Welcome to Warner Music Group's first quarter earnings call for the period ended December 31st, 2022. 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 first 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 Robert Kyncl and our CFO Eric Levin, who will take you through our results, and 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 includes 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 and in our 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's a 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 Robert. Thank you, Kareem. Good morning, everyone. I'm pleased to be here speaking with all of you for my first earnings call at Warner Music Group. I've been on the job for five weeks, and I'm grateful to our board of directors and our employees, artists, and songwriters for giving me such a warm welcome. I would especially like to thank my predecessor, Steve Cooper, for everything he's done to position the company for long-term success and for all his insights as I've been getting up to speed. Thanks also to you, our valued shareholders, and everyone who follows the company for your continued support. Let's get into Q1 results. I am committed to maintaining straightforward and consistent communication with the investor community. In that spirit, I want to immediately and clearly acknowledge that this was a tough quarter. Like most companies, WMG has been dealing with macroeconomic headwinds and the impact of currency exchange rates. It's important to note that last year's Q1 included an extra week of reporting. As a result, this quarter's comparisons need to be adjusted to provide an accurate picture, and I'll be discussing our results in that context. Eric will give you more detail. Here are the headlines. Total revenue in Q1 grew 2% and adjusted OIBDA increased 13% with 210 basis points of margin improvement. Recorded music revenue was flat as the strength of our global performance was offset by a softer quarter in the U.S. We had a tough comparison with the prior year quarter, which included releases from some of our superstar artists. We're expecting a stronger release schedule in the back half of the fiscal year, which will feature new music from Ed Sheeran, Cardi B, David Guetta, Aya Nakamura, and Bebe Rexha. Music publishing had another strong quarter with revenue growth of 14%. Our operating cash flow growth was healthy despite some of our revenue lines coming under pressure. This further underscores our disciplined fiscal management as we navigate this challenging business environment. I'd like to spend some time on this call proactively addressing two questions that I've often been asked, specifically why I chose to go into the music business and why I joined the Warner Music Group after 12 years at YouTube and seven years at Netflix. YouTube thrives at the intersection of creators and technology, which means that I had many options to choose from in planning my next chapter. I chose music, first and foremost because everyone loves music, including me. It's embraced by 100% of global population. In an increasingly digital world, music makes people feel. It brings them joy, hope, and comfort. Plus, in an increasingly divided world, music brings people together. That engagement is very powerful and valuable, and we expect the evolution of monetization models to reflect that. On top of that, music's global appeal is matched by its ubiquity. This industry has achieved something rare. It's built mutually beneficial long-term partnerships with many of the world's biggest companies, Amazon, Apple, Google, Meta, Spotify, and Tencent, among them. As successful as music has become, there is still meaningful upside ahead for three reasons. One, as technology opens up emerging economies, the industry's addressable market will continue to expand even further. Two, innovation is constantly creating new use cases for music, giving us the opportunity to diversify our revenue sources. Music is still undervalued, especially when compared to other forms of entertainment, like video. I'd like to expand a bit on that last point. Since 2011, the subscription price of Netflix's standard service has roughly doubled. Data shows that almost 80% of U.S. households subscribe to at least 3 streaming video services. This means that the average household is spending more than 4x per month on a combination of digital video services that isn't even a comprehensive offer. In contrast, the price of a music subscription has stayed the same since streaming was introduced over a decade ago. Most consumers subscribe to a single service that carries virtually all the music ever released. Against this backdrop, it's encouraging that we're seeing first steps in the right direction by Apple, Deezer, and Amazon. The other question I often get asked is, why WMG? First and foremost, it's the artists and songwriters and powerful catalog that are the lifeblood of this company, and it's such a pleasure to bring this creative work to fans around the world. The new generations of stars like Lizzo, Dua Lipa, and Aya Nakamura, global superstars such as Ed Sheeran, Bruno Mars, Coldplay, and Neil Young, songwriters and composers like Lin-Manuel Miranda, Gamble and Huff, and John Williams, and legends such as John Coltrane, Led Zeppelin, Aretha Franklin, and Prince. Second, it's the people at WMG. This company has a consistent decades-long history of finding and developing unique voices that change culture globally. In an increasingly complex and cluttered world, that originality is an essential ingredient of our success. Third is about size. WMG is big enough to drive meaningful change in the industry, but small enough to have plenty of room for growth. As just one example, the company has been taking a thoughtful approach to global expansion. WMG has made well-timed moves that leapfrog the competition in dynamic, fast-growing markets such as China and the Middle East. This approach has also delivered record-breaking global firsts with artists like Anitta from Brazil, Paulo Londra from Argentina, King from India, and CKay from Nigeria. I wanted to briefly address what we're doing to architect the next phase of growth. I'm only five weeks in, but I've been very intentional about how we've gone about this. I made two significant appointments, both of which tell you something about our priorities going forward. I hired Tim Matusch, my former colleague at YouTube, as our new EVP of Strategy & Operations, which is a new role at WMG. Tim will be critical to facilitating our strategic vision and ensuring its operational execution. I also hired Ariel Bardin as our President of Technology. Ariel's career includes 16 years at Google, where he built, launched, and led some of the company's most successful products, including YouTube's creator tools, memberships, and Content ID. He will drive the development of the systems, infrastructure, and products needed to support our growth. As I said, I'm committed to clear and straightforward communication on our progress. I also want you to know I'm a big believer that actions speak louder than words, and I'm laser-focused on execution. Right now, I'm working with leaders across the company to develop our plans for the future. We're already exploring some exciting ideas and initiatives, and we will provide you with updates as soon as appropriate. That said, many of the fundamentals will remain the same. The foundations of this company are very strong, and the music industry is rich with opportunities. We will continue to invest in new artists and songwriters, our catalog, and our global expansion. At the same time, we plan to thoughtfully reallocate some resources to accelerate how we use technology and data to empower artists and songwriters, as well as drive greater efficiency in our business. As subscription revenue continues to grow, as Spotify recovers, and we explore the possibilities of new technologies and business models, it's essential we structure our deals smartly and strategically. I am approaching this next phase of growth with the unique benefit of having been on both sides of the table. I am proud that over the last five years at YouTube, we developed a very collaborative, mutually beneficial relationship with the music industry after years of rocky roads. I plan on bringing the same approach to WMG and the industry so that our interests are aligned with our partners and that our artists and songwriters gain maximum participation and monetization. Now I'll pass it over to Eric, who will take you through our results, and then we'll answer your questions. Thank you, Robert, and good morning, everyone. As Robert mentioned, our year-over-year comparisons should take into account the impact of the extra week in fiscal Q1 2022. Adjusting for the extra week, we delivered growth across key metrics, including revenue, adjusted OIBDA, and adjusted OIBDA margin. Additionally, we saw strong operating cash flow growth and strong cash conversion as a percentage of adjusted OIBDA despite a challenging macro environment. Total revenue declined 2.7% but increased 2% when adjusted for the impact of the extra week. Adjusted OIBDA was flat and increased 12.8% when adjusted for the extra week. Adjusted OIBDA margin was 22.5% compared to 21.9% in the prior year quarter. Adjusting for the extra week, margin increased 210 basis points. These increases were primarily due to disciplined operating performance and the impact of currency exchange rates. Recorded music revenue declined 5.6%, but was roughly flat when adjusting for the impact of the extra week. Streaming revenue decreased by 2.6%. After adjusting for the extra week, streaming revenue grew by 5% as subscription streaming revenue grew by high single digits and was partially offset by ad-supported revenue declining in the mid-teens. Physical revenue declined 27%. Adjusting for the extra week, physical declined 22%. Our streaming and physical results reflect the lighter release schedule we had this quarter compared with the prior year period, which included releases from Ed Sheeran and Coldplay. Artist services and expanded rights revenue decreased by 4% due to macroeconomic pressures affecting our EMP business and lower advertising revenue. Licensing increased 17% due to an increase in broadcast fees, synchronization, and other third-party licensing. Recorded music adjusted OIBDA decreased by 6% with margin of 24.1%, which was roughly flat compared to the prior year quarter. Excluding the impact of the extra week, adjusted OIBDA grew 7% and the margin improvement was approximately 150 basis points. This was driven by disciplined operating performance and the favorable impact of currency exchange rates. Music publishing continues to deliver strong results, posting 14% growth, driven by strength across digital, performance, and mechanical. Digital revenue grew 16%, reflecting growth in streaming, which increased 17%, driven by continued growth in streaming services and timing of new digital deals. Performance revenue increased by 29% due to continued growth from bars, restaurants, concerts, and live events. Mechanical revenue increased by 17% due to growth in France. Sync revenue decreased by 5% due to lower commercial licensing activity in the U.S. and the timing of legal settlements. Music publishing adjusted OIBDA increased 36% to $72 million, with margin increasing 460 basis points driven by strong operating performance and the favorable impact of currency exchange rates. Q1 CapEx decreased to $21 million as compared to $34 million in the prior-year quarter, mainly due to lower facilities investments. We anticipate some acceleration in the coming quarters, driven by IT infrastructure, facilities, and financial transformation investments. Our financial transformation program remains on track to meaningfully roll out in fiscal 2024 and expand globally in the following years. The program is expected to deliver annualized run rate savings of $35 million-$40 million once fully implemented. Operating and free cash flow growth and conversion were robust in Q1. Operating cash flow increased 62% to $209 million from $129 million in the prior year quarter. Free cash flow increased 98% to $188 million from $95 million in the prior year quarter. Operating cash flow conversion was 62% in Q1. The strong performance was driven by the timing of working capital items. While working capital will fluctuate from quarter to quarter, our goal remains to deliver a conversion rate of 50%-60% over a multi-year period. As of December 31, we had a cash balance of $720 million, total debt of $3.9 billion, and net debt of $3.2 billion. Our weighted average cost of debt is 3.7%, and our nearest maturity date is in 2028. As we look ahead to the rest of the year, our goal is to release amazing new music from our talented roster of artists and songwriters. While some of the macro and release schedule-driven pressures we saw in Q1 will impact Q2, our slate in the back half of fiscal 2023 is strong, featuring releases from some of our biggest stars, as well as our next generation of talent from across the globe. There's no question that our industry is feeling the impacts of the macroeconomic environment. From currency fluctuations and a dislocated ad market to the short-term choppiness inherent in our business, there are a number of variables that can obscure our underlying health. However, our resilience through challenging times has been proven, and we remain confident in our future growth. Against that backdrop, we are resolved to capitalize on the powerful tailwinds that will drive our company forward. Thank you to everyone for joining us today, and we'll now open the call for questions. Thank you. As a reminder to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question will come from Benjamin Black from Deutsche Bank. Your line is open. Good morning, and thanks for taking my question. Robert, I know you've only been in this seat for about a month now, but can you touch on where you potentially see opportunity for improvement within the organization and where do you see potential for faster growth? Thank you. Yeah. I thank you for the question, Benjamin. Yeah, as you said yourself, I've been on the job for five weeks and have been digging in very quickly. Strategy at this point is in development, as I mentioned. I do, you know, I do have the benefit of understanding the industry from both sides, but to be honest, I am still calibrating this side, you know, due to my short tenure on this one. I'd like to have a little bit more time on that and in order to be thoughtful. Here's what I know, which is we'll very thoughtfully relocate resources to accelerate our technology investments and then, you know, to empower not only artists and songwriters, but also to drive efficiencies in the company. That is something that I can tell you now. I think my actions speak louder than words. I've already made two appointments in that direction in the 1st month with the hiring of Tim and Ariel. I think my goal is to accomplish all of that with continued focus on financial discipline and cost containment. Just to follow up, if I may, does that mean that you're planning to potentially cut costs? You know, we've seen cost cutting start to impact the music industry more broadly. We saw recent actions from Spotify, for example. Any view on cost containment more specifically? If so, which areas would you be cutting from? Yeah. One, the company has actually been much more measured in its headcount growth, for instance, over the last few years than others in the industry who are now undergoing, you know, significant layoffs. Two, you all are aware that there were cost transformation initiatives already underway for the last two to three years before any of these macroeconomic issues have emerged. There's been a lot of momentum on this that is probably putting us in slightly different position than others. Again, I'd like to reiterate that I'll be focusing on driving, you know, reallocating resources or internal resources in order to invest in technology and drive not only more tools for reach monetization for creators, but also greater efficiencies for us. Great. Thank you. Thank you. Our next question comes from Sebastiano Petti from JP Morgan. Your line is open. Hi. Thank you. Robert, I just one for Robert, one for Eric. Robert, are you concerned about the dilution of music from AI-generated content? Maybe, you know, just given your unique perspective, given some of your prior roles in media and tech. I'd love to hear your thoughts. For Eric, you touched on, you know, the margin expansion was, you know, driven just by a strong operating results, you know, well ahead of expectations. Wanted to see if maybe you could provide us a little bit of detail there, maybe unpack some of the underlying drivers in each segment that drove the robust margin expansion. Thank you. Yeah. Thank you, Sebastiano. One, I'd like to say that AI is probably one of the most transformative things that humanity has ever seen. It has so many different implications. Because of that, yes, I'm paying very close attention to it, and we across the company are. Two, there are many different ways to sort for the music industry as well as for other industries who own copyrighted material. It really falls into 4 buckets. One, which is, the use of existing copyrights to train generative AI. The second one is, sampling of existing copyrights as the basis for new and remixed AI content, AI-generated content. The use of AI to help and support creativity, so an assistive way to do that. Most importantly, find ways to protect the craft of artists and songwriters from being diluted or replaced by generating AI-generated content, which is what you mentioned. It's not just that question, it's all of these together that we as an industry, and I don't mean just the music industry, but overall sort of, copyright owners, need to work together with the AI platforms on. I wanna make sure that everybody understands that you don't have to be forward-looking in order to address this, which of course we are, but you can also look into today's world, which can benefit our position in the future where there's a lot of AI-generated content. t is tracking of content, identifying and tracking of content on consumption platforms that can appropriately identify copyright and remunerate copyright holders. Underpins all of this. Different platforms have different capabilities in this regard. Obviously, YouTube is most advanced with Content ID, something that Ariel has overseen. But, you know, there are others who lack in this department and need to work on that because in the AI future, this would be a serious deficiency. You will see us focusing on this quite a lot. Eric Thank you. Hi, Sebastiano. Margin expansion. Obviously this quarter, when you look at adjusted for the extra week, 210 basis points increase in margin is substantive. You know, we're proud of that. We focus on discipline management, discipline cost oversight and management. We can look at this quarter and see, for example, Warner Chappell had a 36% EBITDA increase, pretty extraordinary kind of growth from that line of business. We are not targeting 200 basis points of increase on a consistent basis. We are targeting margin expansion, generally on an annual basis. Not every year will be exactly the same, but half a point to one percentage point increase in margin is about what we look towards. Again, not every year is the same. This is an exceptional quarter for margin enhancement, but margin enhancement is part of our strategy for sure. Thank you, Sebastiano. Thank you. Thank you. Our next question will come from Benjamin Swinburne from Morgan Stanley. Your line is open. Morning, Robert. Nice meeting you over the phone, welcome. I wanted to ask you a bit more about your comments around music being undervalued. Obviously, that's been a long going debate in the industry between, you know, the labels and distributors. You know, given your seat on the other side of the negotiating table, I'd love to hear your thoughts on how do you affect that change in the industry from the CEO position at Warner Music Group? Obviously, you know, you don't get to dictate per se, the pricing of the DSPs and sort of what you can extract from players like TikTok. What do you think you can do, given your experience at YouTube, to accelerate the value capture at music? I just wanted to ask Eric, if I could have follow up. You said high single digit subscription streaming revenue, organically, I believe. Can that accelerate this year? Is that a new normal in your mind? That's obviously quite a bit lower than what we saw from Spotify, for example, on an organic basis in premium revenue. I think the market's a bit concerned that the major labels may be losing share. I'd love to get your thoughts on that. Thank you both. Thank you. One, you know, I made my comments. I think everyone's been sort of stuck in the conversation, sort of one-on-one relationship between, you know, content providers and the DSPs. I look at it more from a more macro level, that the space is generally undervalued. If you look at all the other indicators, how people pay for subscriptions and the price increases in various subscriptions, not just entertainment, it has been much more significant than it has been in music. I think that is something that we have to all be very mindful of. I can't really get into the tactics of how we would achieve that, but what I can tell you is that at YouTube, we've had a history of executing and delivering on our plans, and that is precisely what I plan to bring here. We've done so, at least in the last five to seven years, in an extremely collaborative manner. That is also something that I plan to bring here. I know I'm not giving you much of the specifics other than I have a history of getting things done and I have a history of being collaborative. I want the industry to grow for everyone and I believe this is the right path. Thank you. Ben, good talking to you. I would talk to our release schedule a little bit. As we said, our fiscal Q1 release schedule in the U.S. was a little bit of a softer schedule that could roll in and have some impact on Q2 as well. This year we have a second half fiscal 23, a second half-oriented release schedule. The strength of our release schedule tends to be more oriented this year towards the second half, and we think that will have a positive impact on streaming. If we just look back one quarter ago, you know, subscription streaming growth was in the teens, in the low teens area. Release schedule does have a couple point impact. We do think this has a fair amount to do with release schedule timing. Thank you both. Thanks, Ben. Thank you. Our next question will come from Rich Greenfield from LightShed Partners. Your line is open. Hi. Thanks for taking the question. Robert, it's great to have you on these calls. I'd love sort of your perspective on how important you think music is to TikTok's core product. Sort of a related question, when you were at YouTube, I remember how the labels, including Warner, pushed very aggressively for you to launch a subscription product in addition to sort of the marketing aspect of what YouTube did for music. I'm curious if you think the same thing in terms of the push for a subscription product will happen with TikTok? Thank you, Richard. It's great to hear from you. It's funny, having lived through that, we made the decision to launch subscription at YouTube because we were looking at the industry holistically. We had a fast-growing advertising business with free content to users, while at the same time, subscription was somewhat nascent for the industry. The industry really wanted us to invest into converting that large free user base into a paying user base. Obviously, you don't do it with, you know, all two billion users. You do it some fraction of it, and you create great audience segmentation strategy. That's exactly what we did. We decided that music is important to us forever, and therefore we should invest into it holistically. Obviously that also followed a further expansion into Shorts later on. You know, the platform has done an incredible job at delivering multiple formats, super short format with Shorts, AVOD and premium music videos, user-uploaded content, copyrighted, properly remunerated, and subscription as well as Live. When you look at that from the point of view of content owner and content provider, it's a phenomenal partnership and phenomenal platform. That's exactly what we decided to do. I think for TikTok, to go to the beginning of your question, well, let me also say we've looked at this question very closely, and we decided that it was important to us, and that's why we did it. TikTok needs to do that. It's the right decision for them to evaluate. You know, you can see from YouTube's execution what the results of the findings was for us, but I can't speak to what, you know, what TikTok obviously finds. Up to them. My answer is holistic relationship is what we're looking for. Thank you. Thank you. Our next question will come from Matthew Thornton from Truist Securities. Your line is open. Hey, good morning. Robert, welcome aboard. Eric, hope you are well. Maybe two, if I could, and they're related. First one, Eric, any update on emerging streaming and kinda how that trended in the quarter? Relatedly, as you think about fiscal '23, is there any way to think about or handicap whether we could get movement on the emerging streaming side, i.e., a new deal that would actually be material to kind of pushing that business up higher, and/or continued price increase momentum this year that could be material to the subscription streaming side of the business? Any way to think about that impact or potential impact in '23 would be very helpful. Thanks, guys. Sure. Good to hear from you, and appreciate the questions. As Eric, let me tackle these. They're more financially oriented. In this quarter, there were no, I'd say, significant renewals to note. Sequentially, emerging streaming was roughly flat. It's up about 20%, 20 some odd percent year-over-year, so up substantially year-over-year. Generally we have fixed fee deals, so it moves up as we renew deals with the current deal structures in place. Any movement on renewals? The second question. We don't specifically talk about individual deals and deal timing. What we have said is that we have a series of deals we did in the 2021 timeframe, and most of our deals in emerging streaming tend to be two to three years in length. Meaning that within fiscal 2023, there certainly will be discussions about new deals. When exactly those close and what form, whether they're continue to be fixed fee or portions of them are variable is to be seen. We will keep you guys apprised as deals are renewed and they impact the category. That is something where there'll be discussions ongoing throughout the year with some of our partners. On subscription price increases, there have been some meaningful players and partners that have announced price increases and increased prices already. Apple, Amazon, Deezer, we're pleased to see that. Again, we don't talk about individual deals, but generally we say with our largest subscription partners, our deals tend to be variable, and those will have, those will obviously, price increases will have a positive impact on growth. In future quarters, those will be rolling through the subscription revenue numbers, and we expect that to be a positive to the subscription growth kind of story this year. Thank you, Matthew. Appreciate it. Thank you. Our next question will come from Michael Morris from Guggenheim Securities. Your line is open. Thank you. Good morning, guys. I have two questions, I think, for Robert. My first is your comments about technology and innovation, new use cases, and these appointments that you've made. It seems that that element of the growth has largely been dependent on innovation from outside of the company, and your participation there. Do you see areas to incrementally invest on the technology side and maybe bring any of those growth drivers in-house? I'd be curious what you think on that. My second question is about streaming share. You know, Spotify reported their annual results recently and indicated that the share of streams attributed to major labels had again declined by another couple hundred basis points. I'm curious how you view that information, whether you see that as sort of pervasive across your DSP partner relationships. What do you think it means, and how do you address that going forward? Thank you. Sure. Thank you. There's no question that technology will underpin everything we do, whether it's growth or whether it's efficiencies. It's important that we invest into it, and that's what we're doing. It's a little too early for me to describe exactly what we'll do in that regard, but I think it gives you know, investing into it gives you the optionality to do that, when we have the investment capital and can deploy it against it. I think the only dilution question, I think it's, you know, it's something that you've been seeing all along. It's obviously something I keep an eye on, but I sort of consider this a fair game. You know, these are platforms where content providers are uploading content, and we have to do a great job and having a robust catalog, b, more great artists that are gaining meaningful share, and we have to do a great job at that. The onus is on us. That's right, Robert. I would tack on to that, Michael, that, you know, we obviously release music that we A&R and market ourselves, but we also have a significant business that is licensing and distributing indie music. We're constantly expanding our business globally to additional territories. Sometimes that involves acquiring, or licensing music or partnering with local independent players. The independent as well as the major part of the business are both part of the business we participate in robustly, and it's part of our strategy to make sure we're playing into the significant growth areas of the global music market. Thank you for that. Eric, if I could just follow up because I think that's an important point. I don't know if you can help quantify or help us with that, but do you think then that that data sort of from Spotify, and I don't mean to just pick them, but you know, that as an example, is sort of underestimating your actual participation because of your share of the indie side as well? Well, I don't wanna kind of respond to an individual platform because we literally have hundreds of digital platforms that we're licensed to. It's a portfolio, some of whom are global, some of whom are local, some of who are subscriptions, some of whom are ad-supported, some are socially oriented. It is our job to, one, the first thing is that the consumption of music across platforms globally, digital consumption continues to grow. That means that there's additional opportunities for us to license and monetize music. It's our job not just to look at one platform, but to look at different platforms and different territories and develop a strategy to drive growth. It's our job to look at the different ways music is created and released and figure out the right strategy to participate in those. For us, it's kind of a multilayered, multi-tiered, strategy, and we believe that positions us well for continued strong growth. Thank you very much. Thanks, Michael. Appreciate it. Thank you. Our next question comes from Kutgun Maral from RBC Capital Markets. Your line is open. Good morning. Thanks for taking the question. I wanted to follow up on the recorded music subscription revenue discussion from earlier, just because it has been a major area of debate. Eric, I know you talked about the impact of the release slate and content physicality and how that could cause a couple hundred basis points of volatility here and there. The magnitude of the deceleration from Q4 to Q1 was perhaps at the upper end of that, maybe even greater, thinking through some benefits from the Apple Music price increase. There's just this broader concern that there's something else going on beyond just market share shifts. I wanted to confirm your views and maybe get a read on whether the Q1 growth rate of high single digits is maybe an appropriate benchmark for Q2 ahead of your stronger back half release schedule. Thank you. Thank you. I would say two things that affect streaming growth overall, one of which is release slate. The second one is we did see an additional slowdown in ad-supported streaming. We should spend a moment on that. Given the kind of dislocations or challenges in the macroeconomy, we are seeing ad-supported streaming continue to slow down and decelerate, actually decline versus prior year. The decline is getting more pronounced. We have not seen it hit a floor or start to rebound. We're still seeing continued worsening in the ad-supported market. On the subscription side, you know, we have looked at this and, you know, we did have a softer, largely U.S.-based release schedule this quarter, and we do think that is what is driving the slowdown in this quarter, could roll into our fiscal Q2. Given our release schedule is second half-oriented this year, we do feel good about our performance and of releases and strength for the second half of the year. Great. Thanks, Eric. Thanks, you. Thank you. Our last question will come from Stephen Laszczyk from Goldman Sachs. Your line is open. Hey, great. Good morning. Thanks for taking the question. Maybe just a follow-up on that last ad-supported question. Eric, could you remind us what portion of your total streaming revenues are driven by ad-supported, excluding the emerging deals? You know, to what extent there might be any timing differences in those revenues versus what we see out of the likes of Spotify or YouTube? There shouldn't be a meaningful timing difference. I think that it is in the 10s kind of streaming revenue, call it low 10s or maybe even, you know, up, you know, kind of 12, 13, you know, kind of low 10s kind of area. We've seen a deceleration there shouldn't really be a meaningful timing difference what others are seeing in the market. Got it. Thanks for that. Maybe just one on sync. Could you maybe talk a little bit more about the types of conversations your team is having with your sync partners, maybe how much visibility they have into the pace of content creation or ad spend this year, and maybe how that's trending compared to, you know, what we've seen in years past? Thank you. It is, if what you're getting to, Steven, is the slowdown in the ad markets affecting sync growth trends. The answer is to a degree, yes. We have seen that there is definitely an impact in the commercial/advertising markets. That growth has slowed in that category. Although our sync teams are still seeing a lot of opportunities and potential for growth in film, TV and other categories, as well as global sync, non-U.S.-based sync. Last year we saw sync in both recorded and publishing growing in the, you know, kind of 20% range year-over-year. Those numbers were pretty extraordinary, partly based on our new technologies we've rolled out, enhancing our teams and our proactivity in those markets. We do see, certainly in this quarter, a somewhat softer market for sync. We are managing that revenue line in both recorded and publishing for continued growth. It is more challenging market, and our team certainly is targeting the areas that are more active and vital for critical syncs. The commercial ad market is one they are seeing a degree of softness. Great. Thank you very much. Thanks, Steven. Greatly appreciated. Thank you. I am showing no further questions from our phone lines. I'd like to turn the conference back over to Robert Kyncl for any closing remarks. All right. Thank you everyone for dialing in, asking questions and continuing to be interested in our business. I look forward to speaking with you frequently. As I get up to speed, obviously continue to share more and more information in a very straightforward and transparent manner. Thank you very much. Have a great day. Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.