Spotting Winners: Warner Music Group (NASDAQ:WMG) And Media Stocks In Q3

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As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the media industry, including Warner Music Group and its peers.

The advent of the internet changed how shows, films, music, and overall information flow. As a result, many media companies now face secular headwinds as attention shifts online. Some have made concerted efforts to adapt by introducing digital subscriptions, podcasts, and streaming platforms. Time will tell if their strategies succeed and which companies will emerge as the long-term winners.

The 7 media stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 1.4%.

While some media stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.9% since the latest earnings results.

Warner Music Group

Launching the careers of legendary artists like Frank Sinatra, Warner Music Group is a music company managing a diverse portfolio of artists, recordings, and music publishing services worldwide.

Warner Music Group reported revenues of $1.87 billion, up 14.6% year on year. This print exceeded analysts’ expectations by 10.8%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS estimates and an impressive beat of analysts’ revenue estimates.

"With our artists and songwriters hotter than ever, market share gains drove our quarterly revenues to an all-time high,” said Robert Kyncl, CEO, Warner Music Group.

Warner Music Group achieved the biggest analyst estimates beat and fastest revenue growth of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 8.7% since reporting and currently trades at $27.85.

Is now the time to buy Warner Music Group? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: fuboTV

Originally launched as a soccer streaming platform, fuboTV is a video streaming service specializing in live sports, news, and entertainment content.

fuboTV reported revenues of $377.2 million, down 2.3% year on year, outperforming analysts’ expectations by 4.9%. The business had a stunning quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 23.9% since reporting. It currently trades at $2.88.

Is now the time to buy fuboTV? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Scholastic

Creator of the legendary Scholastic Book Fair, Scholastic is an international company specializing in children's publishing, education, and media services.

Scholastic reported revenues of $225.6 million, down 4.9% year on year, falling short of analysts’ expectations by 5.6%. It was a slower quarter as it posted a significant miss of analysts’ revenue estimates and a significant miss of analysts’ EPS estimates.

Scholastic delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 8.8% since the results and currently trades at $29.38.

Read our full analysis of Scholastic’s results here.

News Corp

Established in 2013 after a restructuring, News Corp is a multinational conglomerate known for its news publishing, broadcasting, digital media, and book publishing.

News Corp reported revenues of $2.14 billion, up 2.3% year on year. This number topped analysts’ expectations by 2%. It was a strong quarter as it also put up a beat of analysts’ EPS estimates and a decent beat of analysts’ adjusted operating income estimates.

The stock is up 1.9% since reporting and currently trades at $25.56.

Read our full, actionable report on News Corp here, it’s free for active Edge members.

Warner Bros. Discovery

Formed from the merger of WarnerMedia and Discovery, Warner Bros. Discovery is a multinational media and entertainment company, offering television networks, streaming services, and film and television production.

Warner Bros. Discovery reported revenues of $9.05 billion, down 6% year on year. This result lagged analysts' expectations by 1.9%. Zooming out, it was a mixed quarter as it also recorded a solid beat of analysts’ adjusted operating income estimates but a miss of analysts’ Content revenue estimates.

Warner Bros. Discovery had the slowest revenue growth among its peers. The stock is up 6.7% since reporting and currently trades at $24.45.

Read our full, actionable report on Warner Bros. Discovery here, it’s free for active Edge members.

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Dow Jones jumps 400 points as rate cut hopes rise; US Dollar falls most in three months

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US markets continued their recovery from Monday's fall, ending higher for the second day running, as private payrolls data further strengthened the case for a Fed rate cut next week.

The Dow Jones ended over 400 points higher and at the day's high. The S&P 500 and Nasdaq, although closing in the green, underperformed the Dow. Barring Alphabet, all constituents of the Magnificent Seven ended lower. Microsoft led the fall with a 2.5% drop on reports of soft demand for some of its AI products, which the company went on to deny.

Private Payrolls data released by the ADP showed a surprise drop of 32,000 jobs in November, the most since early-2023. Projections ranged from an addition of 10,000 to as high as 40,000. This is the fourth instance in the last six months that private payrolls have seen a negative number.

On the other hand, the US services sector remained stable, with the Services PMI for November at 52.6, the highest in nine months. A reading above 50 indicates expansion. Prices paid for services and materials also showed the slowest growth in seven months.

While the labor market is showing signs of deterioration, the retail industry continues to remain robust. Apparel manufacturer American Eagle jumped 15% on Wednesday after its earnings beat expectations and the company also raised its full-year forecast, stating that the holiday season is off to a strong start.

Despite the mixed macro picture, the odds of the FOMC cutting rates next week remain at 89%, according to the CME FedWatch. Most experts are off the view that the Fed will indeed cut rates in its final meeting of the year, but that cut will be a hawkish one. What also makes this meeting important is that the central bank may give its economic projections for 2026.

The US Dollar Index, on rising hopes of a rate cut and the rally in equities, fell the most since September, declining below the mark of 99. Gold prices remain above $4,200 an ounce, while Silver also remained steady, near record high levels of $60.

Trade Deficit, initial jobless claims for the week gone by, are some of the macro data points scheduled to be reported later this evening.

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Why Paramount (PSKY) Stock Is Down Today

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+6.45%

Apollo Global Management

+1.01%

What Happened?

Shares of multinational media and entertainment corporation Paramount (NASDAQ:PARA) fell 5.4% in the morning session after reports surfaced that the company submitted a cash bid for Warner Bros. Discovery, an offer that was met with caution amid negative analyst sentiment.

The stock's decline occurred despite news of the major acquisition attempt. Wall Street analysts expressed a bearish outlook, with one consensus rating of 'Sell' and another of 'Moderate Sell.' The average price targets from analysts suggested potential decreases of 12.07% and 10.36% over the next year. Paramount's bid for Warner was reported to be a "100% cash" offer supported by debt financing from Apollo Global Management and Middle Eastern sovereign wealth funds. This reliance on debt may have concerned investors, especially when combined with the existing pessimistic analyst ratings.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Paramount? Access our full analysis report here.

What Is The Market Telling Us

Paramount’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 3 months ago when the stock gained 10.3% on the news that the latest Consumer Price Index (CPI) report came in largely as expected, reinforcing investor hopes for an upcoming Federal Reserve interest rate cut. Data from the Bureau of Labor Statistics showed headline inflation for August at a 2.9% annual rate, with core inflation, which excludes volatile food and energy prices, holding steady at 3.1%. While inflation remains above the Federal Reserve's target, Wall Street interpreted the figures as not being high enough to prevent a widely anticipated rate reduction at the central bank's meeting next week. Analysts note that the Fed's focus has shifted toward the risks of a cooling labor market. With this report being the last key data point before the meeting, the market's conviction for a rate cut strengthened, fueling a broad rally that pushed major U.S. stock indexes to record highs.

Paramount is up 41.8% since the beginning of the year, but at $15.00 per share, it is still trading 24% below its 52-week high of $19.73 from September 2025. Investors who bought $1,000 worth of Paramount’s shares 5 years ago would now be looking at an investment worth $409.98.

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