Welcome to Warner Music Group's third quarter earnings call for the period ended June 30th, 2021. At the request of Warner Music Group, today's call is being recorded for replay purposes. If you object, you may disconnect at any time. I would like to turn today's call over to your host, Mr. Kareem Chin, Head of Investor Relations. You may begin. Good morning, everyone. Welcome to Warner Music Group's fiscal third quarter earnings conference call. Please note that our earnings press release, earnings snapshot, and the Form 10-Q we filed this morning will be available on our website. On today's call, we have our CEO, Steve Cooper, and our CFO, Eric Levin, who will take you through our results. Then we will answer your questions. Before our prepared remarks, I'd like to refer you to the second slide of the earnings snapshot to remind you that this communication involves forward-looking statements that reflect the current views of Warner Music Group about future events and financial performance. We plan to present certain non-GAAP results during this conference call in the earnings snapshot slides and have provided schedules reconciling these results to our GAAP results in our earnings press release. All of these materials are posted on our website. Also, please note that all revenue figures and comparisons discussed today will be presented in constant currency unless otherwise noted. All forward-looking statements are made as of today, and we disclaim any duty to update such statements. Our expectations, beliefs, and projections are expressed in good faith, and we believe there is reasonable basis for them. However, there can be no assurance that management's expectations, beliefs, and projections will result or be achieved. Investors should not rely on forward-looking statements because they are subject to a variety of risks, uncertainties, and other factors that can cause actual results that differ materially from our expectations. Information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained in our filings with the SEC. With that, I'll turn it over to Steve. Thanks, Kareem. Good morning, everyone, thanks so much for joining us. Just over a year ago, we took our company public. We were confident that our business would remain resilient during the pandemic. Thankfully, our confidence was well-founded. Today, we're really fortunate that in looking back over our third quarter, we can celebrate the extraordinary achievements of our global team, our artists, our songwriters, and our partners during this really crazy time. Entertainment consumption habits have been changing swiftly during COVID, the growth in new business models has been accelerating. We've continued to keep pace through our constant evolution, as a result, we've grown stronger than ever. After we review our quarterly results, I'll focus some additional remarks on three areas. First, how we're driving our core business by investing in new and established artists and songwriters. Second, how we continue to innovate to deliver long-term growth. Lastly, how we're playing the game differently through our unique portfolio of media brands. Our continued momentum led to impressive results this last quarter. Total company revenue growth was 27%. While some of the year-over-year comparisons are distorted by COVID, these results reflect the strength of our release schedule and the recovery in certain of our COVID-affected revenues. Digital revenue grew 23% and now represents roughly 70% of total revenue. Adjusted EBITDA grew by approximately 49%, while our margin improved to over 21%. Recorded music delivered revenue growth of approximately 28%, marked by growth across digital, physical, licensing, and artist services. Streaming revenue within recorded music grew 27%. This increase was driven by successful new releases and strong carryover performances, a rebound in ad-supported revenue, and the continued strong growth in revenue from emerging platforms. Physical revenue also saw a major resurgence, growing 136%. This reflects the increasing popularity of vinyl across the globe. Licensing revenue showed a significant rebound, returning to growth of approximately 28%. Artist services was up slightly as double-digit growth at our e-tailing company, EMP, was mostly offset by the continued disruption in live concerts and tour-related merch. As always, the central story is the fantastic new music we've been releasing. Here are some highlights. We're happy to have new music from global superstars like Ed Sheeran and Coldplay. Ed debuted his new single, "Bad Habits" on TikTok, shattering the platform's record for a live music performance with over 5.5 million unique views. Meanwhile, Coldplay debuted their new single, "Higher Power" with a special broadcast from outer space, thanks to the cooperation of the International Space Station. Dance music icon, David Guetta, continued an incredible year scoring multiple top 10 hits around the world. In June, we announced the signing of a new career-spanning partnership with David that includes both his legendary recorded music catalog and future releases. Performers at his level can choose any route to release their music, and our new partnership is a great endorsement of the value we offer the creative community at all stages of their careers. Warner Records signed Bella Poarch, one of TikTok's global stars. The video from her first single, "Build a Bitch," had the biggest debut ever on YouTube for a new artist with over 200 million views and counting. Other highlights included Nashville's Gabby Barrett becoming the first female solo artist in five years to go number one on Billboard's country charts with her first two singles. Russ Millions and Atlantic Records' Tion Wayne taking over the world with their single, "Body," soaring to number one in multiple countries, and the rolling out of major international hits from JJ Lin, Aya Nakamura, and Master KG. There's more fantastic music to come this year from Ed, David, Lizzo, Coldplay, Silk Sonic, and Justin Quiles, to name a few. In publishing, we delivered revenue growth of 21%. This impressive showing was due to 20% and 55% increases in digital and sync respectively. We're seeing a return to normal sync with TV and film production recovering nicely. However, performance revenue remained nearly flat year-over-year due to the ongoing restrictions for bars, restaurants, clubs, and concerts. In Q3, Warner Chappell had a share in 37 number one songs across the U.S. Billboard streaming and radio charts. That's up from 23 last quarter. According to Billboard's Publishers Quarterly, we increased our share in both U.S. radio airplay and Hot 100 songs. Notable songwriter signings included four-time Grammy winner Anderson.Paak, multi-platinum record producer Vinylz, R&B hit maker Sean Garrett, and legendary Mexican star Marco Antonio Solís. In April, Warner Chappell's creative and commercial momentum was recognized with the prestigious ASCAP Pop Publisher of the Year award. We're achieving all of this success by making smart investments in our artists and songwriters. One of our primary goals is to grow our core business through a constant flow of amazing new music, driven by financially disciplined A&R and M&A strategies. We continue to have size, agility, and focus working for us. Our agreement to purchase 12 Tone Music, announced in July, is just the latest example of an immediately accretive investment. 12 Tone's roster includes recordings by Anderson.Paak, Christian music superstar Lauren Daigle, breakthrough electronic artist ILLENIUM, music legend Dolly Parton, and hit Asian collective 88rising. Turning now to innovation, we're continuously transforming to become a tech-enabled, digital-first company in order to deliver long-term growth. As I've said many times before, the music ecosphere is so much more than albums, singles, and videos. We want to be everywhere the fans are, so we're focusing on quickly adapting to new trends and staying ahead of the change curve. While subscription streaming has a long runway ahead of it, we're also positioning ourselves at the center of the converging worlds of social, gaming, digital fitness, and music. We continue to build our portfolios of relationships with best-in-class partners like Roblox, Wave, and Dapper Labs. Recently, we deepened our engagement in the gaming space with Bella Poarch becoming the first Filipino artist to be featured in a Fortnite dance emote, and Bebe Rexha returning to The Sims for an in-game music festival. As part of our ongoing efforts to expand our presence in China, we launched dance label Whet Records. Last month, Whet signed six artists, one of whom was Luo Tianyi, a virtual idol who exists only online. These digital stars are a phenomenon in countries such as China and Japan, with huge social media followings. With Luo Tianyi, Warner is leading the virtual idol crossover into the music business. As a result of our digital-first strategy, our revenue from emerging platforms such as Facebook, TikTok, and Peloton is now running at roughly $235 million on an annualized basis, and that's just from recorded music. Look for more announcements to come in the near future about new investments, partnerships, and collaborations. We've also spoken in the past about differentiating ourselves in the market by building an influential network of consumer destinations. Each brand has music in its DNA and commands its own independent audience of loyal fans. Our strategy to turbocharge growth included bringing together our owned media channels under a newly formed digital advertising and creative content unit. These coordinated channels, which include UPROXX, Songkick, IMGN, HipHopDX, and Cover Nation, have all seen accelerated growth over the past year. It's a powerful thing for us to control our own network of media brands. This is something unique to the Warner Music Group. These assets not only drive digital ad revenue, they give us a real edge in terms of understanding fan behavior, quickly catching new trends, and identifying cultural shifts. Last month, we were pleased to welcome Nancy Dubuc, the CEO of Vice Media Group, to our board of directors. Nancy was also named chairperson of the audit committee and a member of the executive committee. A dynamic leader, she has wide-ranging experience in visual programming and digital entertainment and is already proving to be an excellent addition. At the same time, Thomas H. Lee announced that he was stepping down from the company's board of directors after more than 17 years. In light of his many contributions, Tom has been given the title of director emeritus. On behalf of everyone at WMG, I'd like to thank Tom and say how grateful we are that we'll continue to benefit from his expertise. Last month, we also issued the first annual report for the Warner Music Group, Blavatnik Family Foundation Social Justice Fund. So far, the fund has chosen nine amazing organizations to support, including the Black Cultural Archives, Howard University, and Meek Mill's REFORM Alliance. It's important to know that this fund is just one aspect of our long-term dedication to improving diversity, equity, and inclusion within our company, our industry, and our society. We are making progress, we also understand this is an effort that requires sustained commitment. As part of this, we recently hired Samantha Sims, our first VP of ESG. Sam joins us from PVH, the parent company of Calvin Klein. She will work closely with our global management team, including key leaders such as our global heads of people and DEI, to help build programs that will drive meaningful and sustainable change. We look forward to updating you on our progress. Let me wrap up by saying that our first year as a publicly traded company, despite home confinement, has been one of the most satisfying in my career. Our amazingly creative artists and songwriters, backed by our outstanding team, have accomplished so much during a very trying time. Above all, I'm really excited by what's to come. There's so much great music, innovation, and growth on the horizon, and all of this has been supported by our shareholders, for which we are all deeply appreciative. Stay tuned as we continue to lead the way into the music future. With that, I'll turn it over to Eric. Thank you, Steve. Good morning, everyone. We are extremely proud of our third quarter results, which were marked by strong growth across all components of streaming, recovery in several areas that had been negatively impacted by COVID, and adjusted EBITDA growth that meaningfully outpaced our revenue growth, highlighting the strong operating leverage in our business. While some of the comparisons to the prior year quarter are distorted, given the impact that COVID had on certain areas of our business, I will do my best to contextualize them. Our total revenue was up approximately 27% on a constant currency basis and up almost 33% on an as-reported basis compared to prior year quarter. These results are underpinned by growth across all of our revenue lines, with the exception of performance in music publishing. Adjusted OIBDA increased by over 58% to $263 million, with margin improving from 16.4% to 19.6%. This improvement was driven by revenue mix and strong operating performance. Adjusted EBITDA increased almost 50% to $282 million, with margin improving from 18.7% to 21%. This increase was largely to the same factors that drove adjusted OIBDA performance, pushing our adjusted EBITDA to over $1 billion on an LTM basis. Please refer to our press release for calculations and reconciliations related to adjusted OIBDA and adjusted EBITDA. In recorded music, revenue increased approximately 28% over the prior year quarter. Digital revenue grew by almost 24%, driven by a 27% growth in streaming revenue. Our streaming revenue was propelled by growth from traditional platforms as well as emerging platforms, resulting in robust growth across all of its components. Subscription streaming, which is by far the largest contributor, showed accelerated growth this quarter. Ad-supported streaming, which was impacted by COVID in the prior year quarter, continued its strong recovery, with growth more than doubling that of subscription streaming. Our revenue from emerging streaming platforms continues to grow at an extraordinary pace and is now running at approximately $235 million on an annualized basis, and that's for recorded music alone. Physical had an impressive recovery, with revenue growth of over 136%. This was driven by a resurgence in global demand for vinyl and increasing retail sales as businesses reopen, as well as comparisons against the prior year quarter that was severely impacted by COVID. While the increased demand for vinyl has been welcomed, we continue to believe that physical will be in secular decline on a normalized basis. Licensing revenue returned to growth of almost 28% due to higher synchronization revenue and broadcast fees as businesses began to recover from COVID. Artist services revenue was slightly up as double-digit growth at EMP was partially offset by lower revenue associated with concert promotion and tour-related merchandising. Recorded music adjusted OIBDA grew by more than 52% over the prior year quarter to $254 million, driven by revenue mix, strong operating performance, and the impact from recent acquisitions. Adjusted OIBDA margin increased 2.6 percentage points to 22%. Music publishing revenue increased by over 21%, driven by growth in digital, sync, and mechanical revenue. Digital revenue increased by over 20%, reflecting the continuing shift to streaming and timing of new digital deals with digital service providers. Synchronization revenue increased by almost 55% due to greater motion picture and commercial income. Mechanical revenue increased 30% as businesses began to recover from COVID-related disruption, while performance revenue was down 4% due to the ongoing effects of the restrictions for bars, restaurants, concerts, and live events. Music publishing adjusted OIBDA grew by over 29%, from $34 million to $44 million, with margin improving from 22.8% to 23.3%. This was due to revenue mix and restructuring in the prior year quarter. Operating cash flow decreased from $123 million in the prior year quarter to $91 million. The decline was driven by strong operating performance, more than offset by continued investment in A&R and timing of working capital. On a year-to-date basis, operating cash flow was up 43%, from $287 million to $410 million. Free cash flow decreased to negative $71 million from $87 million in the prior year quarter, largely due to an increase in investment activity as well as lower operating cash flow. CapEx of $20 million was flat compared to the prior year quarter and includes costs associated with our financial transformation program. The total investment associated with our financial transformation program is expected to be about $20 million in fiscal 2021, with annualized run rate savings of approximately $35 million-$40 million once fully implemented in 2023. For fiscal 2021, we continue to expect total CapEx to be in the range of $90 million-$100 million. Cash taxes were $37 million in the quarter, and as of June 30th, we had a cash balance of $442 million and net debt of around $2.9 billion. Over the last year, we have actively managed our capital structure, reducing our weighted average cost of debt from 4% to 3.4% and extending maturities, with our nearest maturity date now in 2026. In July, we received a credit rating upgrade from S&P to BB+ in recognition of the continued health and stability in our business. We are incredibly proud of our third quarter results and all of our progress and growth during our first year as a publicly traded company. We look forward to bringing you some new amazing music in the coming months. Thank you for joining the call today, and we will open the call for questions. Thank you. Our first question comes from Matthew Thornton with Truist Securities. Your line is open. Hey, good morning, Steve. Good morning, Eric. Thanks for taking the question. Maybe two quick ones if I could. I guess first, around some of the recent price increases at Spotify. Obviously, it's still early. I think they're really the only DSP that's taken that initiative. I'm curious what you're sensing out there in terms of feedback, either from other DSP receptivity, from consumer receptivity, and whether this can kind of continue looking forward. I guess that's the first question. Just the second question, again, the DSPs are starting to talk a little more about the opportunity to really accelerate live, both virtual and in-person, as well as merchandising, but just by driving better awareness, conversion, and consumption of these revenue buckets. I'm curious if you're looking at that, if you're embracing that, if you think, again, there is the opportunity here by partnering with DSPs to really drive an inflection in the growth in some of those revenue streams. Any thoughts there? Thanks, guys. I can respond to most of that, Matthew. Spotify has increased rates, and I think they've said that their rate increases are performing well with consumers, and they've kind of met their expectations for the quarter. We have no reason to believe that to be anything but completely true. ARPU will continue overall to decline as the mix as rollout of subscribers in emerging markets, which are at lower rates, will decrease the overall pool. Within developed markets, the ability to start to see rates increase, we think is a meaningful opportunity. We are really pleased that Spotify is taking the initiative and starting to take really positive steps there. Regarding other DSPs, what we can say is that we've been vocal over the years that there's real price upside opportunity, and we think the steps that Spotify is taking is very indicative of that, and we would be highly supportive of other DSPs evaluating their subscriber base and looking at taking similar steps that are appropriate for their platform. We think there are opportunities there, but we don't speak for other DSPs, and I wouldn't want to speak for them in that area. With regard to Live and Merch, the first thing I'd say is that one of the kind of consumer platforms that we have acquired and been running successfully for several years is one called Songkick. Songkick provides listings of where artists are performing live and, in a COVID-affected world, where they're performing live online. They are a significant input provider and data provider for that for Spotify, as well as other services. We really believe in Live and Live online. We've also recently announced a partnership with Wave, which is a leader in that space, and we have been doing a series of online concerts. Part of our relationship with Roblox has been a series of concerts, whether it's Royal Blood performing at the Bloxy Awards or Why Don't We or Ava Max performing on there. That's just the start. We've done a whole series of events. We've also talked about the Ed Sheeran launch event on TikTok, which was a live streamed event. We think there's a lot of opportunity there, certainly to reach audience and build awareness and promote artists and music. The monetization of those platforms is very early, and there'll be a lot of experimentation, but we are an active player in that equation. See it as an opportunity that we're really leaning into, and we'll see how it develops, both from a monetization and promotional standpoint, but we do see it as an active, meaningful part of the future for music going forward. Very helpful. Thanks, Eric. Thanks, Matthew, so much. Our next question comes from Michael Morris with Guggenheim. Your line is open. Thank you. Good morning. I have two topics, one on the subscription streaming revenue strength and one on artist relationships. First, I'm hoping maybe you could unpack the strength in the subscription streaming side a bit more between what was maybe share gains, given the strength of your portfolio, and what was just health of that business overall. If you think about what's driving strength in the business overall, I'd love to hear if you have any insights on particular platforms, particular geographies, anything that stands out to you there. On the artist relationship side, Steve, you referenced this partnership with David Guetta, this very long-term partnership. My question, I'd really love to just hear some more detail. The context is, I think there is concern in the marketplace that eventually technology disintermediates the label value. We've talked about that a lot. You guys have addressed that. Having an established artist strike a long-term partnership with you clearly shows some two-way commitment. I'd love to just hear what's in it for each of you as you establish something long-term like that. Thanks, guys. Sure. Oh, go ahead, Steve. You can tackle that first. No, why don't you do subscription strength first, then I'll deal with artist relations. Super. Thanks for the question, Michael. First I would say that the subscription revenue growth, or I would say the streaming revenue growth, is really multilayered. It is driven by subscription growth, both in developed and emerging markets, supplemented by the price increases that have started to roll through. We've actually seen a modest acceleration in the subscription growth side. Ad-supported revenue grew, as we said, twice at the rate of subscription streaming, indicating that ad-supported, which was affected in the early days of COVID, has really fully rebounded. The emerging forms of streaming continue their solid growth as new deals are signed and the existing platforms continue to grow. Talking about share gain versus market growth, what I would say is a lot of this is driven first and foremost, we have said from the beginning of the year that our release schedule was back half loaded. Steve indicated in his comments some of those artists, whether it's Ed Sheeran, Silk Sonic, the Bruno Mars, Anderson.Paak partnership, Cardi B, Coldplay, also artists all over the world, whether it's Aya Nakamura in France or Capo Plaza in Italy. It's not just the superstars. It is the global superstars, it's also stars from all over the world, as well as breaking artists like Tion Wayne and others. It's a broad reach that is really helping drive our business forward. The market is recovering from COVID in areas that have been affected, the areas that were unaffected, like subscription streaming, continue their strong momentum. It's really, Michael, kind of a broad reach of release schedule having an impact, but also the market overall performing well. You put the two together, it creates a nice environment for growth. Steve, I'll hand it to you. Great. Thanks, Eric. Michael, on the artist relations side the benefits that artists see by way of continuing to partner with a record label is that despite the tools that are available in the digital world, the ability to effectively utilize those tools and amplify an artist's career, their music, their social presence through an organization that has a global and local footprint literally around the globe can't be underestimated. There are tens of thousands of tracks that are uploaded every day to streaming services around the world. Literally tens of thousands of tracks. The number probably now is somewhere between a 500,00 to three quarters of a million tracks a week that are being uploaded. The value a label brings to an artist is the ability to help them cut through the noise of a 500,000 or three quarters of a million tracks and separate their music and their career from literally all of this noise. When you look at really well-established, tremendous global superstars, all of whom have had the opportunity to pivot away from labels, utilize the digital tools available, and go solo, so to speak, by way of moving their career along, virtually none of them have taken that decision to pivot away from the labels. At the end of the day, it is not that easy to separate the really great music and the great artists without an organization such as ours behind them. It is really hard work. When we enter into these partnerships or we have these long-term arrangements with our artists, they are arrangements that are mutually beneficial, where the artist sees the value that we bring, and we see the genius and the greatness in these artists so that it allows with an enormous amount of enthusiasm and our own creativity to get behind these artists, and they see the value that we bring to them in their careers. It's a mutually symbiotic relationship, Michael. Great. Thank you both. Appreciate it. Thanks, Michael. Our next question comes from Meghan with Credit Suisse. Your line is open. Hi. Good morning, guys. I wanted to talk about the emerging platform revenue line. You've given us the number for recorded music. How much would including music publishing increase this run rate? Facebook, I think, announced that they are going to be spending $1 billion on creators. I wanted to know what you think music is going to be as a percentage of that spend. Thanks. Okay. Well, I'll take the first one, Meghan. Nice speaking, Meghan. Obviously we don't release the publishing number. I think you can look at relative proportions of recorded music and publishing digital revenue and get a general feel. If recorded music is, call it, five-ish times what the size of revenue of digital revenue than publishing, plus or minus ballpark, that'll logically lead to what the emerging streaming platforms will be in publishing. What I would say is on publishing, we don't release the number, but we're just as active in developing relationships with these platforms and helping support their growth, but also being a partner in helping lead the way in helping innovative platforms get launched, find traction, and hopefully generate long-term sustainable business models and licenses with both recorded music and publishing. Steve, do you want to discuss the Facebook side? Sure. Hi, Meghan. You're right. Facebook has announced that they are going to be focusing on investments in creators. This is a response to what they see other platforms, YouTube and TikTok doing. While I won't venture a guess at any specific number, what I would point out is when you look at the platforms that Facebook wants to compete against, when you look at other changes that they have initiated recently, by way of example, Instagram Reels, what they're doing is responding to different use cases for short-form video, most of which, not all, but most of which include the utilization of music. What we would expect to see is that whatever the specifics are by way of how they channel that $1 billion to creators, those creators, in the main, will utilize in some way, shape, or form music. They will continue to amplify the use cases and the growth of the music ecosphere. I would expect that we, along with the creators, songwriters, music publishers, and other labels will be in many ways beneficiaries of that additional spend maybe. Okay, congrats guys on Megan Thee Stallion, the other Megan, getting the Sports Illustrated cover. That was pretty cool. Thank you, Meghan. Our next question comes from Benjamin Swinburne with Morgan Stanley. Your line is open. Thanks. Good morning. Eric, if I look at the first nine months of the year, at least on an OIBDA basis, margins are up, I think 200 basis points year-over-year. You guys are tracking nicely to this 20%+ number. Just can you talk about your confidence in margin expansion looking out over the next several years? Do you see anything that derails at least the trend line? If you want to talk numbers, feel free, but I figure you probably won't. Steve, just on the M&A front, you guys continue to acquire not just labels, but also technology assets and other things. Can you remind us of how you're thinking about deploying cash flow as we move into 2022 and 2023? Because your leverage is coming down, and I don't think the company is looking to delever. Just remind us what your M&A strategy and where your focus is. Thank you. Sure. I'll take the first one first, so on margins, and good to hear from you, Ben. Yeah, look, when we went public, which is just 13 months ago, we said three, four years out, kind of 2023, 2024, 2025 timeframe, we expected low to mid, really we said low 20s. As we're now a year out, we're already low 20s margin, and there are a couple of factors. One is executing on the plans that we had laid out, continuing to work on cost containment, whether it's through our technology innovation and automations and efficiency programs. We also have our financial transformation, which will be going live in the next year with the bulk of the savings commencing in fiscal 2023. Continuing to gain leverage on scale as we continue to grow our revenue and gross margin faster than we're growing our underlying cost base. Over time, we would say the shift from physical to streaming, although this quarter, the physical result was obviously up substantially. For this quarter, that doesn't quite hold. We continue to believe that on a long-term basis, continuing to improve our margins above where they are now into the mid-20s is reasonable, and where we're heading. However, we will say in the short term, as we recover from COVID, and specifically when concert touring comes back, our concert promotion businesses and our tour merch businesses, which are the two businesses that haven't recovered yet, are some of our lower margin businesses. As those recover, we could expect to see some moderation in the growth in margins in the short term. Long term, all the fundamentals are in place for continued growth of margin from here forward. We continue to focus on that as a key business driver, both in terms of efficiency in our business and scale. Thanks, Ben. Steve, I'll hand it to you on the next question. Thanks, Eric. Ben, first of all, on our M&A strategy and our free cash flow deployment. First of all, as a broad envelope, we are very disciplined with respect to our investment strategy, which includes M&A. Whenever we do anything, when we look at A&R, when we do M&A, financial discipline and thoughtful financial metrics always guide our decisions. You can see this frankly materialize when you look at our conversion from OIBDA, EBITDA to cash flow. It becomes evident that we remained very disciplined. Relative to our specific strategies, we plan on continuing to invest both organically and through M&A in our core business and expanding our global footprint. We continue to invest in both our own technological capabilities as well as into third-party technological capabilities. In those third-party investments, not only through commercial relationships, but these investments work with them to define how we move our music into broadly diversified revenue streams. That will continue to also be a priority for us. Core music business, diversified revenue streams, and future-proofing us by both internally and externally investments in new technology. When it comes to our free cash flow, you're right, we have no intention at the moment to pay down debt. With the full support of our board, we look first at reinvesting in our business, both with respect to organic as well as M&A opportunities. Secondly, to repatriate to our shareholders excess cash through dividends and presumably over time through modest dividend growth. If and when we run out of opportunities to invest or to repatriate to shareholders, we'll then look to debt reduction. I don't see that in the near future. Thank you both. Thanks, Ben. Our next question comes from Tim Nollen with Macquarie. Your line is open. Oh, thanks very much. I'd like to pick up on this discussion about the new technologies and opportunities. Last earnings call, we spoke for the first time about Wave and about Genies and about Dapper Labs. Now you're introducing this concept of this virtual idol, and I'm just curious, no pun intended, but how real is that? How much of a Chinese-specific opportunity is it? How well-positioned are you to benefit from any growth there? Could that be something that takes hold outside of China or Asia? Thanks. Well, Tim, I think that it's already taken hold, or it's certainly approaching taking a hold, not only in China, Japan, other Asian countries, but globally. When you look at social gaming and these metaverses, we are already talking about dealing in the virtual world, where people have their own avatars. They have their own communities in these virtual worlds. And these virtual worlds reflect who people either are or they want to be between the real world. Creating virtual-only beings is not an illogical next step. While this has been predominantly the domain of certain Asian countries, the wonderful thing about it is you can create these characters, and you can create a tremendous fan base relative to these characters. I'll give you something that's a bit analogous, even though it's not quite all in the digital format. When you watch a Marvel movie, you're talking about characters that don't exist in real life, and you're talking about computer-generated imaging that doesn't exist in real life. Yet when you look at the success of these characters, you look at the success of Marvel, you look at the success of many of the soundtracks, which in many cases we provide, and you look at the fan base for these characters. Being able to do this in a virtual world is really not a massive step, Tim. It's a step where we're determined to lead the crossovers of these virtual beings into the world of music. I don't think it's a flash in the pan. I think it's here to stay, and not only do I think it's here to stay, I think it's here to grow. Hopefully, that answers your questions. That's great. Thanks very much. Thank you. Our next question comes from Kannan Venkateshwar with Barclays. Your line is open. Thank you. I apologize if this has been asked already. I joined a little bit late. On the M&A side, I guess a slightly different aspect of what's going on in the industry is just the catalog acquisitions. Part of it seems to be a function of where rates are, but is there an opportunity for you guys to potentially look at monetizing that to drive a higher multiple? Because today you don't seem to get the credit for that side of the business compared to what some of these transactions are doing in the marketplace. Is there an opportunity for you guys to think about that business slightly differently? Thanks. Eric, let me take the first part, then you can take the second part. I'm sorry, I didn't catch your name. This is Kannan from Barclays. Okay. I'm on a cell phone, so it's still difficult. Let me give you kind of a top view, and then Eric will give you from a financial perspective. From kind of an overview, when you look at some of these multiples, to us it looks like a movement of capital from fixed income to what people believe is a sexier form of fixed income. Many of these financial players are buying assets with no organization or no capability to activate those assets. We also agree with your observation. It may be a function of rate, but what we don't see is us turning into asset managers and moving away from being a proactive music entertainment company. We're looking to the long term and our long-term growth. While it's always possible if our shareholders and board desired to package certain assets and continue to manage them, but frankly, we do that already. You're right, while we don't trade at a 30x or 35x multiple, when you think about buying assets at that multiple and not having an organization to not only activate but turbocharge the cash flow attributable to those assets, from our perspective, that just seems not like a business that we're inclined to be in at the moment. Eric, do you want to add to that? Yeah. I would just supplement that with a few quick things. One is we have been active this year in acquiring music rights, both in the recorded and the publishing side. We announced earlier this year that we acquired for $338 million assets with a run rate OIBDA of $37 million. We've done other deals throughout the year as well. We are always financially disciplined. We are not looking to compete at the highest price for the sake of competing. We look at assets that are accretive to our business. As Steve said, we are always looking for assets where we can drive incremental value, whether the opportunities are in re-energizing and re-releasing masters catalog, looking to improve sync opportunities. When we put it all together, we think we've found an effective array of assets to acquire this year that we've been able to put to work, as Steve said, and generate even higher revenue and returns. We'll continue to look for opportunities in the market that meet our criteria, but we will always apply our same financial discipline to it, Kannan. Thank you both. Thank you. Thank you. This concludes the questioning session. I would now like to turn the call back over to Steve Cooper for closing remarks. Again, I want to thank everybody for taking the time to join us today. Please look for our future announcements as I mentioned during the presentation part of the call. Please, everyone, continue to enjoy the summer, but stay safe because it really remains a crazy world. Thanks again. Speak to you soon. Bye-bye. This concludes today's conference call. Thank You for participating. You may now disconnect.