Warner Music Group Inc. (NYSE: WMG), whose roster of artists includes Madonna, the White Stripes and the Red Hot Chili Peppers, today reported that its third quarter net loss widened as sales continued to shift away from CDs to digital sales.

The company lost $17 million, or 12 cents per share, compared with $14 million, or 10 cents, the New York-based company said in a press release. Revenue fell 2% to $804 million. Excluding one-time items, profit was 20 cents. Wall Street analysts, who excluded these types of charges, expected a loss of 14 cents on revenue of $836 million.

Digital revenue was a bright spot, rising 29% to $119 million. The company's recorded music, however, performed poorly, dropping 4% to $653 million.

Shares of Warner Music Group have dropped almost 52% this year, even though Wall Street cheered the company's decision not to bid for EMI Group Plc. The shares, though, have recently rebounded and were poised to open higher today as investors expressed confidence that Warner Music will be able to survive the upheaval caused by the digital music revolution.

Like so many summer's full of blockbuster film sequels, this summer is also full of music follow-ups. May has already seen the release of several successful new albums, most notably Linkin Park's Minutes to Midnight, which debuted at #1 in Billboard's album charts and scored the highest number of copied sold to date this year. Also released was the new Maroon 5 album, which knocked Linkin Park off the top spot this week. The most talked about new album is Paul McCartney's first on the new Starbucks Corporation (NASDAQ: SBUX) music label Hear Music.

All three of those albums are fairly guaranteed sellers, primarily because the artists' last albums enjoyed great success. The new methods of promotion that surrounded these releases also certainly speak to the large scale of their releases. Who hasn't noticed the Paul McCartney catalog that is now available on Apple Inc. (NASDAQ: AAPL)'s iTunes Store and the new album that has been available for pre-order since May 15th and still won't be released until next Tuesday. These dates and the time may mean nothing, but consider it in comparison to seeing a movie poster for the new Harry Potter movie at the theater complex.

New albums are not the only heavily marketed and promoted music products for this summer though. With the pending reissue of the Traveling Wilburys catalog in a couple of weeks, Warner Bros. is prepping another reissue to promote or at least ride in that release's coattails. Tom Petty, who was a Traveling Wilbury, is set to reissue the album he first released last summer with four new tracks. A year ago that album peaked at #4 in the album charts, so it has seen success already. Is this a ploy to strengthen Traveling Wilburys sales, or to strengthen Petty's sales alone?

The point of citing these release dates and different facts of release and success is that this summer (and pretty much every summer for the last few years) has been full of large scale music releases that resemble how we think about the big movie blockbusters. With so much talk within and outside the music industry this year about Digital Rights Management, and what labels are going to drop the technology, we can't overlook the fact that business is going on as usual.

Linkin Park's new album Minutes to Midnight debuted at #1 in the Billboard 200 and sold more than 623,000 copies in its first week, Billboard reports. That's the highest debut of an album since last December, and one of only seven albums to move that many copies in its first week in the past two years, according to Billboard. Warner Music Group Corp. (NYSE: WMG), the parent company of the album's label Warner Bros. Records, did not enjoy as profitable a week as might be assumed with such high sales. Since the album was released on May 15, the company has continued a slow slide, despite a peak last Friday, closing at $16.38 Thursday. Two weeks earlier, on May 2, the company was sitting over half a dollar higher.

Warner Music had been thought to be a prime candidate to purchase EMI Group PLC, before an announcement was made about that company's sale to European private equity firm Terra Firma on Monday. Clearly with decline, an offer was unlikely to be given. Warner Music has been an advocate of Digital Rights Management technology, and though such high sales of a heavily marketed album might not sway the label to ditch DRM, perhaps the stock's decline in spite of high sales might make an impact.

Warner Music Group (NYSE: WMG) may be in a lawsuit with online retailer AnywhereCD, but the company is doing something right, and that appears to be their advertising. With the coming summer music season, all of the major albums by big artists are being released. Warner will release Linkin Park's third album Minutes to Midnight on May 15th, a highly anticipated album by the rock sextet.

The company appears to have taken the enormity of that band into their consideration of how to best market the album. The biggest change in album marketing I've noticed is the appearance of TV commercials that feature the new single "What I've Done" over the album art, followed by the release date (I've rarely seen a new album by such a large band marketed this way). Additionally, the album has been available for pre-order on Apple Inc.'s (NASDAQ: AAPL) iTunes Store since mid-April, well before pre-orders are typically made available, and features "secret bonus tracks" that are exclusive to that store. In my local Best Buy (NYSE: BBY) store's weekly ad this morning, the album is also available for pre-order and carries special pre-order offers. The album is still two weeks from being released.

These rather minute advertising successes may not increase album sales, but they certainly increase the awareness listeners will have of the album and the release. That is what makes Warner's success this month vital for the company, especially as their prices slowly rise. Last week alone they increased steadily to gain nearly a $1.