Warner Music Group may be preparing to sell EMP Merchandising, the European rock and metal merchandise e-retailer it acquired for USD $180 million in 2018.
That’s according to clues in WMG’s latest earnings press release and quarterly SEC filing, spotted by MBW.
The quarterly filing, covering the three months ended June 30, 2025, reveals a USD $70 million pre-tax impairment charge on “long-lived assets associated with certain of [WMG’s] non-core e-tailer operations” – following what Warner describes as a “triggering event”.
In previous Warner annual filings, only one subsidiary is referred to as an “e-tailer”: EMP.
An impairment charge, essentially a corporate write-down, occurs when a company determines that assets on its balance sheet are worth less than their recorded book value.
So-called “triggering events” for companies to record impairments can include receiving market offers, commissioning independent valuations ahead of asset sales, or other reasons.
In addition to revealing details of the impairment charge, Warner’s Q3 filing notes that the e-tailer now carries “recoverable fair value based on current market indicators”.
“Current market indicators” could obviously suggest sale discussions, or unsolicited offers.
Either way, the $70 million write-down ($48 million after tax) confirms that EMP’s previous book value significantly exceeded what Warner believes it can recover, either through operations or a sale.
Given Warner paid approximately $180 million for EMP in 2018, this represents a substantial reduction in market value.
WMG confirming EMP’s status as a “non-core” asset tells its own story.
This potentially fits within WMG CEO Robert Kyncl‘s recently announced strategic cost-reduction plan, and his determination to focus on “core” music assets.
In July, Kyncl announced plans to reduce WMG’s annual costs by $300 million.
That target was broken down into $200 million from lay-offs ($170 million from redundancies and a further $30 million in related admin/real estate costs) plus an additional $100 million in “a decrease in SG&A expenses unrelated to headcount”.
Whole-asset sales are an obvious avenue to achieve the latter part of the plan.
In February 2024, as part of a previous restructuring program, Warner sold/shed its “owned and operated media properties” including UPROXX and HipHopDX, with Kyncl telling staff these brands “operate outside our core responsibilities to our roster.”
Warner’s decision to write off $70 million from EMP’s value came in the same quarter as a change of leadership for the e-tailer.
According to filings at Germany’s companies register, Dr. Jan Marc Fischer ended his tenure as EMP’s boss in April.
Fischer was named CEO of EMP in 2023 after 10 years as its Chief Financial Officer and Chief Operating Officer.
Succeeding him as EMP’s leader was Tom Kuper, who stepped up from his then-role as COO.
Writing on LinkedIn at the time, Kuper said (translated): “Change brings opportunities – and I am ready to lead the EMP crew through this exciting phase of change with heart and attitude.”
EMP, founded in Germany in 1986, was acquired by Warner in September 2018 from private equity firm Sycamore Partners.
At acquisition, Warner described it as offering merchandise from artists including Twenty One Pilots, Panic! At The Disco, Metallica, Motörhead, Guns N’ Roses, Nirvana, Pink Floyd, AC/DC, and The Doors.
EMP also operates as an e-tailer beyond music merchandise, selling products from entertainment brands like Disney, Marvel, Star Wars, gaming brands like Nintendo and PlayStation, and alternative fashion brands like Vans.
This diversification may no longer align with Warner’s music-first strategy under Kyncl, who last week emphasized “focusing on the artists, songwriters, and markets with the greatest potential”.
A Warner Music Group spokesperson declined to comment when contacted by MBW.Music Business Worldwide
