Warner cashes in 75% of its Spotify equity, making US$400 million

Warner has followed in the footsteps of Sony and sold a significant chunk of its shares in Spotify.

During Warner Music Group’s earnings report overnight, CEO Stephen Cooper revealed that the company had sold 75% of its Spotify shares –and made US$400 million in the process.

The news reveals that Warner's pre-sale holding was worth between $500 and $550 million.

Warner, like Sony, says it will share the proceeds with artists and label partners.

Cooper said, “We’ll share these proceeds [the same way] we share revenue from actual streams and so-called digital breakage.

“In addition, we will be sharing equity proceeds with distributed labels – if [this is] included in their agreements with us.”

Cooper went on to say that the sale was unrelated to Warner's outlook of Spotify in general.

“This sale has nothing to do with our view of Spotify’s future. We’re hugely optimistic about the growth of subscription streaming, we know it has only just begun to fulfil its potential for global scale.

“We fully expect Spotify to continue to play a major role in that growth.”

Warner sold the stock despite posting a strong position of growth for the fiscal Q2 report, revealing 16.7% growth in total revenue.

Last week Sony revealed it had sold 50% of its own shares in Spotify during the Swedish streaming company’s first month on the New York Stock Exchange.

Sony had previously owned 5.7% of Spotify’s stock.