Enter multiple symbols separated by commas

Warner Music's Shares Drop on Rival EMI's Profit Warning

Shares in Warner Music Group fell sharply on Wednesday after rival record company EMI Group issued a profit warning on slowing sales in the North American music market.

Warner Music, the world's fourth largest music company, has boosted market share in the U.S., but last week posted a poorer-than-expected 74% drop in quarterly profit as its artists had fewer hit records than the year-ago period.

Warner and EMI, the third largest music company, were locked in merger discussions last year but ended the talks after European officials annulled the merger of Sony Music and BMG Music Entertainment. Sony and Bertelsmann had created the Sony-BMG joint venture in 2004.

Laura Martin, an analyst at Soleil Media Metrics, said continued upheaval at EMI has dampened prospects that a merger with Warner would reap benefits. EMI recently fired its top two music executives and is undergoing restructuring.

"EMI also cited a very weak North American market, Warner is far more vulnerable to North America than EMI," said Martin.

Contact U.S. News


    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

U.S. Video

  • Hero miles for military members: Real estate magnate's plea

    Chairman of the Fisher House Foundation, Ken Fisher, discusses the Hero Miles program with CNBC's Dina Gusovsky. During Military Appreciation Month, Fisher is asking every traveler to donate 1,000 of their miles to replenish the Hero Miles programs that is in danger of running out.

  • Cramer shuts down this market's haters

    "Mad Money" host Jim Cramer on why this market can't stop, won't stop.

  • From the battlefield to the boardroom

    Your Grateful Nation is dedicated to helping Special Forces veterans enter the corporate world and Knot Standard provides complimentary suits to vets. Mad Money's Jim Cramer spoke with Rob Clapper, Your Grateful executive director; John Ballay, Knot Standard co-founder and president; Tej Gill, retired U.S. Navy Seal; and Darren McB, active duty U.S. Navy Seal.