Warner Music Group (NASDAQ: WMG) announced on November 19 that it has entered into a partnership with Stability AI to develop next‑generation, responsible AI tools for music creation. The collaboration aims to build professional‑grade generative audio models that are ethically trained and licensed, giving artists, songwriters and producers new ways to experiment, compose and produce while safeguarding creators’ rights.
Under the agreement, WMG will provide industry expertise and artist input, while Stability AI will contribute its Stable Audio technology, which is already used by professionals and trained exclusively on licensed data. The joint research and development effort will focus on creating tools that enhance the creative process without compromising quality or artistic control, and will open new revenue pathways for both companies.
The partnership comes as WMG reported Q3 2025 results that showed revenue of $1.69 billion, up 8.7 % year‑over‑year, but a net loss of $0.03 per share. Adjusted OIBDA margin expanded to 22.1 %, a 170‑basis‑point gain over the prior year quarter, driven by a stronger mix in the Recorded Music segment, which generated $1.35 billion of revenue, and a solid performance in Music Publishing. The net loss reflects higher operating expenses and investment in growth initiatives, a trend that management has highlighted as part of its focus on accelerating core business growth and expanding margins.
Carletta Higginson, WMG’s EVP and Chief Digital Officer, said the collaboration “represents an important step toward developing responsible, artist‑friendly AI tools that expand creative possibilities while safeguarding the rights and integrity of music creators.” Prem Akkaraju, CEO of Stability AI, added that “WMG is a leader in the global music and entertainment landscape, and we’re proud to partner with a company that shares our Artist First ethos.” WMG’s CEO Robert Kyncl noted that the company’s “strategy is working” as it continues to invest in talent and technology, while CFO Armin Zerza emphasized the company’s commitment to “accelerating growth in our core business, expanding margins, and deploying capital in ways that strengthen our creative and financial impact.”
The deal aligns with a broader industry trend, as Universal Music Group has also partnered with Stability AI for similar AI music creation tools, and WMG has been involved in copyright litigation against AI platforms. By focusing on ethically trained and licensed AI, the partnership addresses longstanding concerns about copyright and creator rights, positioning WMG as a leader in responsible AI development for music.
WMG is scheduled to release its Q4 2025 earnings on November 20, with analysts expecting revenue of $1.68 billion and EPS of $0.33. The partnership is expected to contribute to long‑term revenue growth and reinforce WMG’s competitive edge in the evolving digital music ecosystem, while the company’s ongoing investment in technology and artist support signals a commitment to sustainable growth.
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