CD sales may be declining globally, but a prominent U.S. distributor and wholesaler of physical music media says its CD sales are up year-over-year thanks to the popularity of K-pop and Taylor Swift.
Headquartered in Florida Alliance Entertainment Said that its CD sales have increased Annual growth of 3.2% In the first half of 2024, due to increased demand for K-pop and “superstar sales,” including Taylor Swift. Alliance said the pop star’s new album, tortured poets departmentSell 1.1 million First week of CD release.
Total company CD sales $130 billion Sales for fiscal year 2024 ending June 30, 2024. $128 million during the previous fiscal year.
“Demand for physical music, particularly vinyl and CD sales, remains strong and we are excited about the major upcoming releases and opportunities in this space,” Alliance CEO said. Jeff Walker explain.
The surge in CD sales bucks a long-term trend that has seen vinyl records outsell CDs in recent years for the first time since the 1980s. While CD sales have been declining as consumers turn to music streaming, vinyl records are experiencing a renaissance as a music collectible.
According to data Recording Industry Association of Americatotal U.S. CD sales dropped to 37 million 2023, below 37.7 million the year before.
However, vinyl sales grew to 43.2 million By 2023, from 40.5 million the year before.
Alliance Entertainment’s vinyl sales grow Annual increase of 1.6% By fiscal year 2024, reach $329.3 million. Vinyl now accounts for 30% The company’s sales range from 20% four years ago.
The company reported total revenue of US$1.16 billion FY 2024, down 5% Since last year.
Still, the company’s revenue is well above where it was before the so-called “peak of the coronavirus” in fiscal 2021 and 2022.
Source: Alliance Entertainment
Despite the decline, the company’s gross profit improved and its adjusted EBITDA also improved due to efficiencies.
Gross profit reached $128.9 million FY 2024, up 24% annual increasewhile the gross profit margin increased to 11.4%compared to 9% the year before.
Adjusted EBITDA is $24.3 millioncompared to adjusted EBITDA loss $17.6 million the year before.
Source: Alliance Entertainment
“In fiscal 2024, we focused on executing our operating strategy to improve profitability and efficiency, and the results speak for themselves,” Walker said.
He added that the alliance’s “emphasis on cost control and margin improvement” demonstrates the company’s “ability to capture value from our revenue streams and adapt to changing market dynamics without sacrificing operational strength.”
Cost efficiencies were achieved “particularly through warehouse automation and strategic reduction of non-essential spending,” Walker said.
In addition to physical music, Alliance also sells physical movies (Blu-ray, DVD, Ultra HD), physical video games, and toys and collectibles.
“In our gaming segment, our average selling prices have more than doubled, particularly in hardware and retro arcade products. Our strategic shift toward higher value products has proven successful and we expect to benefit from New hardware releases in the coming year. Similarly, in consumer products, we improved margins and pricing, demonstrating the effectiveness of our inventory rationalization efforts,” Walker said.
The company recorded Annual growth of 9.2% Growth in sales of Blu-ray, DVD and Ultra HD media $207.4 millionwhile video game sales declined Annual increase of 13.6%arrive $338.1 millionaccounting for a large portion of the company’s total revenue decline.
Image source: Alliance
“Throughout fiscal 2024, we focused on executing our operating strategies to improve profitability and efficiency, and the results speak for themselves.”
Jeff Walker, Alliance Entertainment
“Looking ahead, with the release of new gaming hardware and the stabilization of the collectibles market, we are confident in our ability to capture future demand and continue to improve profitability as we enter fiscal 2025 and beyond,” said the Alliance Chairman. Bruce Ogilvie explain.
The company has also expanded from wholesale to retail, with its direct-to-consumer business accounting for 36% % of fiscal year 2024 total revenue, above 31% the year before.
Alliance Entertainment went public last year through a SPAC acquisition and the company was listed on Nasdaq. The company’s shares have been rising in recent months after a shaky start.
The closing time is $2.49 On Tuesday (September 24), the stock price more than doubled compared with the same period last year, rising by nearly 168% Since the beginning of the calendar year.global music business
