Reservoir Media's Q1 2026 Earnings Call: Unpacking Contradictions in Digital Revenue, M&A Strategy, and Expense Growth

Financial Performance and Growth:
- Reservoir Media reported revenue of $37.2 million for Q1 FY2026, an 8% increase year-over-year, with 5% organic growth.
- The growth was driven by healthy demand for the company's portfolio in Music Publishing and Recorded Music, and strategic acquisitions.

Recorded Music Segment Expansion:
- The Recorded Music segment saw an 8% increase in revenue to $10.4 million compared to Q1 FY2025.
- This increase was primarily due to the growth in Digital revenue from music streaming services and the acquisition of catalogs.

Music Publishing Revenue Trends:
- Music Publishing revenue increased by 4% to $24.9 million, driven by an increase in Synchronization revenue and other publishing revenue.
- The growth was partially offset by a decrease in performance revenue due to the timing of hit songs and decreased Digital revenue.

Immersive Entertainment Investment:
- Reservoir Media made an investment in London-based entertainment company, Lightroom, which develops and exhibits IP-led immersive entertainment experiences.
- This strategic investment diversifies the company's portfolio into the high-growth immersive entertainment vertical, unlocking additional value from its IP.

Acquisitions and Strategic Partnerships:
- The company furthered its commitment to expanding its Recorded Music segment with the acquisition of Fool's Gold Records and a partnership with Off Road Records.
- These moves reflect the company's focus on building and strengthening its Recorded Music platform with commercially relevant assets, championing the value and influence of independent music globally.