I think we're on time, so we'll begin. Nice to have a good full room to welcome Boyd, who's the COO and CFO of Universal Music Group. Thanks very much for coming to Barcelona to see us. Ed, thank you very much. Nice to be here. Hello, everyone. Certainly very recently, you held a Capital Markets Day, where I think we got a good feel for UMG's midterm targets. And as part of that, you allocated, you sort of targeted, 8%-10% subscription revenue growth within that. Can you talk a little bit more about what you're calling Streaming 2.0, and how does it, how are you gonna achieve that subscription target, which unquestionably is the bit people focus on the most here within that? Yeah. No, I mean, it's very clear. The, so we guided—for those of you who weren't, the Capital Markets Day—we guided, on subscription revenue an 8%-10% CAGR over, through the period to 2028. We did try to emphasize at the time this is likely to come in waves as opposed to every quarter, it'll be between 8% and 10%. But the thinking, you know, the thinking behind this, you know, is really kind of twofold. One is that we—in some of the more evolved markets, the more developed markets that have been, you know, kind of in the subscription business for, let's say, 10 to 15, 15 years, you know, the level of subscriber uptake is actually slowing. It's no surprise. There's an inevitability about it. You know, however, so what we were saying in terms of the 8%-10%, approximately half would still come from continued subscriber growth, but half of it, the kind of 4%-5%, would actually come from ARPU improvement. So that ARPU improvement is most likely to come in the more evolved markets, and the subscriber growth, there will still be subscriber growth in the more evolved markets, but a larger share of that subscriber growth is gonna come from whether we call them high growth, high potential, you know, kind of markets. So we're really going to see, I think, and we're calling it 2.0 because we didn't realize there was 1.0 beforehand, but 1.0 has been around for 10, no longer nearly 15 years now. The actual original proposition, which was $10 a month for all of the music ever created wherever you want on whatever device, very, very compelling, not only just financially, kind of proposition to consumers, just a very, very convenient way to access all of that music. That basic model survived right through to, you know, today, but it's never really evolved in any significant way. It does need to evolve. It does need to pivot. Streaming 2.0 is a multitude of different things. It's a moment for the platforms to talk to their subscribers, to identify things like tiering, changing the product availability, a premium tier, maybe a more simple, free tier in terms of mobile, you know, a number of different product offerings. Out of all of that, two things will happen, hopefully continued subscriber acquisition, but also the price point will change and the ARPU will improve. So it's a kind of here is the moment. 2.0 is upon us. And I suppose that ARPU improvement is, you can either look at it that it's partly coming from, or the overall revenue growth will be coming partly from subscribers, partly from ARPU, or that the ARPU improvement covers the mixed effects of new subscribers who are coming at a low price point. But whichever way you look at it, ARPU is clearly a very important driver within that framework. And I think it's fair to say a lot of investors feel like that lever is in the hands of the DSPs rather than it's in your hands necessarily. So. Mm-hmm. What's your response to that? How are you going to ensure that sufficient ARPU to make that target work is gonna be achieved? Yeah. Well, I think when it comes to different product offerings, clearly we're critical in helping the platforms, you know, develop these new offerings to their, you know, to their customers, the premium tier being a, you know, a prime example, you know, of that. So there's a very kind of iterative process back and forth where we're helping them, you know, improve the product offering. In terms of simplistically price increases, this is in the platform's interest to increase prices. And so, you know, I think it's a very, very important consideration here in totality is what is the price point. As just said, the platforms have been around, or subscription's been around for 15 years, 40% inflation in 15 years, 10% increase in subscription prices. So we're not even tracking inflation. You know, the price offering in the first place was very compelling, and now it is remarkably uncompelling. So everyone, everyone knows that. And the platforms need price increases as much as we think we deserve, you know, price increases. But it's just going to be nuanced. There's been quite a few questions this morning already about 'cause we've made some statements about wholesale prices, and I think it's probably worth just trying to mention that. Forgive me. I know you do the questions and I do the answers, but let me just say wholesale pricing in our pricing with all of the DSPs, we have a three-metric commercial model. And basically, we get paid on the higher of revenue share, which everyone kind of seems to understand and seems to know. It's the higher of revenue share, a per-play rate. So we get paid every time there's a play and there's a rate set for that, and also a per sub, per subscriber rate. When I'm thinking wholesale prices, I'm thinking our minimum subscriber, rate. So we have that, always have had it. We've used it very judiciously, but we have that right in our contracts to charge what we believe is appropriate for the value that we deliver. I think it's right to talk about it. It was gonna be it's, it was sort of in my questionnaire because you, I think, alluded to it at the Capital Markets Day and perhaps a bit more detailed on the last call, and I think there were sort of various phrases around sort of ensuring as a content owner you get the. Right. Right remuneration for it, right? Mm-hmm. And the reason that we kind of used wholesale pricing or per subscriber minimums judiciously, you know, that first wave, Streaming 1.0, was all about getting to where we are today, which is more than 600 million subscribers paying an amount of money per month, you know, for the music. So the behavior, the consumption model has changed. So we've achieved that first wave, objective that we had. You also mentioned product. So I think you've talked about the need for continued evolution of tiering in the offering, and you've been talking quite a lot recently about super- premium tiers coming into the offer. So when should we expect those to be available? Clearly, you said, you know, you work with DSPs. You have some sort of sightlines for that. So when can we expect those to be available, and how should the economics of those tiers work from your perspective? Yeah. I mean, 2025, well, you know, you'll see the first of those offerings. Spotify is already, you know, talking about what they call Music Pro, you know, so that's out there. We're talking to all the platforms about what their premium offering might look like. They're all a bit different. You know, the types of things we're talking about are early release of music, things like premiere events around music, things like chat room between artist and fan, collectibles, premiere, not premiere, privileged access to ticketing, and each of the platforms has a slightly different angle. When it comes to physical products, there's one platform you can imagine prides themselves on their delivery to your house within a few hours. So they may be more focused on some of the physical aspects, and the other platforms are more interested in, you know, other things. So, you know, 2025, you know, the first iterations of premium will be in the marketplace. And how mu— Sorry, and just in terms of sharing. Mm-hmm. You know, it will be broadly the same metrics that we have in place today on the current product. So it will be a combination, some kind of combination of rev share and per minimums. So essentially, whatever the mix of price increase that comes through, you should proportionally. Yeah. Benefit from that. Yeah. Yeah. What about the adoption? What proportion of customers do you think are interested in this, and how do you think about how quickly that adoption can play out? Yeah. We've done lots and lots of consumer research on this 'cause it's been very important to us. And we've done six different rounds with, you know, our consumer panels that we're regularly in touch with. But also, to that, now all the platforms are doing their own research, and it's all kind of colliding in a kind of range somewhere between 20% and 30% of today's existing subscribers would be prepared to pay up to two times or twice today's price for a premium offering. It depends a little bit on which of these features are in the service, but 20%-30% are prepared to pay double of what they pay today. Okay. And that might take a minute for us to get there. And I think a minute in terms of the product offering being complete enough to support that kind of price increase. And then secondly, inevitably, it will take some time to migrate, you know, the subscribers, which may well take the kind of same profile or cycle as artist releases. But I would envisage that within two to three years, you could be attaining that kind of penetration. So it's approximately half of the period you're targeting from the CMD has got that kind of tailwind to it. Yeah. Isn't that the way of thinking about it? Yeah. Yeah. Okay. Another aspect that's come up a lot in investor conversations is around the disparity in growth rates among some of your partners. Some are clearly doing very well. Some have done less well, so what gives you the confidence as you put these targets together that the likes of Apple and Amazon, which, you know, is broadly what's been alluded to, will, you know, invest more into their product to be able to drive strong growth at their platforms? Yeah. I mean, all of our conversations with all of them are incredibly positive. I sometimes get asked, are Apple and Amazon in particular losing interest in the category? But the conversations, you know, between us are very, very different. You know, I think in particular, Amazon have made some announcement over the last, you know, few days. So they've been, we would have said, quite quiet. And now they're back, maybe a little bit reactive because it took Spotify to do the audiobook bundle when that really should have been Amazon's play. So they're being reactive, but they will go beyond that in terms over the coming years. So it's good. It's stimulated them into pursuing developments that we're very, very encouraging of. Music's always been at the core of Apple. It's never very far away from Apple. Now, it may well be that they've got a self-serving objective because it's kind of, you know, it helps with all of their heart, their hardware. But we're very, very close. You know, all of their campaigns for new products always have a very significant feature. So the Apple 16, that was one of our artists The Weeknd, that was basically the face of that campaign. So that's never going to be far away from Apple. And I don't think you ever underestimate a company that's one of the most successful companies in the history of commerce. Yeah. But they will not. They're just not all gonna come sequentially and equally with the same. But they're competitive. They can't. They cannot afford to lose the category. I think that's an interesting, you sort of touched on it there. But again, one of the things that comes up with this, I guess, mindset about whether all the platforms are incentivized around price increases because yes, rationally they are. But as you mentioned, with Apple and hardware there as an example, they also have their own other incentives in terms of. Mm-hmm. You know, user bases and ecosystems and loyalty, and, and the rest of it. But it does strike me that with super- premium, it feels like that's an offer that once it's in the market, you sort of have to have a competitive offer. Is that, is that how you would see that in terms of their interest in that product? It's exactly how I see it. You know, the hope and the ambition is this is so compelling that they cannot offer, and no one platform cannot offer this to their subscriber base because they run the risk of having churned to the other platforms that do have it. Artist-Centric. Yeah. It's an initiative that's been going for a little bit now. Can you give us an update more broadly? What partners are on board? You know, what's the progress been? Yeah. Good. Would we like it faster? Yes, we would because everything we do, we like to happen quickly. You know, just going through the kind of the sequencing of this, Deezer was the first platform that embraced Artist-Centric with us. They made a comment at the time that they saw the opportunity for 10% to move from long tail to the more professional artists. The data would tend to support that on Deezer. Spotify was the first of the larger platforms to come on board with their own version of it. It's been live for about two quarters. So far, quite difficult to see anything within the data that would be worth sharing with you at this stage. But the reality is it's a first step. I think this is a journey that all of these platforms are gonna go on. There's an issue with fraud. There's a very real issue with fraud. And you know, for the sake of our artists and our songwriters, we're going to be very active in working with all of the platforms to eliminate fraud, at least to the best extent you know, kind of possible. But there's a number of bad actors out there that need to be held liable for their actions. So we will continue with that. And that's something that the platforms are all nervous you know, about reputationally. What does this mean when their subscribers are going for "Listen to Lady Gaga, but find out it's Gaga"? Mm-hmm. It's not the actual, wonderful Lady Gaga herself. That's not a good customer experience. Yeah. But just with the ease of distribution these days, it's a very real problem. And it's money that's leaking out of the pool and going to where it shouldn't be going. So I think good so far, but quite a long way to go would be my kind of top-level or top-line assessment. Are there any areas that are resistant to it, or have you sort of won the argument in terms of receptivity from the partners? And it's more about then the actual execution and the nuts and bolts of it. Is that also a fair summation, or is there any areas where there's? I think there's still some denial out there. That doesn't happen on our platform. You know, so the efforts are about, "Well, I'm sorry, but here is Lady Gaga." You know, you are this legendary platform. Your reputation's important. Your customers are important. So there's a little bit of kind of denial. Yeah. But once the facts are presented, you know, there's action. You know, the action is taken. Add support a little bit. Yeah. You've shown a bit of weakness in recent quarters. Can you give a bit of color on what's been driving that, and how should we think about ad support going forward? Yeah. I think the major reason that it's been flattish for the last few quarters, you know, I think it's more of a subset of a broader issue in terms of macroeconomy and advertising. Mm-hmm. You know, so that, that's definitely, you know, a very significant component. When we look on platform, the activity level is still exploding, which bodes very well, you know, for the, you know, for the future. The only other point that I would make is really, if you look at within certain of the, particularly on the social platform side, you know, Meta, in our new deal with Meta, they do not want to have the license for what they call long-form video. Long-form video in Meta speak is a three-minute video clip that goes with a song. When you're me, long-form video is an hour and a half concert live show. But it's just the way the world is going is getting shorter and shorter. So they didn't want the three-minute videos. So our new deal with Meta lost that part of the revenue stream, but encouragingly, the monetization and the short-form content. Mm-hmm. Was increased. So there's a net evolution that's going on there. But I still think ultimately here, when you look at ad-funded, where there's audience, the dollars will follow. You know, there's still a very significant migration going on between traditional media and digital media. So I think the long-term horizon is very encouraging. And what we're seeing, I think, is more about the specific dynamics of what is going on today. Okay. We talked about super fans in terms of premium and super- premium tiers, but you're also looking to expand your DTC category. Sure. It doesn't get a lot of airtime. Probably nothing outside of subscription does really very much. But can you talk a bit about your approach there and what we can expect from outside of the business? Yeah, well, I think we kind of came out on Capital Markets Day for the first real time with us really talking about it, you know. We've been quietly, kind of building, you know, building this as a revenue stream for a good few years now, and the way that we do this business is that we have roughly 1,300, 1,300 stores. Mm-hmm. They're most of them are artist stores in terms of, you know, TaylorSwift.com, or whatever. But, you know, large, large number of stores. We're building a, we're building audience that we're basically interacting fans. We have roughly 100 million of our own, sorry, of audience right now. 50 million is Artist-Centric and therefore a different meaning of Artist-Centric. But, you know, Artist-Centric, artist-owned audience, and about 50 million are Universal Music Group-owned audience where fans have opted in to receive, you know, kind of communications, you know, from us. So, you know, combined, you know, 100 million. A fan of one artist is, there's no such thing as a fan of just one artist. So far, we've seen, you know, very encouraging migration opportunities where artists, I'm sorry, fans are kind of opting in to Universal Music Group. So, you know, building that audience is meaningful. And again, you know, one of my, you know, one of my colleagues, who may or may not be in this room, you know, often refers to this as that, you know, we've got demand in search of a product. And it's always resonated with me because when we develop a product and we connect the fan with the artist with the product, the demand is breathtaking. And so, you know, we're very encouraged. And I think we revealed at Capital Markets Day that this revenue stream for us is now over EUR 500 million. So we were quietly building, but now it's a very, very meaningful or becoming increasingly meaningful and a very, very important strategic initiative for us. And as you scale the business, how do you as CFO and COO, how do you think about the margin profile as you start getting there? What do merchandising margins look like going forward? Yeah, well, my least favorite subject, merchandising margins. I'll just give you the kind of merchandise splits into what I call three revenue streams: touring, when you go to see a show, margins, gross margins, by the way, 8%-10%. Mm-hmm. Talent takes all of the money. When it moves towards retail, margins move to the kind of 15% range. And then when you move into direct-to-consumer, you're up over the 25%, kind of margin. However, who knows how far this is. Mm-hmm. We're gonna be able to take this 'cause we've got specific examples of very high-priced products, where the demand has been exceptional. So as we migrate this business into direct-to-fan, the margin profile, you know, changes, you know, significantly. We're also investing quite a lot of capability in terms of headcount and resources and also CapEx on the facilities just to improve the customer experience. Okay. Let's move on to something you spoke about the CMD at some length, which was around the drive to invest in high-growth, high-potential. Mm-hmm. Emerging markets. Can you sort of talk a little bit about your framework that you're using for that and which of the markets you're most excited about? So, we have a category that sometimes we call high growth, sometimes we call high potential, but it's very approximately 17 geographies. You can guess most of the, you know, most of those, you know, geographies from Latin to Asia to Middle East. And, and, you know, they're high, you know, kind of demographically high populations, historically very poorly monetized that we now see an opportunity for significant monetization improvement. When you look at our market share, our market share in those kind of category or basket of geographies is approximately half what it is in the more evolved markets. And again, you know, as I was saying earlier, it's not because we're incompetent and we forgot about them. The reality is the monetization historically really didn't justify the, you know, the investment. We're seeing it differently now, which is all about new subscribers paying an amount per month. So we need to, we need to take our market share from half of what it should be to what it should be. And that's gonna take M&A activity, which is a little bit cumbersome in the sense of it is geography by geography 'cause it's local language, local culture. So there's not a kind of easy fix here where one size fits all. So we've got a long list of targets, and we will embark over the next we've started. But always, I, I think it's probably at least a five-year journey to get to where we, where we need to get to. So when we think about multiples, returns, payback periods, you know, part of what you're describing, I think, is sort of, acquiring into being able to have the right traction to global growth in music over the next decade or maybe even sort of beyond that. So how should we think about the payback period? And you said obviously they're all very different businesses and very individual. Mm-hmm. So as a sort of rule of thumb for people to think about that investment, what, yeah, what's your criteria in terms of multiples and returns? I'm looking at it, by the way, now as a portfolio. If you're looking at 17 geographies, 100 targets or whatever the number is, but it's very, it's approximately that. Mm-hmm. We want to move at a pace. And I think the right thing for me as a CFO to look at this on a portfolio basis. And, you know, that means that perhaps in certain geographies, we would pay a higher multiple than we would do otherwise. But again, it's all to do with having line of sight towards the future growth. And so therefore, something that may well be quite expensive on a look-back basis will become incredibly inexpensive on a look-forward basis. So, you know, I think for the company, that is the best place for us to be investing our capital. Just to be clear, to link it to your targets, you've given the 7% revenue, 10% EBITDA targets. Just to be clear, those investments are necessary or not necessary for you? They're not necessary. You know, there's some of them are little tuck-ins in individual countries, so they may well never get the visibility that you might be looking for. Mm-hmm. But, you know, we'll see how quickly we are able to execute on this strategy, you know, and at the right time, I think, you know, we'll need to update the markets on how we're performing. Let's talk about publishing. It's been a real. Yeah. Positive spot within the company. It's delivered exceptionally strong growth. So as you look forward, can that continue to materially outpace the growth you've seen in recorded music? What are the drivers that lie behind that? Yeah. I hope so. We didn't guide on publishing revenue growth, but, you know, very approximately, you know, there's a kind of metric out there is that growth should be around 8% over the coming years. What we've done, our publishing company is run by Jody Gerson. They've been very, very successful at capturing market share from their competitors. Mm-hmm. You know, the market leader is Sony, and we are number two to Sony. We don't like that. I'm sure they can feel us coming, but the reality is that what Jody and the team have been able to do, they've captured market share and they're getting very close to Sony in terms of a leadership position. I, you know, wouldn't underestimate our ambition. You know, so hopefully we can keep pushing forward and outpacing the growth, you know, the kind of market growth. Okay. And Virgin, why is that? Yeah. That's obviously been a few changes there with the recent reorganization. So why is that an important business for UMG to be in? I mean, we have this wonderful brand internally in the company, which had kind of just kind of lost its luster, I think it's fair to say. You know, we decided, you know, to recreate hopefully some of the entrepreneurial spirit that goes back to, you know, Richard Branson's time as the owner of Virgin. You know, it's run by Nat and JT, and their purpose is really to create services and a service offering that's very compelling to entrepreneurs and to labels, perhaps in some of these high-growth markets as well as in other markets. Mm-hmm. 'Cause we like bringing in entrepreneurs into our, into our ecosystem, and once they're in, things, you know, good things happen typically. You know, we, we recently acquired a company called Mavin out of, out of Nigeria. They already had a relationship with Virgin. They have an artist called Rema, which was distributed through Virgin. With proximity came the opportunity, so, you know, we, we like that. It's not really the, you know, they're not re as soon as you say that, I can think of an example, but, you know, they're not out there making individual artist deals. This is really about bodies of work, labels, entrepreneurs, businesses. Mm-hmm. We want to aggregate and collect. I want to ask one on your targets. It was a lot of, a lot of focus, I think, historically on the way your targets are set up coming out of Vivendi, revenue and EBITDA margin as the two targets. Mm-hmm. And you've unexpectedly completely understandably, I think, moved away from it. Perhaps it's worth just laying out a little bit in terms of why you think that's an important change to where you run your targets and then, you know, what difference does that make from the sort of the company's attitude towards growth? Yeah. I mean, the confusing part was the EBITDA margin. You know, it was given, you know, coming out from under Vivendi, the kind of guidance Vivendi to put into the marketplace is that we would have, or we would move towards an EBITDA margin or adjusted EBITDA margin in the mid-20s%. I think it was very well-intentioned, but the facts and the circumstances changed. You know, I, most people I spoke to, I would find myself continually trying to explain why our EBITDA margin had gone up or had gone down. The reality is I think when you give the absolute guidance basically that we have, it's just much more transparent and voice some of this confusion around, you know, is there a problem with the mix of the business? Is the core business financials changing the dynamic? The reality is there's lots of different aspects to our business, all of which are incredibly positive but may well be slightly dilutive to an EBITDA margin. But we're still on course. So, you know, we're still on course. We still have great operating leverage. We're still expanding our margins. Still feel good about that, you know, the intention behind that original guidance. So I think that's that last point's important because I think people look at it to say, well, subscription is the best proxy to sustainable music revenue growth. So that's all I'll focus on. And then that business should demonstrate good operational gearing by its nature. So I wanna see good subscription growth and good gearing. If that, then I sort of believe in the health of the ecosystem. So I guess that's the point around confidence that you do see operational gearing where you can demonstrate to the market and show that that's still coming through. So is that still in your mindset to be able to show those proof points? It comes completely. I mean, that part of our business is exactly as we had envisaged when we embarked on this journey. Okay. One of your largest shareholders has recently, he sits on your board as well, recently disclosed that he will take his option to force UMG to list shares in the U.S. in 2025. What are your plans for U.S. listing? So just in case anyone in the room doesn't understand, not your question, your question was very clear, but when Pershing acquired 10% in our company from Vivendi, Vivendi granted Pershing Square a right to force us, to use that word, to register in the U.S. So Pershing Square does have that right. In order to benefit from that right, Pershing Square does need to make $500 million of their equity available for the listing. So, you know, the working assumption is that we will continue on that path unless circumstances change between, you know, now and then. One thing that didn't come out in the various tweets, you know, at the time is there is no right to force us to have a primary listing in the U.S. There's no comments about whether we do it by way of, as an FPI or as, as ADRs. You know, so the reality is that the board will work through, you know, what that is going to mean over the coming months. Okay. I'll pause there if there's any questions from the audience. We've got a very full room, so I'll give everyone an opportunity, in which case, with a few minutes we've got left. Sorry, please. One question. Bring the microphone down the front. Thank you. Nobody else will hear you other than Ed and I. Hello? Hello? I wanted to understand better. You were discussing price increases, that your DSPs are having introduced or plan to introduce going forward. Should I expect that these price increases will be proportionate in terms of how it's split with UMG going forward, as it has been in the past, or that share might be shifting as well? Look, I think if history is an indicator of the future, it will be exactly as you suggested. It would be commensurate with the, you know, with the history. The only thing I would point out, in our commercial relationships with all of the partners, we do have incentive plans embedded into those commercial agreements, which are to encourage, you know, certain behaviors or certain actions, be it to grow above a certain percentage or to reduce churn or and on and on and on. But, you know, broadly speaking, I don't really see a reason for why it would change. Again, think about there's three financial metrics per play, per subscriber, as well as the revenue share. And it's the higher of any of these individual metrics. Thank you. I guess just on the U.S. listing point, hammering down there, what would be the reason to not make the U.S. your primary listing? I don't think there's any real meaningful reason. There's not, there's not an obstacle, you know, per se. There's additional work, there's additional costs, you know, etc., etc. You know, but there's no, there's no major obstacle to that. You know, I think this is something that's a board decision. We've got, you know, some significant investors that will, you know, that we will listen to in terms of the construct. But yeah, no, I don't really get much to add. Perfect. Right on time. Boyd, thank you so much for joining us and thank you for everyone presenting. No, thank you, Ed. Thank you, everybody.