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2021-11-03

Q3 2021 revenues: very dynamic Q3 driven by Believe's attractivity to artists and labels, demonstrating Believe's strong digital platform model

Very dynamic Q3 driven by Believe’s attractivity to artists and labels
demonstrating Believe’s strong digital platform model

Revenue growth: +27% in Q3, +31% year-to-date
Organic revenue growth: +27% in Q3, +29% year-to-date
Digital sales growth: +30% in Q3, +33% in year-to-date
FY 2021 guidance uplifted with organic growth now anticipated at least at +27%

Paris, November 3, 2021 – Believe (Ticker: BLV, ISIN: FR0014003FE9), one of the world’s leading global digital music companies, published today its revenue for the third quarter of 2021.  

Denis Ladegaillerie, founder and CEO, said: “We are investing in people and technology to build the best development platform for artists in the digital music era. Our strong revenue growth in Q3 reflects significant market share gains driven by the revenue ramp-up of the investments we have made in the past 24 months. These gains once again demonstrate Believe’s attractivity to artists and labels at all stages of their career thanks to our digital DNA and digital marketing expertise. Our digital-first approach was key to successfully signing our staged acquisition in Play Two, the largest independent label in France. We also signed two partnerships in alignment with our objective to shape music for good.”

in € million Q3 2020 Q3 2021 Change YoY Organic change
Group Revenues 113 144 +27.1% +26.8%
Premium Solutions 105 135 +29.0% +28.8%
Automated Solutions 8 9 +2.6% +2.1%
in € million 9M 2020 9M 2021 Change YoY Organic
change
Group Revenues 309 404 +30.7% +28.9%
Premium Solutions 286 378 +32.2% +29.8%
Automated Solutions 23 26 +11.8% +17.4%

Key highlights

Q3 robust performance was driven by the unparalleled attractivity of Believe for artists and labels looking for digital solutions and expertise, at each stage of their development. For another quarter, digital sales outperformed the market as recent investment in local sales and marketing teams resulted in a record level of signings in the concerned countries. Believe has been able to deliver top quality services for all its artists and labels, at scale thanks to its unique model based on a central data-driven, scalable technology platform and strong local presence.

Aligned with its growth strategy based on increased investment in local sales and marketing, Believe reinforced its local management team in Russia and Eastern Europe adding key skills in digital and streaming services to prepare for the next phase of growth in a context of booming market trends. Russia and Eastern Europe have long been a high priority for the Group which was the first international music company to establish a local presence back in 2013.

The M&A transaction announced today is another illustration of the Group’s proven attractivity for independent labels, which see the benefits of the Group’s digital expertise to grow audiences of their artists. Believe entered in a strategic partnership with Play Two, a highly reputed and the 1st independent label in France and acquired 25% of the company, which is majority held by Group TF1, the French leading TV Group. This transaction underlines the Group’s M&A strategy, presented at the time of the IPO, which aims at reinforcing its footprint in key countries to accelerate revenue growth. The transaction is also allowing Believe to position on more diversified music genres such as pop for example, which are not yet fully digitized to benefit from the ramp up of their digital revenues.

Believe continued to strengthen its attractivity by accelerating digital innovation and developing best-in-class technology solutions. Believe continued to invest and innovate in building a suite of data-based and marketing automation solutions to support artists’ by helping them build efficient go-to-market strategies. In Q3, Believe strengthened its market differentiation by its investment in a SaaS media buying automation platform, a future-proof marketing solution to develop and engage audiences of artists and labels by automatically building and executing targeted media-buy marketing campaign. The Group has enriched an advertising platform and tailored it for the music industry to offer a unique multi-local solution from emerging to top artists and labels. The Group has deployed the solution in 12 countries so far. Believe also in-house developed an algorithmic technology which aims at predicting the virality of a track on TikTok. The algorithm classifies recommended tracks on various categories (emerging, rising, booming, top hits and sunsetters), which Believe can then use to alert its artists and labels to existing and emerging opportunities and implement digital strategies at the optimum time in order to grow their audience.

Overall, Believe further benefitted from the positive structural market trends combining acceleration of paid streaming penetration and diversifying monetization sources for music. The Group also took advantage of its solid market share in several fast-growing emerging markets (Turkey, China, India, Russia, Eastern Europe, Mexico, Brazil, …). Believe has been regularly the first international music companies to establish strong local presence in these markets. 

Believe continued to deploy its CSR strategy as a core objective to shape the music industry for the better. Believe also demonstrated during the quarter its commitment to shape the music for good by signing two key partnerships to promote parity in the music industry and to offer women greater access to tech companies. This includes a partnership with Key Change (global network working to reach full gender equality in the music industry) and a partnership with 50inTech (for a 50% representation of women in tech). This is fully aligned with its CSR pillar - Developing diverse and local talent in local markets first - which aims in priority at promoting gender equality in the music industry and positions Believe as an exemplary inclusive and responsible actor in the sector.

Revenues
Q3 2021 revenues grew by +27.1% to reach €144 million (versus €113 million in Q3 2020) mainly reflecting strong organic growth (+26.8%), with digital sales up +30.4%. Overall, the Group continued benefitting from the favourable structural trends in the digital music industry and from its positioning on the fastest growing markets strengthened by investment in local sales and marketing over the past 24 months. Revenue growth was mostly driven by gain of new artists and labels, expansion of services offering in key markets and by the roster’s performance.

Revenue growth in Q3 was stronger than anticipated due to market share gains above initial expectations in several key regions (Asia, Latin America and Europe). In addition, several emerging markets remained on fast-growth aligned with Q2 trends, which were supported by the recovery in ad-funded streaming services particularly affected by the Covid-19 pandemic in Q2 2020. Moreover, physical sales were slightly down during the quarter, while the Group expected a more pronounced decrease in line with the ongoing curtailing of physical heavy commercial contracts. As a result, revenues were up 30.7% year-over-year for the first nine months of 2021 reaching €404 million with digital sales up +32.6%, reflecting an organic growth of +28.9%.

Revenues by geography: growth in all geographies

Författare GlobeNewswire