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Restructuring and Impairments

3 Months Ended

Dec. 31, 2024

Restructuring and Related Activities [Abstract]

Restructuring and Impairments

Restructuring and Impairments

Strategic Restructuring Plan

In 2024, the Company announced a strategic restructuring plan (the “Strategic Restructuring Plan”) designed to free up additional funds to invest in music and accelerate the Company’s growth for the next decade. The Company expects to incur total non-recurring restructuring charges of approximately $230 million or approximately $150 million of total non-recurring after tax charges. The expected pre-tax charges include approximately $154 million of severance and other termination costs, along with approximately $76 million of non-cash impairment charges. The majority of severance payments and other termination costs are expected to be paid by the end of fiscal year 2026.

For the three months ended December 31, 2024, total severance costs recorded in connection with the Strategic Restructuring Plan were $1 million, of which $2 million of expense was recognized in our Recorded Music segment while there was a $1 million benefit recognized at Corporate associated with a change in estimate for costs previously recorded. Additionally, for the three months ended December 31, 2024, the Company recognized $26 million of impairment losses which were recognized in our Recorded Music

segment. Impairment charges recognized during the period primarily relate to the write-off of certain long-form audiovisual production assets and lease termination costs for office closures.

As of December 31, 2024, total cumulative restructuring and impairment charges recognized in connection with the Strategic Restructuring Plan were $205 million with $195 million of costs recognized in our Recorded Music segment and $10 million recognized at Corporate. These costs are composed of $129 million of severance and other termination benefits, of which $7 million was non-cash, and $76 million of non-cash impairment charges.

The below table sets forth the activity for the three months ended December 31, 2024 in the restructuring accrual associated with the Strategic Restructuring Plan included within accrued liabilities in the accompanying condensed consolidated balance sheets.

			Severance Costs						Contract Termination Costs						Total
			(in millions)
Balance at September 30, 2024			$	99					$	5					$	104
Restructuring charges			1						—						1
Cash payments			(23)						(2)						(25)
Foreign currency movements			(1)						—						(1)
Balance at December 31, 2024			$	76					$	3					$	79

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- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 5.P.4.e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479823/420-10-S99-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482017/420-10-50-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482017/420-10-50-1

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
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-Section 50
-Paragraph 1
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-URI https://asc.fasb.org/1943274/2147482017/420-10-50-1

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