Reservoir Media (RSVR) Q2 2025 earnings summary

Executive summary

• Revenue grew 6% year-over-year to $40.7 million, driven by a 10% increase in Music Publishing revenue and digital gains, partially offset by a 1% decline in Recorded Music revenue.

• Adjusted EBITDA increased 11% to $17.6 million, with operating income up 65% to $10.1 million, reflecting margin expansion and cost discipline.

• Net income was $0.2 million, down from $0.7 million year-over-year, mainly due to a loss on fair value of swaps.

• Major catalog and talent acquisitions included Snoop Dogg, Death Row Records, k.d. lang, Jack Douglas, and Billy Strange.

• Notable sync placements and streaming successes, such as Harry Belafonte's "Day-O" and Sabrina Carpenter's "Espresso," contributed to portfolio value and market share.

Financial highlights

• Music Publishing revenue rose 10% to $28.6 million, offsetting a 1% decline in Recorded Music revenue to $10.7 million.

• Digital revenue increased 14% for the quarter, now representing 56% of total revenue.

• OIBDA increased 34% year-over-year to $16.6 million; Adjusted EBITDA margin improved to 43% for the quarter.

• Gross margin expanded due to cost discipline and revenue growth, with administration expenses down 20%.

• Cash from operating activities was $21.9 million for the six months, up $3 million year-over-year.

Outlook and guidance

• Fiscal 2025 revenue guidance raised to $150–$153 million, implying nearly 5% growth at midpoint.

• Adjusted EBITDA guidance increased to $59–$62 million, signaling almost 9% growth at midpoint.

• Management expects liquidity to be sufficient to support operations over the next twelve months.

• Strong pipeline with over $1 billion in transactions under consideration at attractive multiples.