NEW YORK, United States (AFP) — Major music label Warner said Tuesday it would give back $126 million to artists after it sold its stake in streaming leader Spotify.
The Warner Music Group said the share sale from Spotify, which successfully listed on the New York Stock Exchange earlier this year, earned the company $504 million, or $317 million after paying taxes.
Announcing its latest earnings, Warner said it would share the spoils of Spotify with artists on its labels — whose most famous names include Coldplay, Ed Sheeran and Neil Young.
“I’m pleased to say that in connection with the sales of Spotify equity, an estimated $126 million dollars will be credited to artists’ accounts,” Warner CEO Steve Cooper told financial analysts on a conference call about the results.
He said that artists would find the Spotify proceeds on their latest royalty statements being distributed this month and in September, without details on how the sum would be divided.
Cooper recalled that Warner in 2016 became the first major label group to pledge to share the money from streaming transactions with its artists.
Rival Sony Music said in May that it had sold half its $750 million stake in Spotify, while independent group Merlin fully divested its $125 million share.
Both companies also said they would pass along the proceeds to artists and members.
Universal Music Group, the world’s largest conglomerate, has stood apart by keeping its stake in Spotify.
In July, parent company Vivendi said it was considering selling up to half of its stake in Universal Music.
Streaming has shaken up the music industry, with fast-growing subscriptions to Spotify and its rivals contributing to the first solid growth in the business since CD sales started plummeting in the late 1990s due to the internet.
Artists have frequently complained that they see little of the windfall of the new technology, although few musicians still make good on threats to boycott streaming.
© Agence France-Presse