The music industry is often hailed as a resilient sector, boasting a reputation for being recession-proof. Regardless of economic downturns, individuals consistently invest in their music subscription services and actively seek out concert experiences. While some synchronization opportunities may diminish as advertisers tighten their budgets, the overall health of the music business remains robust and largely unaffected by standard economic fluctuations. This unique stability highlights the enduring demand for music, showcasing its essential role in people’s lives, even during challenging financial times.
Despite the music business’s apparent resilience, stocks associated with music companies are not immune to market volatility and investor apprehensions regarding the increasingly precarious economic landscape. In the latest evaluation, only three of the twenty companies listed on the Billboard Global Music Index (BGMI) reported gains, while five stocks suffered losses exceeding 10%. This decline comes amid a backdrop of strong quarterly earnings, yet factors such as President Donald Trump’s tariffs on imports from Canada, Mexico, China, and Europe have led to widespread market panic, adversely affecting music stocks alongside other industries, including agriculture and manufacturing.
On Thursday, March 13, the S&P 500 index entered a correction phase, closing 10% below its all-time high. The Russell 2000, which tracks small-cap companies, experienced an 18.4% drop from its peak. Although the markets saw some recovery on Friday, March 14, even amidst a decline in the University of Michigan’s consumer confidence index, the initial losses were too substantial to entirely reverse. By the end of the week, the S&P 500 had decreased by 2.3%, and the Nasdaq Composite also reflected a downturn, closing down 2.4%.
International markets showed a more favorable outcome compared to their U.S. counterparts, with the U.K.’s FTSE 100 experiencing only a 0.5% decline. Meanwhile, South Korea’s KOSPI composite index saw a slight increase of 0.1%, and China’s SSE Composite Index rose by 1.4%. This divergence indicates varying market responses globally, suggesting that while the U.S. faces significant challenges, other markets may be more stable and resilient.
Despite 17 of the 20 companies on the BGMI reporting losses during the week, the index managed to rise by 0.5% to 2,460.71. This uptick was propelled primarily by an impressive 8.1% gain from Spotify, which remains the largest component of the index, boasting a market capitalization of around $117 billion—significantly surpassing Universal Music Group’s (UMG) $50.2 billion valuation. Notably, Spotify received positive coverage from Redburn Atlantic, initiating a price target of $545, which suggests a 5.5% upside from its closing price on Friday, further adding to investor optimism.
UMG’s shares experienced an 8.8% decline on Friday, largely in response to Pershing Square’s announcement about selling 50 million shares valued at approximately $1.5 billion. CEO Bill Ackman has previously lauded UMG as “one of the best businesses we have ever owned.” However, JP Morgan analyst Daniel Kerven acknowledged that while the news could negatively influence short-term confidence in UMG, it should be viewed as a strategic profit-taking move rather than a reflection of UMG’s long-term potential or recent performance. UMG shares ended the week down 8.2% at 25.46 euros ($27.78), although they maintained a 6.5% increase year-to-date.
Live Nation’s stock fell by 6.5% to $119.22, marking the fourth consecutive weekly drop for this prominent live entertainment company. During the week, Deutsche Bank raised its price target for Live Nation from $150 to $170 while retaining a “buy” rating. However, on Friday, a judge denied Live Nation’s request to dismiss allegations that it illegally coerced artists into using its promotion services for amphitheater performances, adding to the company’s challenges amid ongoing scrutiny.
Other U.S.-based live entertainment firms also faced steep declines. Sphere Entertainment Co. dropped 10.1% to $31.55, while MSG Entertainment fell 1.3% to $31.46, despite Wolfe Research upgrading its rating to “outperform” with a price target of $46. Additionally, Vivid Seats, a secondary ticketing platform, saw a staggering 28.1% drop to $2.86 following disappointing fourth-quarter earnings, indicating significant investor concerns about the live event sector’s recovery.
Radio companies, typically vulnerable during periods of economic uncertainty, had yet another challenging week. iHeartMedia fell 12.0% to $1.61, while Cumulus Media dropped 11.5% to $0.46. SiriusXM, which announced layoffs, also faced a 10.1% decline to $22.67. Notably, year-to-date, iHeartMedia is down 24.4%, and Cumulus Media has seen a significant 40.3% drop. Conversely, SiriusXM has experienced a modest 1.4% gain in 2025, indicating divergent performance within the radio sector.
Despite the South Korean market finishing the week with a slight gain, K-pop stocks experienced notable declines. Major players such as HYBE, SM Entertainment, JYP Entertainment, and YG Entertainment averaged a 7.4% drop for the week. However, these four South Korean companies have demonstrated a robust start to 2025, collectively achieving an average year-to-date gain of 19.3%, reflecting the enduring popularity and market potential of K-pop on a global scale.
