overdue 31-150 days
24
25
Overdue >150 days
18
15
Trade receivables and accrued income
2,299
2,244
Trade and other receivables are presented net of valuation allowances. For changes in the expected
credit loss allowance and the credit risk management policies and procedures of UMG please refer to
Note
14
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230
Year ended December 31, | ||
(millions of euros) | 2025 | 2024 |
Trade accounts payable | 174 | 168 |
Music royalties to artists and repertoire owners | 4,383 | 4,327 |
Accrued expenses | 480 | 424 |
Creative talent and content liabilities | 344 | 533 |
Other payables 1 | 452 | 530 |
Trade and other accounts payable | 5,833 | 5,982 |
Current contract liabilities | 396 | 412 |
Trade accounts payable and other | 6,229 | 6,394 |
1
Other payables includes accrued liabilities and payables related to employee, taxes and other costs.
The total amount of current and non-current contract liabilities as at December 31, 2025 is
€403 million (2024: €424 million).
Out of the total amount of €424 million recognized in contract liabilities at the beginning of
2025, €379 million has been recognized as revenue for the year ended December 31, 2025 (2024:
€365 million recognized as revenue out of a total of €428 million recognized in contract liabilities at
Cash position
Year ended December 31, | ||
(millions of euros) | 2025 | 2024 |
Cash and cash equivalents | 451 | 553 |
Bank overdrafts | (74) | (8) |
Cash and cash equivalents in the statement of cash flows | 377 | 545 |
UMG operates in a number of territories where regulations do not authorise participation of local
entities to the UMG global cash pooling. Only dividends and intra-group invoices are available to
extract cash from these territories. The amount of cash held by UMG entities in these countries
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December 31, 2025 | December 31, 2024 | |||||
(millions of euros) | Total | Long-term | Short-term | Total | Long-term | Short-term |
Bonds | 2,293 | 2,251 | 42 | 1,810 | 1,776 | 34 |
Drawn revolving | ||||||
credit facilities | 8 | 8 | - | - | - | - |
Commercial papers | 384 | - | 384 | 746 | - | 746 |
Bank overdrafts | 74 | - | 74 | 8 | - | 8 |
Other | 87 | 38 | 49 | 87 | 2 | 85 |
Borrowings at | ||||||
amortized cost | 2,846 | 2,297 | 549 | 2,651 | 1,778 | 873 |
Cash and | ||||||
cash equivalents | (451) | - | (451) | (553) | - | (553) |
Derivative | ||||||
financial assets | (5) | - | (5) | - | - | - |
Net debt | 2,390 | 2,098 | ||||
Borrowings include the following:
•
€500 million of senior unsecured notes issued in June 2022, due on June 30, 2027 with a coupon
of 3.00%.
•
€500 million of senior unsecured notes issued in June 2022, due on June 30, 2032 with a coupon
of 3.75%.
•
€750 million of senior unsecured notes issued in June 2023, due on June 13, 2031 with a coupon
of 4.00%.
•
¥7 billion (€45 million) of senior notes issued in July 2023 and due on July 5, 2038 with a coupon
of 1.61%.
•
€300 million of senior unsecured notes issued in May 2025, due on June 30, 2032 with a coupon
of 3.75%.
•
€100 million of senior unsecured notes issued in June 2025, due on June 13, 2031 with a coupon
of 4.00%.
•
¥7 billion (€41 million) of senior notes issued in September 2025 and due on September 25, 2035
with a coupon of 2.25%.
•
€40 million of senior unsecured notes issued in December 2025, due on December 15, 2038 with a
coupon of 4.00%.
•
€2 billion revolving credit facility extended in February 2023 to April 26, 2028.
•
Up to €2 billion NEU commercial paper program established in July 2022.
•
USD $500 million short-term bilateral floating rate revolving credit facility entered into in April
2025, which expires in April 2028.
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Movements of borrowings
Drawn | ||||||
revolving | ||||||
credit | Bank | Commercial | ||||
(millions of euros) | facilities | Bonds | overdrafts | papers | Other debt | Total |
Balance December | ||||||
31, 2023 | - | 1,808 | 26 | 197 | 73 | 2,104 |
New borrowings | 300 | - | 8 | 3,897 | 124 | 4,329 |
Repayments | (300) | - | (26) | (3,351) | (104) | (3,781) |
Translation differences | ||||||
and other movements | - | 2 | - | 3 | (6) | (1) |
Balance December | ||||||
31, 2024 | - | 1,810 | 8 | 746 | 87 | 2,651 |
New borrowings | 317 | 481 | 74 | 3,689 | 19 | 4,580 |
Repayments | (309) | - | (8) | (4,048) | (12) | (4,377) |
Translation differences | ||||||
and other movements | - | 2 | - | (3) | (7) | (8) |
Balance December | ||||||
31, 2025 | 8 | 2,293 | 74 | 384 | 87 | 2,846 |
UMG’s material contractual obligations and contingent assets and liabilities include:
•
Contractual content commitments. UMG routinely commits to pay agreed amounts to artists and
other parties upon delivery of content or other products. Until the artist or the other party has
delivered his or her content or until the recoupment of an advance, UMG discloses its obligation
as an off-balance sheet commitment;
•
Certain contractual obligations relating to the UMG’s business operations, including leases and
off-balance sheet commercial commitments, such as long-term service contracts and purchase
or investment commitments; and
•
Commitments related to UMG’s financing: term loan and drawn committed bank credit facilities.
The table below analyses UMG’s financial liabilities into relevant maturity groupings based on their
contractual maturities. The amounts disclosed in the table are the contractual undiscounted cash
flows. Balances due within 12 months equal their carrying balances as the impact of discounting
is not significant. Interest on long-term debt is based on floating rate adjustments according to
market expectations.
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Minimum future payments as of December 31, 2025 | Total minimum future | ||||
Payments due in | payments as of | ||||
(millions of euros) | Total | 1 year | 2-5 years | After 5 years | December 31, 2024 |
Borrowings and other | |||||
financial liabilities | 3,281 | 480 | 871 | 1,930 | 3,086 |
Lease liabilities | 695 | 102 | 307 | 287 | 664 |
Music royalties to artists and | |||||
repertoire owners | 4,396 | 4,383 | 13 | - | 4,343 |
Creative talent and | |||||
content liabilities | 583 | 344 | 237 | 2 | 944 |
Other payables | 2,251 | 1,054 | 61 | 1,136 | 2,094 |
Consolidated statement of | |||||
financial position items | 11,206 | 6,363 | 1,489 | 3,355 | 11,131 |
Contractual | |||||
content commitments | 1,614 | 791 | 753 | 70 | 1,707 |
Other commitments 1 | 1,571 | 859 | 122 | 590 | 875 |
Total off-balance | |||||
sheet commitments | 3,185 | 1,650 | 875 | 660 | 2,582 |
Total | 14,391 | 8,013 | 2,364 | 4,015 | 13,713 |
1
In December 2024, UMG entered into a definitive agreement to acquire Downtown Music Holdings LLC. The acquisition was
approved by the European Commission on February 13, 2026 and completed on February 20, 2026. Refer to Note 30 of the
Consolidated Financial Statements for additional information. Total cash outflows resulting from the acquisition are $898 million,
The following table shows the carrying amounts and fair values of financial assets and liabilities
according to their fair value hierarchy. Based on the nature, maturity or the magnitude of the
amounts, UMG considers that the fair value of trade and other receivables, short-term deposits,
loans receivable, borrowings, trade and other payables are not materially different from their
carrying value.
Fair value hierarchy is based on the transparency of the inputs used and is as follows:
•
Level 1: fair value measurement based on quoted prices in active markets for identical assets
or liabilities;
•
Level 2: fair value measurement based on observable market data (other than quoted prices
included under Level 1), being for example, price on the last transactions on over-the-counter
(OTC) markets; and
•
Level 3: fair value measurement based on valuation techniques using inputs for the asset or
liability that are not based on observable market data.
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| December 31, 2025 | ||||
| Fair value | ||||
Carrying | ||||
(millions of euros) | amount | Level 1 | Level 2 | Level 3 |
Financial assets at fair value through profit and loss | ||||
Listed equity securities | 3,404 | 3,404 | - | - |
Other financial assets | 133 | - | 18 | 115 |
Financial assets at fair value through other | ||||
comprehensive income | ||||
Unlisted equity securities | 34 | - | - | 34 |
Financial assets at amortised cost | ||||
Trade and other receivables | 2,607 | - | - | - |
Other financial assets | 215 | - | - | - |
Total financial assets | 6,393 | 3,404 | 18 | 149 |
Financial liabilities at fair value through profit | ||||
and loss | ||||
Trade and other payables | (4) | (4) | - | - |
Other non-current liabilities | (51) | (5) | - | (46) |
Financial liabilities at amortised cost | ||||
Trade and other payables | (6,225) | - | - | - |
Bonds | (2,293) | (2,181) | - | - |
Borrowings, excluding bank overdrafts and bonds | (479) | - | - | - |
Other non-current liabilities | (1,398) | - | - | - |
Total financial liabilities | (10,450) | (2,190) | - | (46) |
December 31, 2024 | ||||
Fair value | ||||
Carrying | ||||
(millions of euros) | amount | Level 1 | Level 2 | Level 3 |
Financial assets at fair value through profit and loss | ||||
Listed equity securities | 2,945 | 2,945 | - | - |
Other financial assets | 112 | - | 7 | 105 |
Financial assets at fair value through other | ||||
comprehensive income | ||||
Unlisted equity securities | 18 | - | - | 18 |
Financial assets at amortised cost | ||||
Trade and other receivables | 2,497 | - | - | - |
Other financial assets | 197 | - | - | - |
Total financial assets | 5,769 | 2,945 | 7 | 123 |
Financial liabilities at fair value through profit | ||||
and loss | ||||
Trade and other payables | (3) | (3) | - | - |
Other non-current liabilities | (63) | (8) | - | (55) |
Financial liabilities at amortised cost | ||||
Trade and other payables | (6,391) | - | - | - |
Bonds | (1,810) | (1,791) | - | - |
Borrowings, excluding bank overdrafts and bonds | (833) | - | - | - |
Other non-current liabilities | (1,393) | - | - | - |
Total financial liabilities | (10,493) | (1,802) | - | (55) |
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Listed equity portfolio
Change | Cumulative | |||||||
Number | Average | Stock | in value | unrealized | Sensitivity | |||
of shares | Ownership | purchase | market | Carrying | over | capital | at +/- 10 | |
held | interest | price 1,2 | price | value | the period | gain/(loss) 3 | pts | |
(thousands) | (€/share) | (millions of euros) | ||||||
Spotify | 6,487 | 3.16% | 6.58 | 431.90 | 2,802 | 1,690 | 2,759 | +280/-280 |
Tencent | ||||||||
Music Entertainment | 12,246 | 0.79% | na | 10.96 | 134 | 33 | 134 | +13/-13 |
Other | 9 | (5) | 9 | |||||
Total at December | ||||||||
31, 2024 | 2,945 | 1,718 | 2,902 | |||||
Spotify | 6,487 | 3.10% | 6.58 | 495.47 | 3,214 | 412 | 3,171 | +321/-321 |
Tencent | ||||||||
Music Entertainment | 12,246 | 0.80% | na | 14.96 | 183 | 49 | 183 | +18/-18 |
Other | 7 | (2) | 7 | |||||
Total at December | ||||||||
31, 2025 | 3,404 | 459 | 3,361 |
1
Includes acquisition fees and taxes.
2
na: not applicable.
3
UMG has an authorized share capital of €27,000 million divided into 2,700,000,000 ordinary shares
with a nominal value of €10 per share. On December 31, 2025, the issued and fully paid share
capital consisted of 1,834,181,772 ordinary shares with a nominal value of €10 per share (2024:
Additional paid-in capital represents the premium paid in excess of the par value of shares at the
Retained Earnings
On May 14, 2025 the shareholders approved a dividend distribution of €0.28 per ordinary share,
corresponding to a total distribution of €513 million, paid in June 2025, except for withholding tax
which was settled in July 2025.
On July 30, 2025 the directors approved an interim dividend distribution of €0.24 per ordinary share,
corresponding to a total distribution of €440 million paid in October 2025.
UMG plans to annually declare and pay dividends to all holders of the Shares on a pro-rata basis
in two semi-annual instalments, in the aggregate amount of no less than 50% of UMG's net profits
realized during the relevant financial year, subject to agreed non-cash items. UMG intends to pay an
interim dividend in the fourth quarter of each financial year, after the publication of the half-year
figures of the Group, and a final dividend in the second quarter of the following financial year, to be
paid following approval of the UMG's financial statements at its Annual General Meeting.
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A proposal will be submitted to the 2026 Annual General Meeting of Shareholders to pay a final
dividend of €0.28 per ordinary share corresponding to a distribution of €514 million, in cash, from
the 2025 retained earnings, payable in Q2 2026. This would bring the total dividend for 2025 to
Note 21. Expenses and income directly recognized in other comprehensive income
Details of changes in equity related to other comprehensive income
Items not subsequently | Items to be subsequently reclassified to profit | |||||
reclassified to profit & loss | & loss | |||||
Financial | ||||||
Actuarial | assets at | Other | Net gain/ | |||
gains/(losses) | fair value | comprehensive | (losses) on | |||
related to | through | Foreign | income from | hedge of net | ||
employee | other | currency | equity | investment | Other | |
defined | comprehensive | translation | affiliates, | and cash flow | comprehensive | |
(millions of euros) | benefit plans | income | adjustments | net | hedges | income |
Balance as of December | ||||||
31, 2023 | (14) | (6) | (166) | (1) | 8 | (179) |
Expenses and | ||||||
income directly | ||||||
recognized in other | (17) | (4) | 261 | 25 | 3 | 268 |
comprehensive income | ||||||
Tax effect | 5 | - | (6) | - | - | (1) |
Balance as of December | ||||||
31, 2024 | (26) | (10) | 89 | 24 | 11 | 88 |
Expenses and | ||||||
income directly | ||||||
recognized in other | 9 | (1) | (642) | (66) | 23 | (677) |
comprehensive income | ||||||
Tax effect | (3) | - | - | - | - | (3) |
Balance as of December | ||||||
31, 2025 | (20) | (11) | (553) | (42) | 34 | (592) |
Year ended December 31, | |||
(millions of euros) | Note | 2025 | 2024 |
Post-retirement employee benefits | 23 | 164 | 178 |
Royalty audit claims | 102 | 118 | |
Deferred employee compensation | 29 | 31 | |
Restructuring costs | 51 | 53 | |
Litigations | 20 | 19 | |
Other | 55 | 62 | |
Provisions | 421 | 461 | |
Deduction of current provisions | (179) | (195) | |
Non-current provisions | 242 | 266 | |
Based on the historical utilisation rate, UMG expects the royalty audit claims provision will be utilized
mainly within the next 3 years.
Movements in provisions
Royalty | |||||
(millions of euros) | Restructuring | Litigation | audit claims | Other | Total |
Balance as at January 1, 2025 | 53 | 19 | 118 | 62 | 252 |
Additions | 51 | 1 | 42 | 1 | 95 |
Utilizations | (52) | - | (36) | (32) | (120) |
Releases | (1) | (1) | (13) | (7) | (22) |
Business combinations | - | - | 1 | 27 | 28 |
Changes in foreign currency translation | |||||
adjustments and other | - | 1 | (10) | 4 | (5) |
Balance as at December 31, 2025 | 51 | 20 | 102 | 55 | 228 |
Current | 49 | 15 | 60 | 33 | 157 |
Non-current | 2 | 5 | 42 | 22 | 71 |
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In accordance with the laws and practices of each country in which it operates, UMG participates
in, or maintains, employee benefit plans providing retirement pensions, post-retirement health
care, life insurance and other post-employment benefits to eligible (former) employees and such
of their beneficiaries who meet the required conditions. Post-retirement benefits are provided for
substantially all employees through defined contribution plans, which are integrated with local
social security, or defined benefit plans, which are generally managed via group pension plans.
The plan funding policy implemented by UMG is consistent with applicable government funding
requirements and regulations. Refer to Note
5
for the contribution to defined contribution plans.
Post-employment benefits covered in this note relate to defined-benefit pension and other post-
retirement defined benefit plans, including medical plans and life insurance. The benefits provided
by these plans are based on employees’ years of service and compensation levels.
Refer to the table below for the present value of the net defined benefit obligations and plan assets
per country as at December 31.
| 2025 | 2024 | |||||
Fair value | Net obligation/ | Fair value | Net obligation/ | |||
(millions of euros) | Obligation | of plan assets | (asset) | Obligation | of plan assets | (asset) |
Germany | 134 | (1) | 133 | 147 | (1) | 146 |
U.S. | 18 | - | 18 | 19 | - | 19 |
Other | 35 | (34) | 1 | 38 | (36) | 2 |
Total | 187 | (35) | 152 | 204 | (37) | 167 |
of which | ||||||
assets related | ||||||
to employee | ||||||
benefit plans | (12) | (11) | ||||
liabilities for | ||||||
employee | ||||||
benefit plans | 164 | 178 | ||||
Germany
The post-retirement benefit plans in Germany aim to provide pension benefits to eligible (former)
employees and such of their beneficiaries who meet certain conditions. The total obligation as
presented above includes multiple plans, of which three are material. These plans are closed to new
entrants since 2003 and earlier. In accordance with current regulations, these plans are not funded
and are not covered by the plan assets. The main risks for UMG relate to changes in discount rates
and inflation rates.
United States
The defined benefit liability in the United States mainly relates to the post-retirement medical care
benefits. Post-retirement medical benefit plans in the United States are not covered by plan assets in
accordance with local laws and practices.
Cash flow impact for 2026
In 2026 UMG expects a cash outflow of €15 million in relation to all defined benefit plans.
Net defined benefit obligations/(assets)
Movements of the net defined benefit obligations and plan assets for the year ended on December
31, are presented in the following tables.
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2025 | ||||
Fair value | Net obligation/ | |||
(millions of euros) | Note | Obligation | of plan assets | (asset) |
Opening balance | 204 | (37) | 167 | |
Current service cost | 5 | 2 | - | 2 |
(Gain)/loss on settlements | - | - | - | |
Other | - | - | - | |
Impact on selling & administrative expenses | 2 | - | 2 | |
Interest cost | 6 | 6 | - | 6 |
Expected return on plan assets | 6 | - | - | - |
Impact on other financial income | 6 | - | 6 | |
Included in the statement of profit or loss | 8 | - | 8 | |
Actuarial losses/(gains) related to: | ||||
Experience adjustments | (2) | - | (2) | |
Financial assumptions | (7) | - | (7) | |
Demographic assumptions | - | - | - | |
Included in other comprehensive income | 21 | (9) | - | (9) |
Contributions by employers | - | (12) | (12) | |
Benefits paid by the fund | (3) | 3 | - | |
Benefits paid by the employer | (12) | 12 | - | |
Foreign currency and other | (1) | (1) | (2) | |
Closing balance | 187 | (35) | 152 | |
of which | ||||
wholly or partly funded benefits | 29 | |||
wholly unfunded benefits 1 | 158 | |||
assets related to employee benefit plans | (12) | |||
liabilities for employee benefit plans | 164 | |||
1
Included a current liability of €14 million as of December 31, 2025
2024 | ||||
Fair value | Net obligation/ | |||
(millions of euros) | Note | Obligation | of plan assets | (asset) |
Opening balance | 192 | (36) | 156 | |
Current service cost | 5 | 1 | - | 1 |
(Gain)/loss on settlements | - | - | - | |
Other | - | - | - | |
Impact on selling & administrative expenses | 1 | - | 1 | |
Interest cost | 6 | 6 | - | 6 |
Expected return on plan assets | 6 | - | (1) | (1) |
Impact on other financial income | 6 | (1) | 5 | |
Included in the statement of profit or loss | 7 | (1) | 6 | |
Actuarial losses/(gains) related to: | ||||
Experience adjustments | 14 | (3) | 11 | |
Financial assumptions | 6 | - | 6 | |
Demographic assumptions | - | - | - | |
Included in other comprehensive income | 21 | 20 | (3) | 17 |
Contributions by employers | - | (13) | (13) | |
Benefits paid by the fund | (3) | 3 | - | |
Benefits paid by the employer | (12) | 12 | - | |
Foreign currency and other | - | 1 | 1 | |
Closing balance | 204 | (37) | 167 | |
of which | ||||
wholly or partly funded benefits | 33 | |||
wholly unfunded benefits 1 | 171 | |||
assets related to employee benefit plans | (11) | |||
liabilities for employee benefit plans | 178 | |||
1
Included a current liability of €15 million as of December 31, 2024
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Assumptions used in the valuation of the net defined benefit liability
The mortality tables used for UMG’s major defined benefit schemes in Germany are Richttafeln 2018
G K. Heubeck.
Other key assumptions used in the valuation of the net defined benefit plans liability are: rate of
compensation increase, discount rate, and expected return on plan assets. The weighted-average
assumptions used to calculate the defined benefit obligation as of December 31 were as follows:
Germany | U.S. | Weighted average of all plans | ||||
2025 | 2024 | 2025 | 2024 | 2025 | 2024 | |
Discount rate | 3.80% | 3.30% | 5.15% | 5.47% | 3.81% | 3.33% |
Inflation rate | 2.00% | 2.00% | na | na | 1.99% | 2.00% |
Duration of the benefit obligation | ||||||
(in years) | 9.7 | 9.9 | ||||
na: not applicable. | ||||||
Defined benefit obligation sensitivity
A 50 basis point change in the key assumptions, assuming all other assumptions remain
unchanged, would result in the following impact to the defined benefit obligation:
2025 | 2024 | |||
50 basis point | 50 basis point | |||
(millions of euros) | Increase | Decrease | Increase | Decrease |
Discount rate | (8) | 9 | (10) | 10 |
Inflation rate | 6 | (6) | 8 | (7) |
Pension plan assets allocation
Year ended December 31, | ||
(millions of euros) | 2025 | 2024 |
Insurance contracts | 54% | 55% |
Equity securities | 23% | 22% |
Debt securities | 14% | 14% |
Diversified funds | 0% | 0% |
Cash and other | 9% | 9% |
Total | 100% | 100% |
In 2022, UMG received formal approval from its shareholders to implement an equity plan, the UMG
Global Equity Plan. Under the plan, Restricted Stock Units (RSUs) and Performance Stock Units (PSUs)
are granted to senior executives to align the interests of the employees of UMG with its shareholders’
interests by providing them with an additional incentive to improve UMG's performance and
increase its share price on a long-term basis. In addition, the Annual Incentive Plan (AIP) for these
senior executives was modified such that all or a portion of the payment under the plan may be
settled in equity at the discretion of UMG. Subsequently, the equity plan was extended to additional
executives, certain non-executive board directors and a number of senior management personnel,
resulting in the issuance of additional RSUs, PSUs and also Performance Stock Options (PSOs).
UMG Restricted Stock Units (RSUs)
Starting in the last quarter of 2022, and continuing for each year of service under the term of their
contracts, certain senior executives and senior management are granted RSUs, being a right to
receive shares upon vesting. These RSU awards have final vesting periods typically of 3 to 5 years
and will vest in 3 equal instalments during that period if the service condition is fulfilled.
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In addition, one-off RSU awards were granted to certain senior executives and senior management
and have final vesting periods typically of 3 to 5 years and will typically vest in 4 to 5 equal
instalments during that period.
The RSUs granted to certain non-executive board directors have vesting periods of 1 to 2 years
vesting in 1 instalment.
The grant-date fair value of each RSU is determined based on the closing UMG share price on that
date. The share rights are dividend-bearing during the service period.
UMG Performance Stock Units (PSUs)
Starting in the last quarter of 2022, and continuing for each year of service under the term of
their contracts, certain senior executives and senior management are granted PSUs, being a right
to receive shares upon vesting. The vesting of these rights is subject to service, market and non-
market performance conditions.
For these PSUs, the total number of shares delivered will range from 0% to 200% of the number of
PSUs granted based on certain performance conditions tailored to each participant. For PSUs granted
in 2022, 2023 and 2024, these include non-market performance conditions: target compound annual
growth rate for revenues (Revenue CAGR) and Adjusted EBITDA (Adjusted EBITDA CAGR) and a market
performance condition: relative total shareholder return (TSR). For PSUs granted in 2025, the same
performance conditions apply with the exception of Adjusted EBITDA CAGR being replaced by Revised
Earnings per Share compound annual ground rate (Revised EPS CAGR). In addition, the employee
must remain in continued service for a three-year period.
Subsequent to 2022, there was a small number of PSU awards granted with service conditions and
performance conditions that vary slightly from the PSU awards described above.
The grant-date fair value of each PSU is determined based on the closing UMG share price on that
date, adjusted to reflect the fair value of the market performance condition. The share rights are
dividend-bearing during the performance period.
Annual Incentive Program (AIP)
In 2022, the AIP for senior executives, which was previously settled only in cash and accrued
throughout the year, was modified to allow UMG the choice of whether to settle in cash, shares,
or a combination of the two. Such modification did not change the fair value of the award compared
to the previously accrued AIP payable. UMG expects to settle 50% of the AIP in cash and 50% in
shares. UMG has a constructive obligation to settle 50% of the award in cash. The total AIP expense
for the full calendar year starting January 1, 2025, being the start of the service period for the 2025
award, was €56 million (2024: €61 million) with the cash-settled AIP accrual amounting to 50% of the
total expense.
The vesting conditions of the AIP awards are a one-year service period and certain internally
measured performance conditions including Adjusted EBITDA, revenue and cash flow from
operations (CFFO). The amount received can vary between 0% and 200% of the on-target amount
based on the actual performance against these performance criteria.
The number of shares granted is based on the total value of the award and UMG’s share price on
March 15.
UMG Performance Stock Options (PSOs)
In 2023, PSOs were granted to a senior executive. The PSOs are subject to a service condition and
a market condition. Under the service condition, the options will vest annually in four substantially
equal instalments on each of the first four anniversaries of the grant date, subject to the senior
executive’s continued employment by UMG on those dates. The market condition requires that
certain stock price hurdles be met before the PSOs become exercisable. The stock price hurdles
are met as follows: one-third of the PSOs each becomes exercisable at hurdle prices of €26.50, €30.00
and €38.00, respectively, based on the preceding 30-day average closing price of UMG N.V. shares.
The PSOs were granted on March 30, 2023 at a total fair value of €45.9 million ($50 million), the grant
date fair value used for recognising the expense on these awards. In accordance with the PSO terms,
the number of options issued was determined at a later valuation date, April 30, 2023.
In 2024, PSOs were granted to another senior executive. The PSOs are subject to a service condition
and a market condition. The terms of the service conditions and market condition are the same as
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Annual Report 2025 |
241
the previously granted PSOs with the exception of the stock price hurdles. The stock price hurdles
are met as follows: one-third of the PSOs each becomes exercisable at hurdle prices of €30.00, €34.00
and €38.00, respectively, based on the preceding 30-day average closing price of UMG N.V. shares.
The PSOs were granted on May 30, 2024 at a total fair value of €4.6 million ($5 million), the grant date
fair value used for recognising the expense on these awards. In accordance with the PSO terms, the
number of options issued was determined at a later valuation date, May 31, 2024.
Both senior executives must be employed by UMG on the occurrence of the stock price hurdles. As a
result, the PSOs vest at the later of completion of service condition or the stock price hurdle. Awards
will forfeit if the relevant stock price hurdle is not met in the five-year period following the grant date.
The PSOs will be equity-settled.
As of each respective valuation date, a Monte Carlo simulation was performed to determine the
number of options to be issued so that the per unit fair values summed in total to the grant
date fair value. The valuation exercise simulated the stock price of UMG over the contractual term,
taking into account the terms and conditions on which the options were granted, expected dividend
distributions and the historical volatility of UMG. UMG’s historical volatility was also benchmarked
against the long-term volatility of other listed groups considered comparable to UMG.
The number and weighted average exercise price (WAEP) of, and movements in, share options were
as follows:
Weighted average exercise price (WAEP)
2025 | 2024 | |||
Number | Number | |||
(thousands) | WAEP (euros) | (thousands) | WAEP (euros) | |
Outstanding at January 1 | 9,235 | 20.61 | 8,625 | 19.81 |
Granted during the year | - | na | 610 | 28.58 |
Forfeited during the year | - | na | - | na |
Exercised during the year | - | na | - | na |
Expired during the year | - | na | - | na |
Outstanding at December 31 | 9,235 | 20.61 | 9,235 | 20.61 |
Exercisable at 31 December | 1,438 | 19.81 | 719 | 19.81 |
The weighted average remaining contractual life for the share options outstanding as at December
31, 2025 was 2.34 years (2024: 3.34 years).
The weighted average fair value of options granted during the year was nil as no new options were
granted (2024: €7.6).
The range of exercise prices for options outstanding at the end of the year was €19.81 to €28.58 (2024:
€19.81 to €28.58).
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242
The following table lists additional weighted average inputs to the Monte Carlo model used for the
PSOs for the awards granted during the period:
2025 | 2024 | |
Dividend yield (%) | - | 2.00 |
Expected volatility (%) | - | 30.70 |
Risk free interest rate (%) | - | 2.93 |
Weighted average share price at valuation date (euros) | - | 28.58 |
The dividend distribution during the lifetime of the option has been estimated based on historical
and forecasted data and is not necessarily indicative of yield patterns that may occur. The expected
volatility reflects the assumption that the historical volatility over a period similar to the life of the
options is indicative of future trends, which also may not necessarily be the actual outcome.
Equity-settled detail by type
The weighted average grant-date fair value per instrument and total fair value for the awards
outstanding vesting as at period end were as follows:
Weighted average grant- | ||||
date fair value per | ||||
instrument outstanding | Total fair value outstanding | |||
(euros) | (millions of euros) | |||
Year ended December 31, | ||||
2025 | 2024 | 2025 | 2024 | |
RSUs | 23.12 | 22.30 | 369 | 395 |
PSUs | 26.89 | 25.00 | 196 | 186 |
AIP | 22.23 | 25.13 | 28 | 31 |
PSOs | 5.50 | 5.99 | 43 | 51 |
The total expense for these awards recognised were as follows:
Year ended December 31, | ||
(millions of euros) | 2025 | 2024 |
RSUs | 102 | 185 |
PSUs | 85 | 96 |
AIP | 28 | 31 |
PSOs | 12 | 17 |
Total | 227 | 329 |
The total equity reserve for these awards recognised were as follows:
Year ended December 31, | ||
(millions of euros) | 2025 | 2024 |
RSUs | 200 | 203 |
PSUs | 145 | 141 |
AIP | 28 | 31 |
PSOs | 39 | 28 |
Total | 412 | 403 |
Estimated future tax obligation
An estimate of the amount that UMG expects to transfer to tax authorities to settle the employees’
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Annual Report 2025 |
243
UMG’s related parties include the Corporate Executives and non-executive board members.
Corporate Executive compensation
As of December 31, 2025, UMG's Corporate Executives are comprised of 10 (2024: 9) members, of which
2 (2024: 2) were Executive Directors on the UMG N.V. board. The Corporate executives are as defined in
the Appendix of the Annual Report. The Executive directors are also members of the UMG N.V. board.
Their aggregate compensation is presented in the table below.
Year ended December 31, 2025 | |||
Other | |||
Corporate | Executive | Corporate | |
(millions of euros) | Executives | Directors | Executives |
Short-term employee benefits | 17 | 25 | 42 |
Post-employment benefits | 1 | - | 1 |
Other long-term benefits | - | - | - |
Termination benefits | - | - | - |
Share-based payments | 46 | 41 | 87 |
Corporate Executives | 64 | 66 | 130 |
Year ended December 31, 2024 | |||
Other | |||
Corporate | Executive | Corporate | |
(millions of euros) | Executives | Directors | Executives |
Short-term employee benefits | 20 | 20 | 40 |
Post-employment benefits | 1 | - | 1 |
Other long-term benefits | - | - | - |
Termination benefits | - | - | - |
Share-based payments | 66 | 51 | 117 |
Corporate Executives | 87 | 71 | 158 |
Refer to the Remuneration Report section in the Annual Report for more detail.
Non-executive board compensation
As of December 31, 2025 UMG's non-executive board received director fees of €1 million (2024:
Other related-party transactions
Other related parties include:
•
companies fully consolidated by UMG. The transactions between these companies have been
eliminated for the preparation of UMG’s Annual Financial Statements;
•
companies over which UMG exercises a significant influence or has joint control;
•
all companies that are controlled or jointly controlled by Corporate Executives or their close
relatives; and
•
all companies that have a significant influence over UMG.
UMG distributes its cash surpluses to shareowners through dividends and share capital reductions
(please refer to Note
20
).
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244
The balances and transactions with the parties described above are summarised in the table below:
| December 31, 2025 | |||||
(millions of euros) | Associates | Joint Ventures | Shareholders | Other | Total |
Statement of Financial Position | |||||
Assets | |||||
Trade accounts receivable | 38 | - | - | - | 38 |
Loans and other receivables | 18 | 116 | - | - | 134 |
Other financial assets | 51 | - | - | - | 51 |
Royalty advances | 17 | - | - | - | 17 |
Liabilities | |||||
Trade accounts payable | (13) | - | - | - | (13) |
Lease liabilities | - | (116) | - | - | (116) |
Statement of Profit or Loss | |||||
Revenue | 250 | - | 1 | - | 251 |
Cost of revenues | (116) | - | - | - | (116) |
Selling, general and | |||||
administrative expenses | - | - | - | - | - |
Other financial income | 4 | 7 | - | - | 11 |
Other financial expenses | - | (3) | - | - | (3) |
December 31, 2024 | |||||
(millions of euros) | Associates | Joint Ventures | Shareholders | Other | Total |
Statement of Financial Position | |||||
Assets | |||||
Trade accounts receivable | 89 | - | 2 | - | 91 |
Loans and other receivables | 10 | 91 | - | - | 101 |
Other financial assets | 58 | - | - | - | 58 |
Royalty advances | - | - | - | - | - |
Liabilities | |||||
Trade accounts payable | (1) | - | - | - | (1) |
Lease liabilities | - | (63) | - | - | (63) |
Statement of Profit or Loss | |||||
Revenue | 286 | - | 9 | - | 295 |
Cost of revenues | - | - | - | - | - |
Selling, general and | |||||
administrative expenses | (20) | - | (2) | (1) | (23) |
Other financial income | - | 6 | - | - | 6 |
Other financial expenses | - | (4) | - | - | (4) |
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245
In the normal course of its business, Universal Music Group is subject to various lawsuits,
arbitrations and governmental, administrative or other proceedings (collectively referred to herein
as “Legal Proceedings”). However, based on the information currently available, UMG believes that the
outcome from these Legal Proceedings will not have a material impact on UMG's consolidated results
The Consolidated financial statements comprise the assets and liabilities of 435 legal entities. Set out
below is a list of material holding companies and subsidiaries.
All the entities are 100% owned.
Legal entity name | Principal country of business |
Universal Music Group N.V. | Netherlands |
Universal Music Group, Inc. | United States |
Universal Music Group Holdings, Inc. | United States |
UMG Recordings Inc. | United States |
Universal Music Corp . | United States |
Universal International Music B.V. | Netherlands |
CMHL B.V. | Netherlands |
Universal Music LLC | Japan |
Universal Music Entertainment GmbH | Germany |
Universal Music Limited | Hong Kong |
Universal Music Holdings Limited | United Kingdom |
Universal Music (UK) Holdings Limited | United Kingdom |
Universal Music Leisure Limited | United Kingdom |
Universal Music Publishing International Limited | United Kingdom |
EMI Group Worldwide Holdings Limited | United Kingdom |
EMI Group (Newco) Limited | United Kingdom |
EMI Group Limited | United Kingdom |
Virgin Music Group | United Kingdom |
Virgin Records Limited | United Kingdom |
UMG does not have subsidiaries that have non-controlling interests that are material for its
ABOUT UMG
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246
Fees for audit services include the audit of the financial statements of the UMG and its subsidiaries.
Fees for other audit services include review of interim financial statements, sustainability, and
other audits. Fees for tax services include tax compliance and tax advice. Fees for other non-audit
services include agreed-upon procedures and advisory services. Fees for tax and other non-audit
services are related to the network outside the Netherlands and are in accordance with local
independence regulation.
Year ended December 31, | ||
2025 | 2024 | |
(millions of euros) | EY | EY |
Audit of UMG and its subsidiaries | 10 | 8 |
Other assurance-related fees 1 | 13 | - |
Tax services | - | - |
Other non-audit services | - | - |
Total 2 | 23 | 8 |
1
Other assurance-related fees consists of sustainability audit fees and assurance fees for US listing preparation. Total
sustainability audit fees was €0 million (2024: €0 million). Assurance fees for US listing preparation was €13 million (2024:
€0 million).
2
UMG has provided guarantees to the following subsidiaries, incorporated in the Netherlands, under
the registered number indicated, under section 403 of Book 2 of the Dutch Civil Code. As these
companies’ financial data is consolidated within these financial statements, the Dutch entities are
allowed to prepare abridged financial statements which are exempt from publication and audit.
Name | Company Number |
Universal International Music B.V. | 31018439 |
Universal Music Publishing International B.V. | 31037866 |
Universal Music Publishing B.V. | 32101966 |
CMHL B.V. | 32140273 |
UMG Supply Chain Europe B.V. | 97258199 |
8Ball Music B.V. | 32118927 |
Virgin Music Group B.V. | 60386304 |
Universal Production Music B.V. | 85798479 |
In addition UMG has provided guarantees to the following subsidiaries, incorporated in Germany,
under the registered number indicated, under section 264 paragraph 3 of the German Commercial
Code. The financial data for these companies are also consolidated within these financial statements
therefore the German entities are allowed to prepare abridged financial statements which are
exempt from publication and audit.
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APPENDIX
MUSIC IS UNIVERSAL
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247
Name | Company Number |
Arabella Musikverlag GmbH | HRB 110271 |
Centre Stage Artist Management GmbH | HRB 66733 |
Deutsche Grammophon Gesellschaft mbH | HRB 138012 |
Dreiklang-Dreimasken, Bühnen- und Musikverlag Gesellschaft mit beschränkter Haftung | HRB 110736 |
G. RICORDI & Co. Bühnen- und Musikverlag GmbH | HRB 153334 |
Musik Edition Discoton, Gesellschaft mit beschränkter Haftung | HRB 110249 |
Rob. Forberg Musikverlag GmbH | HRB 153343 |
Rondor Musikverlag G.m.b.H. | HRB 89705 |
Sheffield Music GmbH | HRB 221164 |
UNIVERSAL / MCA Music Publishing GmbH | HRB 85574 |
Universal Music Entertainment GmbH | HRB 86559 |
Universal Music GmbH | HRB 158632 |
Universal Music Publishing GmbH | HRB 87411 |
Universal Production Music GmbH | HRB 113037 |
On February 13, 2026, the European Commission approved UMG’s proposed acquisition of Downtown
Music Holdings LLC (“Downtown”) on the condition that UMG will fully divest of Downtown’s
royalty accounting platform Curve Royalty Systems, Ltd. The transaction completed on February
20, 2026 when UMG acquired all of Downtown's issued and outstanding share capital, resulting in
UMG obtaining control of Downtown and its subsidiaries as of that date. UMG paid $730 million
(€621 million) cash to the selling shareholder and settled Downtown loans with third party banks
for an amount of $168 million (€143 million). Downtown is a global music services business
with operations in artist & label services, distribution services, royalties & financial services and
music publishing. The Downtown business combination enables UMG to enhance its offerings and
capabilities to serve the independent music community.
On the date these consolidated financial statements were authorised to be issued, UMG’s
initial accounting for the Downtown business combination was not complete. This includes the
determination of amounts UMG will recognise for each major class of assets acquired and liabilities
assumed and the amount of goodwill arising from the business combination. As a result, these
amounts are not disclosed in the consolidated financial statements.
Effective March 1, 2026, UMG entered into a bridge financing facility with a total borrowing capacity of
€1 billion. This facility expires on July 31, 2026, subject to extension by UMG for up to an additional
ABOUT UMG
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APPENDIX
COMPANY STATEMENTS
CONTENTS OF COMPANY STATEMENTS
Company Statement of Profit or Loss and Other Comprehensive Income
249
Company Statement of Financial Position
250
Company Statement of Cash Flows
251
Company Statement of Changes in Equity
252
NOTES TO THE COMPANY FINANCIAL STATEMENTS
253
Note 1.
General information
253
Note 2.
Basis of preparation
253
Note 3.
Dividend income
256
Note 4.
General and administrative expenses
256
Note 5.
Financial income and expenses
257
Note 6.
Income taxes
257
Note 7.
Investments in subsidiaries
258
Note 8.
Current and non-current financial assets
258
Note 9.
Cash position and borrowings
259
Note 10.
Contractual obligations and other commitments
260
Note 11.
Equity
262
Note 12.
Related parties
264
Note 13.
Statutory audit fees
265
Note 14.
Subsequent events
265
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OTHER INFORMATION
APPENDIX
Company Statement of Profit or Loss and Other Comprehensive Income
Year ended December 31,
(millions of euros)
Note
2025
2024
Dividend income
3
1,356
572
General and administrative expenses
4
(6)
(3)
Operating profit
1,350
569
Financial income
5
31
33
Financial expenses
5
(166)
(207)
Profit/(loss) before income taxes
1,215
395
Income taxes
14
(4)
Net profit
1,229
391
Of which:
Net profit attributable to equity holders of the parent
1,229
391
Other Comprehensive income
Net gain on cash flow hedge
4
-
Items to be subsequently reclassified to profit or loss, net of tax
4
-
Other comprehensive income, net of tax
4
-
Total comprehensive income
1,233
391
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APPENDIX
Company Statement of Financial Position
Year ended December 31,
(millions of euros)
Note
2025
2024
Investments in subsidiaries
7
35,930
35,930
Non-current financial assets
8
1
4
Deferred tax assets
61
47
Non-current assets
35,992
35,981
Current financial assets
8
451
532
Cash and cash equivalents
9
-
33
Current assets
451
565
TOTAL ASSETS
36,443
36,546
Year ended December 31,
(millions of euros)
Note
2025
2024
Share capital
18,342
18,293
Additional paid-in capital
15,094
15,041
Treasury Shares
(5)
(5)
Retained earnings
(1,687)
(1,975)
Total equity
11
31,744
31,354
Long-term borrowings
9
2,251
1,776
Long-term lease liabilities
-
1
Non-current liabilities
2,251
1,777
Short-term borrowings
9
2,420
3,395
Trade and other payables
28
20
Current liabilities
2,448
3,415
Total liabilities
4,699
5,192
TOTAL EQUITY AND LIABILITIES
36,443
36,546
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ABOUT UMG
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OTHER INFORMATION
APPENDIX
Company Statement of Cash Flows
Year ended December 31,
(millions of euros)
Note
2025
2024
Operating activities
Operating profit
1,350
569
Changes in net working capital
12
(1)
Net cash used for operating activities before income tax paid
1,362
568
Income tax paid
(5)
(4)
Net cash provided by/(used for) operating activities
1,357
564
Investing activities
Decrease/(increase) in financial assets
8
84
(445)
Interest received
37
12
Proceeds from subsidiaries on issuance of Share Based
Payments awards
111
131
Net cash provided by/(used for) investing activities
232
(302)
Year ended December 31,
(millions of euros)
Note
2025
2024
Financing activities
Distributions to equity holders
11
(953)
(933)
Transactions with shareowners
(953)
(933)
Proceeds from borrowings
9
4,470
4,556
Repayments of borrowings
9
(5,010)
(3,651)
Interest paid
(170)
(195)
Other cash items related to financial activities
-
(3)
Net cash provided by/(used for) financing activities
(1,663)
(226)
Change in cash and cash equivalents
(74)
36
Cash and cash equivalents
At beginning of the period
9
33
(3)
At end of the period
9
(41)
33
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OTHER INFORMATION
APPENDIX
Company Statement of Changes in Equity
2025
(millions of euros)
Note
Number of shares
(thousands)
Share Capital
Additional paid-
in capital
Treasury shares
Retained Earnings
Total equity
BALANCE AS OF DECEMBER 31, 2024
1,829,281
18,293
15,041
(5)
(1,976)
31,353
Net profit
-
-
-
-
1,229
1,229
Income and expenses directly recognized in other
comprehensive income, net of tax
-
-
-
-
4
4
TOTAL COMPREHENSIVE INCOME
-
-
-
-
1,233
1,233
Dividends paid
11
-
-
-
-
(953)
(953)
Share-based compensation plans
11
4,901
49
53
-
9
111
TOTAL CHANGES OVER THE PERIOD
4,901
49
53
-
(944)
(842)
BALANCE AS OF DECEMBER 31, 2025
1,834,182
18,342
15,094
(5)
(1,687)
31,744
2024
(millions of euros)
Note
Number of shares
(thousands)
Share Capital
Additional paid-
in capital
Treasury shares
Retained Earnings
Total equity
BALANCE AS OF DECEMBER 31, 2023
1,821,665
18,217
14,994
(5)
(1,442)
31,764
Net profit
-
-
-
-
391
391
TOTAL COMPREHENSIVE INCOME
-
-
-
-
391
391
Dividends paid
11
-
-
-
-
(933)
(933)
Share-based compensation plans
11
7,616
76
47
-
8
131
TOTAL CHANGES OVER THE PERIOD
7,616
76
47
-
(925)
(802)
BALANCE AS OF DECEMBER 31, 2024
1,829,281
18,293
15,041
(5)
(1,976)
31,353
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252
ABOUT UMG
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OTHER INFORMATION
APPENDIX
Notes to the Company Financial Statements
Note 1. General information
Universal Music Group N.V. (“the Company”) is a public company with limited liability incorporated
under the laws of the Netherlands and listed on Euronext Amsterdam under the symbol ‘UMG.AS’.
The Company was formed to ultimately act as a holding company for Universal Music Group (“UMG”).
The Company’s official seat (statutaire zetel) is in Amsterdam, The Netherlands, and the Company’s
principal office is located at 's-Gravelandseweg 80, 1217 EW Hilversum The Netherlands. The
Company is registered with the Dutch Chamber of commerce under number 81106661.
Incorporation
The Company was incorporated on December 4, 2020. On February 26, 2021, the Company obtained all
of the shares of Universal International Music B.V. and Universal Music Group, Inc. from Vivendi and
the consortium led by Tencent by issuing new shares, to its shareholders.
This internal reorganization of the shareholding structure of UMG was scheduled as part of the
agreement signed in December 2019 by Vivendi and the Tencent-led consortium, a prerequisite for
the company’s planned listing on the stock market.
The prospectus relating to the admission to listing and trading of the shares of the Company on
Euronext Amsterdam was approved by the Dutch Authority for the Financial Markets (Stichting
Autoriteit Financiële Markten) on September 14, 2021 and is available on the Company’s websites.
On September 21, 2021, the shares of the Company started trading on the regulated market of
Euronext Amsterdam.
Note 2. Basis of preparation
2.1 Statement of compliance
For the year ended December 31, 2025, the Company have prepared its financial statements
in accordance with the IFRS Accounting Standards (IFRS) as issued by International Accounting
Standards Board (IASB), IFRS as endorsed by the European Union (EU) and with the statutory
provisions of Part 9, Book 2 of the Dutch Civil Code. The Company financial statements are prepared
by the Board of Management of the Company and authorized for issue on March 26, 2026 and will be
submitted for adoption to the Annual General Meeting of Shareholders on May 13, 2026.
2.2 Basis of measurement
The Company financial statements were prepared using the same accounting policies as set out
in the notes to the consolidated financial statements at December 31, 2025 (the “Consolidated
financial statements”), except for the measurement of the investments as presented under Note
2.6 in the Company financial statements. The accounting policies were consistently applied to all
periods presented.
2.3 Foreign currency translation
The Company financial statements are presented in millions of euros, unless stated otherwise. The
functional currency of the Company is Euro.
Foreign currency
Foreign currency transactions are initially recorded in the Euros at the exchange rate prevailing at
the date of the transaction. At the closing date, foreign currency monetary assets and liabilities are
translated into the entity’s functional currency at the exchange rate prevailing on that date with
foreign currency differences recorded to profit and loss.
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253
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OTHER INFORMATION
APPENDIX
2.4 Recent accounting developments
Accounting policy changes originating from the IFRS amendments
The Company has amended its accounting policies for new or amended IFRS standards and
interpretations that became effective as of 1 January 2025. None of these new or amended standards
and interpretations had a material impact on adoption. These are:
•
Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability
The Company has not early adopted any standards, interpretations or amendments that have been
issued but are not yet effective.
Impact of standards issued but not yet effective
The new and amended standards and interpretations that are issued, but not yet effective, up
to the date of issuance of Company's financial statements are disclosed below. The Company
intends to adopt these new and amended standards and interpretations, if applicable, when they
become effective.
•
Amendments to IFRS 9 Classification and Measurement Requirements and IFRS 7 Disclosures,
effective 1 January 2026;
•
IFRS 18 Presentation and Disclosures in Financial Statements, effective 1 January 2027;
•
IFRS 19 Subsidiaries without Public Accountability: Disclosures, effective 1 January 2027.
Amendments to IFRS 9 Classification and Measurement Requirements and IFRS 7 Disclosures
The IASB issued amendments to IFRS 9 classification and measurement requirements and IFRS 7
disclosures effective for UMG on 1 January 2026. The amendments include:
•
The amendments clarify that a financial liability is derecognized on ‘settlement date’ and
introduce an accounting policy choice to derecognise financial liabilities settled using an
electronic payment system before the settlement date;
•
The classification of financial assets with ESG linked features has been clarified via additional
guidance on the assessment of contingent features;
•
Clarifications have been made on non-recourse loans and contractually linked instruments;
•
Additional disclosures are introduced for financial instruments with contingent features and
equity instruments classified at fair value through OCI.
The Company does not expect that adoption of these amendments will have a material impact on the
Company's financial statements.
IFRS 18 Presentation and Disclosures in Financial Statements
On April 9, 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements,
which replaces IAS 1 Presentation of Financial Statements. IFRS 18, effective for UMG on 1 January
2027, introduces new requirements on presentation within the statement of profit or loss, including
specified subtotals. It also requires disclosure of management-defined performance measures and
includes enhanced requirements for aggregation and disaggregation of financial information in the
primary financial statements and the notes. The IASB also issued narrow scope amendments to IAS 7
Statement of Cash Flows, and some requirements previously included within IAS 1 have been moved
to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, which has been renamed
IAS 8 Basis of Preparation of Financial Statements. Other minor amendments were made to other
standards. IFRS 18 and the other amendments are effective for reporting periods beginning on or
after 1 January 2027 and may be adopted early. The Company is currently assessing the impact that
IFRS 18 and the other amendments will have on the financial statements.
IFRS 19 Subsidiaries without Public Accountability: Disclosures
Subsidiaries without public accountability of a parent that prepares consolidated financial
statements available for public use are eligible to apply IFRS 19. This standard will not impact the
Company's financial statements.
2.5 Significant judgements and estimates
The preparation of Company financial statements in compliance with IFRS requires management to
make certain judgements and estimates that they consider reasonable and realistic. Although these
judgements and estimates are regularly reviewed by management, based, in particular, on past or
anticipated achievements, facts and circumstances may lead to changes in these judgements and
estimates which could have an impact on the reported amount of group assets, liabilities, equity
or profit.
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OTHER INFORMATION
APPENDIX
The main significant judgements relate to the measurement of:
•
Investment in subsidiaries: valuation method used to identify the recoverable amount of the
asset, refer to Note 2.7.
The main significant estimates relate to the measurement of:
•
Investments in subsidiaries: assumptions on the recoverable amount of the asset, refer to
Note 2.7;
•
Expected credit losses on loans receivable and financial guarantees: estimation of loss allowance
requires assessment of the probability of default on the part of the borrower on a prospective
basis. Reasonable forward-looking information and events, including credit ratings if available,
significant adverse economic changes (actual or expected), financial or business environment
that are expected to result in a material change in the borrower's ability to meet its obligations is
used to assess whether there is significant increase in credit risk, refer to Note 2.9 and 2.11. For
more on financial guarantees, refer to Note 2.14.
2.6 Investments in subsidiaries
Investments in subsidiaries are stated at cost, less impairment.
Dividend income from the Company's subsidiaries is recognized in the statement of profit or loss
when the right to receive payment is established.
2.7 Impairment of investments in subsidiaries
At each reporting date, the Company assesses whether there is an indication that investments in
subsidiaries may be impaired. If any such indication exists, the Company makes an estimate of
the asset's recoverable amount. The recoverable amount is defined as the higher of the fair value
of the investment less cost of disposal and its value in use. Where the carrying amount of an
asset exceeds its recoverable amount, the asset is considered impaired and is written down to its
recoverable amount. The recoverable amount of investments in subsidiaries are determined based
on discounted cash flow models and key assumptions are disclosed in Note
9
of the Consolidated
financial statements. Any resulting impairment is recognized in the income statement.
An assessment is made at each reporting date as to whether there is any indication that previously
recognized impairment losses may no longer exist or may have decreased. If such an indication
exists, the Company makes an estimate of the recoverable amount. A previously recognized
impairment loss is reversed only if there has been a change in the estimates used to determine
the asset's recoverable amount since the last impairment loss was recognized. If that is the case,
the carrying amount of the asset is increased to its recoverable amount, up to a maximum of the
carrying amount that would have been determined if no impairment loss had been recognized for
the asset in prior periods. Such a reversal is recognized in the income statement.
2.8 General and administrative expenses
General and administrative expenses primarily include salaries and employee benefits, consulting
and service fees, overhead recharges, insurance costs, administrative department costs, provisions
for receivables and other operating expenses and are expensed when incurred.
2.9 Loans receivable
Loans receivable are initially recognized at fair value and subsequently measured at amortized cost
using the effective interest rate method, less any value allowances.
The Company assesses the expected credit loss associated with the loans receivable on a
prospective basis. A loss allowance for expected credit loss based on probability of default is
recognized at initial recognition. The loss allowance is updated for changes in these expected credit
losses at each reporting date to reflect changes in credit risk since initial recognition. To assess
whether there has been a significant increase in credit risk, the Company compares the credit risk at
the reporting date with the credit risk at the date of initial recognition based on reasonable forward-
looking information and events, including credit ratings if available, significant adverse economic
changes (actual or expected), financial or business environment that are expected to result in a
material change in the borrower's ability to meet its obligations.
2.10 Cash and cash equivalents
Cash and cash equivalents include all cash balances and short-term highly liquid investments with
an original maturity of three months or less that are readily convertible into known amounts of cash.
There are no liens, pledges, collateral or restrictions on cash and cash equivalents. Cash and cash
equivalents do not include amounts in UMG cash management pools.
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OTHER INFORMATION
APPENDIX
2.11 Financial liabilities
A financial liability is recognized when the Company becomes party to the contractual provisions of
the instrument. At initial recognition, the Company measures financial liabilities at fair value, and for
financial liabilities subsequently measured at amortised cost, including transaction costs and fees
that are directly attributable to their issuance. In most cases, fair value at initial recognition is equal
to transaction price.
Financial liabilities of the Company are all classified and subsequently measured at amortized cost
and measured using the effective interest method.
2.12 Related parties
A related party is a person or an entity that is related to the Company. These include both people and
entities that have, or are subject to, the influence or control of the Company (e.g. key management
personnel). Transactions with related parties are accounted for in accordance with the requirements
of relevant IFRSs and take into account the substance as well as the legal form.
2.13 Contingent liabilities
Contingent liabilities are possible or present obligations of sufficient uncertainty that do not qualify
for recognition as a provision, unless it is assumed in a business combination. Contingent liabilities
are reviewed continuously to assess whether an outflow of resources has become probable.
2.14 Financial guarantees
A financial guarantee is a contract that requires the issuer to make specified payments to reimburse
the holder for a loss it incurs because a specified debtor fails to make payments when due in
accordance with the terms of a debt instrument.
Issued financial guarantees are initially recognised at fair value and are subject to the expected
credit loss model, and a credit loss is recognized for expected cash shortfalls.
Non-financial guarantees are accounted for as a contingent liability until such time it becomes
probable that UMG will be required to make a payment under the guarantee.
Note 3. Dividend income
Dividend income for the year ended December 31, 2025 amounted to €1,356 million (2024:
€572 million) and related to dividends from Universal International Music B.V. and Universal Music
Group, Inc.
Note 4. General and administrative expenses
General and administrative costs consisted of the following:
Year ended December 31,
(millions of euros)
2025
2024
Salaries
11
11
Pension
1
1
Wages and expenses
12
12
Legal and professional fees
1
25
8
Audit fees
16
3
Other
2
(59)
(26)
Total
(6)
(3)
Annual average number of full-time equivalent employees, of which two
worked from outside of the Netherlands. All employees are part of the corporate
function of the Company.
36
39
1
Legal and professional fees mainly relate to legal, financial and consulting services.
2
Other consists of employee and service costs charged to and from subsidiaries and other general overheads.
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APPENDIX
Note 5. Financial income and expenses
Financial income and expenses consisted of the following:
Year ended December 31,
(millions of euros)
2025
2024
Interest income from intercompany loans
31
33
Financial income
31
33
Interest expense on borrowings
(160)
(200)
Cost of finance
(6)
(7)
Financial expenses
(166)
(207)
Note 6. Income taxes
The Company is the lead legal entity of the fiscal unity that exists for Dutch corporate income tax
purposes and reports the current income tax expense of the fiscal unity. Each legal entity that
participates in the fiscal unity records its own deferred tax assets and liabilities.
Income taxes expense
Year ended December 31,
(millions of euros)
2025
2024
(Expense)/income
Current tax
Current year
(12)
(16)
Over/(under) provided in prior years
12
(5)
-
(21)
Deferred tax
Originating and reversal of temporary difference and tax attributes
14
24
Over/(under) provided in prior years
-
(7)
14
17
Total income tax expense in statement of profit and loss
14
(4)
Deferred tax assets/(liabilities), net
Year ended December 31,
(millions of euros)
2025
2024
Opening balance of deferred tax assets/(liabilities)
47
30
Income taxes
14
17
Closing balance of deferred tax assets/(liabilities), net
61
47
The deferred tax assets are related to carried forward interest expenses.
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APPENDIX
Note 7. Investments in subsidiaries
Investments in subsidiaries consist of the following investments:
Net carrying value
Year ended December 31,
(millions of euros)
Voting % interest
2025
2024
Universal International Music B.V.; Hilversum; The Netherlands
100
21,080
21,080
Universal Music Group, Inc.; Santa Monica; USA
100
14,850
14,850
35,930
35,930
Net result and equity as per the most recent adopted financial statements:
Net Result
Shareholders' Equity
Year ended December 31,
Year ended December 31,
2024
2023
2024
2023
Universal International Music B.V.
1
2,602
731
11,982
9,680
Universal Music Group, Inc.
2
830
579
5,018
4,517
1
Millions of euros
2
Millions of US dollars
For a list of indirect subsidiaries and other group entities, refer to Note
27
of the Consolidated
Financial Statements.
Note 8. Current and non-current financial assets
At December 31, 2025, current financial assets consisted primarily of a loan receivable of
€372 million from Universal Music Group, Inc. (“UMG INC”). The loan was issued on 3 April 2024,
primarily for the purpose of funding UMG INC's acquisition of ownership interest in Chord Music
Partner, L.P. and NTWRK.
The loan bears interest at a rate as may be agreed between the Company and UMG INC from time to
time, provided that such rate must be a fair market rate and may not be less than SOFR plus 2.2% per
annum. At December 31, 2025, the accrued interest amounted to €16 million.
Other current financial assets consisted of the following:
Year ended December 31,
(millions of euros)
2025
2024
Current intercompany receivables
30
7
Other intercompany receivables related to share-based compensation
45
101
Derivative financial assets
4
-
79
108
Current intercompany receivables primarily consist of a short-term receivable for expenses paid on
behalf of Universal International Music B.V. ("UIM").
Refer to Note
24
of the Consolidated Financial Statements for more details on share-
based compensation.
Non-current financial assets consist of capitalized bank fees of €1 million paid to banks as part of
obtaining the credit facility as disclosed in Note
9
, less amortization over the term of the facility.
The Company is exposed to credit risk embedded in these loans receivable being the credit risk of
UIM and UMG INC. The Company assessed potential credit losses on the loans receivable based on
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APPENDIX
the expected credit loss model (“ECL”), which is designed to be forward-looking. The ECL estimates
were unbiased and included reasonable and supportable information about past events, current
conditions, and forecasts of future economic conditions. UMG Treasury reporting and forecasting
proves sufficient cash generated from the operations of the subsidiaries to fulfill these borrowings.
The effect of the recognized expected credit losses is negligible. The loans are performing in
accordance with the agreements.
Note 9. Cash position and borrowings
Cash position
Year ended December 31,
(millions of euros)
2025
2024
Cash and cash equivalents
-
33
Bank overdrafts
(41)
-
Cash and cash equivalents in the statement of cash flows
(41)
33
Borrowings
December 31, 2025
December 31, 2024
(millions of euros)
Total
Long-term
Short-term
Total
Long-term
Short-term
Bonds
2,293
2,251
42
1,810
1,776
34
Commercial papers
384
-
384
746
-
746
Intercompany payable
1,953
-
1,953
2,615
-
2,615
Bank overdrafts
41
-
41
-
-
-
4,671
2,251
2,420
5,171
1,776
3,395
Borrowings include the following:
•
€500 million of senior unsecured notes issued in June 2022, due on June 30, 2027 with a coupon
of 3.00%.
•
€500 million of senior unsecured notes issued in June 2022, due on June 30, 2032 with a coupon
of 3.75%.
•
€750 million of senior unsecured notes issued in June 2023, due on June 13, 2031 with a coupon
of 4.00%.
•
¥7 billion (€45 million) of senior notes issued in July 2023 and due on July 5, 2038 with a coupon
of 1.61%.
•
€2 billion revolving credit facility extended in February 2023 to April 26, 2028. The facility is
undrawn as at December 31, 2025 and 2024.
•
Up to €2 billion NEU commercial paper program established in July 2022.
•
€300 million of senior unsecured notes issued in May 2025, due on June 30, 2032 with a coupon
of 3.75%.
•
€100 million of senior unsecured notes issued in June 2025, due on June 13, 2031 with a coupon
of 4.00%.
•
¥7 billion (€41 million) of senior notes issued in September 2025 and due on September 25, 2035
with a coupon of 2.25%.
•
€40 million of senior unsecured notes issued in December 2025, due on December 15, 2038 with a
coupon of 4.00%.
The intercompany payable consist of a short-term payable to Universal Music Group Treasury S.A.S.
under a Cash Management Agreement.
Financial covenants
During 2025, the Company maintained its Baa1 with Moody’s and BBB+ with S&P - Long Term Credit
Ratings. The syndicated RCF financial covenant requires that UMG maintain Baa2/BBB long term
ratings with Moody’s and S&P.
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APPENDIX
Movements of borrowings
The movements in borrowings were as follows:
(millions of euros)
Drawn
Revolving
Credit Facility
Bonds
Bank
Overdrafts
Commercial
Papers
Inter-
company
payable
Total
Balance December
31, 2023
-
1,808
4
197
2,256
4,265
New borrowings
300
-
-
3,897
359
4,556
Repayments
(300)
-
(4)
(3,351)
-
(3,655)
Translation differences
and other movements
-
2
-
3
-
5
Balance December
31, 2024
-
1,810
-
746
2,615
5,171
New borrowings
300
481
41
3,689
-
4,511
Repayments
(300)
-
-
(4,048)
(662)
(5,010)
Translation differences
and other movements
-
2
-
(3)
-
(1)
Balance December
31, 2025
-
2,293
41
384
1,953
4,671
Interest rate risk is the risk of the fair value or future cash flows of a financial instrument fluctuating
because of changes in the market interest rates. Financial instruments included in the borrowings
create an inherent interest rate risk.
The Company seeks to limit the period over which interest rates on debt are exposed. The preferred
method of hedging interest rate risk is issuing long term fixed-rate bonds. The use of interest-rate
plain vanilla derivatives is also authorized. The list of authorized instruments includes Interest rate
swaps, FRAs, caps, and floors.
As of December 31, 2025, the Company had a ratio of fixed-rate debt to total outstanding debt of
approximately 84%. A sensitivity analysis conducted in January 2026 on the gross debt portfolio
shows that if short term EURIBOR were to increase instantaneously by 0.5% from their level as of
December 31, 2025, with all other variables held constant, the additional annualized interest expense
would be €2 million.
Note 10. Contractual obligations and other commitments
The table below analyzes the Company's material contractual obligations by expected timing of the
related cash outflows. The amounts disclosed in the table are the contractual undiscounted cash
flows. When future interest rate changes might impact interest on borrowings, interest included in
the cash outflows below is estimated using current market expectations of interest rate movements
(for example, using relevant yield curves).
Contractual obligations
Minimum future payments as of December 31, 2025
Total minimum future
payments as of
Payments due in
(millions of euros)
Total
1 year
2-5 years
After 5 years
December 31, 2024
Bonds
2,791
82
791
1,918
2,239
Commercial Papers
385
385
-
-
754
Statement of finanical
position items
3,176
467
791
1,918
2,993
Other commitments
763
763
-
-
660
Total off-balance
sheet commitments
763
763
-
-
660
Total
3,939
1,230
791
1,918
3,653
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APPENDIX
Other commitments
In December 2024, the Company entered into a definitive agreement to acquire Downtown Music
Holdings LLC. The acquisition was approved by the European Commission on February 13, 2026
and completed on February 20, 2026. Refer to Note
18
and Note
30
of the Consolidated Financial
Statements for additional information.
Liquidity risk
The Company is exposed to the liquidity risk. Liquidity risk management ensures the ability to meet
financial obligations as they fall due.
The primary objective of liquidity management is providing for sufficient cash and cash equivalents
to enable the Company to meet its liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Company.
The Company believes that the cash flow generated by the operations of its investments, net of
amounts used to reduce UMG's debt, as well as funds available through undrawn committed bank
credit facilities will be sufficient to cover cash outflows necessary for its operations as well as its
debt service for the foreseeable future.
Over the course of the year, fluctuations occur in the working capital needed to finance
operations. The Company strives to have a good liquidity position at all times and optimize daily
cash management. Moreover, the Company strictly controls working capital by optimizing billing
and collection.
Financial guarantees
At December 31, 2025, the Company provided guarantees over certain debt of the following
subsidiaries: Universal Music Ltda. (Brazil) €46 million; Universal Music Ltd. (Thailand) €40 million;
Universal Music AB (Sweden) €7 million; Universal Music Publishing Korea Ltd. €9 million. No
material allowances for credit losses were recognized in the Statement of Financial Position for both
years presented, as the expected credit loss estimation was insignificant and the loans are fully
performing in accordance with the agreements. Financial guarantees were measured at fair value on
initial recognition.
For intercompany financial guarantees issued by the Company no material expected credit loss
was estimated and therefore the financial guarantees are not recognised. In addition, the Company
provided guarantees to several subsidiaries in the UK, Germany and the Netherlands.
The Company has provided guarantees to the following Universal Music Group subsidiaries,
incorporated in the Netherlands, under the registered number indicated, under section 403 of Book 2
of the Dutch Civil Code.
Subsidiaries in The Netherlands
Name
Company Number
Universal International Music B.V.
31018439
Universal Music Publishing International B.V.
31037866
Universal Music Publishing B.V.
32101966
CMHL B.V.
32140273
UMG Supply Chain Europe B.V.
97258199
8Ball Music B.V.
32118927
Virgin Music Group B.V.
60386304
Universal Production Music B.V.
85798479
The Company is head of the fiscal unity of Universal Music Group in the Netherlands. As a result, the
Company is liable for the tax liability of the fiscal unity in the Netherlands.
In addition UMG has provided guarantees to the following subsidiaries, incorporated in
Germany, under the registered number indicated, under section 264 paragraph 3 of the German
Commercial Code.
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APPENDIX
Subsidiaries in Germany
Name
Company Number
Arabella Musikverlag GmbH
HRB 110271
Centre Stage Artist Management GmbH
HRB 66733
Deutsche Grammophon Gesellschaft mbH
HRB 138012
Dreiklang-Dreimasken, Bühnen- und Musikverlag Gesellschaft mit
beschränkter Haftung
HRB 110736
G. RICORDI & Co. Bühnen- und Musikverlag GmbH
HRB 153334
Musik Edition Discoton, Gesellschaft mit beschränkter Haftung
HRB 110249
Rob. Forberg Musikverlag GmbH
HRB 153343
Rondor Musikverlag G.m.b.H.
HRB 89705
Sheffield Music GmbH
HRB 221164
UNIVERSAL / MCA Music Publishing GmbH
HRB 85574
Universal Music Entertainment GmbH
HRB 86559
Universal Music GmbH
HRB 158632
Universal Music Publishing GmbH
HRB 87411
Universal Production Music GmbH
HRB 113037
Note 11. Equity
Share capital
The Company has an authorized share capital of €27,000 million, divided into 2,700,000,000 ordinary
shares with a nominal value of €10 per share. On December 31, 2025, the issued and fully paid
share capital consisted of 1,834,181,772 ordinary shares with a nominal value of €10 per share (2024:
1,829,281,171 ordinary shares with a nominal value of €10 per share).
The following table summarizes the changes in the number of issued and fully paid up shares of the
Company for the year ended December 31, 2025:
Ordinary Shares
Issued and fully paid up shares as at December 31, 2024
1,829,281,171
Shares issued
1
4,900,601
Issued and fully paid up shares as at December 31. 2025
1,834,181,772
1
In 2025, the Company issued 4,900,601 shares for the purpose of delivering on the share-based executive incentive plan, refer to
Note
24
of the Consolidated Financial Statements for more details.
Additional paid-in capital
Additional paid-in capital represents the premium paid in excess of the par value of shares at the
time of the issuance of new shares. Since the value of the contribution exceeded the par value of the
shares, the balance constituted share premium.
Treasury shares
As at December 31, 2025 the Company held 214,235 shares (2024: 214,235) as Treasury shares.
Dividend distribution
On May 14, 2025 the shareholders approved a dividend distribution of €0.28 per ordinary share,
corresponding to a total distribution of €513 million, paid in June 2025, except for withholding tax
which was setteld in July 2025.
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OTHER INFORMATION
APPENDIX
On July 30, 2025 the directors approved an interim dividend distribution of €0.24 per ordinary share,
corresponding to a total distribution of €440 million paid in October 2025.
The Company plans to annually declare and pay dividends to all holders of the Shares on a pro
rata basis in two semi-annual instalments, in the aggregate amount of no less than 50% of the
Company's net profits realized during the relevant financial year, subject to agreed non-cash items.
The Company intends to pay an interim dividend in the fourth quarter of each financial year, after
the publication of the half-year figures of the Company, and a final dividend in the second quarter
of the following financial year, to be paid following approval of the Company's financial statements at
its annual General Meeting.
A proposal will be submitted to the 2026 Annual General Meeting of Shareholders to pay a final
dividend of €0.28 per ordinary share corresponding to a distribution of €514 million, in cash, from the
2025 retained earnings of the Company, payable in Q2 2026. This would bring total dividend for 2025
to €954 million, or €0.52 per ordinary share.
Pursuant to Dutch law, limitations exist relating to the distribution of shareholders’ equity up to at
least the total amount of the share capital as well as other reserves mandated per the Company
Articles of Association. At December 31, 2025, the non-distributable reserves of the Company
amounted to €18,342 million (2024: €18,293 million).
The reconciliation of equity and net (loss)/profit as per the Consolidated financial statements to
equity and net (loss)/profit as per the Company financial statements is provided below:
Reconciliation of equity and net (loss)/profit
2025
(millions of euros)
2025
Equity attributable to Universal Music Group equity holders in the Consolidated financial
statements as at December 31, 2025
4,568
Combined equity pre-incorporation
(1,634)
Intra-group restructuring upon incorporation
33,000
Cumulative dividend income received
2,713
Cumulative results of subsidiaries in the Consolidated financial statements
(6,969)
Cumulative expenses and income recognised in other comprehensive income or directly in equity
66
Equity in the Company financial statements as at December 31, 2025
31,744
(millions of euros)
2025
Net (loss)/profit attributable to equity holders of the parent in the Consolidated
financial statements
1,533
Results of subsidiaries in the Consolidated financial statements
(1,660)
Dividend income
1,356
Net (loss)/profit in the Company financial statements as at December 31, 2025
1,229
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NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
2024
(millions of euros)
2024
Equity attributable to Universal Music Group equity holders in the Consolidated financial
statements as at December 31, 2024
4,526
Combined equity pre-incorporation
(1,634)
Intra-group restructuring upon incorporation
33,000
Cumulative dividend income received
1,357
Cumulative results of subsidiaries in the Consolidated financial statements
(5,309)
Cumulative expenses and income recognised in other comprehensive income or directly in equity
(586)
Equity in the Company financial statements as at December 31, 2024
31,354
(millions of euros)
2024
Net (loss)/profit attributable to equity holders of the parent in the Consolidated
financial statements
2,086
Results of subsidiaries in the Consolidated financial statements
(2,267)
Dividend income
572
Net (loss)/profit in the Company financial statements as at December 31, 2024
391
Note 12. Related parties
Detailed information on the remuneration of the Board of Directors and senior management is
included in the “Corporate Governance” and “Remuneration of Directors” sections to the Annual
Report. Also refer to Note
25
Related Parties of the Consolidated financial statements.
Executive management compensation
As of December 31, 2025 there were 2 (2024: 2) Executive Directors on the UMG N.V board. The
Chairman and CEO is directly remunerated by another group company and this remuneration is
not recharged to the Company. The remaining compensation to executive management is presented
in the table below:
Year ended December 31,
(millions of euros)
2025
2024
Short-term employee benefits
2
2
2
2
Non-executive board compensation
As of December 31, 2025, the Company's non-executive board members received director fees of
€1 million (2024: €1 million) and share-based compensation of €1 million (2024: €1 million).
Other related-party transactions
Other related party transactions include:
•
Overhead costs recharged from and to Universal International Music B.V. to a net income amount
of €61 million. Disclosed under “Other” in Note
4
;
•
Investments in subsidiaries (Note
7
);
•
Receivables from Universal International Music B.V. And Universal Music Group Inc. (Note
8
);
•
Financial income on loans granted (Note
5
);
•
Intercompany payables (Note
9
);
•
Financial Guarantees provided to subsidiaries (Note
10
);
•
Guarantee fees received on guarantees provided to subsidiaries (Note
10
);
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Note 13. Statutory audit fees
The fees for services provided by the Company’s independent auditors, EY Accountants B.V. and its
member firms and/or affiliates, consisted of the following:
Year ended December 31,
2025
2024
(millions of euros)
EY Accountants B.V.
EY Accountants B.V.
Audit of the Company
3
3
Other assurance-related fees
1
13
-
Total
16
3
1
Other assurance-related fees consists of sustainability audit fees and assurance fees for US listing preparation. Total
sustainability audit fees was €0 million (2024: €0 million). Assurance fees for US listing preparation was €16 million (2024:
€0 million).
Note 14. Subsequent events
On February 20, 2026, the Company and certain of its subsidiaries completed the acquisition
of Downtown Music Holdings LLC. Refer to Note
30
of the Consolidated Financial Statements for
further information.
Effective March 1, 2026, the Company entered into a bridge financing facility with a total borrowing
capacity of €1 billion. This facility expires on July 31, 2026, subject to extension by the Company for
up to an additional 5 months. As of the date these financial statements were authorised for issue,
the Company had no borrowings outstanding on this facility.
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Other Information
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
DISTRIBUTION OF PROFITS
Pursuant to article 32 of the Articles, the distribution of profits shall be made after the adoption of the
financial statements by the General Meeting from which it appears that the distribution is allowed.
The Company may only make distributions to the extent the shareholders’ equity of the Company
exceeds the sum of the paid-up and called-up part of the share capital of the Company and any
reserves that must be maintained pursuant to Dutch law.
The Board may determine which part of the profits shall be reserved, with due observance of the
dividend policy. The General Meeting may resolve to distribute any part of the profits remaining after
such reservation. If the General Meeting does not resolve to distribute these profits in whole or in
part, such profits (or any profits remaining after distribution) shall also be reserved.
Subject to Dutch law, the Board may resolve to make an interim distribution of profits, provided
that it appears from an interim statement of assets and liabilities signed by the Board that the
shareholders’ equity of the Company exceeds the sum of the paid-up and called-up part of the share
capital of the Company and any reserves that must be maintained pursuant to Dutch law.
The Board, or the General Meeting, at the proposal of the Board, may resolve that a distribution shall
not be paid in whole or in part in cash but in kind or in the form of Shares or that Shareholders shall
be given the option to receive the distribution in cash or in kind or in the form of Shares (and with
due observance of the Articles), and may determine the conditions under which such option can be
given to the Shareholders.
Any distribution shall be made pro rata to the respective shareholdings. In calculating the amount
of any distribution, Shares held by the Company shall be disregarded, unless such Shares are
encumbered with a right of pledge or a right of usufruct.
The Board, or the General Meeting, at the proposal of the Board, may resolve to make distributions
from the share premium reserve or other distributable reserves maintained by the Company.
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INDEPENDENT AUDITOR'S REPORT
To: the shareholders and non-executive directors of Universal Music Group N.V.
Report on the audit of the financial statements 2025 included in the annual report
Our opinion
We have audited the accompanying financial statements for the financial year ended December 31,
2025 of Universal Music Group N.V. based in Amsterdam, the Netherlands.
In our opinion the financial statements give a true and fair view of the financial position of Universal
Music Group N.V. as at December 31, 2025 and of its result and its cash flows for 2025 in accordance
with IFRS Accounting Standards (IFRSs) as issued by the International Accounting Standards Board
(IASB), IFRSs as adopted in the European Union (EU-IFRSs) and with Part 9 of Book 2 of the Dutch
Civil Code.
The financial statements comprise:
•
The consolidated and company statement of financial position as at December 31, 2025
•
The following statements for 2025: the consolidated and company statements of profit or loss,
comprehensive income, changes in equity and cash flows
•
The notes comprising material accounting policy information and other explanatory information
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing.
Our responsibilities under those standards are further described in the Our responsibilities for the
audit of the financial statements section of our report.
We are independent of Universal Music Group N.V. in accordance with the EU Regulation
on specific requirements regarding statutory audit of public-interest entities, the Wet
toezicht accountantsorganisaties (Wta, Audit firms supervision act), the Verordening inzake de
onafhankelijkheid van accountants bij assurance-opdrachten (ViO, Code of Ethics for Professional
Accountants, a regulation with respect to independence) and other relevant independence
regulations in the Netherlands. Furthermore, we have complied with the Verordening gedrags- en
beroepsregels accountants (VGBA, Dutch Code of Ethics for Professional Accountants).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Information in support of our opinion
We designed our audit procedures in the context of our audit of the financial statements as a whole
and in forming our opinion thereon. The following information in support of our opinion and any
findings were addressed in this context, and we do not provide a separate opinion or conclusion on
these matters.
Our understanding of the business
Universal Music Group N.V. is a music company which operates worldwide in more than 60
countries. We paid specific attention in our audit to a number of areas driven by the operations
of the group and our risk assessment.
We determined materiality and identified and assessed the risks of material misstatement of the
financial statements, whether due to fraud or error in order to design audit procedures responsive
to those risks and to obtain audit evidence that is sufficient and appropriate to provide a basis for
our opinion.
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Materiality
Materiality
€100 million (2024: €90 million)
Benchmark applied
Approximately 5% of profit before income taxes, excluding changes in fair value of financial instruments through profit or loss and share-based compensation expenses for 2025
Explanation
We determined materiality based on our understanding of the company’s business and our perception of the financial information needs of users of the financial statements. We considered profit before
income taxes, excluding the volatile changes in fair value of financial instruments through profit or loss and share-based compensation expenses, as an important metric for users of the financial
statements. The benchmark applied and the percentage used are in line with our 2024 audit.
We have also taken into account misstatements and/or possible misstatements that in our opinion
are material for the users of the financial statements for qualitative reasons.
We agreed with the audit committee of the board of directors that misstatements in excess of
€5 million, which are identified during the audit, would be reported to them, as well as smaller
misstatements that in our view must be reported on qualitative grounds.
Scope of the group audit
Universal Music Group N.V. is at the head of a group of entities. The financial information of this
group is included in the financial statements.
We are responsible for planning and performing the group audit to obtain sufficient appropriate
audit evidence regarding the financial information of the entities or business units within the group
as a basis for forming an opinion on the financial statements. We are also responsible for the
direction, supervision, review and evaluation of the audit work performed for purposes of the group
audit. We bear the full responsibility for the auditor’s report.
Based on our understanding of the group and its environment, the applicable financial framework
and the group’s system of internal control, we identified and assessed risks of material
misstatement of the financial statements and the significant accounts and disclosures. Based
on this risk assessment, we determined the nature, timing and extent of audit work performed,
including the entities or business units within the group (components) at which to perform audit
work. For this determination we considered the nature of the relevant events and conditions
underlying the identified risks of material misstatements for the financial statements, the
association of these risks to components and the materiality or financial size of the components
relative to the group. We communicated the audit work to be performed and identified risks through
instructions for component auditors as well as requesting component auditors to communicate
matters related to the financial information of the component that is relevant to identifying and
assessing risks.
We have:
•
performed audit procedures ourselves in respect of areas such as the consolidation, disclosures,
impairment testing for goodwill and other non-current assets, financial instruments, acquisitions
and divestments, share-based compensation, loans and borrowings, equity investments
and taxes;
•
Used the audit work of component auditors from EY Global member firms working under our
supervision for selected components in the United States, the United Kingdom, Japan, France,
Germany and the group shared service center components.
This resulted in a coverage of 89% of the profit before taxes (excluding changes in fair value of
financial instruments through profit or loss), 81% of revenue and 86% of total assets. For other
components, we performed specified audit procedures and analytical procedures to corroborate that
our risk assessment and scoping remained appropriate throughout the audit.
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We performed site visits to meet with local management and component teams, observe the
component operations, discuss the group risk assessment and the risks of material misstatements
for the components in the United States, the United Kingdom, Japan, France and Germany. We
reviewed and evaluated the adequacy of the deliverables from component auditors and reviewed
key working papers for selected components to address the risks of material misstatement. We
held planning meetings, key meetings required based on circumstances and we attended closing
meetings with local management and component teams in the United States, the United Kingdom,
Japan, France and Germany. During these meetings and calls, amongst others, the planning
procedures performed based on risk assessments, findings and observations were discussed and
any further work deemed necessary by the primary or component team was then performed.
By performing the audit work mentioned above at the entities or business units within the
group, together with additional work at group level, we have been able to obtain sufficient and
appropriate audit evidence about the group’s financial information to provide an opinion on the
financial statements.
Teaming and use of specialists
We ensured that the audit teams both at group and at component levels included the appropriate
skills and competences which are needed for the audit of a listed client in the Media and
Entertainment industry. We included specialists in the areas of IT audit, forensics, sustainability,
share based payments and income tax and have made use of our own experts in the areas of
valuations (Goodwill and Catalogues) and actuaries.
Our focus on climate-related risks and the energy transition
Climate change and the energy transition are high on the public agenda. Issues such as CO
2
reduction impact financial reporting, as these issues entail risks for the business operation, the
valuation of assets and provisions or the sustainability of the business model and access to
financial markets of companies with a larger CO
2
footprint.
The board of directors summarized the Universal Music Group N.V.’s commitments and obligations,
and reported in the Sustainability Statement of the board report how the company is addressing
climate-related and environmental risks. Furthermore, the board of directors discloses its
assessment and implementation plans in connection to climate-related risks and the effects of
energy transition.
As part of our audit of the financial statements, we evaluated the extent to which climate-related
risks and the effects of the energy transition and the company’s commitments and (constructive)
obligations, are taken into account in estimates and significant assumptions. Furthermore, we
read the board report and considered whether there is any material inconsistency between the
non-financial information and the financial statements.
Based on the audit procedures performed, we do not deem climate-related risks to have a material
impact on the financial reporting judgements, estimates or significant assumptions as at December
31, 2025.
Our focus on fraud and non-compliance with laws and regulations
Our responsibility
Although we are not responsible for preventing fraud or non-compliance and we cannot be expected
to detect non-compliance with all laws and regulations, it is our responsibility to obtain reasonable
assurance that the financial statements, taken as a whole, are free from material misstatement,
whether caused by fraud or error. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control.
Our audit response related to fraud risks
We identified and assessed the risks of material misstatements of the financial statements due to
fraud. During our audit we obtained an understanding of the company and its environment and
the components of the system of internal control, including the risk assessment process and the
board of directors’ process for responding to the risks of fraud and monitoring the system of internal
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APPENDIX
control and how the non-executive directors, advised by the audit committee, exercises oversight, as
well as the outcomes.
We refer to section Risk and Risk Management of the board report for the board of directors’ (fraud)
risk assessment.
We evaluated the design and relevant aspects of the system of internal control and in particular the
fraud risk assessment, as well as the UMG’s code of conduct, standalone Whistleblowing policy and
incident registration. We evaluated the design and the implementation of internal controls designed
to mitigate fraud risks.
As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect
to financial reporting fraud, misappropriation of assets and bribery and corruption in close co-
operation with our forensic specialists. We evaluated whether these factors indicate that a risk of
material misstatement due to fraud is present.
We incorporated elements of unpredictability in our audit. We also considered the outcome
of our other audit procedures and evaluated whether any findings were indicative of fraud
or non-compliance.
We addressed the risks related to management override of controls, as this risk is present in
all organizations. For these risks we have, among other things, performed procedures to evaluate
whether the selection and application of accounting policies by the company, particularly those
relating to subjective measurements and complex transactions, as disclosed in Note 2.2 to the
consolidated financial statements, under Accounting Estimates and Judgments, may be indicative
to fraudulent financial reporting. We have also used data analysis to identify and address high-risk
journal entries and other adjustments made in the financial reporting process. We evaluated the
business rationale (or the lack thereof) of significant extraordinary transactions, including those with
related parties.
The following fraud risks identified required significant attention during our audit.
Presumed risks of fraud in revenue recognition
Fraud risk
We presumed that there are risks of fraud in revenue recognition. We evaluated that the contractual
agreements and conditions of streaming and subscription revenue in particular give rise to
such risks.
Our audit
approach
We describe the audit procedures responsive to the presumed risk of fraud in revenue recognition in
the description of our audit approach for the key audit matter:
•
Revenue recognition for streaming and subscriptions
We considered available information and made enquiries of relevant executives, directors, internal
audit, legal, compliance, human resources and regional directors and the non-executive directors.
The fraud risks we identified, enquiries and other available information did not lead to specific
indications for fraud or suspected fraud potentially materially impacting the view of the
financial statements.
Our audit response related to risks of non-compliance with laws and regulations
We performed appropriate audit procedures regarding compliance with the provisions of those laws
and regulations that have a direct effect on the determination of material amounts and disclosures
in the financial statements. Furthermore, we assessed factors related to the risks of non-compliance
with laws and regulations that could reasonably be expected to have a material effect on the
financial statements from our general industry experience, through discussions with the board
of directors and key management personnel, reading minutes, inspection of internal audit and
compliance reports and performing substantive tests of details of classes of transactions, account
balances or disclosures.
We also inspected lawyers’ letters and we have been informed by management that there was no
correspondence with regulatory authorities, and remained alert to any indication of (suspected)
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APPENDIX
non-compliance throughout the audit. Finally, we obtained written representations that all known
instances of non-compliance with laws and regulations have been disclosed to us.
Our audit response related to going concern
As disclosed in section Basis of preparation and consolidation in Note 2.2 to the financial
statements, the financial statements have been prepared on a going concern basis. When preparing
the financial statements, the board of directors made a specific assessment of the company’s ability
to continue as a going concern and to continue its operations for the foreseeable future.
We discussed and evaluated the specific assessment with the board of directors exercising
professional judgment and maintaining professional skepticism.
We considered whether board of directors’ going concern assessment, based on our knowledge and
understanding obtained through our audit of the financial statements or otherwise, contains all
relevant events or conditions that may cast significant doubt on the company’s ability to continue as
a going concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditor’s report to the related disclosures in the financial statements or, if such disclosures
are inadequate, to modify our opinion.
Based on our procedures performed, we did not identify material uncertainties about going concern
or the board of directors’ use of the going concern basis of accounting. Our conclusions are based
on the audit evidence obtained up to the date of our auditor’s report. However, future events or
conditions may cause a company to cease to continue as a going concern.
Our key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance
in our audit of the financial statements. We have communicated the key audit matters to the audit
committee of the board of directors. The key audit matters are not a comprehensive reflection of all
matters discussed.
In comparison with previous year, the nature of our key audit matters did not change.
Revenue recognition for streaming and subscriptions
Risk
Subscriptions and streaming revenues represent the largest type of recorded music revenue and account for 51% (51% in 2024) of total UMG revenue. The streaming and subscription revenues of the Company
are driven through global digital contracts and recognized over time. The total amount of streaming and subscription revenue recognized for the year ended December 31, 2025 amounts to EUR 6.3 billion (2024:
EUR 6.0 billion).
As described in Note 2.3.5 and Note 3 to the consolidated financial statements, revenues from contracts with customers are recognized when performance obligations included in the contract are satisfied,
and for an amount for which it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur. As described in Note 2.2 to the consolidated financial statements,
significant judgement is required to identify performance obligations under contracts with customers and to determine whether these performance obligations are satisfied, among other factors.
We consider this to be a key audit matter due to the complexity of the contractual terms and conditions and the significant judgements applied by management in its revenue recognition. Moreover, we
presumed that there are risks of fraud in revenue recognition for streaming and subscriptions.
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Revenue recognition for streaming and subscriptions
Our audit approach
Our audit procedures included, among others, evaluating the appropriateness of the Company’s revenue recognition policies for streaming and subscription revenue in accordance with IFRS 15 ‘Revenue from
Contracts with Customers’ and whether the policies have been applied consistently or whether changes, if any, are appropriate in the circumstances.
We performed the following procedures, among others:
•
We gained insight in the process for identifying and accounting for specific revenue terms and conditions included in contracts with digital service providers
•
We evaluated the design and implementation of controls that address the identified risks
•
We performed contract reviews on significant contracts with digital service providers in order to verify if these are recognized in accordance with IFRS 15
•
We evaluated management’s judgement on revenue recognition for specific contractual terms, based on the relevant digital revenue contracts, (monthly) information from digital service providers and
reconciled this to revenue recorded in the financial administration
•
We performed a look-back analysis on management’s judgement made on the prior year’s recognition of revenue for specific contractual terms
•
We also evaluated the adequacy of the disclosures provided by the Company
Key observations
We did not identify any material misstatements in the revenue recorded for 2025, either due to fraud or error.
Valuation of royalty advances to artists and repertoire owners
Risk
The Company provides royalty advances to artists and repertoire owners. As of December 31, 2025, the total amount of royalty advances amounted to EUR 3.1 billion (2024: EUR 3.3 billion).
As described in Note 2.3.8 and Note 10 to the consolidated financial statements, these advances to artists, songwriters and co-publishers are capitalized as an asset when their current popularity and past
performances provide a reasonable basis to conclude that a future recoupment of such royalty advances against earnings otherwise payable to them is reasonably assured. Royalty advances are recognized
as an expense as subsequent royalties are earned by the artist, songwriter or co-publisher. Any portion of capitalized royalty advances not deemed to be recoverable against future royalties is expensed during
the period in which the loss becomes evident.
As described in Note 2.2 to the consolidated financial statements, estimation of the future performance of artists and repertoire owners is considered a significant management estimate, for evaluating
whether capitalized royalty advances are recoverable against future earnings and mainly relates to the estimated future earnings performance of artists, songwriters and co-publishers.
We consider this to be a key audit matter based on the significant judgements applied by management in valuing royalty advances.
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Valuation of royalty advances to artists and repertoire owners
Our audit approach
As part of our audit procedures, we obtained an understanding of the estimation process and management’s application of the related accounting policies. Specifically, we evaluated the Company’s accounting
policy over recognition and measurement of royalty advances in accordance with IAS 38 ‘Intangible assets’. Furthermore, we performed, amongst others, the following audit procedures:
•
We obtained an understanding of the estimation models for determining the future projections relating to royalty advances
•
We evaluated the contracts and payments relating to material royalty advances during the year
•
We tested the recoupment for 2025 of new and existing royalty advances capitalized with material net exposure as at December 31, 2025
•
We assessed the recoverability of net advances and related future contractual commitments by performing sensitivity analyses on historical recoupment run-rates to evaluate the assumptions made by
management in its royalty advances recoverability analysis
•
We assessed the classification of advances between Non-current royalty advances and Current royalty advances recorded on the Company’s statement of financial position
•
We performed a look-back analysis on management’s judgement and estimates made in prior year valuation of royalty advances
•
We evaluated the adequacy of the disclosures
Key observations
We did not identify any material misstatements in the valuation of royalty advances to artists and repertoire owners as at December 31, 2025.
Valuation of music catalogues
Risk
The Company has presented Catalogues (of music and publishing rights) - hereinafter: music catalogues - on the balance sheet as of December 31, 2025 amounting to EUR 3.1 billion (2024: EUR 3.4 billion).
As described in Note 2.3.8 and Note 10 to the consolidated financial statements, music catalogues are recognized at cost, and music catalogues acquired in a business combination are recorded at their fair
value at the acquisition date. Amortization expenses are charged on a straight-line basis over the estimated useful life. Annually, impairment tests are performed to compare the future cash flows of each
music catalogue against the carrying amount.
As described in Note 2.2, the Company identifies a significant estimate relating to the assumptions in the impairment tests performed as well as the determination of the (remaining) useful life for the
music catalogues.
As the related amounts of the music catalogues presented are significant and the estimation involved includes significant judgement applied by management, we consider this a key audit matter.
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Valuation of music catalogues
Our audit approach
As part of our audit procedures, we obtained an understanding of the estimation process to determine the valuation of the music catalogues and the Company’s application of the related accounting policies.
We evaluated the Company’s accounting policies over recognition and measurement of music catalogues for compliance with IAS 36 ‘Impairment of assets’ and IAS 38 ‘Intangible assets’. Additionally, we
performed, amongst others, the following audit procedures:
•
We obtained an understanding of management’s information model to determine the qualitative and quantitative factors supporting the catalogues’ useful life, such as the asset’s expected pattern of the
future earnings and the period of the contractual arrangements
•
We assessed the historical revenues associated with the music catalogues, along with forecasted revenues, in order to assess the appropriateness of the catalogues’ (remaining) useful life
•
We evaluated management’s impairment indicator assessment over catalogues, and, in case of an impairment indicator identified by management, we evaluated the impairment assessment to determine
whether any impairment should be recorded as at December 31, 2025
•
We evaluated the adequacy of the disclosures to the financial statements
Key observations
We did not identify any material misstatements in the valuation of music catalogues as at December 31, 2025.
Report on other information included in the annual report
The annual report contains other information in addition to the financial statements and our
auditor’s report thereon.
Based on the following procedures performed, we conclude that the other information:
•
Is consistent with the financial statements and does not contain material misstatements
•
Contains the information as required by Part 9 of Book 2 of the Dutch Civil Code for the
management report (excluding the sustainability statement) and the other information as
required by Part 9 of Book 2 of the Dutch Civil Code and as required by Sections 2:135b and
2:145 sub
‑
section 2 of the Dutch Civil Code for the remuneration report.
We have read the other information. Based on our knowledge and understanding obtained
through our audit of the financial statements or otherwise, we have considered whether the other
information contains material misstatements. By performing these procedures, we comply with the
requirements of Part 9 of Book 2 and Section 2:135b sub-Section 7 of the Dutch Civil Code and the
Dutch Standard 720. The scope of the procedures performed is substantially less than the scope of
those performed in our audit of the financial statements.
The board of directors is responsible for the preparation of the other information, including the
management report in accordance with Part 9 of Book 2 of the Dutch Civil Code and other information
required by Part 9 of Book 2 of the Dutch Civil Code. The board of directors are responsible for
ensuring that the remuneration report is drawn up and published in accordance with Sections 2:135b
and 2:145 sub
‑
section 2 of the Dutch Civil Code.
Description of responsibilities regarding the financial statements
Responsibilities of the board of directors and the non-executive directors for the
financial statements
The board of directors is responsible for the preparation and fair presentation of the financial
statements in accordance with IFRSs as issued by the IASB, EU-IFRSs and Part 9 of Book 2 of the
Dutch Civil Code. Furthermore, the board of directors is responsible for such internal control as the
board of directors determines is necessary to enable the preparation of the financial statements that
are free from material misstatement, whether due to fraud or error.
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As part of the preparation of the financial statements, the board of directors is responsible for
assessing the company’s ability to continue as a going concern. Based on the financial reporting
framework mentioned, the board of directors should prepare the financial statements using the
going concern basis of accounting unless the board of directors either intends to liquidate the
company or to cease operations, or has no realistic alternative but to do so. The board of directors
should disclose events and circumstances that may cast significant doubt on the company’s ability
to continue as a going concern in the financial statements.
The non-executive directors, advised by the audit committee, are responsible for overseeing the
company’s financial reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit engagement in a manner that allows us to obtain
sufficient and appropriate audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we may
not detect all material misstatements, whether due to fraud or error during our audit.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements. The materiality affects the nature, timing and extent of our
audit procedures and the evaluation of the effect of identified misstatements on our opinion.
We have exercised professional judgment and have maintained professional skepticism throughout
the audit, in accordance with Dutch Standards on Auditing, ethical requirements and independence
requirements. The Information in support of our opinion section above includes an informative
summary of our responsibilities and the work performed as the basis for our opinion. Our audit
further included among others:
•
Performing audit procedures responsive to the risks identified, and obtaining audit evidence that
is sufficient and appropriate to provide a basis for our opinion
•
Obtaining an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the company’s internal control
•
Evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the board of directors
•
Evaluating the overall presentation, structure and content of the financial statements, including
the disclosures
•
Evaluating whether the financial statements represent the underlying transactions and events in
a manner that achieves fair presentation
Communication
We communicate with the audit committee of the board of directors regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including any significant
findings in internal control that we identify during our audit. In this respect we also submit an
additional report to the audit committee in accordance with Article 11 of the EU Regulation on
specific requirements regarding statutory audit of public-interest entities. The information included
in this additional report is consistent with our audit opinion in this auditor’s report.
We provide the audit committee of the board of directors with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, related safeguards.
From the matters communicated with the audit committee of the board of directors, we determine
the key audit matters: those matters that were of most significance in the audit of the financial
statements. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, not communicating
the matter is in the public interest.
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Report on other legal and regulatory requirements and ESEF
Engagement
We were engaged by the general meeting as auditor of Universal Music Group N.V. on September 20,
2021, as of the audit for the year 2021 and have operated as statutory auditor ever since that date.
No prohibited non-audit services
We have not provided prohibited non-audit services as referred to in Article 5(1) of the EU Regulation
on specific requirements regarding statutory audit of public-interest entities.
European Single Electronic Reporting Format (ESEF)
Universal Music Group N.V. has prepared the annual report in ESEF. The requirements for this are set
out in the Delegated Regulation (EU) 2019/815 with regard to regulatory technical standards on the
specification of a single electronic reporting format (hereinafter: the RTS on ESEF).
In our opinion the annual report prepared in the XHTML format, including the (partially) marked-up
consolidated financial statements as included in the reporting package by Universal Music Group
N.V., complies in all material respects with the RTS on ESEF.
The board of directors is responsible for preparing the annual report, including the financial
statements, in accordance with the RTS on ESEF, whereby the board of directors combines the
various components into a single reporting package.
Our responsibility is to obtain reasonable assurance for our opinion whether the annual report in
this reporting package complies with the RTS on ESEF.
We performed our examination in accordance with Dutch law, including Dutch Standard
3950N, ”Assurance-opdrachten inzake het voldoen aan de criteria voor het opstellen van een digitaal
verantwoordingsdocument” (assurance engagements relating to compliance with criteria for digital
reporting). Our examination included amongst others:
•
Obtaining an understanding of the company’s financial reporting process, including the
preparation of the reporting package
•
Identifying and assessing the risks that the annual report does not comply in all material respects
with the RTS on ESEF and designing and performing further assurance procedures responsive to
those risks to provide a basis for our opinion, including:
•
Obtaining the reporting package and performing validations to determine whether the reporting
package containing the Inline XBRL instance document and the XBRL extension taxonomy files,
has been prepared in accordance with the technical specifications as included in the RTS
on ESEF
•
Examining the information related to the consolidated financial statements in the reporting
package to determine whether all required mark-ups have been applied and whether these are
in accordance with the RTS on ESEF.
Amsterdam, March 26, 2026
EY Accountants B.V.
Signed by F.J. Blenderman
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LIMITED ASSURANCE REPORT OF THE INDEPENDENT AUDITOR ON
THE SUSTAINABILITY STATEMENT
To: the shareholders and the non-executive directors of Universal Music Group N.V.
Our conclusion
We have performed a limited assurance engagement on the consolidated sustainability statement
for 2025 of Universal Music Group N.V. based in Amsterdam, the Netherlands (hereinafter:
the company) in section Sustainability statement of the accompanying board report including
the information incorporated in the sustainability statement by reference (hereinafter: the
sustainability statement).
Based on our procedures performed and the evidence obtained, nothing has come to our attention
that causes us to believe that the sustainability statement is not, in all material respects:
•
Prepared in accordance with the European Sustainability Reporting Standards (ESRS) as adopted
by the European Commission and compliant with the double materiality assessment process
carried out by the company to identify the information reported pursuant to the ESRS
•
Compliant with the reporting requirements provided for in Article 8 of Regulation (EU) 2020/852
(Taxonomy Regulation)
Our conclusion has been formed on the basis of the matters outlined in this limited
assurance report.
Basis for our conclusion
We have performed our limited assurance engagement on the sustainability statement in
accordance with Dutch law, including Dutch Standard 3810N, “Assurance-opdrachten inzake
duurzaamheidsverslaggeving” (Assurance engagements relating to sustainability reporting), which
is a specified Dutch standard that is based on the International Standard on Assurance
Engagements (ISAE) 3000 (Revised), “Assurance engagements other than audits or reviews of
historical financial information”.
Our assurance engagement was aimed to obtain a limited level of assurance that the sustainability
statement is free from material misstatements. The procedures vary in nature and timing from,
and are less in extent, than for a reasonable assurance engagement. Consequently, the level of
assurance obtained in a limited assurance engagement is substantially lower than the assurance
that would have been obtained had a reasonable assurance engagement been performed.Our
responsibilities in this regard are further described in the section Our responsibilities for the limited
assurance engagement on the sustainability statement of our report.
We are independent of Universal Music Group N.V. in accordance with the Verordening inzake de
onafhankelijkheid van accountants bij assurance-opdrachten (ViO, Code of Ethics for Professional
Accountants, a regulation with respect to independence) and other relevant independence
regulations in the Netherlands. This includes that we do not perform any activities that could result
in a conflict of interest with our independent assurance engagement and we are not involved in the
preparation of the sustainability statement, as doing so may compromise our independence.
Furthermore, we have complied with the Verordening gedrags- en beroepsregels accountants (VGBA,
Dutch Code of Ethics for Professional Accountants). The ViO and VGBA are at least as demanding as
the International code of ethics for professional accountants (including International independence
standards) of the International Ethics Standards Board for Accountants (the IESBA Code) as relevant
to limited assurance engagements on sustainability statements of public interest entities in the
European Union.
We believe that the assurance evidence we have obtained is sufficient and appropriate to provide a
basis for our conclusion.
Inherent limitations associated with measurement or evaluation of
sustainability information
Significant uncertainties affecting the quantitative metrics
Section ESRS 2 General Disclosures in the sustainability statement identifies the quantitative metrics
and monetary amounts that are subject to a high level of measurement uncertainty and discloses
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information about the sources of measurement uncertainty and the assumptions, approximations
and judgements the company has made in measuring these in compliance with the ESRS.
Comparability may be limited for entity-specific sustainability information
The company provides additional entity-specific sustainability information in Sections Attraction
and retention of artists, Intellectual property, piracy, and content protection and Privacy and
cybersecurity. The comparability of entity-specific sustainability information between entities and
over time may be affected by the absence of a uniform practice or availability of external information
sources to measure or evaluate this information that can support comparability. This allows for the
application of different, but acceptable, measurement techniques.
Inherent limitations of a double materiality assessment process
The sustainability statement may not include every impact, risk and opportunity or additional
entity-specific disclosure that each individual stakeholder (group) may consider important in its
own particular assessment.
Inherent limitations of forward-looking information
In reporting forward-looking information in accordance with the ESRS, the board of directors
describes the underlying assumptions and methods of producing the information, as well as other
factors that provide evidence that it reflects the actual plans or decisions made by the company
(actions). Forward-looking information relates to events and actions that have not yet occurred and
may never occur. The actual outcome is likely to be different since anticipated events frequently do
not occur as expected.
Responsibilities of the board of directors for the sustainability statement
The executive directors of the board of directors are responsible for the preparation of the
sustainability statement in accordance with the ESRS, including the double materiality assessment
process carried out by the company as the basis for the sustainability statement and disclosure of
material impacts, risks and opportunities in accordance with the ESRS.
As part of the preparation of the sustainability statement, the executive directors are responsible for
compliance with the reporting requirements provided for in Article 8 of Regulation (EU) 2020/852
(Taxonomy Regulation). The executive directors are also responsible for selecting and applying
additional entity-specific disclosures to enable users to understand the company’s sustainability-
related impacts, risks or opportunities and for determining that these additional entity-specific
disclosures are suitable in the circumstances and in accordance with the ESRS.
Furthermore, the executive directors are responsible for such internal control as it determines
is necessary to enable the preparation of the sustainability statement that is free from material
misstatement, whether due to fraud or error.
The non-executive directors of the board of directors are responsible for overseeing the
sustainability reporting process including the double materiality assessment process carried out
by the company.
Our responsibilities for the limited assurance engagement on the
sustainability statement
Our responsibility is to plan and perform the limited assurance engagement in a manner that allows
us to obtain sufficient and appropriate assurance evidence for our conclusion.
We apply the applicable quality management requirements pursuant to the Nadere voorschriften
kwaliteitsmanagement (NVKM, regulations for quality management) and the International Standard
on Quality Management (ISQM) 1, and accordingly maintain a comprehensive system of quality
management including documented policies and procedures regarding compliance with ethical
requirements, professional standards and other relevant legal and regulatory requirements.
Our limited assurance engagement included amongst others:
•
Performing inquiries and an analysis of the external environment and obtaining an
understanding of relevant sustainability themes and issues, the characteristics of the company,
its activities and the value chain and its key intangible resources in order to assess the double
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ABOUT UMG
BOARD REPORT
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FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
materiality assessment process carried out by the company as the basis for the sustainability
statement and disclosure of all material sustainability-related impacts, risks and opportunities in
accordance with the ESRS
•
Obtaining through inquiries a general understanding of the internal control environment,
the company’s processes for gathering and reporting entity-related and value chain information,
the information systems and the company’s risk assessment process relevant to the
preparation of
the sustainability statement and for identifying the company’s activities, determining eligible
and aligned economic activities and prepare the disclosures provided for in Article 8 of
Regulation (EU) 2020/852 (Taxonomy Regulation), without obtaining assurance information about
the implementation or testing the operating effectiveness of controls
•
Assessing the double materiality assessment process carried out by the company and identifying
and assessing areas of the sustainability statement, including the disclosures provided for in
Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation), where misleading or unbalanced
information or material misstatements, whether due to fraud or error, are likely to arise (‘selected
disclosures’). Designing and performing further assurance procedures aimed at assessing that
the sustainability statement is free from material misstatements responsive to this risk analysis.
•
Considering whether the description of the double materiality assessment process in the
sustainability statement made by the board of directors appears consistent with the process
carried out by the company
•
Performing analytical review procedures on quantitative information in the sustainability
statement, including consideration of data and trends
•
Assessing whether the company’s methods for developing estimates are appropriate and have
been consistently applied for selected disclosures. We considered data and trends, however our
procedures did not include testing the data on which the estimates are based or separately
developing our own estimates against which to evaluate the board of directors estimates
•
Analyzing, on a limited sample basis, relevant internal and external documentation available to
the company (including publicly available information or information from actors throughout its
value chain) for selected disclosures
•
Reading the other information in the annual report to identify material inconsistencies, if any,
with the sustainability statement
•
Considering whether the disclosures provided to address the reporting requirements provided
for in Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation) for each of the environmental
objectives, reconcile with the underlying records of the company and are consistent or coherent
with the sustainability statement, appear reasonable, in particular whether the eligible economic
activities meet the cumulative conditions to qualify as aligned and whether the technical
screening criteria are met, and whether the key performance indicators disclosures have been
defined and calculated in accordance with the Taxonomy delegated acts, and comply with the
reporting requirements provided for in Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation),
including the format in which the activities are presented
•
Considering the overall presentation, structure and fundamental qualitative characteristics of
information (relevance and faithful representation: complete, neutral and accurate) reported in
the sustainability statement, including the reporting requirements provided for in Article 8 of
Regulation (EU) 2020/852 (Taxonomy Regulation)
•
Considering, based on our limited assurance procedures and evaluation of the evidence obtained,
whether the sustainability statement as a whole, is free from material misstatements and
prepared in accordance with the ESRS.
Communication
We communicate with the audit committee of the board of directors regarding, among other matters,
the planned scope and timing of the assurance engagement and significant findings that we identify
during our assurance engagement.
Amsterdam, 26 March 2026
EY Accountants B.V.
Signed by F.J. Blenderman
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Appendix
ABOUT UMG
BOARD REPORT
NON-EXECUTIVE DIRECTORS' REPORT
FINANCIAL STATEMENTS
OTHER INFORMATION
APPENDIX
BIOGRAPHIES OF THE CORPORATE EXECUTIVES
Sir Lucian Grainge
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
Sir Lucian has transformed Universal Music Group (UMG) into the most
successful company in the history of the music industry by pioneering new
approaches to signing and developing the most successful recording artists
and songwriters and championing innovative business models with a wide
range of media and technology partners. For more than two decades, UMG has
been the No. 1 music company in the world.
Over the span of four decades at UMG, Sir Lucian has signed and worked with many worldwide stars
including ABBA, Andrea Bocelli, Sabrina Carpenter, Eminem, Elton John, Lady Gaga, Kendrick Lamar,
The Rolling Stones, Taylor Swift, U2 and Amy Winehouse, among many others. In 2011, he led UMG’s
successful acquisition of the recorded music assets of the legendary British music company EMI,
revitalizing its iconic Capitol Records, and, in the process, further strengthening UMG’s position as
the global leader in music.
Billboard magazine has listed Sir Lucian a record eight times at No. 1 on the publication’s annual
Power 100 list of the most influential music executives and Variety magazine has ranked him
among the Top 10 most powerful executives in the global entertainment industry. A native of
London, Sir Lucian was bestowed with a knighthood in 2016 by Her Majesty Queen Elizabeth II in
the Queen’s 90th Birthday Honours list for accomplishments in the music industry and leadership
through its challenging times, contributions to British business and inward investment, as well
as his development of innovative business models, technology and media partnerships that have
expanded UMG’s global presence. In 2020, Sir Lucian received a star on the Hollywood Walk of Fame.
Sir Lucian lives in Los Angeles with his wife and has three children. He serves on the board of
Northeastern University in Boston, Massachusetts.
Matt Ellis
CHIEF FINANCIAL OFFICER
Matt Ellis is Chief Financial Officer (CFO) of Universal Music Group. As CFO,
Ellis is responsible for leading global financial operations across UMG and its
subsidiaries. He is based in Santa Monica and reports to UMG Chairman and
CEO, Sir Lucian Grainge.
Ellis joined UMG following a 10-year tenure at Verizon Communications where
he most recently served as Executive Vice President and Chief Financial Officer (CFO). In this role,
he led all finance activities, including Controllership, Treasury, Tax, Investor Relations, FP&A, Internal
Audit, Corporate Development, and Business Transformation. Prior to Verizon, Ellis held multiple
senior finance positions at global food company Tyson Foods Inc., where he served as Vice President
and Treasurer from 2010-2013.
Ellis was born in the U.S. and raised in the UK. Prior to moving back to the U.S. in 1997, Ellis held
early career roles as a Commercial Accountant at Dixons Stores Group and as an Audit Supervisor at
Coopers & Lybrand (now PwC). He is a member of the Institute of Chartered Accountants in England
and Wales and earned a BCom (Accounting) from the University of Birmingham in the UK.
Philippe Flageul
EXECUTIVE VICE PRESIDENT, CONTROLLER
Philippe Flageul is Executive Vice President, Controller for Universal Music
Group. He is responsible for overseeing many aspects of UMG’s finance
operations, including accounting, tax, treasury, risk management and IT and
supply chain finance. He also oversees UMG’s global procurement. Flageul
joined UMG in 2015 from Bolloré Group, where he worked for more than two
decades as CFO of the industrial division and Chairman of IER. Flageul holds an MBA from EDHEC.
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Jody Gerson
CHAIRMAN AND CEO, UNIVERSAL MUSIC PUBLISHING GROUP
Jody Gerson is Chairman and CEO of Universal Music Publishing Group and
a member of Universal Music Group’s Executive Management Board. One of
the industry’s most respected and accomplished executives, Gerson leads a
global company with 48 offices in 41 countries and more than 850 employees.
She made history as the first female chairman of a global music company
and the first woman to be named CEO of a major music publisher.
Since joining UMPG in 2015, Gerson has transformed the company into a global powerhouse that
owns and administers more than 5 million copyrights and is the industry’s best global home
for songwriters.
A highly respected creative authority and thought leader in our culture, Gerson has signed and works
with the world’s biggest superstars, including Adele, Bee Gees, Bad Bunny, Justin Bieber, Sabrina
Carpenter, Lana Del Rey, Ariana Grande, Coldplay, Drake, Billie Eilish, H.E.R., Elton John, Alicia Keys,
Steve Lacy, Kendrick Lamar, Post Malone, Maren Morris, the Prince estate, Rosalia, Harry Styles, Taylor
Swift, SZA, The Weeknd, and more. She also led UMPG’s historic and highly competitive acquisitions of
the iconic catalogs of Bob Dylan, Neil Diamond, Sting, and others.
As a champion for women in music and advocate for education, Gerson cofounded the global
nonprofit She Is The Music. She also serves on Boards for the USC Annenberg Inclusion Initiative,
The Rock & Roll Hall of Fame, the National Music Publishers Association, Gap Inc., Ancestry.com, New
Roads School, and Project Healthy Minds.
In January 2020, Gerson made history as the first woman and first music publishing executive
to be named
Billboard
’s ‘Executive of the Year’ for that outlet’s most coveted Power 100 list, and
annually ranks within that list’s Top Ten. She is the recipient of numerous other prestigious honors,
including the Recording Academy’s 2025 Grammy Salute to Industry Icons award;
Billboard
Power
Players’ Choice Award;
Variety
’s Hitmakers Executive of the Year;
Billboard
's 2015 Executive of the
Year for their Women In Music issue;
Rolling Stone
’s ‘Future 25’;
Variety
’s Power of Women L.A.; The
2016 March of Dimes Inspiring Woman of the Year; and more.
Gerson oversees Polygram Entertainment, a film and television development and production division
of UMG which produces award-winning feature-length films and music-centric series. In 2024 alone,
she served as Executive Producer on a broad array of projects, including
Music Box: Yacht Rock: A
DOCKumentary
;
The Beach Boys
;
STAX: Soulsville, U.S.A.
; and
Billy Preston: That’s The Way God Planned
It
. Other recent projects that Gerson Executive Produced include
The Bee Gees: How to Mend a
Broken Heart
and HBO’s
Music Box
series. Among her and Polygram’s many projects in development
are documentaries on Bernie Taupin and Prince.
Jeffrey Harleston
GENERAL COUNSEL AND EXECUTIVE VICE PRESIDENT OF BUSINESS AND
LEGAL AFFAIRS
Jeffrey Harleston is responsible for the global oversight of all business
transactions, contracts and litigation. He is additionally responsible for
the development of corporate policies to ensure a unified strategy across
the Company’s divisions, including the coordination of UMG’s government
relations, trade and anti-piracy activities. Harleston joined the Company in 1993 at MCA Records,
after serving as Associate Independent Counsel for the IranContra Investigation and prior to that as a
Litigation Associate at Covington & Burling LLP. Throughout his career, Harleston has been recognized
for his many achievements including receiving The Recording Academy’s 2020 Entertainment Law
Initiative Service Award, Billboard’s 2018 “Lawyer of the Year”, the 2018 Diversity Award from the
Association of Corporate Counsel for Southern California. In 2017, Harleston was named one of Ebony
magazine’s “Power 100” and he is annually recognized by Billboard on the magazine’s “Power 100”
list of the most powerful executives in the music industry.
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Harleston is a Member of the Board of Trustees of Williams College and the Board of Harvard-
Westlake School. He also serves on the boards of the Recording Industry Association of America
the TJ Martell Foundation, MusiCares and the Motown Museum.
Harleston is proud to be a Founder of the Universal/Motown Fund, an endowment dedicated to
providing financial assistance for artists from the 50’s, 60’s and 70’s. He received a B.A. in Political
Science from Williams College and a J.D. from the University of California, Berkeley School of Law.
Eric Hutcherson
EXECUTIVE VICE PRESIDENT, CHIEF PEOPLE AND INCLUSION OFFICER
With a focus on people, culture and inclusion, Eric Hutcherson leads a
global team across UMG’s record labels, publishing division and operating
companies to align talent functions, amplify the Company’s entrepreneurial-
based culture, accelerate diversity and inclusion across all levels and
territories, attract, retain and develop talent, accelerate the Company’s social
justice initiatives and build on UMG’s successful track-record of driving innovation by recruiting
employees who bring new ideas, perspectives and skillsets.
Prior to joining UMG, he was EVP, Chief Human Resources Officer of the National Basketball
Association (NBA) where he managed a team that drove the NBA’s global workforce strategy.
Hutcherson currently serves as Vice-Chair of Covenant House International and Chair of the Human
Capital Committee, and on the Board of Councilors for the USC Annenberg School of Communication
and Journalism. Additionally, he serves as strategic advisor to the Board of Directors for the Young
Peoples Chorus; a multicultural youth chorus whose mission is to provide children of all economic
and cultural backgrounds with a unique program of music education and choral performance.
Hutcherson earned a bachelor’s degree in political science from New York University and a master’s
degree in Sports Management and Administration from the University of Massachusetts-Amherst.
Boyd Muir
CHIEF OPERATING OFFICER (COO)
Boyd Muir is Chief Operating Officer (COO) of Universal Music Group (UMG). As
COO, Muir is responsible for driving strategic growth across the company’s
worldwide operations. Muir formerly served as UMG’s EVP, Chief Financial
Officer (CFO) and President of Operations, and was appointed COO in October
2024. As UMG’s CFO, Muir played a key role in the company’s successful
listing on the Euronext stock exchange in 2021.
He has also been involved in a number of significant acquisitions, including Sanctuary Group and
V2 Music Group, as well as leading the company’s successful acquisitions of EMI, Ingrooves, [PIAS]
and UMG’s minority investment in the Chord Music Fund. He was appointed as UMG’s EVP, CFO
and President of Operations in 2010, having previously served as CFO for Universal Music Group
International, the division which manages UMG’s businesses in more than 50 countries for more
than a decade. From 1984 to 1991, Muir worked for Ernst & Young, including at its entertainment
media division in London, and for EMI from 1991 to 1994. At the latter group, he was head of internal
audit, spending considerable time working in Los Angeles and New York. He was also closely involved
in EMI’s acquisition of Virgin Music and Chrysalis Records.
Michael Nash
EXECUTIVE VICE PRESIDENT, CHIEF DIGITAL OFFICER
Michael Nash is Executive Vice President, Chief Digital Officer and oversees
UMG’s digital business development activities around the world. Nash has
worked at the forefront of media and technology convergence for his entire
career as an executive, entrepreneur and producer. Most recently, Nash
served as a strategic advisor to Warner Music Group (WMG), as well as several
digital media startups and new technology companies. Prior to that, he served as an executive at
WMG from 2000 to 2011, rising to the role of Executive Vice President of Digital Strategy and Business
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Development where he oversaw WMG’s worldwide new media projects, strategic relationships and
business development activities.
Before joining WMG, Nash was the Executive Director of the Madison Project, the music industry’s
first digital distribution trial. From 1994 to 1997, Nash was founding CEO of Inscape, an interactive
entertainment and games publishing joint venture between WMG and HBO that produced titles with
artists such as William S. Burroughs, DEVO, Thomas Dolby and The Residents. Prior to that, Nash
served as Director of The Criterion Collection, working closely with directors and artists such as
Robert Altman, David Bowie, Terry Gilliam and Louis Malle.
Will Tanous
EXECUTIVE VICE PRESIDENT, CHIEF ADMINISTRATIVE OFFICER
Will Tanous plays a key role in the development of the company’s business
strategy, overseeing several major strategic and corporate endeavors, as well
as managing worldwide external and internal communications, global public
policy, investor and government relations, event functions and global impact.
Prior to joining UMG in 2013, Tanous served as Executive Vice President of Communications &
Marketing for Warner Music Group where he was central in all of the company’s major corporate
initiatives, including: the sale of WMG to Access Industries, Inc.; WMG’s initial public offering on the
New York Stock Exchange in 2005; and the sale of WMG by Time Warner Inc. to a private equity
consortium. In 2019, he was awarded the prestigious Ellis Island Medal of Honor, which is presented
annually to U.S. citizens “who have distinguished themselves within their own ethnic groups while
exemplifying the values of the American way of life”. Tanous is a graduate of Georgetown University
in Washington D.C. and serves on the board of the Recording Industry Association of America.
Vincent Vallejo
DEPUTY CHIEF EXECUTIVE OFFICER, CORPORATE AND EXECUTIVE DIRECTOR
Based at the Company’s corporate headquarters in Hilversum, The
Netherlands, Vincent Vallejo is in the lead of a number of corporate initiatives
related to the Company’s listing on the Euronext NV in Amsterdam. Vallejo
joined UMG in 2021 and has worked closely across UMG matters ever since he
joined Vivendi in 1998, where he served most recently as SVP, Audit & Special
Projects. Prior to joining Vivendi, Vallejo held positions at AGF-ALLIANZ in France (where he was
Deputy CFO) and Ernst & Young in Paris and Madrid. He received an MBA from Montpellier University
and a Master of Science from Cornell-Essec, CergyPontoise, France.
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BIOGRAPHIES OF THE BOARD OF DIRECTORS
Sir Lucian Grainge
Male, Age: 66, Nationality: British
CHAIRMAN AND CHIEF EXECUTIVE OFFICER AND EXECUTIVE DIRECTOR
Sir Lucian has transformed Universal Music Group (UMG) into the most successful company in the
history of the music industry by pioneering new approaches to signing and developing the most
successful recording artists and songwriters and championing innovative business models with a
wide range of media and technology partners. For more than two decades, UMG has been the No.
1 music company in the world. Over the span of four decades at UMG, Sir Lucian has signed and
worked with many worldwide stars including ABBA, Andrea Bocelli, Sabrina Carpenter, Eminem, Elton
John, Lady Gaga, Kendrick Lamar, The Rolling Stones, Taylor Swift, U2 and Amy Winehouse, among
many others. In 2011, he led UMG’s successful acquisition of the recorded music assets of the
legendary British music company EMI, revitalizing its iconic Capitol Records, and, in the process,
further strengthening UMG’s position as the global leader in music. Billboard magazine has listed
Sir Lucian a record eight times at No. 1 on the publication’s annual Power 100 list of the most
influential music executives and Variety magazine has ranked him among the Top 10 most powerful
executives in the global entertainment industry. A native of London, Sir Lucian was bestowed with a
knighthood in 2016 by Her Majesty Queen Elizabeth II in the Queen’s 90th Birthday Honours list for
accomplishments in the music industry and leadership through its challenging times, contributions
to British business and inward investment, as well as his development of innovative business
models, technology and media partnerships that have expanded UMG’s global presence. In 2020,
Sir Lucian received a star on the Hollywood Walk of Fame. Sir Lucian lives in Los Angeles with his wife
and has three children. He serves on the board of Northeastern University in Boston, Massachusetts.
Vincent Vallejo
Male, Age: 65, Nationality: French
DEPUTY CHIEF EXECUTIVE OFFICER, CORPORATE AND EXECUTIVE DIRECTOR
Based at the Company’s corporate headquarters in Hilversum, The Netherlands, Vincent Vallejo is
in the lead of a number of corporate initiatives related to the Company’s listing on the Euronext NV
in Amsterdam. Vallejo joined UMG in 2021 and has worked closely across UMG matters ever since
he joined Vivendi in 1998, where he served most recently as SVP, Audit & Special Projects. Prior to
joining Vivendi, Vallejo held positions at AGF-ALLIANZ in France (where he was Deputy CFO) and Ernst
& Young in Paris and Madrid. He received an MBA from Montpellier University and a Master of Science
from Cornell-Essec, CergyPontoise, France.
Sherry Lansing
Female, Age: 81, Nationality: American
CHAIRMAN OF THE BOARD AND NON-EXECUTIVE DIRECTOR
Sherry Lansing is the founder and CEO of The Sherry Lansing Foundation, an organization dedicated
to funding and raising awareness for cancer research, health, public education, and encore career
opportunities. Lansing has extensive knowledge of the creative industries, including but not limited
to audio and visual content. During a nearly 30-year career in the motion picture business, Lansing
was involved in the production, marketing, and distribution of more than 200 films, including
Academy Award winners
Forrest Gump
,
Braveheart,
and
Titanic
. In 1980, she became the first woman
to head a major film studio when she was appointed President of 20th Century Fox. Later, as
an independent producer, she was responsible for such successful films as
Fatal Attraction
,
The
Accused
,
School Ties
,
Indecent Proposal
, and
Black Rain
. Returning to the executive ranks in 1992,
Lansing was named Chairman and CEO of Paramount Pictures and began an unprecedented tenure
that lasted more than 12 years. Lansing graduated cum laude with a Bachelor of Science Degree from
Northwestern University in 1966.
Margaret Frerejean-Taittinger
Female, Age: 40, Nationality: American
VICE-CHAIRMAN OF THE BOARD AND NON-EXECUTIVE DIRECTOR
Margaret Frerejean-Taittinger is the co-founder of French Bloom, a company that specializes in
organic alcohol-free sparkling wines. Serving as Chief Marketing Officer, Frerejean-Taittinger has
successfully positioned French Bloom as the market leader of the super-premium 0.0% category
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with presence in more than 60 markets. Previously, she served as International Development
Manager for the Michelin Guide, the renowned restaurant rating system that publishes its yearly
selections in over 35 countries. In this role, Frerejean-Taittinger led the expansion of the Michelin
Guide working towards doubling its international footprint over a period of five years. Prior to
Michelin, she served as the Director of Communications and Marketing for Laboratories Surface-
Paris, a beauty company that specializes in cosmeceutical skincare. Frerejean-Taittinger also spent
eight years in the international development field, addressing cross-sector challenges to sustainable
development with a focus on education and micro-finance in East Africa. Frerejean-Taittinger holds
a Master of Development Practice from l’Institut d'Études Politiques de Paris (Sciences Po), where she
graduated summa cum laude.
Cathia Lawson-Hall
Female, Age: 54, Nationality: French and Togolese
NON-EXECUTIVE DIRECTOR
Cathia Lawson-Hall founded CAT, a strategic advisory firm, specialising in corporate and financial
strategy, mergers and acquisitions, restructurings and complex operations in Africa, following a
25-year career in investment banking, She previously held senior leadership positions at Société
Générale, notably as Head of Coverage and Investment Banking for Africa and Head of Debt Capital
Markets for corporates in France, Belgium and Luxembourg. Lawson-Hall is also a member of the
Board of Directors of Havas N.V., Endeavour Mining Plc and Eurazeo S.E. and currently also serves on
the Supervisory Board of Vivendi S.E., although her mandate will end in April 2026. She also sits on
the Board of Amis du Centre Pompidou, the association of patrons contributing to the enrichment of
the museum’s collections. Lawson-Hall has received several distinctions, including Manager of the
Year at the La Tribune Women’s Awards (2015), the Diversity Award - Career Path from the Club XXIe-
Siècle (2017), and has been named among the “100 Women of Culture of the Year” (2025). Lawson-Hall
holds a Master’s degree and a postgraduate degree in Finance from Paris Dauphine University.
Eric Sprunk
Male, Age 62, Nationality: American
NON-EXECUTIVE DIRECTOR
Eric Sprunk is a global consumer-retail industry leader with more than 25 years’ experience
delivering outstanding financial results, creating shareholder value and building loyal, high-
performance teams. He most recently served as the Chief Operating Officer of Nike from 2013
to 2020, where he led a globally distributed team of 25,000+ Nike employees and an additional
1,200,000 contract employees responsible for its robust and innovative global supply chain, demand/
supply planning, procurement, corporate real estate and workplaces and IT/technology for the
global enterprise. During his 27 years at Nike, he held various executive positions of increasing
responsibility, including EVP, Global Product & Merchandising from 2008 to 2013 and EVP & GM,
Global Footwear from 2001 to 2008. As COO, he drove the digital transformation of the company to
be consumer direct. He currently serves as a member of the Board of Directors of General Mills
and Recreational Equipment, Inc. Sprunk has a Bachelor’s degree in Business Administration and
Accounting from the University of Montana.
Haim Saban
Male, Age 81, Nationality: American and Israeli
NON-EXECUTIVE DIRECTOR
Haim Saban is an entrepreneur with more than four decades of experience building successful
media and telecommunication businesses. He is the Chairman and CEO of Saban Capital LLC, a
private Los Angeles-based investment firm that spans operations in real estate, venture capital,
film and music. In partnership with News Corp. and Rupert Murdoch, Saban co-founded Fox
Family Worldwide in 1996, creating a global television, broadcasting, production, distribution and
merchandising company. In 2001, Walt Disney Co. acquired Fox Family for an enterprise value of
USD 5.3 billion. Saban founded Saban Capital Group (SCG) and led an investor group in 2003 to buy
a controlling stake in ProSiebenSat.1 Media, Germany’s largest broadcaster. He served as Chairman
of its Supervisory Board and in 2007 oversaw the sale of the controlling stake to KKR and Permira
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at a USD 7.5 billion valuation, representing five times the initial investment. In 2005, SCG and Apax
Partners acquired a controlling stake in Bezeq, Israel’s largest telecom company, which they sold to
Eurocom Group at a valuation of more than four-and-a-half times the initial investment five years
later. SCG led the acquisition in 2007 of Univision Communications, the leading Spanish-language
media company in the U.S. for which Saban served as Chairman. SCG continues to make minority and
controlling investments in early stage private and public companies, including Epic Games, Keshet,
Kite Pharma and Roblox, among others; feature film distribution through Saban Films; and private
equity investments in companies, including Celestial Tiger.
James Mitchell
Male, Age: 52, Nationality: British
NON-EXECUTIVE DIRECTOR
James Mitchell is a Senior Executive Vice President and Chief Strategy Officer of Tencent Holdings
Limited (HKEX: 0700), where he has worked since July 2011. He is a director of certain listed
companies including Frontier Developments Plc (AIM: FDEV) and Tencent Music Entertainment Group
(NYSE: TME, HKEX: 1698), and of various unlisted companies. He was previously Chairman of the Board
of China Literature Limited (HKEX: 0772). Prior to joining Tencent, Mitchell was a Managing Director
at Goldman Sachs. Mitchell received a Bachelor of Arts degree from Oxford University and holds a
Chartered Financial Analyst certification.
Luc Van Os
Male, Age: 59, Nationality: Dutch
NON-EXECUTIVE DIRECTOR
Luc van Os is co-owner of Misset Uitgeverij, a B2B publisher of multi-media brands for the
agricultural sector, and of Rendement Uitgeverij, a B2B multi-media publisher specialized in HR,
fiscal and salary information. Previously, he served for 12 years as CEO of Hearst Netherlands and its
predecessors, home to titles including
Harper’s Bazaar
,
Elle
,
Quote
and
Cosmopolitan
. Prior to serving
as CEO, he held different leadership roles at Hearst and its predecessors, Hachette Filipacchi Media
and Quote Media. Under his leadership, Hearst became the largest upscale magazine publisher
in the Netherlands. Van Os is also a member of the Supervisory Board of VNO-NCW, the national
employers association in the Netherlands.
Mandy Ginsberg
Female, Age: 56, Nationality: American
NON-EXECUTIVE DIRECTOR
Mandy Ginsberg is an operating partner at Advent International, one of the largest global private
equity investment firms. An accomplished leader with extensive online consumer acumen, Ginsberg
played various roles over fourteen years at Interactive Corp and Match Group, a portfolio of industry
leading digital dating platforms. She served as CEO of Match Group Americas from 2016 to 2018
and ultimately served as CEO of the publicly listed entity Match Group from 2018 to 2020 leading
its 45 global dating companies, including Tinder, Match.com, OkCupid, and Hinge. As CEO of Match
Group, she drove a period of tremendous subscriber and revenue growth and more than doubled
the company’s enterprise value. During her tenure, she led the company’s expansion in North
America and overseas, both through organic growth and acquisitions, including the 2018 purchase
of relationship-focused platform Hinge. Ginsberg has held roles within the IAC portfolio of digital
companies since 2006. This includes tenures as an EdTech CEO of both The Princeton Review and
Tutor.com from 2013 to 2015 and CEO of Match.com North America from 2008 to 2012. She currently
serves on the Board of Directors at Flo Health, Uber Technologies and ThredUp, and previously served
as a director at Match Group, J.C. Penney Company and Care.com. Ginsberg holds an MBA from The
Wharton School of the University of Pennsylvania and a BA from the University of California, Berkeley.
Nicole Avant
Female, Age: 58, Nationality: American
NON-EXECUTIVE DIRECTOR
Nicole Avant is a best-selling author and an award winning film producer. She served as the 13th U.
S. Ambassador to The Bahamas after being nominated by President Barack Obama and unanimously
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confirmed by the U. S. Senate, becoming the youngest as well as the first African American woman
to hold the position. In addition to her international diplomatic work, Ambassador Avant brings deep
commercial insight and knowledge of the media and entertainment industries having worked in the
music business for over 25 years and serving as Vice President of Interior Music Publishing, founded
by her father, entertainment mogul, Clarence Avant. Ambassador Avant currently focuses her efforts
in film and television production and has produced critically acclaimed and award winning films
including the
The Six Triple Eight
,
The Black Godfather
and
Trees of Peace
. Throughout her career,
Ambassador Avant has also pursued an array of business and philanthropic ventures and is a Board
Trustee at LACMA. Ambassador Avant graduated with a Bachelor of Arts degree in Communications
from California State University, Northridge.
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DEFINITIONS
In this Annual Report release, UMG presents certain financial measures when discussing UMG’s
performance that are not measures of financial performance or liquidity under IFRS (“non-IFRS”).
These non-IFRS measures (also known as alternative performance indicators) are presented because
management considers them important supplemental measures of UMG’s performance and believes
that they are widely used in the industry in which UMG operates as a means of evaluating a
company’s operating performance and liquidity. UMG believes that an understanding of its sales
performance, profitability, financial strength and funding requirements is enhanced by reporting the
following non-IFRS measures. All non-IFRS measures should be considered in addition to, and not
as a substitute for, IFRS measures of operating and financial performance as presented in UMG’s
Consolidated Financial Statements and the related Notes. In addition, it should be noted that other
companies may have definitions and calculations for these non-IFRS measures that differ from
those used by UMG, thereby affecting comparability.
EBITDA and EBITDA margin
UMG considers EBITDA and EBITDA margin, non-IFRS measures, to be relevant measures to assess
its operating performance. It excludes restructuring expenses, which may impact period-to-period
comparability. EBITDA margin is EBITDA divided by revenue.
To calculate EBITDA, the accounting impact of the following items are excluded from Operating Profit:
1.
amortisation of intangible assets;
2.
impairment of goodwill and other intangibles;
3.
depreciation of tangible assets including right of use assets;
4.
(gains)/losses on the sale of tangible assets, including right of use assets and intangible
assets; and
5.
restructuring expenses.
Adjusted EBITDA and Adjusted EBITDA margin
The difference between EBITDA and Adjusted EBITDA consists of non-cash share-based
compensation expense and certain one-time items, that are deemed by management to be
significant and incidental to normal business activity. Adjusted EBITDA margin is Adjusted EBITDA
divided by revenue.
UMG considers Adjusted EBITDA and Adjusted EBITDA margin, non-IFRS measures, to be relevant
measures to assess its operating performance and performance of its operating segments excluding
items that may be incidental to normal business activity and excluding non-cash share based
compensation which may impact period-to-period comparability.
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Adjusted Net Profit/Adjusted Net Profit per share
UMG uses Adjusted Net Profit as the basis for Adjusted Net Profit Per Share both of which are non-
IFRS financial measures. UMG considers Adjusted Net Profit and Adjusted Net Profit Per Share to be
relevant measures to represent profitability as it removes the impact of unusual or non-recurring
items. Adjusted net profit and Adjusted Net Profit Per Share may be subject to limitations as an
analytical tool for investors, as they exclude certain unusual or non-recurring items or items that
impact year on year comparability and therefore does not reflect the expense associated with such
items, which may be significant and have a significant effect on UMG’s net profit.
The accounting impact of the following items are excluded from Net profit attributable to equity
holders of the parent:
1.
amortisation of catalogues;
2.
impairment of goodwill and intangible assets;
3.
financial income and expenses, excluding interest and income from investments;
4.
restructuring expenses;
5.
earnings from discontinued operations;
6.
non-cash share-based compensation expense;
7.
certain one-time items that are deemed by management to be significant and incidental to
normal business activity;
8.
income tax impact on the above adjustments;
9.
other income taxes adjusting items that are deemed by management to be significant and
incidental to normal business activity; and
10.
adjustments attributable to non-controlling interests.
Adjusted Net Profit Per Share is defined as Adjusted Net Profit divided by the weighted average
number of shares outstanding during the period. UMG presents both basic and diluted Adjusted Net
Profit Per Share.
Adjusted Net Profit Per Share — basic is calculated by dividing Adjusted Net Profit by the weighted
average number of shares outstanding during the period. Adjusted Net Profit Per Share — diluted is
calculated by dividing Adjusted Net Profit by the weighted average number of shares outstanding
during the period, adjusted for the effects of all potentially dilutive shares, which comprise share
rights and options granted to employees.
Financial Net Debt
UMG considers Financial Net Debt, a non-IFRS measure, to be a relevant indicator of the group’s
liquidity and capital resources. UMG management uses this indicator for reporting, management and
planning purposes. Financial Net Debt is calculated as:
1.
the value of borrowings at amortised cost as reported in the Consolidated Statement of
Financial Position.
Less the sum of:
1.
cash and cash equivalents, as reported in the Consolidated Statement of Financial Position,
including (i) cash in banks and deposits, whether or not compensated, corresponding to cash,
and (ii) money market funds;
2.
cash management financial assets, included in the Consolidated Statement of Financial Position
under “Other current financial assets”, relating to financial investments, which do not satisfy the
criteria for classification as cash equivalents set forth in IAS 7;
3.
derivative financial instruments, net (assets and liabilities) where the underlying instruments
are Financial Net Debt items, as well as cash deposits securing borrowings included in the
Consolidated Statement of Financial Position under “Other current financial assets”;
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Free Cash Flow
UMG defines Free Cash Flow as net cash provided by/(used for) operating activities plus net cash
provided by/(used for) investing activities, less repayment of lease liabilities and related interest
expense, interest paid, net and other cash items related to financing activities. UMG considers Free
Cash Flow, a non-IFRS measure, to be a relevant indicator of its cash flow generated to fund dividend
payments and repayment of debt. Free Cash Flow is not a measure of performance calculated in
accordance with IFRS and therefore it should not be considered in isolation of, or as a substitute for
cash flow provided by operating activities as a measure of liquidity. Free Cash Flow, as we calculate
it, may not be comparable to similarly titled measures employed by other companies. In addition,
Free Cash Flow does not necessarily represent funds available for discretionary use and is not
necessarily a measure of our ability to fund our cash needs.
Reconciliation of net profit attributable to equity holders of the parent
to adjusted net profit
Year ended,
December 31
(millions of euros)
2025
2024
Net profit attributable to equity holders of the parent
1
1,533
2,086
Financial income and expenses, excluding interest and income from investments
(187)
(1,177)
Non-cash share-based compensation expense
227
329
Certain one-time items
2
47
-
Restructuring expense
95
169
Impairment of intangible assets
3
2
Amortisation of catalogues
256
245
Income tax on adjustments
(93)
128
Other income taxes adjusting items
26
-
Adjusted Net Profit
1,907
1,782
1
As reported in the Consolidated Statement of Profit or Loss
2
Certain one-time items consists of US listing preparation costs, certain M&A advisory costs and interest expense in relation to the
other income taxes adjusting items.
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Adjusted net profit per share
Year ended December 31,
(millions of euros)
2025
2024
basic
diluted
basic
diluted
Adjusted net profit
1,907
1,907
1,782
1,782
Number of shares
1
Weighted average number of shares outstanding
1,833
1,833
1,827
1,827
Potential dilutive effects related to
sharebased compensation
-
20
-
25
Adjusted weighted average number of shares
1,833
1,853
1,827
1,852
Adjusted net profit per share (in euros)
1.04
1.03
0.98
0.96
1
As reported in Note 8 of the Consolidated Financial Statements.
Net cash provided by operating activities - Adjustments
Operating profit includes certain non-cash items that are adjusted to get to the Net cash provided by
operating activities as follows:
Year ended,
December 31
(millions of euros)
2025
2024
Amortisation and depreciation expense
446
409
Non-cash share-based compensation expense, net of employees tax withheld
111
131
Impairment on intangible assets
3
2
Changes in provisions, net
(48)
1
(Gain)/loss on sale of assets
(4)
(23)
Adjustments
508
520
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CAUTIONARY NOTICE
Forward-looking statements
This Annual Report may contain statements that constitute forward-looking statements relating to
UMG’s financial condition, results of operations, business, strategy and plans, and the industry in
which UMG operates. Such forward-looking statements may be identified by the use of words such as
‘profit forecast’, ‘expect’, ‘estimate’, ‘project’, ‘anticipate’, ‘should’, ‘intend’, ‘plan’, ‘probability’, ‘risk’,
‘target’, ‘aspiration’, ‘objective’, ‘will’, ‘endeavour’, ‘optimistic’, ‘prospects’ and similar expressions
or variations on such expressions or the negative of such expressions, or by the forward-looking
nature of discussions, or by context. Although UMG believes that such forward-looking statements
are based on reasonable assumptions, they are not guarantees of future performance. Actual results
may differ materially from such forward-looking statements as a result of a number of risks and
uncertainties, many of which are related to factors that are outside UMG’s control, including, but not
limited to, UMG’s inability to compete successfully and to identify, attract, sign and retain successful
recording artists and songwriters, failure of streaming and subscription adoption or revenue to
grow or to grow less rapidly than anticipated, UMG’s reliance on digital service providers, UMG’s
inability to execute its business strategy, the global nature of UMG’s operations, changes in global
economic and financial conditions, UMG’s inability to protect its intellectual property and against
piracy, challenges related to generative AI, UMG’s inability to attract and retain key personnel, UMG’s
restructuring and reorganization activities, UMG’s acquisitions and other investments, changes in
laws and regulations (and UMG’s compliance therewith), UMG’s inability to meet expectations with
respect to ESG-related matters and the other risks described in this Annual Report. Accordingly, UMG
cautions readers against placing undue reliance on such forward-looking statements. Such forward-
looking statements are made as of the date of this Annual Report. UMG disclaims any intention or
obligation to provide, update or revise any such forward-looking statements, whether as a result of
new information, future events or otherwise.
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