Release Date: April 24, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Tips Music Ltd (BOM:532375, Financial) reported a 29% growth in revenue and a 31% growth in profit for the year 2025.
- The company has seen strong performance across digital platforms like YouTube, Spotify, and Meta, contributing to revenue growth.
- Tips Music Ltd (BOM:532375) has successfully extended its deal with Sony Music Publishing, adding YouTube as a platform for international publishing exploitation.
- The company plans to invest 25-28% of its revenue in new content acquisition for the financial year 2026, focusing on high-quality music content.
- The company has declared a cumulative interim dividend of INR 7 per share and a buyback for non-promoter shareholders, reflecting a payout ratio of around 82% for FY 2025.
Negative Points
- Content costs increased by 25% year-over-year due to significant releases in regional languages, impacting margins.
- Employee expenses included provisions for ex-gratia and variable pay, adding to the overall cost structure.
- The company faced challenges with the timing of revenue collection from deals, such as the Warner deal, affecting cash flow visibility.
- There is a competitive pressure in acquiring content, with producers charging more than expected, which could impact profitability.
- The company's operating margins for Q4 were lower at 47% compared to the annual average, indicating potential volatility in quarterly performance.
Q & A Highlights
Q: Could you quantify the revenue received from Warner in FY 2025?
A: The revenue from Warner is approximately 25% of our full-year revenue, which translates to around INR 70-80 crores. - Unidentified_3
Q: Why was the collection from Warner lower in H2 compared to H1?
A: The collection varies due to timing differences in deals and payments. Some deals are made in advance, and payments may come later, so it's not consistent on a quarterly basis. - Unidentified_3
Q: What is the expected content cost for the next year, and how does it relate to revenue?
A: We plan to invest 25-28% of our revenue in content acquisition, which could be in the range of INR 95 to 120 crores. - Unidentified_3
Q: Can you provide guidance on the growth outlook for the next year?
A: We are targeting a 30% growth in both top-line and bottom-line, driven by new releases and strong catalog performance. - Unidentified_3
Q: How is the landscape evolving with increased paid subscriptions on platforms like Spotify and YouTube?
A: Paid subscriptions are increasing as platforms push consumers towards paid models, which is promising for the industry. - Unidentified_4
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
