Despite this loss, the music giant still managed to increase domestic sales up 10.5% in the face of album sales dropping 14.6%, and international sales also increased by 2.7%. The company told Billboard that the growth was due to labels Warner Bros. Records and Atlantic Records "capturing the No. 1 and No.2 rankings in U.S. market share and to a strong showing in digital revenue." According to the same piece, the revenue from digital sales was 14% of all revenue, but still not a significant increase over past figures.
Chairman Edgar Bronfman Jr. told Wall Street analysts that even with these increases, "physical sales decline further and digital growth, particularly mobile, remained on a slower trajectory." That dynamic has long been the assumption of what kind of growth the digital market has shown, but Bronfman also said that Warner Music had taken the "digital lead" over the other majors with album sales increases in 2007, in physical sales and digital equivalents.
This announcement has not stopped the decline of share prices, with high prices near $6.95 enjoyed on Wednesday before dropping to close at $6.62 yesterday. This morning, early trading has not been kind to the stock either, with current prices continuing to decline. Unfortunately, these kinds of reports should be expected from the major music companies for the time being, as long as digital growth does not begin a sharp increase and take a larger portion of total music sales. That won't happen until illegal downloading decreases 20-fold.
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