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3、ecision.Refer to important disclosures on page 10 to 12.Analyst Certification on page 8.Price Objective Basis/Risk on page 8.12860035 Universal Music Group 2Q unlikely to assuage concerns cut PO to 23 Reiterate Rating:UNDERPERFORM|PO:23.00 EUR|Price:25.38 EUR Reiterate Underperform,PO cut to 23 Univ

4、ersal Music Group(UMG)delivered in-line 2Q results,which,given shares are-8%MTD could bring some modest relief.However,beneath the surface,there were,in our view,several blemishes on margin,leading us to cut 2025-27E EBITDA by 1-3%(see Exhibit 6),while FCF remains volatile we cut 2025E by 25%.Growth

5、 acceleration in subscription,the main positive catalyst,is a possibility,but not a certainty,in our view,as we expect volume growth to slow.Combined with the overhang of a possible large stake disposal by some anchor shareholders,as we explored in our 28 July 2025 note,and a stretched valuation(26x

6、 25E P/E,2%FCF yield),we reiterate our Underperform.PO cut to 23 from 25 on lower FCF and lower value of UMGs stake in Spotify.Revenue algo fine for now 2Q25 revenue grew+4.5%cFX versus+3.7%e.Subscription growth matched expectations(+8.5%vs+8.8%e),but decelerated QoQ despite easier comps.UMG spoke a